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Candice Brilz v. Metropolitan General

August 21, 2012

CANDICE BRILZ, PLAINTIFF AND APPELLANT,
v.
METROPOLITAN GENERAL INSURANCE COMPANY, DEFENDANT AND APPELLEE.



APPEAL FROM: District Court of the Fourth Judicial District, In and For the County of Missoula, Cause No. DV 08-723 Honorable Ed McLean, Presiding Judge

The opinion of the court was delivered by: James C. Nelson

August 21 2012

Submitted on Briefs: February 22, 2012

Filed:

Clerk

Justice James C. Nelson delivered the Opinion of the Court.

¶1 Candice Brilz filed an action in Montana state court purportedly asserting statutory and common law bad-faith claims against Metropolitan General Insurance Company (Metropolitan). Metropolitan removed the action to federal court and filed a motion for summary judgment, which the federal court granted. Thereafter, Brilz commenced the instant declaratory judgment action in the Fourth Judicial District Court, Missoula County, seeking a determination that she may pursue her common law bad-faith claim against Metropolitan. Because the statute of limitations on that claim had since expired, Brilz requested a ruling that she may pursue the claim pursuant to § 27-2-407, MCA, or this Court's doctrine of equitable tolling. The District Court dismissed the action, and Brilz now appeals.

¶2 The sole issue on appeal is whether Brilz is entitled to pursue her common law bad-faith claim. Brilz again argues that she may do so under § 27-2-407, MCA, or the equitable tolling doctrine. We conclude, however, that principles of claim preclusion bar her from filing a second action against Metropolitan arising out of the same underlying facts. We accordingly affirm the District Court's judgment.

BACKGROUND

¶3 Brilz was injured and suffered property damage in an automobile collision which occurred in Missoula on August 14, 1998. She alleges that the driver of the other vehicle, David Kidder, was entirely at fault. At the time of the accident, Kidder was insured by Metropolitan. His policy included coverage in the amount of $25,000 for personal injury to one person.

¶4 Brilz submitted a claim to Metropolitan seeking to recover under Kidder's policy. On January 8, 2001, Metropolitan offered to settle with Brilz by tendering the $25,000 policy limits. Brilz alleges that this only occurred after "numerous communications and requests" on her part. Brilz accepted Metropolitan's offer on February 2, 2001, thus settling her insurance claim.

¶5 One year and five days later, on February 7, 2002, Brilz filed a lawsuit in the Fourth Judicial District Court against Metropolitan regarding the manner in which Metropolitan had adjusted her claim for insurance benefits. In paragraphs 7 through 9 of her complaint, Brilz alleged that Metropolitan had violated the Unfair Trade Practices Act by failing to reasonably investigate her claim and by failing to effectuate prompt, fair, and equitable settlement of her claim. See § 33-18-201(4), (6), MCA. Additionally, in paragraphs 11 and 12 of her complaint, Brilz alleged that Metropolitan knew it was obligated to pay her claim but nevertheless withheld benefits, and in so doing acted "oppressively, maliciously and outrageously towards Plaintiff, with conscious disregard to Plaintiff's known rights and with the intention of wrongfully interfering with Plaintiff's prospective economic advantage and property interest in such benefits and of intentionally causing unjust and cruel hardship and severe emotional distress to Plaintiff." Brilz further alleged that Metropolitan "acted to and did vex, injure and annoy Plaintiff," and that in failing and refusing to timely and reasonably pay benefits based upon all available information, Metropolitan "acted wrongfully and unreasonably."

¶6 Metropolitan removed the action to the United States District Court for the District of Montana based on diversity jurisdiction. See 28 U.S.C. §§ 1332(a)(1), 1441(a), (b). The parties then filed cross-motions for summary judgment on the question whether Brilz's claims are time barred. The federal district court concluded, first, that Brilz's statutory claim under the Unfair Trade Practices Act is barred by § 33-18-242(7)(b), MCA, which prescribes a one-year statute of limitations on an action by a third-party claimant against an insurer. Brilz argued that her complaint also set forth a separate common law bad-faith claim to which a three-year statute of limitations applied. The federal district court ruled, however, that Brilz had not alleged such a claim. The court reasoned that her complaint "contains no allegations that [Metropolitan] acted in 'bad faith,' breached its duty of good faith and fair dealing, or otherwise breached some duty 'independent of statute or of insurance contract' " (quoting St. Paul Fire & Marine Ins. Co. v. Cumiskey, 204 Mont. 350, 357, 665 P.2d 223, 226 (1983)).*fn1 Citing paragraphs 7 through 9 of the complaint, the federal district court observed that Brilz had alleged violations of § 33-18-201(4) and (6), MCA, and from this the court then reasoned that she "bases the allegations in her complaint entirely on statutory duties, and does not allege the material elements of a common law bad faith claim." The court did not identify what it thought "the material elements of a common law bad faith claim" were, however. Nor did the court specifically cite or discuss paragraphs 11 and 12 of Brilz's complaint.

¶7 The United States Court of Appeals for the Ninth Circuit affirmed in a memorandum opinion issued October 19, 2007. Brilz v. Metlife Auto & Home, 251 Fed. Appx. 458 (9th Cir. 2007). The court first concluded that Brilz's statutory claim under the Unfair Trade Practices Act is time barred. Brilz, 251 Fed. Appx. at 459-60. Turning then to the question whether Brilz had alleged a common law claim, the court assessed her complaint under Rule 8(a)(2) of the Federal Rules of Civil Procedure. Doing so, the court held that Brilz's pleadings failed to set forth a common law bad-faith claim because although her complaint "explicitly alleged" that Metropolitan had violated the Unfair Trade Practices Act, it "made no mention of any common law claim." Brilz, 251 Fed. Appx. at 460. The Ninth Circuit concluded that Brilz's complaint "provided the court and defendant ample notice of the statutory claim, but no meaningful notice of any purported common law claim. Nor does she point to anything in the record that would support any such claim." Brilz, 251 Fed. Appx. at 460.

ΒΆ8 Following the federal courts' termination of her 2002 action, Brilz commenced the present action in the Fourth Judicial District Court. She filed her complaint in June 2008 and an amended complaint in May 2009. Brilz did not seek to renew her statutory claim against Metropolitan; rather, she requested a declaration that she may pursue her common law claim-even ...


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