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COURT OF APPEALS DECISION DATED AND RELEASED JULY 12, 1995 |
NOTICE |
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A party may file
with the Supreme Court a petition to review an adverse decision by the Court
of Appeals. See § 808.10
and Rule 809.62, Stats. |
This opinion is
subject to further editing. If
published, the official version will appear in the bound volume of the
Official Reports. |
No. 94-2081
STATE OF WISCONSIN IN
COURT OF APPEALS
DISTRICT II
DOROTHY WENTLAND,
Plaintiff‑Appellant,
v.
AMERICAN FAMILY MUTUAL
INSURANCE COMPANY,
Defendant‑Respondent.
APPEAL
from a judgment of the circuit court for Kenosha County: DAVID BASTIANELLI,
Judge. Affirmed.
Before
Anderson, P.J., Brown and Nettesheim, JJ.
ANDERSON,
P.J. Dorothy Wentland appeals from a circuit court
judgment granting American Family Mutual Insurance Company's motion for summary
judgment. Because we conclude that
there is no genuine issue as to any material fact, and American Family is
entitled to judgment as a matter of law, we affirm.
Wentland
was injured when she attempted to avoid an oncoming all-terrain vehicle (ATV)
at a baseball diamond. The driver of
the ATV had no insurance. Wentland
notified her insurer, American Family, of her claim under the uninsured
motorist coverage provisions of her policy.
American Family denied her claim, stating that the ATV was not a “motor
vehicle” as defined in the policy.
Wentland filed suit against American Family.[1] The circuit court concluded that the ATV
constituted a “motor vehicle” under Wentland's policy.
Although
the court concluded that coverage was provided under the policy, American
Family denied coverage, claiming that the issues of liability and damages
remained unresolved. Prior to trial,
American Family offered the Wentlands $100,000 to settle their claims. The offer was declined and a jury trial was
held. The jury awarded damages in
excess of $400,000.
Wentland
also filed suit, which is the subject of this appeal (Wentland II),
claiming that American Family's refusal to honor her claim after the coverage
issue had been resolved constituted bad faith:
There is and was no reasonable basis in fact or law for
American Family's continued denial of Plaintiffs' claims, and Defendant knew,
or acted in reckless disregard of the fact that there was no reasonable basis
for denying Plaintiffs' claims. Said
conduct constituted the tort of bad faith.
American Family filed a motion for summary judgment. The trial court granted summary judgment in
favor of American Family, stating:
Wentland
sought certain benefits under her policy of insurance, as to future medical
expenses and past economic loss. This
court finds that there is no genuine issue of material fact that there was an
absence of a reasonable basis for denying these benefits under the policy by
American. Consequently, the court will
grant American's motion for summary judgment seeking a dismissal of this
action.
Wentland appeals.
In
reviewing summary judgment determinations, we apply the same standards as the
trial court. Posyniak v. School
Sisters of St. Francis, 180 Wis.2d 619, 627, 511 N.W.2d 300, 304 (Ct.
App. 1993). A summary judgment motion
will be granted “if the pleadings, depositions, answers to interrogatories, and
admissions on file, together with the affidavits, if any, show that there is no
genuine issue as to any material fact and that the moving party is entitled to
a judgment as a matter of law.” Section
802.08(2), Stats.
The
following elements are required to show a claim for bad faith:
[A] plaintiff must show the absence of a reasonable
basis for denying benefits of the policy and the defendant's knowledge or
reckless disregard of the lack of a reasonable basis for denying the claim.
Anderson v. Continental Ins. Co., 85 Wis.2d 675, 691, 271 N.W.2d 368, 376 (1978). This test of bad faith was further developed
by the supreme court when it stated that an insurer will have committed the
tort of bad faith only when it has denied a claim without a reasonable basis
for doing so, that is, when the claim is not fairly debatable. See Mowry v. Badger State Mut.
Casualty Co., 129 Wis.2d 496, 516, 385 N.W.2d 171, 180 (1986).
Wentland
argues that “whether an insurer's lump sum offer to settle a first party claim
was objectively reasonable must be assessed in terms of how a reasonable
insurer would value the total claim.”
American Family offered Wentland $100,000 to settle her claim. Under the first part of the Anderson
test, Wentland must show that a reasonable insurer under the circumstances
would not have acted as American Family did by offering an amount which is
alleged to be unreasonably low. Fehring
v. Republic Ins. Co., 118 Wis.2d 299, 310-14, 347 N.W.2d 595, 601-02
(1984).
We conclude that the
$100,000 settlement offer was within the range of what a reasonable insurer
would offer under the circumstances. We
agree with American Family that Wentland had an erratic salary history, substitute
taught in 1991 and presented no evidence that she had been advised against
working subsequent to her knee injury.
These factors, coupled with the uncertainty of whether future surgery
would be necessary and the extent of Wentland's pain and suffering, combined to
make Wentland's damages subject to debate.
Next,
Wentland argues that “[t]here was an insufficient evidentiary basis for the
trial court's conclusion that two sub-parts of Mrs. Wentland's claim were
‘fairly debatable.’” The two subparts
Wentland refers to are “past loss of earning capacity and ¼ future medical
bills.” We reject Wentland's
argument. From our review of the
record, we conclude that Wentland's damages were subject to debate. The evidence presented by American Family
showed that future medical expenses, as well as the extent of Wentland's loss
of earning capacity, were uncertain.
Contributory
negligence was also an issue that was fairly debatable. As we stated in Wentland I:
[T]he trial court directed a verdict in Wentland's favor
because no reasonable jury could find that [the ATV driver] was anything other
than negligent and that his negligence caused Wentland's injuries. However, the court allowed the jury to
decide whether Wentland was contributorily negligent and, if so, whether her
contributory negligence was causal.
Wentland v. American Family Mut. Ins. Co., No. 93-3310, unpublished slip op. at 4 (Wis. Ct. App.
May 10, 1995). The fact that there was
conflicting testimony as to the ATV driver's rate of speed as he approached
Wentland and his distance from her, coupled with the fact that a person
standing next to Wentland at the scene did not feel the need to react, raised a
debatable issue as to Wentland's contributory negligence. American Family, in the exercise of ordinary
care, made an investigation of the facts and law and concluded on a reasonable
basis that Wentland's claim was debatable.
See Anderson, 85 Wis.2d at 693, 271 N.W.2d at 377.
Lastly,
Wentland argues that the real controversy has not been tried because it was the
trial court, not American Family, that first raised the argument as to whether
the two components of damages at issue were debatable and there was not a
significant record addressing this issue.
Section 752.35, Stats.,
provides in relevant part:
Discretionary
reversal. In an appeal to the court
of appeals, if it appears from the record that the real controversy has not
been fully tried ¼ the court may reverse the judgment or order appealed
from ¼.
We conclude that the real controversy has been fully
tried. American Family raised the issue
of damages in its pleadings and in its brief in support of the motion for
summary judgment. Additionally, as we
noted earlier, there is sufficient information from the pleadings to conclude
that damages and Wentland's contributory negligence were fairly debatable;
therefore, summary judgment in favor of American Family was appropriately
granted.
By
the Court.—Judgment affirmed.
Not
recommended for publication in the official reports.