 |
 |
to fill out a simple form to connect to Personal Injury Lawyers in your area.
|
|
|
|
|
McLelland v. United Wisconsin Life Insurance Co.3/26/1999
{1} United Wisconsin Life Insurance Company (United Wisconsin) appeals a $250,000 punitive damages award entered against it for willfully engaging in an unfair trade practice, in violation of the Unfair Practices Act, NMSA 1978, §§ 57-12-1 to 57-12-22 (1967, as amended through 1995) (the UPA). It does not challenge the award of $9169.84 in compensatory damages. Its two contentions on appeal are: (1) The UPA does not permit a jury to award punitive damages; it only permits a Judge to award up to treble damages for a willful violation of the Act. (2) The punitive damages award is excessive under constitutional and common-law standards. Plaintiff, Elizabeth McLelland, denies that the award is excessive and argues that United Wisconsin is precluded from raising the first contention because it approved a special verdict form that asked the jury to assess punitive damages for a willful UPA violation. We agree with United Wisconsin's first contention and therefore reverse and remand for the district court to decide whether to award treble damages. We need not reach United Wisconsin's second contention, because it does not argue that treble damages would be excessive.
BACKGROUND
{2} McLelland bought health insurance from United Wisconsin to cover hospital and physician expenses in case a medical emergency prevented her from giving birth at home with a midwife's assistance. The United Wisconsin brochure listed "Complications of Pregnancy" as a covered expense. The insurance agent selling the policy circled this language in the brochure and, according to McLelland 's testimony, assured McLelland that Caesarian sections were covered by the policy. The brochure advised the reader to refer to the certificate of coverage "for a more detailed list of benefits." But at the time McLelland purchased the policy, the agent did not show McLelland a copy of the certificate; indeed, he had never seen one. Although the insurance company mailed McLelland the certificate several weeks later, she did not read it. On page twenty-one of the thirty-seven page document, Caesarian section delivery was excluded from the definition of complications of pregnancy.
{3} McLelland required an emergency Caesarian section. The hospital and physician expenses totaled about $7000. United Wisconsin denied coverage. After fruitless telephone and mail correspondence, McLelland sued the company on four theories of recovery: (1) breach of contract; (2) violation of the duty of good faith under the insurance contract (referred to by the parties as the "insurance bad faith" claim); (3) commission of an unfair claims practice prohibited by the New Mexico Insurance Code, NMSA 1978, § 59A-16-20 (1997); and (4) violation of the UPA.
{4} On at least two occasions during trial the district court discussed with counsel the availability of punitive damages. The first occasion was when counsel were debating the admissibility of testimony by McLelland's expert witness. Although the Discussion did not focus on this particular point, McLelland's position apparently was that the only possible punitive damages awards would be a jury award under her claims for insurance bad faith or unfair claims practices, or a court award of up to treble damages under the UPA claim. Later, during the hearing on United Wisconsin's motion for a directed verdict, United Wisconsin stated that the only punitive damages that could be recovered would be those awarded by the jury for insurance bad faith or treble damages awarded by the court under the UPA. McLelland did not dispute that proposition in her argument against United Wisconsin's motion.
{5} In its instructions to the jury after the close of evidence, the district court
Page 1 2 3 4 5 6 7 8 New Mexico Personal Injury Attorneys
Personal Injury Lawyers
|
| |
to fill out a simple form to connect to Personal Injury Lawyers in your area.
|
|