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STA TE OF MAINE BUSINESS AND CONSUMER COURT CUMBERLAND, ss Location: Portland DocketNo.: BCD-CV-15-39
) GLENNE. PERRY &MARY JANE ) PERRY, ) ) Order Oil Defendant's Motion for Partial Plaintiffs, ) Summary Judgment ) v. ) ) THE NETHERLANDS INSURANCE ) COMPANY, ) ) Defendant. )
Plaintiffs Glenn E. Perry and Mary Jane Perry asse1i seven causes of action against The
Netherlands Insurance Company ("The Netherlands") in their Amended Complaint. The
Netherlands moves for summaiy judgment against five of these counts. 1 Specifically, they seek
summaiy judgment against: Count III Overdue Payments under 24-A M.R.S.A. § 2436; 2 Count
III Unfair Claims Settlement Practices under 24-A M.R.S.A. § 2436-A; Count IV Negligent
Infliction of Emotional Distress; Count V Intentional Infliction of Emotional Distress; and Count
VI Unfair Trade Practices Act, 5 M.R.S.A. §§ 207, 213. The Netherlands also moved for
summary judgment against Plaintiffs' request for punitive damages.
The Comt held oral argtiment on this motion and three motions in lim.ine on May 16,
2015. For the reasons discussed below, the Court grants smnmaiy judgment against Count III
for overdue payments under 24-A M.R.S.A. § 2436, Count IV for negligent infliction of
I Although raised as an issue in The Netherlands' initial motion for summary judgment, the parties have since agreed that Plaintiffs' potential recovery lmder the terms of The Netherlands' policy is limited to $200,000 in light of an earlier settlement for $50,000 eroding the $250,000 policy limits. 2 Plaintiffs mistakenly numbered two causes of action as "Count IIT." For the sake of simplicity, the Cou11 refers to these counts based on the statute allegedly violated. emotional distress, Count V for intentional infliction of emotional distress, Count VI for
violation of the Unfair Trade Practices Act, and against Plaintiffs' request for punitive damages.
The Court grants in part and denies in part The Netherlands motion for summary judgment
against Count Ill for unfair claims settlement practices under 24-A M.R.S.A § 2436-A. More
specifically, the Court grants summary judgment against Plaintiffs' claims pursuant to 24-A
M.R.S.A. § 2436-A(l)(E), but denies summary judgment against Plaintiffs' claims brought under
24-A M.R.S.A. § 2436-A(l)(B) & (D).
I. Background
On October 23, 2013, plaintiff Glen Perry was in a vehicular accident. (Supp. S.M.F. ~
1.) Mr. Perry's vehicle was rear ended by a vehicle driven by Hannah Oriol, who was insured by
Progressive Insurance ("Progressive"). (Id. ~ 2.) Mr. Peny sustained a large cut on his head in
the accident that required thirteen staples. (Id.~ 3; Opp. S.M.F. ~ 3.) At the time of the accident,
Mr. Perry was employed by Mariner Beverages ("Mariner") and the accident occurred while he
was performing work duties for the company. (Supp. S.M.F. i! 4.) Two days after the accident,
Mr. Perry returned to work. (Id ~ 5.) In April 2014, Progressive agreed to pay Mr. Peny the
$50,000 policy limits on Ms. Orio l's policy in full and final settlement of the claims against Ms.
Oriol. (Id. ~ 6.)
At the time of the accident, Mr. Peny had a motor vehicle policy with The Netherlands
Insurance Company ("The Netherlands") that included uninsured motorist coverage with limits
of$250,000. (Id. iJ 7.) By late November 2013, Mr. Peny was in contact with a person
representing The Netherlands. 3 (A.S.M.F. ~ 8.) Mr. Peny sent the representative evidence as to
) At oral argument, counsel fol' the parties explained that although there were a number of insurance companies involved in addition to The Netherlands, for purposes of the present motion, they could all be treated as The Netherlands.
2 .'
the value of his destroyed vehicle as we! 1 as photos depicting the thirteen staples that were placed
inbishead. (Id.)
On April 8, 2014, Mr. Perry's attorney, John Campbell, notified The Netherlands that
Progressive had agreed to settle Mr. Perry's claims against Ms. Oriol for the $50,000 policy
limits and requested The Netherlands' consent. (Supp. S.M.P. ~ 8.) That same day, Attorney
Campbell put The Netherlands on notice that Mr. Peny would be making an uninsured motorist
claim over and above the amount paid by Progressive against The Netherlands. (Id. ~ 9.) There
were no demand or medical records provided to The Netherlands on that date. (Id. ~ 1O;
A.S.M.F. ~ 9.) Mr. Perry did, however, send The Netherlands two photographs depicting his
head a few days after the accident when the bandages were taken off, plus a third picture
depicting the permanent trough that is now in Mr. Peny's head. (Id.) On or about April 5, 2014,
Mr. Perry advised The Netherlands that he was still suffering mental health issues from the
effects ofhis head injury and was scheduled to see a neurologist in June of 2014. (A.S.M.F. ~
11.)
On April 8 and 9, adjusters representing The Netherlands made written requests that
Attorney Campbell provide them with a letter of representation, the police report, a demand
package, all of the medical records and bills, the declarations page of Ms. Oriol 's policy, and an
affidavit stating that there was no additional i.nsurnnce. (Supp. S.M.F. ~ 11.) Mr. Peny asserts
that he and Attorney Campbell subsequentJy had numerous and repeated calls about his claim
with various people representing various insurers who were acting on behalf of The Netherlands.
(Peny Aff. ~ 22.) Mr. Peny asserts that he promptly supplied all information that was requested.
(id~ 23.) However, as of August 25, 2014, none of the additional information requested by The
Netherlands on April 8 and 9, 2014, was provided. (Supp. S.M.F. ~ 12.)
3 On August 25, 2014, adjuster Emily Mousette was assigned to the file. (Id. ~ 13 .) On
that day, Ms. Mousette spoke with Attorney Campbell by phone and wrote to him confirming
that she had been assigned to the file. (Id. ~ 14.) Ms. Mousette' s writing also requested: i) a
formal letter of representation; ii) a copy of the declarations page of the Progressive policy; iii)
the settlement agreement and release with Progressive; iv) confirmation that there was no other
insurance; v) information about workers compensation coverage and coverage from Mr. Perry's
employer's policy; and vi) Mr. Perry's medical bills, records related to the accident, and pre
accident medical records. (Id.)
On September 19, 2014, Attorney Campbell e-mailed Ms. Mousette and attached copies
of: i) a medical bill from Maine Health in the amount of $1,680.70; ii) a bill from Westbrook
Fire Department for $779.60; iii) Intermed records from November 7, 2013 and November 15,
2013; iv) a medical record form Dr. Dinnerstein dated June 6, 2014; v) a letter from Progressive;
vi) the declarations page from Ms. Oriol's policy showing limits of $50,000; vii) letters from
Progressive confirming the settlement; viii) a copy of Progressive's $50,000 check to Mr. Perry;
and ix) a statement from Philip Williams dated September 15, 2014. (Id~ 15.)
On October 7, 2014, Ms. Mousette took a recorded statement from Mr. Perry over the
telephone with Attorney Campbell present. (Id. ~ 16.) On that date, Attorney Campbell
informed Ms. Mousette, for the first time, that he considered Mr. Perry's case a policy limits
case. (Id.~ 18.) Ms. Mousette responded on the seventh that in order to evaluate Mr. Peny's
claim, The Netherlands needed to know whether there was coverage for Mr. Perry under
Mariner's commercial auto policy and questioned why Mr. Peny had not made a workers
compensation claim since the injury was work related. (Id. ~ 17.) In connection therewith, Ms.
Mousette offered to call Mariner to start the process of requesting an opinion 011 whether its
4 commercial automobile insurance policy had coverage for the accident. (Id. ~ 19; Answer to
Amended Comp!.~ 33.)4
On October 20, 2014, Ms. Mousette responded to an email from Attorney Campbell sent
earlier in the day explaining that "I have not yet been able to reach out to [Mariner], it is on my
to do list." (Answer to Amended Comp!.~~ 35-36. 5) Attorney Campbell sent Ms. Mousette a
further email on October 27, to which Ms. Mousette responded the following da)'.:
So the process has been started with both workers comp and the commercial auto for Mariner Beverage. I will have to wait to see how their coverages apply, if they will, and how that will effect our UIM policy in the settlement of this claim.
I appreciate your cooperation and patience in resolving this claim. Let me know if you have any questions or need anything from me at this time.
I will be in touch wlth a status update as soon as I have one ....
(Id. ~ 37.)
On October 29, 2014, Attorney Campbell emailed Ms. Mousette asking how
Mariner's commercial automobile policy could affect settlement because it was "excess"
and stating that he did not understand how the workers compensation policy could come
4 The.re appears to be a disputed issue of fact as to when Attorney Campbell told Ms. Mousette she could directly contact Mr. Perry's employer, Mariner. Plaintiffs admit in their opposing statement of material facts that Attorney Campbell approved Ms. Mousette's request to reach out to Mariner on October 14, 2014. (Supp. S.M.F. ~ 19.) The Netherlands admit in their Answer to Plaintiffs' Amended Complaint, however, that Attorney Campbell approved Ms. Mousette's plan on October 7, 2014. (Answer to Amended Comp I.~ 34.) For purposes of the present motion, the seven-day discrepancy is not material. 5 Plaintiffs' Additional Statement of Material Facts contains numerous conclusory assertions and characterizations that do not satisfy the short and concise statement of facts required by M.R. Civ. P. 56(h). See e.g. Orient v. Dwyer, 490 A.2d 660, 662 (Me. 1985). Furthermore, Plaintiffs' Additional Statement of Material Facts rely heavily on the affidavit of Mr. Perry in which he recounts co1runun.ications between Attorney Campbell and Ms. Mousette. (See A.S.M.F. ~~ 15-20). Mr. Pel'l'y's affidavit, however, does not establish personal knowledge of these communications and they are therefore inadmissible hearsay. (See e.g. Perry Aff. ~~ 28-57.) While the Court has no independent duty to search or consider any portion of the record not specifically referenced in the parties' separate statement of facts, it is not prohibited from doing so. M.R. Civ. P. 56(h)( 4).) In the interests of justice, the Court has elected to consider The Netherlands' Answer to Plaintiffs' Amended Complaint, in which The Netherlands admits to the substance of many of the Statements of Material Facts that are otherwise inadmissible hearsay. The Court does not take this step lightly, but deems it necessary to provide a complete picture of the undisputed facts at issue in the present case.
5 into play at all. (Id. ~ 38.) Ms. Mousette responded on November 2, 2014 that The
Netherlands had to "evaluate all potential coverages available to the insured, including all
applicable collateral sources and what we may have to be prepared for in terms of liens,
etc." (Id. ~ 39.) She stated that she would let Attorney Campbell know as she receives
more information from Mariner about how its insurance coverage "will integrate with
ours." (Id.)
On November 4, 2014, Attorney Campbell emailed Ms. Mousette reiterating that
Mr. Perry never commenced a workers compensation claim and that, in his opinion, there
could be no lien. (Id. ii 41.) He also wrote Ms. Mousette that Maine law provides
remedies for delaying payment under insurance policies and for failing to effectuate a fair
settlement when liability is reasonably clear. (Id.) Ms. Mousette responded on
November 13, 2014 apologizing for the delay and explaining that she was still waiting to
hear back about the potential commercial automobile coverage. (Id. ~ 42.) She stated
that The Netherlands needs to "clarify any potential coverage issues as far as who would
be primary and/or excess before we can finalize the settlement" and expressed concern
"as to why Mr. Perry did not file a workers compensation claim for his medical bills and
pending disability issues." (Id.) She assured Attorney Campbell that she did not intend
to delay a settlement, but had to follow protocols, was working on the file, and hoped to
resolve the matter promptly . (Id.)
The following day, Attorney Campbell e-mailed Ms. Mousette asking for a copy
of the Mariner policy and questioning how far along she was in her discussions regarding
the resolution of Mr. Perry's claims. (Id.~ 43.) Attorney Campbell also posed further
questions about the workers compensation issue, inquiring whether Mr. Perry had to
6 "needlessly attempt to commence a comp proceeding at this point in order to recover
what you describe as 'out of pocket expenses' cis a precondition to recovering the benefits
that he is contractually entitled to under his ... policy." (Id.) Ms. Mousette responded on
November 21, 2014 that she had not yet received a copy of the Mariner's policy. (Id. ,
45.)
. On November 24, Attorney Campbell e-mailed Ms. Mousette expressing surprise and
disappointment that she had not obtained the conunercial policy from Mariner and requested the
name of her supervisor. (Supp. S.M.F. ~ 24.) Ms. Mousette replied on the same day, explaining
that she hoped to hear back from Mariner soon and that her supervisor was aware of the missing
information. (Id. ~ 25.) Ms. Mousette also provided her supervisor's name and copied her to the
email. (Id.) Attorney Campbell emailed Ms. Mouselte and her supervisor on December 1, 2014
asking whether they had received a copy of the Mariner policy and asking whether that is the
missing information referenced in Ms. Mousette's November 24 email. (See id. ~ 26; Answer to
Amended Compl. ~ 48.) The following day, Ms. Mousette responded that she had not received
the contact information for the claims adjuster for the Mariner commercial automobile policy, but hoped to have it by the end of the week. (Answer to Amended Compl. ~ 49.) Ms. Mousette
explained that there may have been a misunderstanding when she first contacted the agent for
Mariner in October and that the agent had put in notice of the possible workers compensation
claim afte1· their first conversation, but had only recently put in the commercial automobile
claim. (Id.) That same day, Ms. Nfousette's supervisor wrote her stating, "Can you also send the
agent a written letter requesting claim (sic) created for auto policy and written position of
coverage available for insured?" (Id. ~ 50.)
7 Thereafter, Mr. Perry and Attorney Campbell reached out to Mariner's insurer and
received a letter dated December 9, 2014 denying coverage because Mariner did not own the
vehicle that was involved in the accident . (Id. ~ 52; Supp. S.M.F. ~ 27.) Ms. Mousette received
a copy of this letter on December 10, 2014. (Supp. S.M.F. ~ 27.) Ms. Mousette responded to a
December 11, 2014 e-mail from Attorney Campbell later that day stating she was completing her
evaluation of Mr. Peny's claim. (Id. ~ 28.) Ms. Mousette included in her email a list of all the
medical bills she had and requested that Attorney Campbell confirm there were no more. (Id)
She also sent out an internal request for other adjusters to participate in a roundtable to discuss
the value of Mr. Peny' s claims. (id.) Attorney Campbell confirmed on December 15 that there
were no more bills since those supplied in September. (Id. ~ 30.)
Sometime sh01ily after December 10, 2014, the round table discussion with other
insurance adjusters took place. (Id. ~ 29.) Some of the adjusters opined that the value of Mr.
Perry's claim was less than the $50,000 settlement he had received, while none thought the value
approached limits of The Netherlands' policy. (Id) In malcing their decision, the adjusters
considered Mr. Perry's significant cut, the photos and scarring, the minimal medical treatment
and bills, the two-day absence from work, and the claim of a traumatic brain injmy. (Id.) The
adjusters felt that the traumatic brain injury claim was not substantiated and that the claim of a
lost job opportunity was speculative. (Id.)
On December 16, 2014, Ms. Mousette e-mailed her supervisor with her evaluation,
intending to obtain settlement authority and begin settlement negotiations. (Id. ~ 31.) The
following day, Ms. Mousette went into labor a month before her expected due date and went on
short-term disability. (Id ~ 32.) Mr. Perry did not submit a written settlement demand or a
proof of loss to The Netherlands and Mr. Perry's claim was never arbitrated. (Id.~~ 33-35.)
8 On December 23, 2014, Attorney Campbell emailed Ms. Mousette asking when he could
expect a response. (Answer to Amend. Comp!.~ 56.) On that same day, Matthew Szymanoski
was assigned to handle Mr. Perry's claim. (Supp. S.M.F. ~ 36.) Mr. Szyrnanoski emailed
Attorney Campbell on the 23rd informing him of this. (Id. ~ 37.) Mr. Szymanoski also asked
Attorney Campbell to provide the ambulance trip report, ER records, PCP records and
neurologist records. (Id.) In the same email, Mr. Szymanoski provided Attorney Campbell with
his contact information and told him that he was reachable that week, but would be out the last
week of the year, returning on January 5, 2015. (Id. 138.) While Mr. Szymanoski was out on
vacation, he received internal emails about Mr. Perry's claim and an e-mail from Attorney
Campbell. (Id. 140.) On January 7, 2015, Mr. Syzmanoski contacted Attorney Campbell and
told him he needed to go through the information. (Id. ~ 41.) Attorney Campbell stated that he
understood and would be in touch. (Id.)
Thereafter, Mr. Szymanoski looked at the materials in the file, including those provided
by Attorney Campbell and the evaluations. (Id. ~ 42.) Mr. Syzmanoski considered: i) Mr.
Perry's injury and scar; ii) the limited medical treatment and low medical bills of approximately
$2,400; iii) Mr. Perry's claim of a brain injury and the lack of a substantiating neurologist's
report; and iv) Mr. Perry's claim of a lost job opportunity. (Id.~ 43.) On January 12, 2015, Mr.
Szymanoski spoke with Attorney Campbell by phone to discuss the case and The Netherlands'
evaluation. (Id. 144.) During the call, he told Attorney Campbell that he thought the $50,000
his client had received was the full value of the case, but also offered an additional $3,000 in new
money to settle the claim. (Id.) Attorney Campbell responded that he saw the case as a full
policy limits case. (Id. 145.) Mr. Syzmanoski disagreed with Attorney Campbell's opinion, but
indicated that he was willing to continue to discuss the case. (Id. ~ 46.) On March 13, 2015, Mr.
9 Szymanoski offered $10,000 to settle Mr. Peny's claims. (A.S.M.F. 42.) On March 19, 2015,
he upped the settlement offer to $15,000. (Id.) The offers were not accepted .
While Mr. Szymanosk.i worked on the case, he had some of the medical information
requested, but never received a written demand package, a copy of the record of Mr. Peny's
post-accident C.T. scan, the rescue records-excluding the rescue bill--or the neurologist's bills.
(Supp. S.M.F. ~ 47.) The bills Mr. Szymanoski was in possession of totaled approximately
$2,400. (Id)
II. Stanchtrcl of Review
"The function of a summary judgment is to permit a court, prior to trial, to determine
whether there exists a triable issue of fact or whether the question[ s] before the court [areJ
solely ... of law." Bouchard v. American Orthodontics, 661 A.2d 1143, 1144 (Me. 1995).
Summa1y judgment is appropriate where there are no genuine issues of material fact and the
moving party is entitled to judgment as a matter oflaw. M.R. Civ. P. 56(c); see also Levine v.
R.B.K. Caty Corp., 2001 ME 77, ~ 4, 770 A.2d 653. A "material fact" is one that can affect the
outcome of the case, and a genuine issue exists when there is sufficient evidence for a fact finder
to choose bet\veen competing versions of the fact. Lougee Conservc,ncy v. City-Mortgage, Inc.,
2012 ME 103, ~I I, 48 A.3d 774.
Sununary judgment is also appropriate if, looking at the record in the light most favorable
to the non-moving party and drawing all reasonable inferences in that party's favor, no
reasonable juror could find for the non-moving party. Id.~ 14, n. 3 (quoting Scalf v. Harris, 550
U.S . 372, 377 (2007)). This is true "even when concepts such as motive or intent are at issue ... if
the non-moving party rests merely upon concluso1y allegations, improbable inferences, and
unsupported speculation." Dyer. v. Dep t. ofTransp., 2008 ME 106, ~ 14, 951 A.2d 821 (quoting 1
10 Vives v. Fajardo, 472 F.3d I 9, 21 (1st Cir. 2007)); Bouchard, 661 A.2d at 1144-45 (quoting
Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 249-50 (1986)) ("If the evidence is merely
colorable, or is not significantly probative, summary judgment may be granted"). Accordingly, a
"judgment as a matter of law in a defendant's favor is proper when any jury verdict for the
plaintiff would be based on conjectme or speculation." Stanton v. Univ. oflvfaine System, 2001
ME 96, ~ 6, 773 A.2d 1045.
III. Discussion
A. Whether Stmunaiy Judgment is Warranted Against Plaintiffs ' Claim for Violation of the Late Payment Statute, 24-A M.R.S.A. § 2436.
The Netherlands argues that summary judgment is warranted because Mr. Perry did not
trigger Section 2436's 30 day deadline for payment since he did not provide proof of loss to The
Netherlands, and there was no ascertainment of the loss through written agreement or arbitration.
In the alternative, The Netherlands argues that even if the 30 day period was triggered, its
payments are not overdue because Plaintiffs failed to produce all of the requested information
and, even if Plaintiffs had provided the information, The Netherlands made an offer of settlement
within 30 days ofreceiving sufficient information.
Plaintiffs respond that, in essence, The Netherlands seeks to exempt itself from 24-A
M.R.S.A. § 2436 by not providing the Plaintiffs a "proof of loss" form to submit. They argue
that the filing of a particular form is not what the statute requires. Instead, the "proof of Joss"
that is required is the equivalent of what might be on a proof of loss form, i.e. the essential
information about the loss. Plaintiffs further respond that they provided "proof of loss" on April
8, 2014, or at the latest by October 7, 2014 . The Netherlands, however, did not agree to pay the
claim, dispute it, or request reasonable additional information from the Plaintiffs to toll the 30
1] day period. Instead, Plaintiffs argue that The Netherlands deliberately delayed its determination
to their prejudice.
Subsection 1 of Section 2436 provides, in pertinent part:
A claim for payment of benefits under a policy or certificate of insurance delivered or issued for delive1y in th.is State is payable within 30 days after proof of loss is received by the insmer and ascertainment of the loss is made either by written agreement between the insurer and the insured or beneficiary or by filing with the insured or beneficiary of an award by arbitrators as provided for in the policy. For pmposes of this section, "insured or beneficiary" includes a person to whom benefits have been assigned. A claim that is neither disputed nor paid within 30 days is overdue. If, during the 30 days, the insurer, in writing, notifies the insured or beneficiary that reasonable additional information is required, the undisputed claim is not overdue lintil 30 days following receipt by the insurer of the additional required information ....
24-A M.R.S. § 2436(1). A violation of this statute results in the overdue claim bearing interest at
the rate of 1 Y2% per month and an award of reasonable attorney's fees for representing a
claimant on an overdue claim. Id. § 2436(3-4). Nothing in Section 2436 prohibits or limits any
claim or action a claimant has against the insurer. Id. § 2436(5).
When interpreting a statute, the Court seeks "to give effect to the intent of the Legislature
by examining the plain meaning of the statutory language and considering the language in the
context of the whole statutory scheme." Darling's v. Ford Motor Co., 1998 ME 232, ,r 5, 719
A.2d 111 (citations omitted). The Court interprets "the plain language by taking into account the
subject matter and purposes of the statute, and the consequences of a particular interpretation."
Dickau v. Vt. Mui. Ins. Co., 2014 ME 158, ,r 21, 107 A.3d 621 (citation omitted). In determining
a statute's practical operation and potential consequences, the Cami "may reject any constrnction
that ... creates absurd, illogical, unreasonable, inconsistent, or anomalous results if an alternative
interpretation avoids such results." Id. (quotation omitted). Similarly, the Comi may reject
interpretations that render some language mere surplusage or result in duplicative recoveries for
12 the same injuries. Id. ~22 (citation omitted); Edwards v. Trnve!ers Ins. Co., 2001 ME 148, ~ 10,
783 A.2d 163 (disfavoring interpretations of the Workers' Compensation Act that result in
duplicate recovers for the same injuries). Because Section 2436 is a penal in nature, it must be
strictly construed. See Marquis v. Farm Family Mut. Ins. Co., 628 A.2d 644, 651 (Me. 1993).
The first sentence of subsection 1 of Section 2436 triggers the commencement of the 30
day period following : 1) submission to the insurer of proof ofloss, and 2) ascertainment of the
loss by written agreement between the insurer and the insured or by filing an award by
arbitrators. 24-A M.R.S.A. § 2436(1) . While the statute also imposes liability for an insurer's
failure to dispute or pay a claim with.in 30 days without expressly mentioning the prerequisites of
submitting proof of loss and ascertainment of the loss; a strict construction of Section 2436
requires the Court to read these prerequisites into the term "claim" order to trigger the 30.day
period. This interpretation is further supported by 24-A M.R.S .A. § 2436-A, which provides the
same penalties for virtuaIJy the same injuries. 24-A M.R.S.A. § 2436-A(l)(B) (permitting the
recovery of damages, costs, reasonable attorney's fees and 1 Yi% interest per month against an
insurer that fails to acknowledge and review claims with.in a reasonable time following receipt of
written notice from the insured).
Here, there is no evidence that Plaintiffs have satisfied the prerequisite of ascertaining the
loss by written agreement between themselves and The Netherlands or through an arbitration
award . Accordingly, there is no evidence that the 30 day period was triggered and summary
judgment is warranted against Plaintiffs' claim for the violation of 24-A M.R.S.A. § 2436.
13 B. Wl1ether Summaiy Judgment is Warranted Against Plaintiffs' Claim for Violation of Unfair Claims Settlement Practices Statute, 24-A M.R.S.A. § 2436-A.
The Netherlands argues that summary judgment must be granted because it timely
acknowledged and reviewed Plaintiffs' claim. The only point of contention, The Netherlands
argues, stems from the fact that it evaluated the damage claim differently than Plaintiffs. This
differing val\lation, The Netherlands argues, does not constitute a violation of the Unfair Claims
Settlement Practices Statute.
Plaintiffs respond that there are genuine issues of material fact as to whether The
Netherlands violated subsections (B), (D), and (E) of Section 2436-A. 6 For instance, a
reasonable jury could find either that The Netherlands delay was due to matters outside its
control, such as Mousette's pregnancy, or that the delays were intentional or stemming from The
Netherlands' negligence. Plaintiffs further respond that liability was reasonably clear, and strong
evidence indicates Mr. Peny's damages were greater than the $50,000 paid by Progressive.
Section 2436-A provides, in pertinent part:
A person injured by any of the following actions taken by that person's own insurer may bring a civil action and recover damages, together with costs and disbmsements, reasonable attorney's fees and interest on damages at the rate of l 1/2% per month :
B. Failing to acknowledge and review claims, which may include payment or denial of a claim, within a reasonable time following receipt of written notice by the insurer of a claim by an insured arising under a policy;
D. Failing to affirm or deny coverage, reserving any appropriate defenses, within a reasonable time after having completed its investigation related to a claim; or E. Without just cause, failing to effectuate prompt, fair and equitable settlement of claims submitted in which liability has become reasonably clear.
6 Plaintiffs cite to subsection ( 1)(A) of Section 2436-A, but discuss the merits of subsection ( l )(B) .
14 24-A M.R.S. § 2436-A( 1). "For the purposes of this section, an insurer acts without just cause if
it refuses to settle claims without a reasonable basis to contest liability, the amount of any
damages or the extent of any injuries claimed." 24-A M.R.S.A § 2436-A(2). Nothing in section
2436 ''prohibits any other claim or cause of action a person has against an insurer." 24-A
M.R.S.A. § 2436-A(J). Section 2436-A, like Section 2436, is penal in nature and must be
strictly construed. Grich v. Anthem Health Plans ofMaine., 2007 Me. Super. LEXIS 101, *5-6
(May 18, 2007); Anderson v. CIGNA Healthcare ofMaine, 2005 Me. Super. LEXIS 139, *11-12
(Oct. 27, 2005).
Here, viewing the evidence in the light most favorable to Plaintiffs, there are genuine
issues of material fact as to whether The Netherlands violated subsections (B) and (D) of Section
2436-A(l). Specifically, a reasonable juror could conclude that The Netherlands: (B) failed to
acknowledge and review Iv1r. Perry's claims within a reasonable time following receipt of Mr.
Perry's written notice; and (D) failed to affirm or deny coverage within a reasonable time after
completing its investigation into Mr. Perry's claim. This is because Mr. Perry provided The
Netherlands with written notice in early April of 2014. (Supp. S.M.F. ~ 9.) By October 7, 2014,
Plaintiffs had provided Ms. Mousette with what a reasonable juror could conclude constituted
sufficient information for The Netherlands to review Mr. Perry's clain1 and begin making a
coverage decision. (See Supp. S.M.F. ~~ 15-16.) While The Netherlands maintain that it was
diligently searching for and waiting on additional pe1iinent information, such as Mariner's
insurance policy, a reasonable juror could determined that this policy was uru1ecessary for The
Netherlands to reach a coverage opinion. (See id. ~~ 17-19; Answer to Amended Comp!. ~~35
38.) Furthermore, there is sufficient information for a reasonable juror to conclude that even if
The Netherlands required the Mariner insurance policy to reach a decision, it was not diligent in
15 tracking down this information. (Answer to Amended Comp!.~~ 35-45, 49; Supp. S.M.F. ~~ 24
27.) Finally, there is sufficient information for a reasonable juror to conclude that even if The
Netherlands ,vas diligent in its pursuit of the Mariner insurance policy, The Netherlands was not
diligent in reviewing and reaching a coverage position until January 12, 2015. (See Supp. S.M.F.
~~ 27-44.)
Summary judgment is warranted, however, against Plaintiffs' claim pursuant to Section
2436-A(l )(E) because no reasonable juror could find that The Netherlands did not have a
reasonable basis to dispute the amount of damages and the extent of injuries claimed by Mr.
Perry. (Supp. S.M.F. ~~ 42-46; A.S.M.F. ~ 42.) This is highlighted by the discrepancy between
Mr. Peny's request for the $200,000 policy limits of The Netherlands policy and the limited
medical bills (approximately $2,400), lack of a substantiating neurologist's report for Mr. Perry's
claimed brain i1tjmy, and Mr. Peny's quick return to work. (Id. at~~ 29, 43, 45.) The fact that a
reasonable juror could conclude The Netherlands was not diligent in reaching th.is determination
is not pe11inent to liability under subsection E. See Curtis v. Allstate Ins. Co., 2002 ME 9, ~~ 32
33,787 A.2d 760.
C. Whether Summaiy Judgment is Warranted Aga inst Plaintiffs' Claim for Negligent and Intentional Infliction of Emotional Damage
The Netherlands argue that it is entitled to summaiy judgment because Plaintiffs' claims
arise out of the contractual terms of The Netherlands' policy and it is well established that
damages for emotional distress are not available for a breach of contract, absent certain
circumstances not present in this case. The Netherlands further contends that summary judgment
is warranted against the negligent infliction of emotional distress claim because there is no
evidence of the requisite special relationship or "bystander liability." Finally, The Netherlands
16 argue that summa1y judgment is warranted against the intentional infliction of emotional distress
claim because the conduct alleged is not outrageous enough to support the tort as a matter of law.
Plaintiffs respond that their claims go beyond a simple breach of contract to include
claims for unfairly and maliciously delaying a settlement offer to Mr. Peny and making him
jump through hoops for a minimal settlement offer. They also respond that they have at least
created an issue of fact as to whether The Netherlands recklessly inflicted emotional harm on
Plaintiffs.
"As a general rule, in order to recover for mental or emotional distress suffered as a result
of a breach of contract, the plaintiff must suffer some accompanying physical injury, or the
contract must be such that a breach of it will result in a serious emotional disturbance, such as
contracts between carriers and innkeepers, contracts for the carriage or proper disposition of dead
bodies, and contracts for the delivery of messages concerning death." A1arquis v. Farm Family
ll1ut. Ins. Co., 628 A.2d 644, 651 (Me. 1993) "[A]n insurance contract is not one ofthose
'special' types of contracts warranting damages for a severe emotional disturbance ...." ld.
In Jvfarquis, the plaintiffs brought suit against Farm Family Mutual Insurance Company
("Farm Family") for breach of two fire insurance contracts. Id. at 646. At trial, a jury
determined, among other things, that Farm Family investigated the fire claims in bad faith and
that the plaintiffs were entitled to recover for the loss of personal property insured under the
policy and consequential damages. Id. at 647. Thereafter, Farm Family moved for a judgment
nolwithstanding the verdict to which the trial court determined ph1intiffs: 1) were not entitled to
recover interest and attorney fees under 24-A M.R.S.A. § 2436, 2) were not entitled to recover
under 24-A M.R.S.A. § 2436-A because they had not pled the claim, and 3) had not presented
sufficient evidence to recover for lost profits. Id. The parties cross-appealed and the Law Courl
17 determined, in pertinent part, that: 1) the j my had sufficient evidence to determine Farm Family
breached the implied duty of good faith and fair dealing an insurer owes to its insured (Id. at
648-49); 2) the trial court correctly dismissed plaintiffs' requests for severe emotional distress
because plaintiffs did not suffer any physical injmy and the claim arose out of an insurance
contract (Jd. at 651 ); and 3) it would not recognize an independent tort of bad faith resulting from
an insurer 's breach of its duty to act in good faith and deal fairly with an insured (Id. at 652).
The present case is similar to Marquis in that it stems from The Netherlands alleged
breach of its duty to act in good faith and deal fairly with Plaintiffs. Furthermore, the Plaintiffs'
claim does not allege physical injury and is not a special type of contract that warrants damages
for a severe emotional disturbance. Accordingly, summaiy judgment is warranted against
Counts IV and V of Plaintiffs' Complaint. See also Co{ford v. Chubb L(fe Ins. Co. ofAm., 687
A.2d 609, 616-17 (Me. 1996) (requiring commission of independently tortious conduct beyond
the breach of an insurance contract); Osgood v. York Ins. Co., 2006 Me. Super. LEXIS 136. *20
21 (June 5, 2006) (no claim for intentional infliction of emotional distress where insurer delayed
and eventually denied claim of insurance coverage).
D. Whether Summaiy Judgment is Warranted Against Plaintiffs' Claim for Violation of the Unfair Trade Practices Act
The Netherlands argues that sumrna1y judgment is warranted because Section 208 of the
Unfair Trade Practices Act ("UTPA") exempts insurance companies from liability thereunder.
In support, The Netherlands points to Lessard v. Allstate Ins. Co., which concluded that
"insurance companies' practices are exempt from the UTPA" because "[t]he business of
insurance is heavily regulated by the State of Maine through Title 24-A. 200 I Me. Super.
LEXIS 36, *10-11 (Mar. 12, 2001). The Netherlands further argues that even if it could be held
liable under the UTPA, there is no evidence that it engaged in an unfair method of competition or
18 deception or that Plaintiffs suffered any loss of money or property as a result thereof. The
Netherlands also argues that Plaintiffs cam1ot recover attorney fees under the UTPA because
they did not comply with the Act's notice requirement. Plaintiffs respond that the present action
does not involve "transactions or actions ... permitted" under Maine's laws.
1. Whether The Netherlands is Exempt From Liability Under the UTPA
Section 207 of the UTPA declares unlawful any"[ uJnfair methods of competition and
unfair or deceptive acts or practices in the conduct of any trade or commerce .... " 5 M.R. S.A. §
207 (2016). When Lessard was decided, Section 208 of the UTPA provided, in pertinent pa11,
that that it does not apply to "transactions or actions otherwise permitted under laws as
administered by any regulatory board ... acting under statutory authority .... " 5 M.R.S.A. §
208(1) (2000). In interpreting this language, Lessard looked to state and federal case law for
guidance in determining whether the plaintiff could proceed with his UTPA claim against the
defendant insurance company. 2001 Me. Super. LEXIS 36, *8-11. Specifically, Lessard
examined the Law Comt' s opinion in First ofMaine Commodities v. Dube, 534 A.2d 1298 (Me.
1987) and two opinions from the federal district court of Maine. Id. at* 8-10. In Dube, the
plaintiffs argued that the defendant real estate broker violated the UTPA by failing to notify them
of their right under another statute to void the parties' exclusive listing agreement within three
days of its execution. 534 A.2d at 1301. Dube observed that the Maine Real Estate Commission
"may investigate and penalize licensed brokers who violate the numerous statutory restrictions
on their activities." Id. Dube concluded that "[b]ecause the Maine Real Estate Commission
extensively regulates brokers' activities, including the execution of exclusive listing agreements,
such activities fall outside the scope of' the UTPA. Id. Based on the text of Section 208, Dube,
and two decisions from the federal district of Maine, Lessard concluded that "insurance
19 companies' practices are exempt from the UTPA" because "[t]he business of insurance is heavily
regulated by the State of Maine through Title 24-A. 2001 Me. Super. LEXIS 36, *10-11.
In 2007, the Legislature amended Section 208 to "establish[] a 2-step analysis to
determine if a defendant's transactions or actions are exception from the application of the
[UTPA]." Comm. Amend. A. toL.D. 94, No. I-1-240 (123rdLegis. May 15, 2007). Following
this amendment, Section 208 now provides:
Nothing in this chapter shall apply to:
l. Regulatory Boards. Transactions or actions otherwise permitted under laws as administered by any regulatory board or officer acting under statutory authority of the State or of the United States. This exception applies only if the defendant shows that: A. Its business activities are subject to regulation by a state or federal agency; and B. The specific activity that would otherwise constitute a violation of this chapter is authorized, permitted or required by a state or federal agency or by applicable law, rule or regulation or othet regulatory approval. 5 M.R.S . § 208(2015).
When interpreting a statute, the Court seeks "to give effect to the intent of the Legislature
by examining the plain meaning of the statutory language and considering the language in the
context of the whole statutory scheme." Darling's, 1998 ME 232, ~ 5, 719 A.2d 111 (citations
omitted). Only when a statute is ambiguous should the Comt look beyond the plain language of
the statute and the context of the statutory scheme "to i.ndicia of legislative intent such as the
statute's history and its underlying policy." Fuhrmann v. Staples, 2012 ME 135, ~ 23, 58 A.3d
1083 (quotation omitted). "A statute is ambiguous if it is reasonably susceptible to different
interpretations." Id. (quotation omitted).
Since Section 208 was amended in 2007, the federal district court of Maine has adopted a
different interpretation than the one relied upon in Lessard. For example, Campbell v. First A111.
Title Ins. Co. determined that Section 208 did not exempt a title insurer accused of violating 24
20 A M.R.S.A. § 2316 from the UTPA because Section 208 only exempted transactions that were
otherwise permitted by law, and 24-A M.R.S.A. § 2316 explicitly prohibited the challenged
conduct. 644 F. Supp. 2d 126, 133-34 (D. Me. 2009). Implicit in this determination is the
conclusion that the "actions otherwise permitted" refer to the specific actions taken, as opposed
to the general category within which the actions can be grouped. In other words, Campbell
would frame the action at issue in the present case as The Netherlands' allegedly dilatory
handling of Mr. Perry's claim, while it could be argued that Dube would have framed the action
as The Netherlands' analyzing and adjusting Plaintiffs' claim. To the extent Dube 's
interpretation under an earlier version of Section 208 creates ambiguity, the Court examines the
statute's legislative history.
The 2007 Amendment to Section 209 makes clear that, consistent with Campbell, the
"actions otherwise permitted" focuses on whether the "specific activity that is the focus of the
inquiry is authorized, permitted or required by ... applicable law ...." Conm1. Amend. A. to L.D.
94, No. H-240 (123rd Legis. May 15, 2007); see also An Act to Protect Consumer Rights under
the Maine Unfair Trade Practices Act: In Support of L.D. 94 Before the J. Standing Comm. on
Judicimy, 123rd Legis. (Feb. 1, 2007) (testimony of Linda Conti for the Office of Attorney
General arguing that the UTPA exception "extends only to practices permitted by regulation"
and does not preclude its application "to any conduct generally regulated by other laws ... "),
(testimony of Michael Bigos, as Chair of the Maine Trial Lawyers Association, arguing that the
Legislature should "[e]xplain that specific permission or authorization for a particular trade
practice is required to qualify for an exception, and not just 'extensive regulation' in the subject
matter area of the party"); Bruce A McGlauflin, The exception that threatens to swallow the
statute: The Statutmy except ion to 1\lfaine 's Unfair Trade Practice A ct, Me. Bar. J. 152-15 7
21 (Sununer 2006). Accordingly, summary judgment is not warranted against Plaintiffs' claims
simply because The Netherlands is an insurance company regulated by the Bureau oflnsurance
or because it was engaging in the broadly permitted category of analyzing and adjusting a claim.
2. Whether Plaintiffs have Suffered a Loss of Money or Prope1ty as a Result of The Netherlands ' Allegedly Unfair Trade Practices
The UTPA creates a private remedy for:
Any person who purchases or leases goods, services or properly ... primarily for personal, family or household purposes and thereby suffers any loss of money or property ... as a result of the use or employment by another person of a method, act or practice declared unlawful by section 207 .... may bring an action, .. in the Superior Court ... for actual damages, restitution and for such other equitable relief, including an injunction, as the court determines to be necessary and proper.
5 M.R.S.A. § 213(1) (2015).
"The plain language of th[is] statute denies relief for plaintiffs who do not
demonstrate injury from the alleged deceptive or unfair practice." McKinnon v.
Honeywell lnt'l, inc., 2009 ME 69, ~ 21, 977 A.2d 420 (quotation omitted). The
demonstrated injury "must be substantial." Id. (citation omitted). "The substantial injury
requirement is a limitation on the use of the UTPA for a private cause of action." Id.
(citation omitted). "The failure to establish a loss of money or property as a result of [the
insurer's] actions ... is fatal to [a] UTPA claim." Curtis v. Allstate Ins. Co., 2002 ME 9, 1
38, 787 A.2d 760 (affirming grant of sununary judgment where "plaintiffs' statement of
material facts is completely devoid of any evidence that they suffered a loss of money or
property as a result of'' allegedly deceptive trade practice); see also William Mushero,
Inc. v. Hull, 667 A.2d 853, 855 (Me. 1995) (finding of damages caused by violation of
UTPA not clearly erroneous where there was evidence indicating that homeowner had to
22 pay additional expenses to level road in order to achieve desired goal that was not met by
defendant's construction).
Here, there is no evidence indicating that Plaintiffs suffered any loss of money or
property as a result of The Netherlands' alleged violation of the UTPA. At most,
Plaintiffs have alleged an unnecessary delay in receiving the money they contend they are
due. As discussed supra sections II(A) & (B), the Unfair Claims Settlement Practices
statute is specifically designed to deal with this delay, the UTPA is not the proper method
for Plaintiffs to seek recovery and summary judgment is warranted. 7
E. Whether Summa1y Judgment is Warranted Against Plaintiffs ' Request for Punitive Damages
The Netherlands asserts that Plaintiffs are not entitled to punitive damages because said
damages are not available for a breach of contract, even an egregious breach. Plaintiffs respond
that summary judgment is not warranted because there are issues of fact as to Plaintiffs' statutory
counts and sufficient evidence to support a finding of actual or implied malice.
Maine law is well settled that "[n]o matter how egregious the breach, punitive damages
are unavailable ... for breach of contract[.]" Drink111ater v. Patten Realty Corp., 563 A.2d 772,
776 (Me. 1989) (citation omitted). Fmthermore, punitive damages are not available, as a matter
oflaw, under a strict constrnction of the unfair claims settlement practices statute, 24-A
M.R.S.A. § 2436-A. E.g. Grich v. Anthem Health Plans ofMe., 2007 Me. Super. LEXIS 101,
*8-9 (May 18, 2007); Anderson v. CIGNA Healthcare ofMaine, 2005 Me. Super. LEXIS 139,
* 11-12 (Oct. 27, 2005).
7 Because Plaintiffs have not suffered a loss of money or prnperty as a result of The Netherlands' alleged violation of the UTPA , the Court need not, and does not, reach The Netherlands' remaining arguments against Plaintiffs' UTPA claim.
23 Given that Plaintiffs' smviving claims me for brench of contract, declnrntory judgment,
and vioJa!ion of the unfair claims settlement practices stal\lte, Plni.ntiffs huve not stated a basis
!"or recovering p1.miti ve damages. Accordingly, sumnrnry judgment is wmrantecl against that
req\1Cst.
IV. Conclusion
Fo1· the rec1sons d~scussed, it is hereby ORDERED AND ADJUDGED AS FOLLOWS:
The Netherlands' motion for summmy judgment is granted against the following cot.mis
of Plaintiffs' Amended Complnint:
Count 111: Overdue Payments under 24-A M.R.S.A. § 2436;
Count III: Unfair Claims Settlement Prnctices \ll1der 24-A M.R.S.A. § 2436-A(l)(E);
Count IV: Negligent Infliction of Emotional Distress;
Count Y: Intentional lnflic1io11 of Emotional Distress; and
Count VI: Unfair Trade Practices Act.
Summary judgment is also grnuted against Plaintiffs' reqttest fo1· p\lnitivc damages.
The Netherlauds' motion for summary judgment is denied as to Count ITT for violation of
the Unfair Claims Settlement Practices Statute \mder 24-/\ M.R.S.A. § 2436-A(l)(B) & (D).
Pursuant to M.R. Civ. P, 79(a), the Clerk is hereby directed to incorporate this Order by
reference in the docket.
Dnted: June 3, 2016
Justice, Business & Consumer Court
&·3· Entered on lhc Docket: . J~ 24 Copies sent via Mail_Electronicallyv