Allen v. Prudential Property & Casualty Insurance Co.

839 P.2d 798, 190 Utah Adv. Rep. 8, 1992 Utah LEXIS 49, 1992 WL 141595

• Court: Utah Supreme Court
• Decided: June 22, 1992
• Docket: 890408
• Status: Published

Opinions

ZIMMERMAN, Justice:

Blaketta Allen brought a district court action for declaratory judgment to invalidate a household exclusion in her homeowner’s insurance policy issued by Prudential Property and Casualty Insurance Company. The district court granted summary judgment for Prudential, and Allen appeals. Allen initially claims that the district court erred in failing to enter a brief statement of the grounds for its decision, as required by Utah Rule of Civil Procedure 52(a). Addressing the merits, Allen challenges the district court’s refusal to invalidate the household exclusion, claiming that the exclusion violates her “reasonable expectations” of insurance coverage. We reject Allen’s contentions and affirm the grant of summary judgment.

In considering an appeal from a summary judgment, we view the facts in a light most favorable to the nonmoving party. Blue Cross & Blue Shield v. State, 779 P.2d 634, 636 (Utah 1989). We state the facts in this case accordingly.

In 1981, Allen’s husband met with a Prudential agent to discuss homeowner’s insurance. During the meeting, Mr. Allen completed an application for a homeowner’s policy under which Prudential would insure the Allens’ home and provide liability coverage against accidents occurring on the property. At the meeting, the agent did not mention the household exclusion, but advised Mr. Allen that he should review the policy when he received it. The Allens received the policy in the mail approximately two months after the meeting. Attached to the policy was an endorsement excluding members of the Allens’ household from liability coverage. Neither Allen nor her husband read the endorsement.

Approximately three years after the agreement went into effect, the Allens’ two-year-old son was injured when Allen spilled a pot of boiling water on him. After the accident, Mr. Allen contacted the Prudential agent, seeking recovery against the policy for his wife’s accidental injury of his son. The agent, for the first time, orally informed Mr. Allen of the household exclusion. Based on the exclusion, Prudential denied coverage.

Allen filed a declaratory judgment action seeking to invalidate the exclusion on the grounds that the insurance agreement was an adhesion contract and that the existence of the exclusion violated her reasonable expectations. Prudential moved for summary judgment, arguing, inter alia, that the exclusion was unambiguous and that it did not violate public policy. The district court granted Prudential’s motion, stating simply that it was doing so for reasons “set forth in the arguments of defendant.” Allen appeals.

We address two of Allen’s three challenges to the trial court’s grant of summary judgment.¹ First, she contends that the trial court committed reversible error in failing to issue a brief written statement of the grounds for its decision, as required by Utah Rule of Civil Procedure 52(a). Second, addressing the merits, Allen contends that the household exclusion should be held unenforceable. She claims that the insurance agreement was an adhesion contract and that a provision in an adhesion contract which violates the insured’s reasonable expectations of coverage is invalid. We will address these contentions in order.

As a threshold matter, we note the applicable standard of review. By definition, a summary judgment is based solely on conclusions of law. Therefore, we review a summary judgment for correctness, without deferring to the trial court’s legal determinations. See, e.g., Bonham v. Morgan, 788 P.2d 497, 499 (Utah 1989); Transamerica Cash Reserve, Inc. v. Dixie Power & Water, Inc., 789 P.2d 24, 25 (Utah 1990).

We begin with Allen’s contention that the trial court’s failure to issue a brief written statement of the grounds for its decision violates Utah Rule of Civil Proee-dure 52(a). The last sentence of rule 52(a) states, “The court shall issue a brief written statement of the ground for its decision on all motions [for summary judgment] granted ... when the motion is based on more than one ground.” Utah R.Civ.P. 52(a); see Lowe v. Sorenson Research Co., 779 P.2d 668, 669 n. 1 (Utah 1989). Although Prudential advanced a number of arguments in support of its motion for summary judgment, the trial judge’s short statement of his ruling said merely that “under the facts of this case ... the motion for summary judgment of the defendant is proper as set forth in the arguments of [Prudential].”

Clearly, the trial judge did not comply with the requirements of rule 52(a). We recently added the final sentence to rule 52(a) to aid our review of summary judgments in which the parties have advanced a number of alternate grounds; otherwise, we could not identify the basis for a trial judge’s ruling. When reviewing trial court decisions, we presume them to be correct and search for grounds upon which they may be upheld. E.g., College Irr. Co. v. Logan River & Blacksmith Fork Irr. Co., 780 P.2d 1241, 1244 (Utah 1989). As a practical matter, however, that presumption has little operative effect when members of this court cannot divine the trial court’s reasoning because of the cryptic nature of its ruling. Consequently, both the interest of the trial court in having a correct ruling sustained and the interest of the parties in having a properly framed appellate proceeding are better served when the trial judge complies with rule 52(a). Be that as it may, some trial judges cling to the view that the less explanation given for their rulings the better. They would prefer to remain silent and rely on the presumption that their rulings are correct. As we have noted, the wisdom of that view is questionable, but a trial judge’s failure to comply with the last sentence of rule 52(a) alone is not reversible error absent unusual circumstances. See Neerings v. Utah State Bar, 817 P.2d 320, 323 (Utah 1991). We find no need to discuss in the abstract what may constitute unusual circumstances, but note that they are not present here.

Having disposed of her procedural objection, we turn to Allen’s argument on the merits. Allen claims that the district court erred in failing to invalidate the household exclusion because the court did not recognize the “reasonable expectations doctrine.” ² In general, the reasonable expectations doctrine authorizes a court confronted with an adhesion contract to enforce the reasonable expectations of the parties under certain circumstances. See Roger C. Henderson, The Doctrine of Reasonable Expectations in Insurance Law After Two Decades, 51 Ohio St.L.J. 823 (1990) [hereinafter Henderson].

Allen offers three alternative formulations of the reasonable expectations doctrine and seeks their application to her case. Underlying all her arguments is the premise that she has raised a factual issue as to whether she, in fact, expected the household exclusion to be contained in the Prudential policy and whether that expectation was reasonable. For purposes of this decision, we assume that she has raised such factual questions.

Allen’s three formulations of the reasonable expectations doctrine can be summarized as follows. First, she contends that the insurance contract with Prudential is an adhesion contract and reasons that she therefore is entitled to have the court enforce her reasonable expectations. Second, she argues that the trial court should have applied a variant of the reasonable expectations doctrine discussed in a recent Utah Court of Appeals decision, Wagner v. Farmers Insurance Exchange, 786 P.2d 763 (Utah Ct.App.1990). Under this theory, she claims, courts must enforce the reasonable expectations of the insured where the insurer has a reason to believe that the insured would not have assented to a particular term had he or she known of its presence. Third, Allen appears to argue for a version of the doctrine that focuses on whether the exclusion at issue was ambiguous. We assume that she is urging us to adopt a rule that would allow a court to interpret ambiguous provisions so that the insured’s reasonable expectations are fulfilled.

These three variations are more easily understood when placed in a historical context. The intellectual foundation of the reasonable expectations doctrine was initially formulated by Professor, now Judge, Robert Keeton as an overarching set of principles to assist in explaining the results of disparate insurance law decisions that appeared to be based on a number of different rationales. Henderson at 823, 825 (citing Robert E. Keeton, Insurance Law Rights at Variance with Policy Provisions, 83 Harv.L.Rev. 961 (part 1) & 83 Harv.L.Rev. 1281 (part 2) (1970)). Courts in various states have since attempted to massage these principles into a legal rule through case-by-case development. Consequently, different versions of the doctrine exist.

One commentator, after surveying the jurisdictions purporting to apply the reasonable expectations doctrine, classifies the legal rules resulting from these various approaches as follows: (i) construction of an ambiguous term in the insurance contract to satisfy the insured’s reasonable expectations; (ii) refusal to enforce the “fine print” of an insurance contract because it limits more prominent provisions giving rise to the insured’s expectations; and (iii) refusal to enforce an insurance contract provision when it would frustrate the reasonable expectations of coverage created by the insurer outside of the contract. Stephen J. Ware, Comment, A Critique of the Reasonable Expectations Doctrine, 56 U.Chi.L.Rev. 1461, 1467 (1989) [hereinafter Ware]; see also Mark C. Rahdert, Reasonable Expectations Reconsidered, 18 Conn.L.Rev. 323, 335-36, 345 (1986) (discussing the various approaches as either “weaker” or “stronger” versions) [hereinafter Rahdert]. Allen’s suggested alternative rationales for permitting her to go to trial on the merits under the reasonable expectations doctrine largely reflect these various versions.

Acceptance of the doctrine, regardless of the version, has not been without criticism. Henderson at 823 & n. 7; Rahdert at 368-73. Some of this criticism arises because a number of states have struggled with the doctrine’s scope, leaving a trail of inconsistent decisions and creating an obviously uncertain future for the doctrine in those states.³ At least two states, Idaho⁴ and Pennsylvania,⁵ appear to have initially recognized broad versions of the doctrine but later retreated to limit the doctrine’s conflict with the freedom of parties to contract. Today, after more than twenty years of attention to the doctrine in various forms by different courts, there is still great uncertainty as to the theoretical underpinnings of the doctrine, its scope, and the details of its application. See, e.g., Henderson at 824, 838; Rahdert at 345, 370-71.

With this background, we turn to Allen’s first argument, i.e., that because her homeowner’s policy is an adhesion contract, the court should have enforced her allegedly reasonable expectations as a matter of course. Allen overreaches the rationale for the doctrine, even at its broadest. The fact that an insurance contract is adhesive is no reason, in itself, to enforce what might be found to be the reasonable expectations of the insured when those expectations conflict with the plain terms of the policy.⁶ To our knowledge, no court has taken such an expansive view of the reasonable expectations doctrine, and Allen cites no authority to this effect.

The second version of the reasonable expectations doctrine advanced by Allen is more principled and better supported than her first. She asks that this court adopt the analysis suggested in Wagner v. Farmers Insurance Exchange, 786 P.2d 763 (Utah Ct.App.1990). Under the court of appeals’ formulation, a court is to determine “first, whether the insurer knew or should have known of the insured’s expectations; second, whether the insured created or helped to create these expectations, and third, whether the insured’s expectations are reasonable.” Id. at 766. “ ‘In most cases, [the third] criterion will be met if one of the other two is.... ’” Id. at 768 (quoting Kenneth S. Abraham, Judge-Made Law and Judge-Made Insurance: Honoring the Reasonable Expectations of the Insured, 67 Va.L.Rev. 1151, 1180 (1981).

To bring herself within the ambit of this version of the doctrine, Allen makes the following argument: A year after she received the Prudential policy and two years before her son’s accident, her husband met with the Prudential agent to increase the homeowner’s policy’s coverage because the family had just bought a trampoline. She alleges that her husband told the agent he wanted to make sure that “anyone” who was hurt on the trampoline would be covered. Thus, she argues, the agent knew or should have known that Mr. Allen expected the policy to cover the Allens’ son. Allen further argues that the agent’s failure to mention the existence of the exclusion when her husband made the statement “left the impression with Mr. Allen that his family was covered.” She concludes, “Because of the agent’s failure to meet his obligations at that stage, the insured’s expectations were reasonable.”⁷

In making this argument, Allen asks us to adopt a doctrine that considerably modifies the legislatively expressed public policy underlying the regulation of the insurance industry. The theory she advances essentially.would allow a court to invalidate a clear provision of an insurance contract, even if the insured had not read it, if the finder of fact is convinced that the insurer’s agent knew or should have known that the insured had expectations that contradicted the policy’s language and that the agent created or helped to create those expectations. For the reasons set forth below, we decline to make such a change in Utah law.

As a general matter, we are unwilling to make sweeping modifications in the public policy that underlies the regulation of the insurance industry in the absence of legislative direction. This approach is counseled by the active and preeminent role the legislative and executive branches have taken in this area.

The legislative and executive branches’ occupation of this field is evidenced by title 31A of the Code, which comprises the “Insurance Code” and sets out a comprehensive regulatory framework for the insurance industry.⁸ Utah Code Ann. §§ 31A-2-101 to -29-123 (1991). Section 31A-2-101 of this title creates an “Insurance Department” to administer the Insurance Code. Id. § 31A-2-101. Through its commissioner, the Insurance Department may promulgate rules to implement the provisions of the title and investigate violations. Id. § 31A-2-201; see Utah Admin.Code R590-66-1 to -145-9 (1992). Preprinted policies for household insurance, such as the Prudential policy at issue in this case, must be filed with the commissioner. Utah Code Ann. § 31A-21-201(1) (1991). The commissioner may disapprove a preprinted policy at any time if it is found to be “inequitable, unfairly discriminatory, misleading, deceptive, obscure, or encourages misrepresentation.” Id. § 31A-21-201(2)(a)(i).⁹ Thus, the validity of preprint-ed insurance contracts is premised on executive approval, a regulatory mechanism that the Wagner version of the reasonable expectations doctrine would largely undermine.

Our prior case law demonstrates our tradition of deferring to the legislature on questions of general policy when considering the validity of insurance policies. When we have invalidated a provision of an insurance agreement, generally we have grounded the ruling in legislative policy. For example, in General Motors Acceptance Corp. v. Martinez, 668 P.2d 498 (Utah 1983), we invalidated a provision in a credit life and disability insurance agreement excluding coverage because the insured had not been informed in writing of the exclusion. Id. at 501. In so ruling, we relied on a statutory requirement that all credit life and disability insurance be evidenced by an individual policy or group certificate stating “ ‘the term and coverage including any exceptions, limitations and restrictions’ ” and that the policy or agreement “ ‘be delivered to the debtor.’ ” Id. (quoting Utah Code Ann. § 31-34-6(1), (2) (1953) (repealed 1986).

Three years later, in Farmers Insurance Exchange v. Call, 712 P.2d 231 (Utah 1985), we held that a household exclusion in an automobile liability insurance agreement was void to the extent that the exclusion conflicted with the minimum coverage requirements of the Utah Automobile No-Fault Insurance Act. Id. at 234-36 (citing Utah Code Ann. §§ 31-41-1 to -13 (1953) (repealed 1986)). Two members of this court and a district judge sitting by designation went beyond the legislative policy expressed in the no-fault statute to hold that, to the extent the exclusion limited liability under the policy in an amount in excess of the statutory minimum, the exclusion was invalid because the insurer had failed to inform the insured specifically of the exclusion. Id. at 236-37. This result was reached by extending the disclosure requirement articulated in Martinez for credit life and disability insurance to automobile insurance, even though there was no comparable statute requiring disclosure for automobile insurance. See id. at 239-40 (Howe, J., dissenting). The majority reasoned, in part, “Without disclosure, the household exclusion clause fails to ‘honor the reasonable expectations’ of the purchaser, rendering the exclusion clause invalid as to the entire policy limits.” Id. at 237 (citations omitted).

Two years after Call, in State Farm Mutual Automobile Insurance Co. v. Mastbaum, 748 P.2d 1042 (Utah 1987), we reaffirmed the principle of deferring to legislative policy regarding the general validity of insurance provisions. In that case, we upheld a household exclusion in an automobile liability insurance agreement in excess of the minimum required by statute because there were no other statutory bases for invalidating the provision beyond the minimum. Id. at 1044. Although the insured in Mastbaum raised a reasonable expectations argument, four members of this court found no reason to address it.¹⁰

Taken as a whole, these cases show our unwillingness to alter fundamentally the terms of insurance policies in the* absence of legislative direction. They also show the consequent uneasiness of a majority of this court with the notion of a reasonable expectations doctrine. Today we again affirm the principle of deferring to legislative policy in considering the facial validity of insurance provisions.

Notwithstanding our deference to legislative policy in this area, we necessarily retain authority to invalidate insurance provisions that are found contrary to public policy as expressed in the common law of contracts that has not been preempted by legislative enactment. In this vein, we note that the reasonable expectations doctrine has been urged because of the supposed inadequacy of the existing equitable doctrines available to courts confronted with overreaching insurers. Joseph E. Minnock, Comment, Protecting the Insured from an Adhesion Insurance Policy: the Doctrine of Reasonable Expectations in Utah, 1991 Utah L.Rev. 837, 875. The difficulty with this logic is that no such inadequacy has been shown to exist in Utah. See, e.g., id. at 846-47 (noting that doctrine of unconscionability is not fully developed in Utah). It is not clear why estoppel,¹¹ waiver,¹² unconscionability,¹³ breach of the implied duty of good faith and fair dealing,¹⁴ and the rule that ambiguous language is to be resolved against the drafter,¹⁵ for example, are insufficient to protect against overreaching insurers when applied on a case-by-case basis.¹⁶

We also recognize that the reasonable expectations doctrine was developed in part because established equitable doctrines were found to be inadequate theoretically. See Robert E. Keeton, Insurance Law Rights at Variance with Policy Provisions, 83 Harv.L.Rev. 961 (part 1) & 83 Harv.L.Rev. 1281 (part 2) (1970); see also William A. Mayhew, Reasonable Expectations: Seeking a Principled Application, 13 Pepp.L.Rev. 267, 269-72 (1986) (justifying adoption of reasonable expectations doctrine because courts misapply existing equitable doctrines and consequently create uncertainty). However, in this state, we have yet to address and develop fully any of the existing equitable doctrines available to an aggrieved insured. Also, our past decisions applying various existing equitable doctrines to provide relief to aggrieved insureds have not changed those doctrines’ traditional formulations unduly. Thus, even if we were free to do so in the absence of a legislative policy declaration to the contrary, we find no persuasive reason to attempt to craft a new and potentially sweeping equitable doctrine.¹⁷ Therefore, we decline to adopt the Wagner reasonable expectations approach.

Our decision today to proceed interstitially with existing equitable doctrines rather than to adopt a new doctrine with unknown ramifications is consistent with the legislative policy underlying the Insurance Code. That Code expresses an intent that “freedom of contract” be maintained, Utah Code Ann. § 31A-1-102(7), and that written contracts be the primary means by which this freedom to contract be exercised. See, e.g., id. §§ 31A-21-301 to -404 (1991 & Supp. 1991) (setting forth detailed provisions authorizing and governing insurance contract clauses and setting forth acceptable methods by which various clauses can be modified by the parties). Adoption of the reasonable expectations doctrine poses a much greater risk of broadly undermining these legislative goals than our continued use of existing equitable doctrines applied on a case-by-case basis.

Allen’s final argument is that the contested exclusion is ambiguous. Although her brief is unclear as to the consequences of the alleged ambiguity, we assume that she wants the court to find that the exclusion is ambiguous and therefore enforce her reasonable expectations. So construed, Allen’s final argument comports with a version of the reasonable expectations doctrine apparently recognized in several states. See, e.g., Richards v. Hanover Ins. Co., 250 Ga. 613, 299 S.E.2d 561, 563 (1983) (applying rule that when insurance contract is ambiguous, it is “to be read in accordance with the reasonable expectations of the insured”); Simon v. Continental Ins. Co., 724 S.W.2d 210, 213 (Ky.1987) (applying rule that insured’s reasonable expectations are to be enforced unless disputed exclusion is conspicuous and clear). Under this theory, ambiguous provisions are interpreted to effectuate the reasonable expectations of the insured. Henderson at 826.

It is doubtful whether application of this version of the reasonable expectations doctrine can be distinguished from, or adds anything to, the application of the canon of construction resolving ambiguities against the drafter and reforming the contract accordingly. See generally Henderson at 827 (“[Djecisions that use [reasonable expectations] solely to construe policy language do not support a new principle at all, but fall within the time-honored canon of construing ambiguities against the drafter of the contract....”); Ware at 1469 (same conclusion). However, we have no occasion to consider this issue further because the disputed exclusion is not ambiguous.

Allen’s policy states that coverage is excluded for “any Insured under .•.. the definition of ‘Insured.’ ” “Insured” is defined as “if residents of the Named Insured’s household, his spouse, the relatives of either, and any other person under the age of twenty-one in the care of any Insured.” The exclusion clearly applies to the Allens’ two-year-old son.

In sum, we reject the various versions of the reasonable expectations doctrine advanced by Allen.¹⁸ Our existing equitable doctrines have not been shown to be inadequate to the task of protecting insureds from overreaching insurers. Accordingly, we affirm the summary judgment in favor of Prudential.

HALL, C.J., and HOWE, Associate C.J., concur.

1 . Allen also appealed on the ground that the district court erred in failing to sign an order to publish the depositions of Allen and her husband. She contends that we must reverse the summary judgment because the district court relied on the Allens’ depositions as the factual basis for its ruling but neglected to formally publish them. Prudential did not controvert Allen’s assertion that the trial judge failed to sign the publication order, claiming instead that such a failure has no legal significance. However, the trial record before this court reveals that the order was signed by the trial judge two months before entry of the court’s judgment. Consequently, there is no issue before us.

2 . Allen uses the term “adhesion contract theory” to describe the reasonable expectations doctrine, apparently following the nomenclature used by the dissent in State Farm Mutual Automobile Insurance Co. v. Mastbaum, 748 P.2d 1042, 1047 (Utah 1987) (Durham, J., dissenting). The term "reasonable expectations doctrine” more appropriately describes the doctrine. See generally Roger C. Henderson, The Doctrine of Reasonable Expectations in Insurance Law After Two Decades, 51 Ohio St.L.J. 823 (1990).

3 .The decisions of the Iowa and New Jersey Supreme Courts are illustrative. The Iowa Supreme Court first adopted a rather limited version of the reasonable expectations doctrine, applying it only to situations in which a layperson would not understand the exclusion or in which the insurer created an expectation of coverage. See Rodman v. State Farm Mutual Auto. Ins. Co., 208 N.W.2d 903, 908 (Iowa 1973). The court then expanded the doctrine’s scope to enforce the reasonable expectations of the insured even though the exclusion was clear and the insurer's actions did not create the expectations. See C & J Fertilizer, Inc. v. Allied Mutual Ins. Co., 227 N.W.2d 169, 176-77 (Iowa 1975). The Iowa Supreme Court’s latest cases signal a retreat to a Rodman-type formulation of the doctrine, although the exact scope remains unclear. See, e.g., Chipokas v. Travelers Indem. Co., 267 N.W.2d 393, 396 (Iowa 1978) (refusing to enforce insured’s expectations because a layperson would understand disputed exclusion and insurer did not create expectation of coverage); Farm Bureau Mutual Ins. Co. v. Sandbulte, 302 N.W.2d 104, 112-14 (Iowa 1981) (denying insurer relief because ordinary layperson would not misunderstand disputed term and term was not bizarre or oppressive, did not eviscerate terms explicitly agreed to, and did not eliminate dominant purpose of transaction); Grinnell Mutual Reinsurance Co. v. Voeltz, 431 N.W.2d 783, 786 (Iowa 1988) (quoting with approval from C & I Fertilizer but applying Rodman formulation of reasonable expectations doctrine to invalidate exclusion). See generally Rahdert at 357-61 (describing evolution of reasonable expectations doctrine in Iowa); Joseph E. Minnock, Comment, Protecting the Insured from an Adhesion Insurance Policy: The Doctrine of Reasonable Expectations in Utah, 1991 Utah L.Rev. 837, 855-61 (same).

The New Jersey Supreme Court initially adopted an apparently broad version of the doctrine that could be used regardless of whether the disputed policy language was ambiguous or clear. See, e.g., Kievit v. Loyal Protective Life Ins. Co., 34 N.J. 475, 170 A.2d 22, 24, 26-27 (1961) (enforcing insured’s expectations even though disputed exclusion was unambiguous because exclusion undermined purpose of policy). The court later restricted its view of the doctrine, applying it only when the disputed language was ambiguous. See, e.g., DiOrio v. New Jersey Mfrs. Co., 79 N.J. 257, 398 A.2d 1274, 1280-81 (1979) (rejecting reasonable expectations argument because policy language was unambiguous); Weedo v. Stone-E-Brick, Inc., 81 N.J. 233, 405 A.2d 788, 794-95 (1979) (holding that insured’s reasonable expectations will be enforced only if disputed language is genuinely ambiguous). The New Jersey Supreme Court appears now to have adopted a very broad version of the doctrine. See, e.g., Sparks v. St. Paul Ins. Co., 100 N.J. 325, 495 A.2d 406, 414-15 (1985) (invalidating exclusion because it did not conform to "objectively reasonable expectations” and expressly declining to establish precise standards to determine reasonableness). See generally Rahdert at 361-64 (describing evolution of reasonable expectations doctrine in New Jersey).

4 . Compare Corgatelli v. Globe Life & Accident Ins. Co., 96 Idaho 616, 533 P.2d 737, 740-41 (1975) (plurality) (adopting broad version of reasonable expectations doctrine without delineating scope but holding that it is not dependent on presence of ambiguity) with Casey v. Highlands Ins. Co., 100 Idaho 505, 600 P.2d 1387, 1391 (1979) (rejecting reasonable expectations doctrine as unnecessary in light of traditional doctrines) and Foremost Ins. Co. v. Putzier, 102 Idaho 138, 627 P.2d 317, 321, 324 (1981) (noting that reasonable expectations doctrine has been rejected but that insured’s reasonable expectations are considered when resolving ambiguous provisions). See generally Rahdert at 354-57 (describing evolution of reasonable expectations doctrine in Idaho).

5 . Compare Hionis v. Northern Mutual Ins. Co., 230 Pa.Super. 511, 327 A.2d 363, 365-66 (1974) (holding that exclusions, even if unambiguous, must be explained to insureds before they can be enforced) and Collister v. Nationwide Life Ins. Co., 479 Pa. 579, 388 A.2d 1346, 1353-54 (1978) (holding that insured’s reasonable expectations, as determined by analyzing totality of circumstances, should be enforced even if policy’s limiting language is unambiguous) with Standard Venetian Blind v. American Empire Ins. Co., 503 Pa. 300, 469 A.2d 563, 566-67 (1983) (explicitly rejecting Hionis and implicitly disavowing Collister in holding that an unambiguous exclusion clause is valid by applying traditional contract principles). But see Tonkovic v. State Farm Mut. Auto. Ins. Co., 513 Pa. 445, 521 A.2d 920, 924-25 (1987) (distinguishing Standard Venetian Blind but holding that a policy limitation on specifically requested coverage is not enforceable, even if unambiguous, unless it has been explained to insured). See generally Rahdert at 364-67 (describing evolution of reasonable expectations doctrine in Pennsylvania); Henderson at 829-31 (same).

6 . See Rahdert at 338. In this context, we note that form contracts are essential to the economic viability of the insurance industry. Id.; William A. Mayhew, Reasonable Expectations: Seeking a Principled Application, 13 Pepp.L.Rev. 267, 270 (1986) [hereinafter Mayhew]. Yet, as recognized by the Arizona Supreme Court, which has adopted one of the broadest versions of the reasonable expectations doctrine in the country, "most insureds develop a ‘reasonable expectation’ that every loss will be covered by their policy.” Darner Motor Sales v. Universal Underwriters, 140 Ariz. 383, 682 P.2d 388, 395 (1984).

7 . In his concurring opinion, Justice Stewart asserts that Allen has not raised a factual question as to the objective reasonableness of her expectations. However, a close examination of his analysis demonstrates that he is not taking the facts in a light most favorable to the nonmoving party, as we are bound to do. See Blue Cross & Blue Shield v. State, 779 P.2d 634, 636 (Utah 1989). Rather, Justice Stewart weighs the evidence and makes a finding of fact that Allen’s expectations could not be reasonable. The result is that by holding that Allen cannot proceed under his version of the doctrine, he de facto narrows the doctrine beyond anything that is argued for by this plaintiff or by Justice Durham in her dissent.

8 . Title 31A became effective July 1, 1986, and recodified the prior Insurance Code in title 31. 1985 Utah Laws ch. 242. Many of the provisions in title 31A mirror provisions in title 31, and both titles are equally comprehensive in their scope and regulatory effect.

9 . A similar provision was in effect when the Prudential policy at issue in this case was signed. Utah Code Ann. §§ 31-19-9(1), -10 (1953) (repealed 1986).

10 . In the plurality opinion, Justice Howe, joined by Chief Justice Hall, simply did not address the reasonable expectations argument. 748 P.2d at 1042-44. In my concurring opinion, joined by Justice Stewart, I refused to reach the argument because the reasonable expectations issue was not adequately presented on appeal. Id. at 1044 (Zimmerman, J., concurring). Justice Durham, who was the author of Call, proceeded to discuss the issue. Id. at 1047-49 (Durham, J., dissenting).

11 . See American W. Life Ins. Co. v. Hooker, 622 P.2d 775, 779 (Utah 1980) (applying estoppel to insurer); see also Mendez v. State Dep’t of Social Servs., 813 P.2d 1234, 1236 (Utah Ct.App.1991) (describing elements of estoppel). See generally Annotation, Doctrine of Estoppel or Waiver as Available to Bring Within Coverage of Insurance Policy Risks Not Covered by Its Terms or Expressly Excluded Therefrom, 1 A.L.R.3d 1139 (1965 & Supp.1991); Mayhew at 293 (“Attempting to distinguish between reasonable expectations, estoppel, and unconscionability can be difficult because the doctrine of reasonable expectations, with its equity origins, often overlaps with the other two.”).

12 . See Sullivan v. Beneficial Life Ins., 91 Utah 405, 426, 64 P.2d 351, 361 (1937) (applying waiver to insurer); see abo Anderson v. Brinkerhoff, 756 P.2d 95, 98 (Utah Ct.App.1988) (describing elements of waiver). See generally 1 A.L.R.3d 1139.

13 . See Resource Mgmt. Co. v. Weston Ranch & Livestock Co., 706 P.2d 1028, 1040-43 (Utah 1985) (describing substantive and procedural unconscionability). See generally Donald M. Zupenec, Annotation, Doctrine of Unconsciona-bility as Applied to Insurance Contracts, 86 A.L.R.3d 862 (1978 & Supp.1991); Scott B. Kri-der, Comment, The Reconstruction of Insurance Contracts Under the Doctrine of Reasonable Expectations, 18 J. Marshall L.Rev. 155, 173 (1984) (noting that unconscionability is promising alternative to reasonable expectations doctrine).

14 . See Beck v. Farmers Ins. Exch., 701 P.2d 795, 801 (Utah 1985) (holding that insurer has implied duty of good faith and fair dealing to insured based on insurance contract).

15 . See LDS Hospital v. Capitol Life Ins. Co., 765 P.2d 857, 858-59 (Utah 1988) (describing test to be applied in determining ambiguity of insurance contracts); Hoffman v. Life Ins. Co. of N. America, 669 P.2d 410, 417 (Utah 1983) (applying rule that ambiguities be resolved against drafter in construing insurance contract); Phillips v. Utah Local Gov'ts Trust, 660 P.2d 249, 250 (Utah 1983) (same).

16 . In addition to the various equitable remedies, tort remedies may be available to an aggrieved insured under appropriate circumstances. For example, the plaintiff may be able to assert a claim for fraud, see Crookston v. Fire Ins. Exch., 817 P.2d 789, 800 (Utah 1991), negligent misrepresentation, see Culp Constr. Co. v. Buildmart Mall, 795 P.2d 650, 654-55 (Utah 1990), or breach of fiduciary duty, see Ammerman v. Farmers Ins. Exch., 19 Utah 2d 261, 265, 430 P.2d 576, 577-78 (1967). An insurance company may be vicariously liable for the tortious conduct of its agent, or it may directly incur tort liability by imputation of the agent’s knowledge. See Hodges v. Gibson Products Co., 811 P.2d 151, 156-57 (Utah 1991). An insurance company also may be liable for negligent hiring, supervision, or retention even if the employee is not acting within the scope of his or her employment. See Stone v. Hurst Lumber Co., 15 Utah 2d 49, 386 P.2d 910 (1963).

17 . We find it difficult to conceive why the version of the reasonable expectations doctrine Allen advances should be limited solely to insurance contracts. See W. David Slawson, The New Meaning of Contract: The Transformation of Contracts Law by Standard Forms, 46 U.Pitt.L.Rev. 21, 52 (1984) (noting that reasonable expectations doctrine "lacks any principled justification for being limited to insurance policies”). Compare, e.g., Mayhew at 271-72 (claiming that insurance contracts differ "substantially" from other adhesion contracts because insured typically retains right of cancellation without incurring untoward expenses or legal consequences) with Utah Code Ann. § 31A-21-303 (Supp.1991) (specifying narrow grounds on which an insurer may cancel a policy, such as failure to pay a premium when due, material misrepresentation, substantial and unforeseeable change in risk, or substantial breach; setting forth the procedure required for cancellation; and granting the insured a right to renewal). But see generally Rahdert at 339-41 (discussing several features of insurance contracts that the author believes creates an "enhanced” risk of unequal bargaining power compared to other types of adhesion contracts). Any of the considerations underlying application of the doctrine, such as presence of an adhesion contract and objectively reasonable expectations of the aggrieved party, see Wagner, 786 P.2d at 767, may occur in contractual relationships outside of the insurance context. See, e.g., Schurtz v. BMW of North Am., Inc., 814 P.2d 1108 (Utah 1991) (addressing dispute involving a form warranty for new automobile). In comparison, the existing equitable doctrines, such as waiver, es-toppel, and unconscionability, apply to any contractual relationship regardless of context so long as warranted by the facts.

18 . Justice Stewart’s concurrence criticizes this opinion for all manner of sins. In order to provide the target for his attack, Justice Stewart imputes to the majority motives that it does not have and mischaracterizes a number of statements made in this opinion. The best source as to what this opinion stands for is the opinion itself.

It is worth noting that the rather truncated version of the reasonable expectations doctrine described in Justice Stewart’s opinion, a version that would preclude Allen from taking her case to a jury, bears little resemblance to any of the versions of this doctrine argued for by plaintiff or by Justice Durham in her dissent. Indeed, the narrow doctrine described by Justice Stewart, under which Allen’s factual allegations are not sufficient to raise a jury question as to the reasonableness of her expectations, amounts to little more than a variation on the traditional equitable doctrines by which this court has proceeded interstitially to remedy overreaching by insurers and others using standard form contracts to the detriment of insureds and consumers generally.