Date: 07-03-2024

Case Style:

Jeremy Lanningham v. Farm Bureau Mutual Insurance Company of Idaho, et al.

Case Number: 50441

Judge: Samuel A. Hoagland

Court: Fourth Judical District Court, Ada County, Idaho

Plaintiff's Attorney:

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Defendant's Attorney: Benjamin C. Ritchie

Description:

Boise, Idaho personal injury lawyer represented the Plaintiff who sued on a bad faith breach of insurance contract theory.

This case concerns an insurance company's denial of a claim for underinsured motorist (UIM) coverage by the adult heirs of Jay Lanningham. Lanningham died in a tragic car accident caused by an underinsured motorist.[1] He had an insurance policy with Farm Bureau Mutual Insurance Company of Idaho that included UIM coverage (the Policy); however, Farm Bureau denied Jeremy's and Jamie's claim for UIM benefits for their father's wrongful death. On cross-motions for summary judgment, the district court granted Farm Bureau's motion, determining that Farm Bureau rightfully denied payment to Jamie and Jeremy because they did not qualify as insured persons under the Policy since they did not reside with Lanningham. We affirm the district court's judgment in favor of Farm Bureau.

The material facts are undisputed by the parties. On June 18, 2017, Lanningham was driving his Suburban near McCammon, Idaho. His fifteen-year-old granddaughter, Payton, was riding in the passenger seat with him. At the same time, a vehicle driven by fifteen-year-old Eric Neibaur was traveling toward Lanningham's vehicle. Neibaur failed to maintain his lane of travel and suddenly crossed the center lane, causing a head-on collision with Lanningham's vehicle. Lanningham, Neibaur, and Neibaur's passenger, his sister, were killed instantly. Payton survived the collision but was seriously injured.

After the accident, Neibaur's parents agreed to split their Liberty Mutual liability coverage policy limit of $100,000, which paid $50,000 to them, apparently pertaining to the death of their daughter, and $25,000 each to Lanningham's sons, Jamie and Jeremy. Lanningham's Farm Bureau policy included UIM coverage with limits of $100,000 per person and a maximum of $300,000 per occurrence. The Policy had various coverages, including Medical Payment Coverage and Collision Rollover Coverage. Lanningham was the only named insured on the Policy.

On Payton's behalf, Jamie and Jeremy submitted a UIM claim to Farm Bureau requesting the policy per person limit of $100,000. Jamie and Jeremy also each submitted personal UIM claims of $100,000 for their father's wrongful death. Subsequently, Farm Bureau sent a $100,000 check for Payton's UIM claim. Farm Bureau denied payment to Jamie and Jeremy for the wrongful death of Lanningham because they did not live with their father and therefore did not qualify as insureds under the terms of the Policy. After Farm Bureau denied Jamie's and Jeremy's personal claims, they submitted a claim in their capacity as personal representatives of Lanningham's Estate. They asserted that Lanningham was entitled to recover under the insurance contract and, therefore, as Lanningham's heirs, Jamie and Jeremy succeeded to Lanningham's contract rights against Farm Bureau. Farm Bureau denied that claim as well.

Subsequently, Jamie and Jeremy filed this lawsuit against Farm Bureau seeking, first, a declaratory judgment "that the provisions and/or exclusions relied upon by Farm Bureau to deny underinsured motorist coverage to the Plaintiffs, to the extent such provisions and/or exclusions actually exist, violate the express public policy of the State of Idaho," and second, damages for breach of the insurance contract. Both parties filed motions for summary judgment. The parties stipulated to the underlying facts and agreed that the claims presented exclusively legal questions for the district court to resolve. After oral argument, the district court granted Farm Bureau's motion for summary judgment and denied the Estate's, as well as Jamie's and Jeremy's, motion for summary judgment.

Ruling in favor of Farm Bureau, the district court stated that Jamie and Jeremy are not "persons insured" under the policy:

[Jamie and Jeremy] are in a far different situation than those insured persons the UIM statute is meant to protect. The language on which [Jamie and Jeremy] rely from Idaho Code § 41-2502(1) plainly applies to the protection of "persons insured." [Lanningham's] adult sons who do not reside with him are not "persons insured" under the Policy.

(Footnote omitted). The district court held that the Policy is consistent with the public policy of the state of Idaho as stated in Idaho Code section 41-2502 which governs underinsured motorist coverage:

[Jamie and Jeremy] criticize [Farm Bureau Mut. Ins. Co. of Idaho v. Eisenman, 153 Idaho 549, 286 P.3d 185 (2012)] for not addressing the UIM requirements set forth in [s]ection 41-2502(1). However, the plain language of this statute parallels the language in the Farm Bureau Policy at issue in that and this case. Both limit the application and protection to "persons insured" under a policy "who are legally entitled to recover damages from owners or operators of uninsured and underinsured motor vehicles." I.C. § 41-2502(1).

Jamie and Jeremy timely appealed. The Idaho Trial Lawyers Association (the amicus) filed an amicus curiae brief in support of Jamie and Jeremy.
Lanningham v. Farm Bureau Mut. Ins. Co. of Idaho, 50441 (Idaho Jul 03, 2024)

Outcome: Lanningham. We affirm the district court's judgment in favor of Farm Bureau.

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