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Bargel v. Principal Life Insurance Co.

United States District Court, E.D. Washington

November 12, 2019

LESLIE BARGEL, Plaintiff,
v.
PRINCIPAL LIFE INSURANCE COMPANY, a foreign insurer, Defendant.

          ORDER GRANTING DEFENDANT'S MOTION FOR SUMMARY JUDGMENT

          STANLEY A. BASTIAN UNITED STATES DISTRICT JUDGE.

         Before the Court is Defendant's Second Motion for Summary Judgment, ECF No. 23. The motion was heard without oral argument. Plaintiff is represented by Robb Grangroth. Defendant is represented by Patrick Cronin.

         Previously, the Court denied Defendant's Motion for Summary Judgment, finding questions of material fact existed regarding whether JoAnn Bargel made the requisite payments or whether Defendant was justified in terminating her policy. ECF No. 19. After the Order was issued, Defendant sought discovery on the amount of payment. Defendant now asserts and Plaintiff does not deny that $2, 000, not $4, 000, was paid on the policy in September 2017. ECF No. 25. As a result, Defendant moves for summary judgment.

         Motion Standard

         Summary judgment is appropriate “if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(a). Fed.R.Civ.P. 56(c). There is no genuine issue for trial unless there is sufficient evidence favoring the non-moving party for a jury to return a verdict in that party's favor. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 250 (1986). The moving party has the initial burden of showing the absence of a genuine issue of fact for trial. Celotex Corp. v. Catrett, 477 U.S. 317, 325 (1986). If the moving party meets its initial burden, the non-moving party must go beyond the pleadings and “set forth specific facts showing that there is a genuine issue for trial.” Anderson, 477 U.S. at 248.

         In addition to showing there are no questions of material fact, the moving party must also show it is entitled to judgment as a matter of law. Smith v. Univ. of Wash. Law Sch., 233 F.3d 1188, 1193 (9th Cir. 2000). The moving party is entitled to judgment as a matter of law when the non-moving party fails to make a sufficient showing on an essential element of a claim on which the non-moving party has the burden of proof. Celotex, 477 U.S. at 323. The non-moving party cannot rely on conclusory allegations alone to create an issue of material fact. Hansen v. United States, 7 F.3d 137, 138 (9th Cir. 1993).

         When considering a motion for summary judgment, a court may neither weigh the evidence nor assess credibility; instead, “the evidence of the non-movant is to be believed, and all justifiable inferences are to be drawn in his favor.” Anderson, 477 U.S. at 255.

         Interpretation of Insurance Contract

         A federal court sitting in diversity looks to the forum state's choice of law rules to determine the controlling substantive law. Patton v. Cox, 276 F.3d 493, 495 (9th Cir. 2002). Under Washington law, insurance policies are construed as contracts, and interpretation of policies is a matter of law. State Farm Gen. Ins. Co. v. Emerson, 102 Wash.2d 477, 480 (1984). Policies are to “be given a fair, reasonable, and sensible construction” that comports with how the average purchaser of insurance would view the policy. Grange Ins. Co. v. Brosseau, 113 Wash.2d 91, 95 (1989) (quotation omitted).

         The court must enforce clear and unambiguous policy language as written; it may not modify the policy or create ambiguity where none exists. Quadrant Corp. v. Am. States Ins. Co., 154 Wash.2d 165, 171 (2005). The expectations of the insured cannot override the plain language of the contract. Id. at 172. Any ambiguities are construed in favor of the insured; but a clause is ambiguous only “when, on its face, it is fairly susceptible to two different interpretations, both of which are reasonable.” Id. at 171 (citation omitted).

         Background Facts

         This action is a lawsuit for benefits under a life insurance policy that was issued to Plaintiff's mother, JoAnn Bargel, in 1990. Plaintiff is the beneficiary. JoAnn Bargel died shortly after Defendant denied her application for reinstatement after it terminated the policy for failure of payment.

         The type of life insurance that was purchased by Plaintiff's mother was a “Flexible Premium Universal Life” policy. ECF No. 23. Plaintiff purchased her policy in 1990. The Data Page had the following explanation:

*1 If sufficient premiums are paid, this policy provides life insurance protection on the insured until the maturity date, which is the policy anniversary following the birthday on which the insured attains age 95. You may have to pay other than the planned periodic premium shown above to keep this policy and coverage in force to that date, and to keep any additional benefit riders in force.

ECF No. 23.

         The policy contained provisions relating to premium payments and maintaining coverage under the policy:

“Premium Payments and Reinstatement
Your Policy is effective and your first premium is due on the policy date. After that, premiums may be paid at any time while this policy is in force and in any amounts subject to the Premium Payment Limits ...

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