Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

Wortham v. Western Mutual Insurance Company

United States District Court, D. Nevada

March 28, 2018

BOBBY E. WORTHAM and SYLVIA E. WORTHAM, Plaintiffs,
v.
WESTERN MUTUAL INSURANCE COMPANY, Defendants.

          ORDER

         Presently before the court is defendant Western Mutual Insurance Company's (“Western Mutual”) motion for partial summary judgment. (ECF No. 26). Plaintiffs Bobby E. Wortham and Sylvia E. Wortham, husband and wife, (“plaintiffs”) filed a response (ECF No. 46), to which the Western Mutual replied (ECF No. 52).

         Also before the court is plaintiffs' motion for Rule 56(d) relief regarding Western Mutual's motion for partial summary judgment. (ECF No. 48).

         I. Facts

         The present case involves a dispute over plaintiffs' homeowner's policy purchased from Western Mutual. (ECF No. 26). The policy covered the premises at 229 Heaven Sent Court, Henderson, NV 89074 (the “property”). Id. Plaintiffs have paid insurance premiums to Western Mutual since 1999. (ECF No. 46).

         On May 3, 2016, plaintiffs notified Western Mutual of a fire at the property. (ECF No. 26). Plaintiffs told Western Mutual that their son, the full time resident of the property, discovered the fire. Id. As a result of the fire, plaintiffs made a claim on their homeowner's policy. Id.

         Plaintiffs' homeowner's policy defines “residence premises” as the one family dwelling where the named insured resides and which is shown as the residence premises on the declarations. (ECF No. 26, Ex. C). Plaintiffs had moved out of the property in 2009 and purchased a single story home because Bobby Wortham could no longer climb the stairs. (ECF No. 26). Plaintiffs' adult son resided at the property full-time. Id. Plaintiffs left furniture, computers, and TVs at the premises for their son to use. Id.

         On May 11, 2016, Western Mutual notified plaintiffs that because plaintiffs were not residing at the property full-time at the time of the fire, but instead their son was, there was no coverage for the dwelling under plaintiffs' homeowner's policy. (ECF No. 26, Exhibit A). Additionally, Western Mutual notified plaintiffs that their “loss of use” coverage covered only the part of the property where plaintiffs resided that was made unfit for habitation by the fire loss. Id. Because plaintiffs, the insureds, were not residing at the property at the time of the fire, they did not qualify for this coverage. Id.

         In the same correspondence, Western Mutual notified plaintiffs that the policy did provide coverage for their personal property located at the property at the time of the fire. (ECF No. 26, Exhibit A).

         In December of 2015, Western Mutual submitted the form titled “HO NV SP WM 15” (the “new form”) to the Nevada Division of Insurance for approval. (ECF No. 46). The new form added the language “. . . . and which is occupied by you as your primary residence” to the definition of “residence premises.” Id. The declarations page of the policy lists the new form. Id. However, on May 3, 2016, the date of the fire, Western mutual acknowledged that plaintiffs had not received proper notice of the inclusion of the new form and thus, the new definition would not be applied to plaintiffs' claim. Id. Instead, the form included in plaintiffs' policy prior to the update (the “old form”) would be applied. Id. The old form defined “residence premises” as the one family dwelling where the named insured resides and which is shown as the residence premises on the declarations. Id. Neither the old form nor the balance of the policy defines the word “resides.” Id. Further, the declarations sheet states: “the premises covered by the policy is located at: 229 Heaven Sent Ct Henderson, NV 89704-8751.” Id. Nonetheless, Western Mutual has relied on the “primary residence” language throughout its communications with plaintiffs, including its denial of plaintiffs' claim.

         Plaintiffs retained the Greenspan Company in order to assist them with the inventory of damages to their personal property. (ECF No. 26). Plaintiffs then retained an attorney. Id. On August 23, 2016, plaintiffs' attorney sent Western Mutual a demand letter asserting that the declarations page of the policy and the policy's boiler plate language created a reasonable expectation of coverage. Id. Further, plaintiffs' attorney also asserted that plaintiffs' son's person and property were also insured under the policy and that the loss of use coverage was not dependent on plaintiffs' occupancy of the property. Id.

         In response, Western Mutual requested the examination under oath (“EUOs”) of plaintiffs in order to reconsider its previous denial of the claim and to conduct further investigation. (ECF No. 26, Exhibit D). On November 9, 2017, the EUOs of plaintiffs were taken. Id. From the EUOs, Western Mutual learned that plaintiffs moved into the home in 1999 and plaintiffs' two sons Shane and Devin each lived at the property from 1999 until 2015 and from 2003 until the fire, respectively. Id. Plaintiffs' sons helped pay the mortgage. (ECF No. 26, Exhibit E). Sylvia Wortham only went to the property once a week after 2009 and did not leave any personal items there, besides some furniture and wall hangings used by her sons. Id.

         Plaintiffs report the property to the IRS as a “rental property” for tax purposes. (ECF No. 26, Exhibit D). Bobby Wortham regularly visited the house to do chores and general upkeep, and while he did not keep any toiletries or medication there, he occasionally slept there. Id. When plaintiffs moved in 2009, Bobby Wortham updated his voter registration to reflect plaintiffs' new address. Id.

         On November 11, 2017, plaintiffs filed the underlying complaint alleging three causes of action: (1) breach of contract and implied covenant of good faith and fair dealing; (2) tortious bad faith claims handling; and (3) negligent marketing. (ECF No. 1).

         In the instant motion, Western Mutual moves for partial summary judgment as to plaintiffs' extra-contractual claims, or in the alternative, to bifurcate, pursuant to ...


Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.