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Smith v. Jackson National Life Insurance Co.

United States District Court, D. Utah

March 29, 2019

MIKEL SMITH, Plaintiff,
v.
JACKSON NATIONAL LIFE INSURANCE COMPANY, Defendant.

          MEMORANDUM DECISION AND ORDER GRANTING DEFENDANT'S MOTION FOR SUMMARY JUDGMENT (ECF NO. 17)

          EVELYN J. FURSE UNITED STATES MAGISTRATE JUDGE.

         Before the Court[1] is Defendant Jackson National Life Insurance Company's (“Jackson National”) Motion for Summary Judgment (ECF No. 17). Plaintiff Mikel Smith, the son of life insurance policyholder Mary Foxen, asserts two causes of action against Jackson National relating to the Foxen insurance policy issued in 1997 (“Foxen Policy”):

(1) violation of Utah Code § 31A-22-402(5), which mandates that an insurer send written notice of termination of coverage to the policyholder's last-known address at least thirty days before the date that the coverage terminates (first cause of action), and
(2) breach of the implied covenant of good faith and fair dealing, premised on Jackson National's alleged violation of Utah Code § 31A-22-402(5). (Compl., ECF No. 2.)

         Jackson National moves for summary judgment on both causes of action, arguing, among other things, that the Court cannot apply Utah Code § 31A-22-402(5)- which went into effect five years after issuance of the Foxen Policy-retroactively. (See Def.'s Mot. for Summ. J. (“Mot.”) 5, ECF No. 17.) As set forth in detail below, the Court agrees with Jackson National. Unless the legislature indicates otherwise-which did not happen here-substantive statutory amendments enacted after parties enter into a contract, including insurance policies, do not apply to that contract or policy. Because the Court cannot apply Utah Code § 31A-22-402(5) retroactively to the Foxen Policy, both of Mr. Smith's claims, premised on a violation of this statute, fail as a matter of law. Accordingly, the Court GRANTS Jackson National summary judgment on both causes of action.

         The Court grants summary judgment when the evidence shows “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).

         FACTUAL BACKGROUND

         Mr. Smith does not dispute any of the facts set forth in Jackson National's Statement of Undisputed Facts.[2] (Pl.'s Br. in Opp'n to Def.'s Mot. for Summ. J. (“Opp'n”) 2-3, ECF No. 18.)

         The life insurance policy at issue in this case, insuring the life of Mary Katherine Foxen, issued in 1997. (Mot., Undisputed Material Fact No. 1, ECF No. 17; Ex. A to Mot., Decl. of Linda L. Woodell (“Woodell Decl.”), ¶ 3, ECF No. 17-1; Compl. ¶ 7, ECF No. 2.) Ms. Foxen designated her son, Mr. Smith, as the beneficiary of the Foxen Policy. (Mot., Undisputed Material Fact No. 2, ECF No. 17; Woodell Decl., ¶ 5, ECF No. 17-1; Compl. ¶ 9, ECF No. 2.)

         On November 10, 2016, Jackson National mailed a document entitled “Payment Notice” to Ms. Foxen that indicated her premium payment of $29.41 was due December 9, 2016, and that the payment “must be received” by that date, or the “policy will enter its grace period and will terminate if the renewal premium is not received by the last day of the grace period . . .” (Mot., Undisputed Material Fact Nos. 3 & 4, ECF No. 17; Woodell Decl., ¶¶ 6-7, ECF No. 17-1; Ex. B to Mot., Payment Notice, ECF No. 17-2.) Ms. Foxen did not make the required premium payment. (Mot., Undisputed Material Fact No. 5, ECF No. 17; Woodell Decl., ¶ 8, ECF No. 17-1; Compl., ¶ 11, ECF No. 2.)

         On December 29, 2016, Jackson National mailed a document entitled “Second Notice Please Pay Immediately” to Ms. Foxen, indicating that her “policy has entered its grace period and will terminate if the renewal premium is not received by the last day of the grace period . . .” (Mot., Undisputed Material Fact Nos. 6 & 7, ECF No. 17; Woodell Decl., ¶¶ 9-10, ECF No. 17-1; Ex. C to Mot., Second Notice Please Pay Immediately, ECF No. 17-3.) Ms. Foxen still failed to make the required premium payment. (Mot., Undisputed Material Fact No. 8, ECF No. 17; Woodell Decl., ¶ 11, ECF No. 17-1.)

         On January 11, 2017, Jackson National mailed a document entitled “Notice of Policy Lapse” to Ms. Foxen, which stated that the policy had terminated effective January 9, 2017 since Jackson National had not received the premium due December 9, 2016. (Mot., Undisputed Material Fact No. 9, ECF No. 17; Woodell Decl., ¶¶ 12-13, ECF No. 17-1; Ex. D to Mot., Notice of Policy Lapse, ECF No. 17-4; Compl., ¶ 14, ECF No. 2.) The Notice further offered to reinstate the policy, without evidence of insurability, subject to certain conditions. (Mot., Undisputed Material Fact No. 9, ECF No. 17; Woodell Decl., ¶¶ 12-13, ECF No. 17-1; Ex. D to Mot., Notice of Policy Lapse, ECF No. 17-4.) Also on January 11, 2017, Ms. Foxen died. (Mot., Undisputed Material Fact No. 11, ECF No. 17; Compl., ¶ 15, ECF No. 2.) Jackson National never received the required payment, and no one took any other steps to reinstate the policy. (Mot., Undisputed Material Fact No. 10, ECF No. 17; Woodell Decl., ¶¶ 14-15, ECF No. 17-1.)

         DISCUSSION

         I. Mr. Smith's First Cause of Action for Violation of Utah Code ยง 31A-22- 402(5) Fails as a Matter of Law Because that Provision Does ...


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