F I L E D United States Court of Appeals Tenth Circuit UNITED STATES COURT OF APPEALS MAR 12 1997 FOR THE TENTH CIRCUIT PATRICK FISHER Clerk
EUGENE PERKINS,
Plaintiff-Appellant,
v. No. 96-6186 (D.C. No. CIV-95-1232-M) USAA CASUALTY INSURANCE (W.D. Okla.) COMPANY, a corporation,
Defendant-Appellee.
ORDER AND JUDGMENT *
Before BALDOCK, EBEL, and LUCERO, Circuit Judges.
After examining the briefs and appellate record, this panel has determined
unanimously to grant the parties’ request for a decision on the briefs without oral
argument. See Fed. R. App. P. 34(f) and 10th Cir. R. 34.1.9. The case is
therefore ordered submitted without oral argument.
* This order and judgment is not binding precedent, except under the doctrines of law of the case, res judicata, and collateral estoppel. The court generally disfavors the citation of orders and judgments; nevertheless, an order and judgment may be cited under the terms and conditions of 10th Cir. R. 36.3. Plaintiff, who was injured in a pedestrian-auto accident in December 1994,
made a claim for uninsured/underinsured motorist (UM) benefits under the auto
policy defendant USAA issued him in November 1994. By state statue, every
automobile liability policy issued in Oklahoma must provide minimum UM
coverage of $10,000 per person/$20,000 per occurrence unless the insured rejects
this minimum amount in writing. See Okla. Stat. tit. 36, § 3636; Okla. Stat. tit.
47, § 7-204. The declarations page of plaintiff’s USAA policy reflected that the
policy provided the statutorily minimum UM coverage, for which plaintiff was
charged a premium. See Appellant’s App. at 52.
In June 1995, USAA tendered plaintiff payment in the amount of $20,000,
representing what USAA contended were the stacked UM limits 1 under plaintiff’s
policy. In August 1995, plaintiff sued USAA for breach of contract and for bad
faith. Plaintiff contended that the stacked UM limits under the policy should be
imputed by law to be equal to the stacked liability limits, or $200,000, because
USAA had failed to send plaintiff a written offer of increased UM limits, as
required by Okla. Stat. tit. 36, § 3636(B), (H), when it issued the new policy in
November 1994. In so arguing, plaintiff relied upon the Oklahoma Court of
1 “Stacked” UM limits represent the per person limit of liability of the insured’s UM coverage multiplied by “the number of vehicles insured under the policy for which a separate premium for uninsured motorist coverage is charged,” Cofer v. Morton, 784 P.2d 67, 71 (Okla. 1989). The policy here covered two vehicles, for which plaintiff was charged separate premiums for UM coverage.
-2- Appeals’ decision in Perkins v. Hartford Underwriters Insurance Co., 889 P.2d
1262, 1264 (Okla. Ct. App. 1994). While the parties’ cross-motions for summary
judgment were pending in the district court, the Oklahoma Supreme Court issued
its opinion in May v. National Union Fire Insurance Co., 918 P.2d 43 (Okla.
1996), which expressly overruled Perkins.
Thereafter, the district court granted summary judgment to USAA on both
of plaintiff’s claims. The court determined that plaintiff’s contract claim was
governed by the Oklahoma high court’s opinion in May, which held that “[w]here
an insurer fails to offer in writing or obtain a written rejection of UM coverage
such that UM coverage is imputed to an insured’s policy as a matter of law,
. . . the mandate of § 3636 is satisfied by imputation of the minimum limits of UM
coverage required by statute. To impute a higher amount of UM coverage [as the
court did in Perkins] would go beyond the mandate of § 3636.” Id. at 48.
Therefore, the district court concluded, plaintiff was entitled to UM coverage of
only $10,000 under the policy (resulting in stacked limits of $20,000). The court
further concluded that “there is no evidence in the record reasonably tending to
show that defendant acted in bad faith in denying plaintiff’s claim for $200,000,”
Appellant’s App. at 223, and, therefore, entered summary judgment for USAA on
the bad faith claim as well.
-3- We review the grant of summary judgment de novo, applying the same
standards as the district court under Fed. R. Civ. P. 56(c). Wolf v. Prudential Ins.
Co. of Am., 50 F.3d 793, 796 (10th Cir. 1995). We review the factual record and
any reasonable inferences arising therefrom in the light most favorable to the
nonmovant to determine whether there is a genuine issue as to any material fact.
Id. If we determine there are no genuine issues of material fact in dispute, we
then look to see whether the district court correctly applied the substantive law.
Id. Based upon our review of the record and the pertinent law, we affirm the
grant of summary judgment to USAA for substantially the reasons given by the
district court.
We write additionally to address a matter that the district court did not
discuss in its orders on summary judgment. Although plaintiff has steadfastly
maintained that USAA did not send him the statutorily mandated offer form, he
alternatively argued in the district court, though rather belatedly, that the offer
form USAA contends it did send him is ambiguous. Plaintiff contends that
construing this ambiguity in his favor results in constructive UM limits equal to
his liability limits, which were $100,000 per person/$200,000 per occurrence.
The form USAA allegedly sent to plaintiff in November 1994 followed the
prescribed form set forth in § 3636(H). The statutorily prescribed form notifies
the proposed insured that he can make one of four choices about UM coverage:
-4- he can purchase UM coverage equal to his liability limits; he can purchase UM
coverage in the minimum statutory amount; he can purchase UM coverage in an
amount less than the liability limits but more than the statutory minimum; or he
can reject UM coverage altogether. The manner in which USAA filled in the
blanks in the prescribed form resulted in an offer to plaintiff to “buy Uninsured
Motorist coverage equal to your bodily injury liability coverage for
$ 0.00 for 6 months.” Appellant’s App. at 54.
Plaintiff argues that, because USAA offered him UM coverage equal to his
liability limits for no additional charge, we should construe his UM limits to be
$100,000 per person/$200,000 per occurrence. This argument overlooks one
fundamental fact: the record is devoid of any evidence that plaintiff ever
intended to, or actually did, accept this offer of increased coverage. “An offer
becomes a binding promise and results in a contract only when it is accepted. To
constitute acceptance, there must be an expression of the intent to accept the
offer, by word, sign, writing or act, communicated or delivered to the person
making the offer or the offeror’s agent.” Garrison v. Bechtel Corp., 889 P.2d
273, 281 (Okla. 1995).
USAA’s form, as required by § 3636(H), not only notified plaintiff of his
choices concerning UM coverage, but directed him to indicate what UM coverage
he wanted.
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F I L E D United States Court of Appeals Tenth Circuit UNITED STATES COURT OF APPEALS MAR 12 1997 FOR THE TENTH CIRCUIT PATRICK FISHER Clerk
EUGENE PERKINS,
Plaintiff-Appellant,
v. No. 96-6186 (D.C. No. CIV-95-1232-M) USAA CASUALTY INSURANCE (W.D. Okla.) COMPANY, a corporation,
Defendant-Appellee.
ORDER AND JUDGMENT *
Before BALDOCK, EBEL, and LUCERO, Circuit Judges.
After examining the briefs and appellate record, this panel has determined
unanimously to grant the parties’ request for a decision on the briefs without oral
argument. See Fed. R. App. P. 34(f) and 10th Cir. R. 34.1.9. The case is
therefore ordered submitted without oral argument.
* This order and judgment is not binding precedent, except under the doctrines of law of the case, res judicata, and collateral estoppel. The court generally disfavors the citation of orders and judgments; nevertheless, an order and judgment may be cited under the terms and conditions of 10th Cir. R. 36.3. Plaintiff, who was injured in a pedestrian-auto accident in December 1994,
made a claim for uninsured/underinsured motorist (UM) benefits under the auto
policy defendant USAA issued him in November 1994. By state statue, every
automobile liability policy issued in Oklahoma must provide minimum UM
coverage of $10,000 per person/$20,000 per occurrence unless the insured rejects
this minimum amount in writing. See Okla. Stat. tit. 36, § 3636; Okla. Stat. tit.
47, § 7-204. The declarations page of plaintiff’s USAA policy reflected that the
policy provided the statutorily minimum UM coverage, for which plaintiff was
charged a premium. See Appellant’s App. at 52.
In June 1995, USAA tendered plaintiff payment in the amount of $20,000,
representing what USAA contended were the stacked UM limits 1 under plaintiff’s
policy. In August 1995, plaintiff sued USAA for breach of contract and for bad
faith. Plaintiff contended that the stacked UM limits under the policy should be
imputed by law to be equal to the stacked liability limits, or $200,000, because
USAA had failed to send plaintiff a written offer of increased UM limits, as
required by Okla. Stat. tit. 36, § 3636(B), (H), when it issued the new policy in
November 1994. In so arguing, plaintiff relied upon the Oklahoma Court of
1 “Stacked” UM limits represent the per person limit of liability of the insured’s UM coverage multiplied by “the number of vehicles insured under the policy for which a separate premium for uninsured motorist coverage is charged,” Cofer v. Morton, 784 P.2d 67, 71 (Okla. 1989). The policy here covered two vehicles, for which plaintiff was charged separate premiums for UM coverage.
-2- Appeals’ decision in Perkins v. Hartford Underwriters Insurance Co., 889 P.2d
1262, 1264 (Okla. Ct. App. 1994). While the parties’ cross-motions for summary
judgment were pending in the district court, the Oklahoma Supreme Court issued
its opinion in May v. National Union Fire Insurance Co., 918 P.2d 43 (Okla.
1996), which expressly overruled Perkins.
Thereafter, the district court granted summary judgment to USAA on both
of plaintiff’s claims. The court determined that plaintiff’s contract claim was
governed by the Oklahoma high court’s opinion in May, which held that “[w]here
an insurer fails to offer in writing or obtain a written rejection of UM coverage
such that UM coverage is imputed to an insured’s policy as a matter of law,
. . . the mandate of § 3636 is satisfied by imputation of the minimum limits of UM
coverage required by statute. To impute a higher amount of UM coverage [as the
court did in Perkins] would go beyond the mandate of § 3636.” Id. at 48.
Therefore, the district court concluded, plaintiff was entitled to UM coverage of
only $10,000 under the policy (resulting in stacked limits of $20,000). The court
further concluded that “there is no evidence in the record reasonably tending to
show that defendant acted in bad faith in denying plaintiff’s claim for $200,000,”
Appellant’s App. at 223, and, therefore, entered summary judgment for USAA on
the bad faith claim as well.
-3- We review the grant of summary judgment de novo, applying the same
standards as the district court under Fed. R. Civ. P. 56(c). Wolf v. Prudential Ins.
Co. of Am., 50 F.3d 793, 796 (10th Cir. 1995). We review the factual record and
any reasonable inferences arising therefrom in the light most favorable to the
nonmovant to determine whether there is a genuine issue as to any material fact.
Id. If we determine there are no genuine issues of material fact in dispute, we
then look to see whether the district court correctly applied the substantive law.
Id. Based upon our review of the record and the pertinent law, we affirm the
grant of summary judgment to USAA for substantially the reasons given by the
district court.
We write additionally to address a matter that the district court did not
discuss in its orders on summary judgment. Although plaintiff has steadfastly
maintained that USAA did not send him the statutorily mandated offer form, he
alternatively argued in the district court, though rather belatedly, that the offer
form USAA contends it did send him is ambiguous. Plaintiff contends that
construing this ambiguity in his favor results in constructive UM limits equal to
his liability limits, which were $100,000 per person/$200,000 per occurrence.
The form USAA allegedly sent to plaintiff in November 1994 followed the
prescribed form set forth in § 3636(H). The statutorily prescribed form notifies
the proposed insured that he can make one of four choices about UM coverage:
-4- he can purchase UM coverage equal to his liability limits; he can purchase UM
coverage in the minimum statutory amount; he can purchase UM coverage in an
amount less than the liability limits but more than the statutory minimum; or he
can reject UM coverage altogether. The manner in which USAA filled in the
blanks in the prescribed form resulted in an offer to plaintiff to “buy Uninsured
Motorist coverage equal to your bodily injury liability coverage for
$ 0.00 for 6 months.” Appellant’s App. at 54.
Plaintiff argues that, because USAA offered him UM coverage equal to his
liability limits for no additional charge, we should construe his UM limits to be
$100,000 per person/$200,000 per occurrence. This argument overlooks one
fundamental fact: the record is devoid of any evidence that plaintiff ever
intended to, or actually did, accept this offer of increased coverage. “An offer
becomes a binding promise and results in a contract only when it is accepted. To
constitute acceptance, there must be an expression of the intent to accept the
offer, by word, sign, writing or act, communicated or delivered to the person
making the offer or the offeror’s agent.” Garrison v. Bechtel Corp., 889 P.2d
273, 281 (Okla. 1995).
USAA’s form, as required by § 3636(H), not only notified plaintiff of his
choices concerning UM coverage, but directed him to indicate what UM coverage
he wanted. The form had a place for plaintiff to check which of the four
-5- alternatives concerning coverage he chose and it had a place for his signature.
The form concluded with the following statement: “THIS FORM IS NOT A
PART OF YOUR POLICY AND DOES NOT PROVIDE COVERAGE.”
Appellant’s App. at 54; see also Okla. Stat. tit. 36, § 3636(H) (mandating such
language). Plaintiff has acknowledged that the statutorily prescribed form
contains “a place for the insured’s signature indicating receipt of the form and a
specific election of the coverage desired,” and that the Oklahoma legislature
obviously “intend[ed] the form to be signed.” Appellant’s App. at 116. Yet,
plaintiff admits that he never indicated his choice of coverage or signed the form.
Indeed, plaintiff contends that he never even received the offer of “free”
increased UM coverage. Absent plaintiff’s acceptance of this offer, the policy
terms remained as reflected on the declarations page.
Therefore, whether USAA actually sent plaintiff the required written offer
has no effect on plaintiff’s contract claim. Whether imputed by law or based on
the written terms of the policy, plaintiff’s UM coverage was the same: $10,000
per person/$20,000 per occurrence. As to plaintiff’s claim for bad faith, we agree
with the district court that the evidence presented did not give rise to a reasonable
inference of tortious conduct and, therefore, summary judgment for USAA was
proper. See, e.g., City Nat’l Bank & Trust Co. v. Jackson Nat’l Life Ins., 804
-6- P.2d 463, 468-69 (Okla. Ct. App. 1990); Willis v. Midland Risk Ins. Co., 42 F.3d
607, 612 (10th Cir. 1994).
The judgment of the United States District Court for the Western District of
Oklahoma is AFFIRMED.
Entered for the Court
David M. Ebel Circuit Judge
-7-