9th circuit affirms district court ruling in insurance case

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THE United States Court of Appeals for the Ninth Circuit has affirmed the ruling of District Court for the NMI Chief Judge Ramona V. Manglona in dismissing the lawsuit of a couple against Guam-based Pacific Indemnity Insurance Company for not defending them in the wrongful death claim over a fatal accident.

In September 2018, Dong-Youl Lim and Moon Hee Ko, through attorney Charles P. Reyes Jr., appealed to the Ninth Circuit the ruling of Judge Manglona who dismissed with prejudice the lawsuit of the couple on Aug. 23, 2018.

Lim and Ko sued Pacific Indemnity Insurance for breach of contract, breach of covenant of good faith and fair dealing, violation of the Consumer Protection Act, and fraud and intentional misrepresentation.

The couple said they were forced to settle with the decedent’s family for $300,000.

Pacific Indemnity Insurance Company insured the couple, whose son, driving a covered vehicle, struck a pedestrian who later died. The insurer covered liability stemming from bodily injury up to a “maximum limit” of $15,000 per person injured.

Ninth Circuit Judges John Farris, Margaret McKeown, and Bridget Bade, in their order, said “although the policy defined “minimum limits” as $25,000, the term “minimum limits” is not included in the section of the policy that addresses bodily injury.

“The policy is not ambiguous. Plaintiffs-Appellants themselves admitted that the applicable policy limit was $15,000,” the Ninth Circuit judges stated.

“Second, under CNMI law, an individual appointed ‘personal representative’ on behalf of the estate may act on behalf of the decedent’s survivors in a separate wrongful death action. We only consider whether such action is legally binding,” the judges added.

“Here, nothing in the CNMI wrongful death statute prohibits an Administratrix or any other appointed ‘personal representative’ under the CNMI probate code from serving as personal representative in a wrongful death action.

“As a result, under CNMI law, the personal representative properly accepted the $15,000 policy limit as settlement on behalf of decedent’s survivors, and the insurer has no further obligation under the terms of the policy.”

“Third,” the Ninth Circuit judges said, “the parties have produced no evidence of any action by the probate court since it appointed the administratrix in 2013. It is unclear whether that court approved the $15,000 settlement, knew of it, impliedly consented, or whether probate is in fact still open. As such, summary judgment in favor of Plaintiffs-Appellants on the issue of probate court approval is improper.”

In their third motion for partial summary judgment, the plaintiffs contend that the $15,000 settlement with Apolonia Joseph’s wrongful death claim is invalid because it never received court approval.

According to the lawsuit, the couple’s son operated their car when it struck Jefferson Keju who died from the accident.

Keju’s mother, Apolonia Joseph, filed a claim with Pacific Indemnity Insurance company for “Wrongful Death.” Joseph was also appointed the administratrix of her deceased son’s estate.

Pacific Indemnity offered the policy limit of $15,000 to settle the claim and provided a release of claims agreement.

On Feb. 27, 2014, in exchange for the $15,000 payment to the “Estate of Jefferson Keju,” Joseph signed the release of claims as the administratrix wherein she agreed to release Dong-Youl Kim, He Ko Moon, Woo Hyun Kim, and Pacific Indemnity Insurance Company from any lawsuit arising from the accident.

Pacific Indemnity Insurance, through its counsel Patrick Civille, denied the couple’s claims.

Civille said the plaintiffs are stopped from challenging the validity of the settlement “because they accepted the benefit of the settlement.”

He said if the settlement was initially invalid, “they ratified it by accepting the benefits,” adding that “the only person who could challenge the settlement is Ms. Joseph.”

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