Wilson v. Educators Mutual Insurance

2018 UT App 155THE UTAH COURT OF APPEALS
EVERETT P. WILSON JR. AND DARLA WILSON,
Appellants,
v.
EDUCATORS MUTUAL INSURANCE ASSOCIATION,
Appellee.
Opinion
No. 20150150-CA
Filed August 16, 2018
Fourth District Court, Provo Department
The Honorable Samuel D. McVey
No. 110400083
Jack C. Helgesen and Craig Helgesen, Attorneys
for Appellants
Randall R. Smart and Jeffrey A. Callister, Attorneys
for Appellee
JUDGE MICHELE M. CHRISTIANSEN FORSTER 1 authored this
Opinion, in which JUDGES GREGORY K. ORME and KATE A.
TOOMEY concurred.
CHRISTIANSEN FORSTER, Judge:
¶1 This case is before us on remand from the Utah Supreme
Court. See generally Wilson v. Educators Mutual Insurance Ass’n
(Wilson II), 2017 UT 69, 416 P.3d 355, rev’g Wilson v. Educators
Mutual Insurance Ass’n (Wilson I), 2016 UT App 38, 368 P.3d 471.
In Wilson II, our supreme court reversed this court’s
determination in Wilson I that Educators Mutual Insurance
Association (EMIA) lacked standing to pursue a subrogation
1. Due to a change in marital status, the authoring judge is now
known as Judge Michele M. Christiansen Forster.
Wilson v. Educators Mutual Insurance
action against the tortfeasor in its own name, concluding that
EMIA had standing to sue for subrogation in its own name
under the terms of the insurance policy in question. Id. ¶ 22. On
remand, we are instructed to address the parties’ remaining
contentions. Id. ¶¶ 22–23.
¶2 Appellants Everett P. Wilson Jr. and Darla Wilson
contend that EMIA’s claim was barred by Utah Code section
78B-3-107 and that the district court erred in its allocation of
interpleaded funds. Regarding their first contention, the Wilsons
have failed to provide any meaningful analysis and have
therefore failed to meet their burden of persuasion on appeal. See
Bank of Am. v. Adamson, 2017 UT 2, ¶¶ 12–13, 391 P.3d 196. As to
the Wilsons’ second contention, we conclude that the district
court did not abuse its discretion in equitably dividing the
interpleaded funds between the Wilsons and EMIA. We
therefore affirm the district court’s order allocating the
interpleaded funds.
BACKGROUND
¶3 This case began in September 2010 with the tragic death
of Jessica Wilson, who was struck by a car while walking in a
crosswalk. Jessica died at the hospital a few hours later. Jessica’s
insurance provider, EMIA, covered $78,692.34 of her medical
expenses.
¶4 In 2011, Jessica’s parents, the Wilsons, filed a wrongful
death claim against the driver of the car that struck Jessica,
seeking funeral expenses and compensation for the loss of
Jessica’s companionship, love, and affection. In 2013, the Wilsons
reached a tentative settlement with the driver’s insurer for the
$100,000 limit of his liability insurance policy.
¶5 In January 2014, EMIA filed a “Complaint for Subrogation
Claim” against the driver, seeking reimbursement for the
20150150-CA 2 2018 UT App 155Wilson v. Educators Mutual Insurance
$78,692.34 in medical expenses it had paid out on Jessica’s
behalf, with accrued interest. 2 EMIA asserted its subrogation
claim under the terms of its insurance policy with Jessica. The
driver filed a motion to dismiss, asserting that EMIA lacked
standing to bring suit in its own name. The district court denied
the driver’s motion, observing that (1) Utah Code sections 78B-2-
105, 78B-3-106, and 78B-3-107 did not apply; (2) Utah Code
section 31A-21-108 applied and allowed an insurer to bring “an
action to subrogate in either its name or the name of its insured”;
and (3) pursuant to EMIA’s insurance policy with Jessica, EMIA
“was entitled to recovery against a third-party tortfeasor.”
Consequently, the court determined that EMIA had standing to
file its lawsuit.
¶6 Eventually, the parties agreed to consolidate the cases
against the driver, and the driver filed an interpleader
counterclaim 3 against EMIA and the Wilsons, in which his
2. “The doctrine of subrogation allows an insurer, having paid a
loss resulting from a peril insured against, to step into the shoes
of its insured and recoup its losses from a tort-feasor whose
negligence caused the loss.” Birch v. Fire Ins. Exch., 2005 UT App
395, ¶ 7, 122 P.3d 696 (quotation simplified).
3. An interpleader is an action in which a person deposits money
or property claimed by others with the court so that the court
can determine the respective ownership rights of the claimants.
See Interpleader, Black’s Law Dictionary (10th ed. 2014); see also
Terry’s Sales, Inc. v. Vander Veur, 618 P.2d 29, 31 (Utah 1980)
(explaining that interpleader is an action “in which a person who
has possession of money or property which may be owned or
claimed by others seeks to rid himself of risk of liability, or
possible multiple liability, by disclaiming his interest and
submitting the matter of ownership for adjudication by the
court”).
20150150-CA 3 2018 UT App 155Wilson v. Educators Mutual Insurance
insurer agreed to interplead with the court the $100,000 policy
limit. EMIA and the Wilsons agreed to accept the $100,000 in
settlement of their claims against the driver and to dismiss him
from the lawsuit with prejudice, but they disagreed on how to
allocate the funds.
¶7 After a hearing on the matter, the district court concluded
that it was “equitable to divide the $100,000.00 equally between
the parties, specifically, $50,000.00 to the Wilsons and $50,000.00
to EMIA.” However, in recognition of the fact that the Wilsons
had “labored more than EMIA to acquire the $100,000.00 that
was deposited with [the] Court by [the driver],” the court
determined that it was “equitable to reimburse the Wilsons for
one half of their attorneys’ fees and costs from EMIA’s
portion”—$16,667 in attorney fees and $9,150.69 in costs.
Accordingly, the court awarded $75,817.69 of the interpleaded
funds to the Wilsons and $24,182.31 to EMIA. The Wilsons
appealed.
¶8 In Wilson I, this court determined that Utah Code section
31A-21-108 4 “contains no language granting an insurance
company the right to bring a subrogation action in its own
name.” 2016 UT App 38, ¶ 8, 368 P.3d 471. We also observed that
“‘it has been generally held that a suit at law to enforce [a] right
of subrogation must, at common law, be brought in the name of
the insured, rather than by the insurance company in its own
name and right.’” Id. ¶ 10 (alteration in original) (quoting
Johanson v. Cudahy Packing Co., 152 P.2d 98, 104 (Utah 1944)).
Thus, we concluded that “EMIA lacked standing to bring a
subrogation action [against the driver] in its own name rather
than in the name of Jessica or Jessica’s estate.” Id. ¶ 7. Therefore,
4. “Subrogation actions may be brought by the insurer in the
name of its insured.” Utah Code Ann. § 31A-21-108 (LexisNexis
2017).
20150150-CA 4 2018 UT App 155Wilson v. Educators Mutual Insurance
we further concluded that the district court erred in dividing the
interpleaded funds between the Wilsons and EMIA, and we
“reverse[d] the [district] court’s order and remand[ed] with
instructions for the [district] court to dismiss EMIA’s claims and
award all of the interpleaded funds to the Wilsons.” Id. ¶ 13.
Given our determination that EMIA lacked standing, we
declined to address the Wilsons’ other arguments. Id. ¶ 7. EMIA
petitioned our supreme court for certiorari, which was granted.
See Wilson II, 2017 UT 69, ¶ 7, 416 P.3d 355.
¶9 The supreme court reversed, concluding that EMIA had
standing to sue for subrogation in its own name pursuant to the
express terms of its insurance policy with Jessica Wilson. Id.¶¶ 9–10, 19. First, the court discussed the law of equitable
subrogation and observed that “[t]he law of equitable
subrogation places limits or conditions on the insurer’s right of
subrogation.” Id. ¶¶ 11–13. “One of those conditions is the
‘made-whole’ principle, which states that an insurer is at least
sometimes required to fully compensate its insured for any
losses before it asserts a claim for subrogation.” Id. ¶ 13. The
court then discussed subrogation by the express terms of a
contract and explained that “[a]n insurer and an insured may
agree to contract away the requirements of the common law of
equitable subrogation. They may provide in an insurance policy
that the insured need not be made whole before the insurer may
sue for subrogation . . . .” Id. ¶¶ 18–19. With regard to the made-
whole principle, the court explained that the principle “arise[s]
as a matter of our common law of equitable subrogation” and
that it “can be modified by contract.” Id. ¶ 18 (quotation
simplified). Observing that EMIA’s insurance policy with Jessica
“recognized EMIA’s authority ‘to pursue its own right of
Subrogation against a third party’ without regard to whether the
insured ‘is made whole by any recovery,’” the court stated that
“[i]t is difficult to imagine a clearer statement of EMIA’s
authority to sue for subrogation in its own name and without
regard to full ‘make-whole’ compensation for the Wilsons.” Id.
20150150-CA 5 2018 UT App 155Wilson v. Educators Mutual Insurance
¶ 19. Consequently, the supreme court upheld EMIA’s standing
to sue for subrogation in its own name. Id. ¶ 22. The court
remanded the case to this court with instructions to identify and
address any issues that remained for decision after Wilson II.
Id. ¶ 23.
¶10 On remand from the supreme court, we asked the parties
to submit supplemental briefing advising this court as to which,
if any, of the issues raised in the original briefing in Wilson I
remained outstanding and needed resolution. The Wilsons
identified two remaining issues: (1) whether EMIA’s claim was
barred by Utah Code section 78B-3-107, and (2) whether the
district court erred in its allocation of the interpleaded funds. 5
ANALYSIS
¶11 The Wilsons first contend that EMIA’s claim was barred
by Utah’s survival action statute, Utah Code section 78B-3-107. 6
5. Aside from brief references to this court’s decision in Wilson I,
the Wilsons’ supplemental briefing on the two identified issues
is almost identical to its original briefing on the same issues in
Wilson I.
6. Utah Code section 78B-3-107 provides,
A cause of action arising out of personal injury to a
person, or death caused by the wrongful act or
negligence of a wrongdoer, does not abate upon
the death of the wrongdoer or the injured person.
The injured person, or the personal representatives
or heirs of the person who died, has a cause of
action against the wrongdoer or the personal
representatives of the wrongdoer for special and
general damages . . . .
Utah Code Ann. § 78B-3-107(1)(a) (LexisNexis Supp. 2017).
20150150-CA 6 2018 UT App 155Wilson v. Educators Mutual Insurance
More specifically, they assert that section 78B-3-107 “expressly
gives the cause of action for a pre-death injury (all special and
general damages suffered) to ‘the personal representatives or
heirs of the person who died’” and that “[p]re-death medical
expenses are part of an injury claim.” Thus, although they do not
explicitly state as much, the Wilsons appear to be arguing that
EMIA could not seek reimbursement for the medical expenses it
paid out on Jessica’s behalf as part of its subrogation claim. We
decline to address the merits of this contention because it is
inadequately briefed.
¶12 An appellant’s brief “must explain, with reasoned
analysis supported by citations to legal authority and the record,
why the party should prevail on appeal.” Utah R. App.
P. 24(a)(8). “An appellant who fails to adequately brief an issue
will almost certainly fail to carry its burden of persuasion on
appeal.” Bank of Am. v. Adamson, 2017 UT 2, ¶ 12, 391 P.3d 196(quotation simplified). An appellant “must cite the legal
authority on which its argument is based and then provide
reasoned analysis of how that authority should apply in the
particular case, including citations to the record where
appropriate.” Id. ¶ 13; see also Hess v. Canberra Dev. Co., 2011 UT
22, ¶ 25, 254 P.3d 161 (observing that “a party’s brief must
contain meaningful legal analysis”; that “a brief must go beyond
providing conclusory statements and fully identify, analyze, and
cite its legal arguments”; and that “meaningful analysis requires
not just bald citation to authority but development of that
authority and reasoned analysis based on that authority”
(quotations simplified)).
¶13 Here, the Wilsons’ argument is devoid of any meaningful
analysis. See Hess, 2011 UT 22, ¶ 25. First, the Wilsons quote a
paragraph from this court’s decision in Wilson I, wherein we
referred to EMIA’s action as a personal injury action and stated
that EMIA should have brought the action “in the name of the
estate or intervened in the Wilsons’ action against [the driver]”
20150150-CA 7 2018 UT App 155Wilson v. Educators Mutual Insurance
instead of in its own name. See 2016 UT App 38, ¶ 12, 368 P.3d
471. However, the Wilsons have failed to provide any analysis of
that paragraph or, more importantly, to explain how it supports
their argument in light of our supreme court’s conclusion in
Wilson II that EMIA could file a subrogation action in its own
name based on the express terms of its insurance policy with
Jessica. See 2017 UT 69, ¶ 22, 416 P.3d 355. Indeed, we are
inclined to agree with EMIA that the Wilsons’ argument is
merely an “attempt to categorize EMIA’s cause of action as one
for personal injury” instead of as a subrogation action. Next, the
Wilsons simply quote Utah Code section 78B-3-107, providing
no analysis. And lastly, they assert, without providing any
pinpoint citations, that Morrison v. Perry, 140 P.2d 772 (Utah
1943), stands for the proposition that “[p]re-death medical
expenses are part of an injury claim.”
¶14 That is the extent of the Wilsons’ analysis, and it is
inadequate. As we have stated many times, “an appellate court
is not a depository in which a party may dump the burden of
argument and research.” See, e.g., Wachocki v. Luna, 2014 UT App
139, ¶ 14, 330 P.3d 717 (quotation simplified); see also State v.
Davie, 2011 UT App 380, ¶ 16, 264 P.3d 770 (“An issue is
inadequately briefed when the overall analysis of the issue is so
lacking as to shift the burden of research and argument to the
reviewing court.” (quotation simplified)). The Wilsons have
offered only bald citation to authority and conclusory statements
without any meaningful analysis—they have failed to explain
why, given the supreme court’s opinion, EMIA could not seek
reimbursement of the medical expenses it paid out on Jessica’s
behalf in its subrogation action. Consequently, they have failed
to carry their burden of persuasion on appeal.
¶15 The Wilsons next contend that the district court erred in
its allocation of the interpleaded funds. “An action in
interpleader is a proceeding in equity in which a person who has
possession of money or property which may be owned or
20150150-CA 8 2018 UT App 155Wilson v. Educators Mutual Insurance
claimed by others seeks to rid himself of risk of liability, or
possible multiple liability, by disclaiming his interest and
submitting the matter of ownership for adjudication by the
court.” Terry’s Sales, Inc. v. Vander Veur, 618 P.2d 29, 31 (Utah
1980). “When a district court fashions an equitable remedy, we
review it to determine whether the district court abused its
discretion.” Collard v. Nagle Constr., Inc., 2006 UT 72, ¶ 13, 149
P.3d 348. “This standard recognizes the district court’s unique
ability to balance facts and craft equitable remedies and our
corresponding hesitance to act as a Monday morning
quarterback in such matters.” Id. (quotation simplified).
¶16 Here, the district court found that the Wilsons suffered
damages for the loss of the love and affection of their daughter,
as well as funeral expenses, which amount exceeded the
$100,000.00 deposited with the court. The court also found that
EMIA disbursed a substantial amount 7 for Jessica’s medical
expenses. The court then noted that the $100,000 interpleaded by
the driver was “insufficient to satisfy the damages claimed by
the Wilsons and EMIA.” The court further found that the
Wilsons had been in litigation with the driver for a longer period
of time than EMIA and that the Wilsons had “labored more than
EMIA to acquire the $100,000.00 that was deposited with [the]
Court by [the driver].” Lastly, the court found that both parties
had incurred attorney fees and costs, and the Wilsons
7. The district court’s order states, “The amount of damages
claimed by EMIA for the medical expenses paid [on] behalf of
Jessica Wilson also exceed[s] $100,000.00.” The amount EMIA
sought to recoup for medical expenses in its subrogation action,
however, was $78,692.34. See supra ¶ 5. We also note that, in
briefing the issue of allocation in the district court, the parties
did not dispute that $78,692.34 represented the full amount
EMIA paid in medical expenses for Jessica.
20150150-CA 9 2018 UT App 155Wilson v. Educators Mutual Insurance
specifically had paid $33,334 in attorney fees and $18,301.38 in
litigation costs.
¶17 The district court then observed that “[i]nterpleader
actions filed pursuant to Rule 22 of the Utah Rules of Civil
Procedure are equitable in nature” and that, because the parties’
claims to the $100,000 exceeded that amount, the court had to
“balance the equities and determine how that amount should be
allocated.” Relying on its factual findings, the court stated that
“[t]he equities that should be balanced in this matter are the
Wilsons’ loss of their daughter and EMIA’s claim for
reimbursement for the medical expenses it paid out [on] behalf
of Jessica Wilson.” The court determined that it was equitable to
divide the $100,000 equally between the parties, that is,
$50,000.00 to the Wilsons and $50,000.00 to EMIA. However,
recognizing that the Wilsons’ efforts to obtain the $100,000 were
disproportionate to those of EMIA, the court further determined
that it was equitable to reimburse the Wilsons for one-half of
their attorney fees and costs from EMIA’s portion of the funds.
Accordingly, the court awarded $75,817.69 to the Wilsons and
$24,182.31 to EMIA.
¶18 The Wilsons do not challenge the district court’s factual
findings. Instead, they assert that the district court’s allocation of
the interpleaded funds was incorrect for two reasons:
(1) “wrongful death claimants have ‘superior equity’” over an
insurer attempting to enforce its subrogation rights, and (2) there
is a “priority of payment” in situations, like this one, where there
are multiple parties competing for the same settlement proceeds.
We address these arguments in turn.
¶19 First, relying on Hill v. State Farm Mutual Automobile
Insurance Co., 765 P.2d 864 (Utah 1988), the Wilsons assert that
“parents in a Utah wrongful death action have ‘superior equity’
over a subrogated insurer and are entitled to be made whole.”
We are not persuaded.
20150150-CA 10 2018 UT App 155Wilson v. Educators Mutual Insurance
¶20 In Hill, our supreme court explained that “[s]ubrogation is
an equitable doctrine and is governed by equitable principles.”
Id. at 866. “This doctrine,” the court continued, “can be modified
by contract, but in the absence of express terms to the contrary,
the insured must be made whole before the insurer is entitled to
be reimbursed from a recovery from the third-party tort-feasor.”
Id. In other words, in the absence of a clear contract to the
contrary, an insurer cannot assert its equitable subrogation rights
against a tortfeasor unless its insured has been made whole. See
id.
¶21 The equitable-subrogation and made-whole principles
described in Hill are inapplicable to this case. Indeed, in Wilson
II, our supreme court ruled that EMIA’s authority to sue for
subrogation was based in contract—EMIA’s insurance policy
with Jessica Wilson. 2017 UT 69, ¶¶ 9–10, 19, 416 P.3d 355. The
court explained that “[t]he made-whole principle . . . arise[s] as a
matter of our common law of equitable subrogation” and that
the made-whole principle “‘can be modified by contract.’” Id.
¶ 18 (quoting Hill, 765 P.2d at 866). Observing that EMIA’s
policy with Jessica specifically “recognized EMIA’s authority ‘to
pursue its own right of Subrogation against a third party’
without regard to whether the insured ‘is made whole by any
recovery,’” the supreme court stated that “[i]t is difficult to
imagine a clearer statement of EMIA’s authority to sue for
subrogation in its own name and without regard to full ‘make-
whole’ compensation for the Wilsons.” Id. ¶ 19. Because Jessica’s
policy with EMIA was sufficiently clear to contract away the
common law principles of equitable subrogation, the
made-whole principle—the general rule that the insured be
made whole before the insurer can recover from the tortfeasor—
does not apply in this case.
¶22 Second, the Wilsons assert that Utah law establishes “[a]
priority of payment in competing claims.” More specifically,
they assert that “[w]hen victims (like the Wilsons) and a
20150150-CA 11 2018 UT App 155Wilson v. Educators Mutual Insurance
subrogated insurer (like EMIA) compete for the same settlement
proceeds, Utah law establishes a priority of payment, and gives
first priority to the claimant with ‘superior equity.’” (Emphasis
omitted.) The Wilsons cite Section 5 of Article 16 of the Utah
Constitution, and Oliveras v. Caribou-Four Corners, Inc., 598 P.2d
1320 (Utah 1979), to support their “first priority” argument.
¶23 Section 5 of Article 16 of the Utah Constitution provides,
“The right of action to recover damages for injuries resulting in
death, shall never be abrogated, and the amount recoverable
shall not be subject to any statutory limitation, except in cases
where compensation for injuries resulting in death is provided
for by law.” Utah Const. art. XVI, § 5. Our supreme court has
observed that Article 16, Section 5 “enshrines two separate
protections on the right to recover for wrongful death”: (1) “that
the right to recover damages ‘shall never be abrogated’” and
(2) “that the amount of the damages ‘shall not be subject to any
statutory limitation.’” Smith v. United States, 2015 UT 68, ¶ 18,
356 P.3d 1249. The Wilsons provide no explanation or analysis as
to how either protection has been implicated or violated in this
case. Moreover, as EMIA correctly observes, the Wilsons
“provide no argument or analysis as to how Article Sixteen of
the Utah Constitution supposedly supports their proposition
that [they] have a superior right of recovery over EMIA.”
Because the Wilsons’ argument is “devoid of any meaningful
analysis,” we conclude that it is inadequately briefed and decline
to address it further. See State v. Garner, 2002 UT App 234, ¶ 12,
52 P.3d 467 (quotation simplified).
¶24 Citing Oliveras v. Caribou-Four Corners, Inc., 598 P.2d 1320(Utah 1979), the Wilsons also assert that “heirs have a superior
right to be made whole ahead of the insurer which paid medical
expenses, even in light of an arguably conflicting statutory
scheme.” But Oliveras does not stand for the proposition
advanced by the Wilsons. In that case, after the decedent was
killed in a workplace accident, the State Insurance Fund (the
20150150-CA 12 2018 UT App 155Wilson v. Educators Mutual Insurance
Fund) paid out compensation benefits to the decedent’s
dependent heirs who qualified for such benefits under the
workers’ compensation statute then in effect. Id. at 1321–22. The
decedent also had two nondependent heirs who did not receive
any worker’s compensation benefits, but they were later
awarded damages in a separate wrongful death action. Id. at
1322. The dependent heirs also received damages in the
wrongful death action. Id. The workers’ compensation statute
then in effect authorized the Fund to seek reimbursement from
any amount received in the wrongful death action “for the
payments made by the Fund to dependents.” Id. The Fund
sought to be reimbursed from both the dependent and
nondependent heirs for the compensation benefits it had paid
out. Id. The Utah Supreme Court ultimately determined that,
while the Fund was entitled to reimbursement from the
dependent heirs’ share of the recovery in the wrongful death
action, the Fund was not entitled to reimbursement from the
share of the nondependent heirs’ recovery, as the nondependent
heirs had received no workers’ compensation benefits from the
Fund. See id. at 1324–25.
¶25 Essentially, the Oliveras case dealt with the Fund’s
statutory right to reimbursement from certain heirs and the
limitations of those rights as against other heirs. As EMIA
correctly observes, Oliveras had nothing to do “with the general
priority of an heir’s claim versus an insurer’s claim against a
third-party tortfeasor.” Accordingly, we conclude that Oliveras is
inapplicable to the present case. The Wilsons have not cited any
other authority to support their “first priority” argument, and
they have therefore failed to demonstrate that they have a
superior right to the interpleaded funds.
¶26 Turning to the district court’s equitable allocation of the
interpleaded funds, as previously discussed, “[w]hen a district
court fashions an equitable remedy, we review it to determine
whether the district court abused its discretion.” Collard v. Nagle
20150150-CA 13 2018 UT App 155Wilson v. Educators Mutual Insurance
Constr., Inc., 2006 UT 72, ¶ 13, 149 P.3d 348. Here, the district
court recognized that the interpleaded funds were insufficient to
satisfy either of the Wilsons’ or EMIA’s claims, and it divided
the funds equally between the parties. The court then equitably
reimbursed the Wilsons, out of EMIA’s portion of the funds, for
one-half of their attorney fees and costs. Although equity might
have countenanced the court awarding more of the interpleaded
funds to the Wilsons, equity did not demand that the court do
so. The Wilsons received approximately three-fourths of the
interpleaded funds, and we are unable to conclude that the court
abused its discretion in allocating the funds as it did. See id.CONCLUSION
¶27 We conclude that the Wilsons’ argument that EMIA’s
claim was barred by Utah Code section 78B-3-107 is
inadequately briefed. We further conclude that the district court
acted within its discretion in allocating the interpleaded funds.
We therefore affirm the district court’s allocation of those funds.
20150150-CA 14 2018 UT App 155