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IN THE SUPREME COURT OF THE STATE OF IDAHO
Docket No. 34970-2008
LESLIE WEINSTEIN and LINDA                                                                          )
WEINSTEIN, husband and wife,                                                                        )   Boise, January 2010 Term
individually and as guardians ad litem for                                                          )
SARAH WEINSTEIN,                                                                                    )   2010 Opinion No.   61
)
Plaintiffs-Respondents-Cross Appellants,                                                            )   Filed: June 1, 2010
)
v.                                                                                                  )   Stephen W. Kenyon, Clerk
)
PRUDENTIAL PROPERTY AND                                                                             )
CASUALTY INSURANCE COMPANY,                                                                         )
PRUDENTIAL GENERAL INSURANCE                                                                        )
COMPANY, LIBERTY MUTUAL                                                                             )
INSURANCE COMPANY, and LM                                                                           )
PROPERTY AND CASUALTY                                                                               )
INSURANCE,                                                                                          )
)
Defendants-Appellants-Cross Respondents.                                                            )
                                                                                                    )
Appeal from the District Court of the Fourth Judicial District of the State of
Idaho, in and for Ada County.  The Hon. Darla S. Williamson, District Judge.
The judgment of the district court is affirmed in part and vacated in part.
Anderson, Julian & Hull LLP, Boise, for appellants.  Robert A. Anderson argued.
Risch Pisca, PLLC, and Goss Gustavel Goss, PLLC, Boise, for respondents.
John Insinger argued.
EISMANN, Chief Justice.
This is an appeal from a judgment for compensatory damages for breach of an insurance
contract, from an award of punitive damages for insurance bad faith, and from the award of
attorney fees.   The district court ordered a new trial on punitive damages unless the plaintiffs
accepted a remittitur, and they cross appeal from that order.    We affirm the judgment for
compensatory damages, we vacate the award of attorney fees, we deny the cross appeal, we




affirm the amount of punitive damages determined by the district court to be consistent with due
process, and we vacate the plaintiffs‘ option to request a new trial on punitive damages.
I.  FACTS AND PROCEDURAL HISTORY
On September 30, 2002, an uninsured, sixteen-year-old driver with a suspended license
pulled out of a private driveway onto a public street and negligently failed to yield to a pickup,
striking it  and causing  it  to  collide with  an automobile in  which Sarah Weinstein  was a
passenger.   The automobile was owned by Sarah‘s parents, Leslie and Linda Weinstein (―the
Weinsteins‖), and was being operated by Mrs. Weinstein.   Both Sarah and Mrs. Weinstein were
injured in the collision.  They were taken by ambulance to a hospital, but were released that day.
At the time of the accident, they were insured under a policy of automobile insurance
issued by Prudential Property and Casualty Insurance Company, which was later purchased by
Liberty Mutual Insurance Company on November 1, 2003.   In this lawsuit, the parties have
treated the insurance companies as if they were one company, and so we will refer to them as
one company called  ―Liberty Mutual.‖    The insurance policy provided  $5,000 in medical
(―MedPay‖) coverage per person and  $250,000 in uninsured motorist  (―UM‖) coverage per
person for bodily injury.
The Weinsteins promptly notified Liberty Mutual of the accident, and the following day
it determined that the accident had been caused by an uninsured driver.   It also sent ―Parent of
Sarah Weinstein‖ a letter stating that the MedPay provision required that any medical bills first
be submitted to the Weinsteins‘ health insurance carrier and that it would only pay for any
uncovered or disallowed items, assuming they were reasonable and necessary expenses.
Liberty Mutual assigned a UM adjuster to be in contact with the Weinsteins.    On
November 11, 2002, the adjuster sent the Weinsteins a letter asking for copies of all of their
medical bills and for them to sign and return a form authorizing Liberty Mutual to obtain medical
records  from  Sarah‘s  treatment  providers.    Mrs.  Weinstein  signed  the  medical  release  on
December 5, 2002, and sent it to the adjuster along with a list of medical providers.   At the
adjuster‘s request, Mrs. Weinstein later provided two other medical authorizations, the last so the
adjuster could obtain records from the MedPay unit.   Liberty Mutual did not use any of the
medical authorizations or attempt to obtain any medical records from any providers.  Some of the
medical bills and records submitted by the Weinsteins were received by the UM adjuster, who
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sent them to the MedPay unit.   The UM adjuster later attempted unsuccessfully several times to
have the MedPay unit send her the MedPay file.
On January 2, 2003, Mrs. Weinstein told the adjuster that the Weinsteins were receiving
threatening telephone calls concerning unpaid medical bills and that she and Sarah were still
receiving treatment.   Liberty Mutual responded on February 12, 2003, by sending the Weinsteins
a letter stating that if it did not receive any new medical bills within thirty days it would close the
MedPay file.   Twelve days later it closed the file because the Weinsteins had not yet responded
to the letter.
Sarah had injured her left hip in the accident and had been receiving physical therapy.   In
February 2003, her therapist released her to resume physical activities as tolerated.   When she
resumed training for and playing soccer, her favorite sport, her hip pain returned.   She was only
able to play ten minutes per half, and ultimately had to quit playing entirely.   Mrs. Weinstein
sought further medical treatment for her.
In April 2003,  Mrs. Weinstein notified the adjuster that a magnetic resonance imaging
scan indicated that Sarah may require hip surgery.    The following month, Mrs. Weinstein
informed the adjuster that a second scan showed that Sarah had suffered a labial tear of her left
hip and that she would need surgery.   Liberty Mutual responded by increasing its reserve for
Sarah‘s UM claim to $25,000.  Sarah had the surgery on May 19, 2003.
Prior  to  April                                                                                          2003,  Liberty  Mutual  incorrectly  believed  that  the  insurance  policy
provided that it did not have to pay Sarah‘s medical expenses until the bills were first submitted
to and denied or only partially paid by her health insurance carrier.  In April 2003, it realized that
such provision in the policy did not apply to Sarah.   It only applied to the Weinsteins as the
named insureds, not to passengers in their insured vehicles.   Liberty Mutual did not make any
payments under the MedPay coverage until April 2, 2003.  Prior to that time, it had sent letters to
Sarah‘s medical providers stating that it was ―unable to make payment for these charges at this
time,‖ but if Sarah‘s health carrier denied payment or made only partial payment, the provider
should ―resubmit the bill along with the health carrier‘s Explanation of Benefits.‖
Mr. Weinstein was self-employed in a business providing services to the airline industry,
and his business was struggling financially as a result of the terrorist attacks of September 11,
2001.   From May 2003 on, the Weinsteins received regular telephone calls and demand letters
from medical billing departments and collection agencies regarding the overdue medical bills.
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On one occasion as Mrs. Weinstein was leaving a doctor‘s office with Sarah, a staff member
loudly and publicly told Mrs. Weinstein that if she did not pay her outstanding bill in full
immediately, the doctor would no longer treat Sarah.   Although Mrs. Weinstein notified Liberty
Mutual of this incident, it did nothing.   These events caused Mrs. Weinstein to feel depressed
and cry, and the grief, stress, and embarrassment resulted in marital discord and family turmoil.
It was Liberty Mutual‘s policy to exhaust the MedPay coverage before making any
payment under the UM coverage and to not make any payments under the UM coverage until the
insured  desired  to  settle  the  entire  UM  claim.    Sarah‘s  MedPay benefits  of                $5,000  were
exhausted on September 3, 2003, when Liberty Mutual made a partial payment to the hospital for
her surgery.   Thereafter, Liberty Mutual sent Sarah‘s medical providers letters stating that her
―maximum policy limits of $5,000 for medical expenses related to this accident have been paid
and no further payments can be made.   You may wish to contact this patient or the appropriate
health insurance carrier for payment of future bills.‖   Liberty Mutual did not include in these
letters the fact that Sarah had ample UM coverage to pay the medical bills.
On September 3, 2003, Mrs. Weinstein called the adjuster and told her that collection
agencies were after them, that their credit was ruined, that Liberty Mutual took a lot of time to
decide to pay the bills under the MedPay coverage, and that it should pay the remaining bills
under the UM coverage.   The adjuster answered that Liberty Mutual would not pay under the
UM coverage until the Weinsteins were ready to settle the entire claim.
The Weinsteins contacted attorney Bruce Bistline to represent them.   By letter dated
October 10, 2003, he informed Liberty Mutual that he was representing the Weinsteins.   On
October 21, 2003, Liberty Mutual increased its reserve for Sarah‘s UM claim to $50,000.
On October  28,  2003, Bistline sent the adjuster a letter seeking information, listing
unpaid medical bills, and stating that he was not aware of any reason why the bills should not be
paid from the UM coverage.   The adjuster later responded that it was not Liberty Mutual‘s
practice to do so.
On  April  20,  2004,  Bistline  sent  the  adjuster  a  letter  accompanied  by a  notebook
containing medical bills and records.   In the letter he demanded payment of $16,669.64, which
represented the unpaid bills as of November 20, 2003, including interest.   Liberty Mutual did not
pay any of the bills, but on June 7, 2004, it did increase its reserve for Sarah‘s UM claim to
$75,000.
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On June 11, 2004, a new UM adjuster sent Bistline a letter stating that she was now
handling Sarah‘s UM claim, that Liberty Mutual ―will afford the policy‘s Uninsured Motorist
coverage with limits of $250,000 per person,‖ that it had ―no legal obligation‖ to pay Sarah‘s
medical expenses, and that it ―will offer a $10,000 payment in advance on Ms Weinstein‘s future
settlement‖ if her parents signed the enclosed form.   The letter added, ―We will evaluate Ms
Weinstein‘s damages when her medical treatment is completed or when you submit a settlement
demand with all the medical documentation and proofs.‖
The form enclosed with the letter required the Weinsteins to agree, among other things,
that the payment ―does not constitute an admission of any liability by the uninsured motorist . . .
for any damages Sarah Weinstein has sustained in the above-described [9/30/02] accident‖ and
that Liberty Mutual ―reserves all of its rights including, but not limited to, defenses which may
be applicable to this claim.‖   Bistline responded by letter dated July 7, 2004, stating that the
Weinsteins did not believe they had a duty to agree to anything in order to receive payments due
under the policy and that they cannot wait any longer due to the statute of limitations.   They had
therefore instructed him to file a lawsuit, which he had done.    He enclosed a copy of the
complaint with the letter.   Later, the Weinsteins‘ current counsel replaced Bistline.   The above
does not list all of the contacts between Liberty Mutual and the Weinsteins or their counsel
before this lawsuit was filed.
On January 5,  2005, Liberty Mutual paid the Weinsteins the sum of $80,000.   That
payment was $60,000 for Sarah‘s injuries; $17,000 for prejudgment interest; and $3,000 for
attorney fees.
This case was ultimately tried to a jury in September 2007.   It returned a special verdict
finding: (a) that Liberty Mutual had breached the MedPay provisions in the insurance policy but
had not committed bad faith in handling the MedPay coverage; (b) that Liberty Mutual had
breached the UM provisions in the insurance policy and had committed bad faith in handling the
UM coverage; (c) that the Weinsteins have suffered damages totaling $210,000 as a result of
Liberty Mutual‘s bad faith;  (d) that they were entitled to punitive damages in the sum of
$6,000,000; and (e) that Sarah sustained damages in the sum of $250,000 as a result of the
accident.
On October  1,  2007, the court entered judgment in favor of the Weinsteins against
Liberty Mutual in the sum of $6,210,000, and on October 19, 2007, it entered judgment in favor
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of Sarah against Liberty Mutual in the sum of $165,000.   The court later entered an amended
judgment in favor of Sarah in the sum of $182,225.48 to correct certain calculations and add
prejudgment interest, and in addition it also awarded her  $84,150.00 in attorney fees and
$2,958.15 in court costs.
Liberty Mutual filed motions for a new trial, for judgment notwithstanding the verdict,
and for a remittitur.   The district court denied the motions, except that it granted a new trial on
punitive damages  if  the Weinsteins  would not  accept  a  reduction in  punitive damages  to
$1,890,000.  Liberty Mutual appealed and the Weinsteins cross-appealed.
II.  ISSUES ON APPEAL
1.   Did the district court err in permitting the Weinsteins to amend their complaint to add a claim
for punitive damages?
2.   Did the district court err in failing to grant a mistrial or a new trial due to the Weinsteins
providing annotated exhibits to the jury?
3.  Did the district court err in instructing the jury?
4.   Did the district court err in failing to grant Liberty Mutual‘s motions for a directed verdict,
judgment notwithstanding the verdict, or new trial because the Weinsteins failed to prove a claim
of bad faith?
5.   Did the district court err in failing to grant Liberty Mutual‘s motions for a directed verdict,
judgment notwithstanding the verdict, or new trial because the Weinsteins failed to prove or
mitigate their damages?
6.  Did the district court err in awarding Sarah attorney fees pursuant to Idaho Code § 41-1839?
7.  Did the district court err in refusing to apply Idaho Code §§ 6-1604(1) & (3) to this action?
8.  Did the district court err in failing to grant a new trial on the ground of juror misconduct?
9.   Should this Court vacate the award of punitive damages on the ground that the Weinsteins
failed to prove unconscionable conduct by clear and convincing evidence?
10.   Should the award of punitive damages be set aside due to errors in jury instructions and in
admitting evidence?
11.  Did the remitted award of punitive damages in the sum of $1,890,000 violate due process?
12.   Did the district court err in granting a new trial on punitive damages if the Weinsteins do not
accept the sum of $1,890,000 in punitive damages?
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III.  ANALYSIS
A.   Did the District Court Err in Permitting the Weinsteins to Amend Their Complaint to
Add a Claim for Punitive Damages?
Liberty Mutual contends that the district court erred in permitting the Weinsteins to
amend their complaint to add a claim for punitive damages.    Liberty Mutual‘s argument,
however, addresses two separate amendments of the complaint.
First, Liberty Mutual asserts, ―The court abused its discretion in allowing Plaintiffs to
amend their Complaint to cure certain defects in their pleadings (i.e., limiting their cause of
action to events after September 3, 2003) during the summary judgment hearing, and after the
deadline set by the court for amended pleadings.‖  This rather cursory argument apparently refers
to the district court permitting the Weinsteins to file a third amended complaint.
During argument on Liberty Mutual‘s motion for summary judgment on April 25, 2007,
an issue arose as to whether the second amended complaint alleged a bad faith claim with respect
to the MedPay coverage.    Weinstein‘s counsel then orally moved to file a third amended
complaint to eliminate any issue in that regard.   During the hearing on that motion on May 2,
2007, Liberty Mutual objected that the motion was untimely and that Liberty Mutual would be
prejudiced by the amendment.   The district court found that the motion was made six or seven
days after the deadline for filing motions, that Liberty Mutual had not shown any prejudice, and
that there was adequate time to conduct any additional discovery that may be needed if the
amendment was granted.   The trial was scheduled to begin in mid-September.   It also found that
there was good cause for permitting the amendment because Liberty Mutual had been aware
since at least December 2006 that MedPay was an issue and because the court had indicated
during a hearing in December 2006 that the allegations in the second amended complaint were
sufficient to raise the issue of Liberty Mutual‘s handling of the MedPay coverage.
Rule 16(b)(7) of the Idaho Rules of Civil Procedure states that a scheduling order may be
modified for good cause.   In addition, alleged errors not affecting substantial rights will be
disregarded.   Vendelin v. Costco Wholesale Corp., 140 Idaho 416, 426, 95 P.3d 34, 44 (2004).
Liberty  Mutual  has  failed  to  show  either  that  the  district  court  abused  its  discretion  in
considering the late-filed motion or that it was prejudiced by the granting of the motion.
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Second, on May 2, 2007, the district court also heard the Weinsteins‘ motion to amend
their complaint to add a claim for punitive damages.   The court granted that motion, and the
Weinsteins filed their fourth amended complaint adding that claim on the same date.   Liberty
Mutual  contends,  ―Allowing  Plaintiffs  to  argue  for  punitive  damages  at  trial  changed  the
character of the trial and prejudiced Defendants as a result.‖   In this cursory allegation, Liberty
Mutual does not attempt to explain how the character of the trial was changed or how it was
allegedly prejudiced.
Idaho Code  §  6-1604(2) provides,  ―The court shall allow the motion to amend the
pleadings [to add a claim for punitive damages] if, after weighing the evidence presented, the
court concludes that, the moving party has established at such hearing a reasonable likelihood of
proving facts at trial sufficient to support an award of punitive damages.‖   A trial court‘s ruling
on a motion to amend a complaint to add a claim for punitive damages is reviewed for an abuse
of discretion.   Todd v. Sullivan Constr. LLC, 146 Idaho 118, 121, 191 P.3d 196, 199 (2008).
Liberty Mutual‘s unsupported statement that it was prejudiced by the amendment is insufficient
to show an abuse of discretion.
B.   Did the District Court Err in Failing to Grant a Mistrial or a New Trial Due to the
Weinsteins Providing Annotated Exhibits to the Jury?
During the second day of trial on September 18, 2007, Weinsteins‘ counsel asked if he
could distribute to the jurors copies of a white binder containing exhibits that had been admitted.
The district court asked Liberty Mutual‘s attorney if he had any objection, and he stated that he
did not.    Three days later, after the jury was excused for lunch, Liberty Mutual‘s counsel
addressed the court stating that he had seen one of the jurors reviewing the exhibit list in his
white binder and had noticed that the list had annotations on it.   Counsel recited an example of
the annotations as follows:                                                                            ―Exhibit 63, Linda [Weinstein] mailed medical authorization form to
Kempczenski [UM adjuster] to print.   Kempczenski never used it.                                       9/2/03 UM adjuster log, first
entry since 5/12/03.‖  Counsel then moved for a mistrial.
Weinsteins‘ counsel responded that there was nothing on the exhibit list that was not in
the record; that when asking to distribute the binders to the jury he had stated that the binders
included the chronology and exhibit list that had been provided to the court; and that Liberty
Mutual‘s counsel had not objected.   He suggested that they just collect the notebooks from the
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jurors, instruct them to disregard anything in them, and then address the issue at a later time.
Liberty Mutual‘s counsel responded that he was sticking with his motion.   The court stated that
before ruling on the motion it wanted to listen to the tape recording of what occurred when the
Weinsteins‘ counsel asked to distribute the binders to the jurors.   Liberty Mutual‘s counsel
suggested that they complete the day of testimony and address the issue the following Monday,
and the court agreed.
After  the  jurors  returned  from  lunch,  the  district  court  had  the  bailiff  collect  the
notebooks from the jurors.  The court then instructed the jury as follows, ―Ladies and gentlemen,
in the event that you had read any of the narrative statements on that chronology and exhibit list,
you are instructed at this time to disregard any of those statements that you read.‖
On the following Monday, the district court took up the motion for a mistrial.   The court
recited what had occurred as follows:
THE COURT:  I went back and listened to the recording and Mr. Risch had asked
that the plaintiffs‘ exhibit be published and be presented to the jury.  There was no
objection to that.
And then, right after that, you had asked for a sidebar, and then right after
that,  Mr.  Risch  indicated  that  he  was  also  providing  them  a  copy  of  the
chronology and exhibit list, and there was no response in regards to that.
So I think probably, Mr. Anderson, you were distracted because you had
asked for a sidebar.   I think that‘s probably why you didn‘t say anything, but he
did put that on the record that he was providing that document to them.
I have looked at these, all of the chronology and exhibit list.  We‘ve gotten
all of these from the jury, and I couldn‘t find any of them that had been marked on
or highlighted.  I had instructed the jury to disregard them.
MR. ANDERSON:   For the record, I saw the juror in front highlighting
his copy.
THE COURT:  Well, and he‘s the juror that we‘re going to excuse also.1
The court then denied the motion for a mistrial for the following reasons:                            (1) it had
instructed the jury to disregard the chronology and exhibit list; (2) the binders were retrieved
from the jurors and it did not appear that any other juror had written or highlighted anything in
the binders; (3) the juror who had highlighted in his binder was going to be excused anyway and
what he had highlighted coincided with the evidence; and (4) Liberty Mutual‘s attorney had not
objected to distributing to the jury the binders with the chronology and exhibit list.
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Liberty Mutual moved for a new trial alleging, as one of the grounds, that distributing the
notebooks  to  the  jurors  with  the  annotated  exhibit  list  constituted  an  irregularity  in  the
proceedings that deprived it of a fair trial.   The district court refused to grant a new trial on the
same grounds that it had denied the motion for a mistrial.
―[A] motion for mistrial is directed to the trial court‘s judicial discretion, and the trial
court‘s ruling will not be disturbed unless there be shown such an abuse of discretion that
defendant‘s rights are prejudiced.‖   Barry v. Arrow Transp. Co., 83 Idaho 41, 46-47, 358 P.2d
1041, 1045 (1960) (citations omitted).   Liberty Mutual recites that the district court abused its
discretion in denying the motion for mistrial, but it presents no argument to support that recital.
During oral argument, counsel for Liberty Mutual was asked, ―Was there anything ever in those
notations that was not proven by the plaintiff?,‖ and he responded, ―Most likely not.‖   Liberty
Mutual has not shown that its substantial rights were affected by the distribution of the annotated
exhibit list to the jurors or that the district court abused its discretion in denying the motion for a
mistrial or for a new trial.
C.  Did the District Court Err in Instructing the Jury?
1.   Failing to give Liberty Mutual’s requested instruction defining severe emotional
distress.   The district court instructed the jury regarding the elements that must be proved in
order for the Weinsteins to recover damages for emotional distress.    The instruction was a
verbatim statement of the elements that this Court listed in Evans v. Twin Falls County, 118
Idaho 210, 220, 796 P.2d 87, 97 (1990).   Liberty Mutual requested as its supplemental jury
instruction No. 9 an additional instruction stating, ―A defendant is liable for emotional distress
only where the distress inflicted is so severe that no reasonable person could be expected to
endure it.‖
The proposed jury instruction comes from comment j to Section 46 of the Restatement
(Second) of Torts (1965), which this Court quoted in Evans v. Twin Falls County, 118 Idaho 210,
220, 796 P.2d 87, 97 (1990).   It was included in the comment in juxtaposition to the statement
―Complete emotional tranquillity is seldom attainable in this world, and some degree of transient
1 The juror was scheduled to be excused on Wednesday so he could attend a funeral out-of-state.    The court
apparently wanted to wait until Wednesday before excusing him in case something prevented another juror from
serving to the completion of the trial.   He was excused and did not participate in jury deliberations.
10




and trivial emotional distress is a part of the price of living among people‖ to explain that
emotional distress must be severe, not simply the level of distress that people are expected to put
up with in society.   We have never held that the jury should be instructed regarding the text of
comment j, and using Liberty Mutual‘s proposed instruction out of context could lead a jury to
conclude that emotional distress is only severe if it leads to a psychological disorder.   We have
not required evidence of a psychological disorder in order to recover damages for emotional
distress intentionally caused.   See Walston v. Monumental Life Ins. Co., 129 Idaho 211, 220, 923
P.2d 456, 465 (1996) (award of damages for intentional infliction of emotional distress upheld
where insurer ―impugned [insured‘s] character and drew him into a prolonged dispute when he
was grieving the loss of his wife‖).
Liberty Mutual‘s entire argument in its opening brief regarding this alleged error is, ―The
court also erred by not instructing the jury as to the elements required to prove the intentional
infliction of emotional distress as requested by Defendants‘ Supplemental Jury Instruction No.
9.‖   It has not presented any argument as to why the trial court‘s instructions were not sufficient.
―We will not consider assignments of error not supported by argument and authority in the
opening brief.‖  Hogg v. Wolske, 142 Idaho 549, 559, 130 P.3d 1087, 1097 (2006).
2.   Instructing the jury on the Unfair Claim Settlement Practices Act.   The district
court instructed the jury regarding the provisions of the Idaho Unfair Claim Settlement Practices
Act, I.C. § 41-1329.  Liberty Mutual contends that the district court erred in doing so because the
instruction                                                                                             ―improperly  created  a  private  cause  of  action  in  that  the  jury  was  essentially
instructed that violation of the Act justified imposition of liability.‖   In White v. Unigard Mutual
Insurance Co., 112 Idaho 94, 101, 730 P.2d 1014, 1021 (1986), we held that the Act ―does not
give rise to a private right of action whereby an insured can sue an insurer for statutory violations
committed in connection with the settlement of the insured‘s claim.‖   Accordingly, in this case
the district court instructed the jury, ―Violation of any of the above [provisions of the Act] does
not give rise to a right to sue.   The above are the standards of the insurance industry and may be
considered by you only in  your deliberations to determine whether there was an extreme
deviation from industry standards which warrants punitive damages.‖   The district court did not
instruct the jury that the Act created a private cause of action.
Liberty Mutual also contends that the instruction ―constituted an improper statement of
law and/or improper comment on the evidence by the judge by instructing the jury as to a
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standard of care.‖   It was not error for the judge to instruct the jury as to the applicable law.           ―A
trial court has the duty to properly instruct the jury on the law applicable to the case before it.‖
Sulik v. Central Valley Farms, Inc., 95 Idaho 826, 828, 521 P.2d 144, 146 (1974).   In Inland
Group of Companies, Inc. v. Providence Washington Insurance Co., 133 Idaho 249, 258, 985
P.2d 674, 683 (1999), we held that testimony regarding the Unfair Claim Settlement Practices
Act to establish insurance industry standards was admissible in an insurance bad faith case.
Liberty Mutual contends that while the provisions of the Act can be presented through testimony,
it is improper for the court to instruct the jury regarding the Act‘s provisions.   It argues, ―The
trial court‘s inclusion of the Act in the jury instructions changed the Act from potential evidence
of the industry standard to the law governing bad faith claims.‖  The Act is not simply ―potential
evidence of the industry standard.‖   It is a legislative enactment establishing insurance industry
standards.   The district court did not err in instructing the jury as to its provisions.   Interestingly,
Liberty Mutual‘s manual entitled ―Uninsured and Underinsured Motorist Claims and the Process
of Good Faith Claims Handling‖ affirms that a claim for violation of the implied covenant of
good faith and fair dealing ―can also be supported by demonstrating violations of unfair claims
settlement practices statutes . . . even though these statutes . . . don‘t independently support a
private cause of action against an insurance company.‖
3.   Failing to instruct the jury regarding corporate liability for punitive damages.  In
Griff, Inc. v. Curry Bean Co., Inc., 138 Idaho 315, 321, 63 P.3d 441, 447 (2003), this Court
stated, ―To recover punitive damages against a corporation, one must show that an officer or
director participated in, or ratified, the conduct underlying the punitive damage award.‖   Liberty
Mutual submitted a proposed instruction stating,  ―To recover punitive damages against the
Defendants, Plaintiffs must show that an officer or director of the Defendant corporations
participated in, or ratified, the conduct underlying the conduct underlying  [sic] the punitive
damage award, if any, having at the time knowledge of all material facts.‖   The district court
refused to give the instruction on the ground that there was sufficient evidence in the record
showing Liberty Mutual‘s corporate policies.
Although we have not addressed the issue of whether recovery of punitive damages for
insurance bad faith requires evidence that an officer or director participated in, or ratified, the
conduct constituting bad faith, neither party asserts that insurance corporations should be treated
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differently from other corporations with respect to this requirement, and we agree.   The district
court should have instructed the jury on this issue.
An error in the jury instructions that does not affect a substantial right of a party is
disregarded as harmless error.   Smith v. Mitton, 140 Idaho 893, 901, 104 P.3d 367, 375 (2004);
Lubcke v. Boise City/Ada County Housing Auth., 124 Idaho 450, 459, 860 P.2d 653, 662 (1993);
Neff v. Hysen, 72 Idaho 470, 474-75, 244 P.2d 146, 148-49 (1952).   Liberty Mutual does not
contend that there was any conflicting evidence on this issue.  It contends that there was a lack of
sufficient evidence to establish corporate liability for punitive damages.
The jury found that Liberty Mutual did not commit bad faith in handling the MedPay
coverage, but it did commit bad faith in handling the UM coverage.  The issue with respect to the
UM coverage was whether Liberty Mutual committed the tort of bad faith by refusing to pay
undisputed medical bills before settlement of the entire UM claim.
The adjuster who handled the claim in this case from its inception until June 11, 2004,
had worked for the company since May 1975.   She testified that the company had a standard
practice for handling UM claims, that it was the company‘s practice not to pay undisputed
medical bills from UM coverage until the entire UM claim was settled, and that to the best of her
knowledge she handled this claim in the way the company wanted it handled.   Her supervisor,
who had worked for the company for about twenty-eight years, testified that it was the company
practice not to pay undisputed medical bills under UM coverage until it settled the total UM
claim, even if the insured was incurring medical bills for two or three years.  A third witness had
worked for the company from 1978 until September 2005 and was a UM adjuster during the time
at issue in this case.   She handled this claim beginning in June 2004 and testified that she had
reviewed the handling of the UM claim in this case and it was handled in the way she was
trained to handle claims.
Liberty Mutual contends that this testimony was not sufficient to show corporate liability
for punitive damages.   It apparently contends that the Weinsteins were required to present direct
evidence that an officer or director approved of the corporate policy.    It argues,  ―Plaintiffs
presented no evidence showing ratification, let alone knowledge, by officers and directors of any
of the Defendant corporations.‖   It dismisses the testimony of the former employee because she
was ―not a corporate officer/director.‖
13




There need not be direct evidence that an officer or director participated in or ratified the
wrongful conduct in order to sustain an award of punitive damages against the corporation.   In
Vendelin v. Costco Wholesale Corp., 140 Idaho 416, 95 P.3d 34 (2004), this Court upheld an
award of punitive damages in an action to recover damages for personal injuries caused when a
store display of garden stepping stones partially collapsed and fell against the plaintiff.   The
defendant challenged the award of punitive damages on the ground that there was no evidence
showing that an officer or director had participated in, or ratified, the conduct upon which the
award was based.   In affirming the award, we did not require direct evidence that an officer or
director had participated in, or ratified, the improper manner of stacking the stepping stones.
Rather, we stated:
There is substantial evidence that Costco personnel are improperly trained, or not
trained at all, in proper stocking techniques or in recognizing and correcting the
hazards of falling merchandise.   There is also substantial evidence from which to
infer that this deviation was the cause of numerous accidents involving falling
merchandise.   The establishment of adequate employee training procedures is
ultimately the  responsibility of  Costco‘s  corporate  management.    Under  the
circumstances, Costco, as a corporation, was either aware or should have been
aware  that  it  lacked  adequate  training  procedures  and  that  this  deficiency
increased  the  likelihood  that  Costco  customers  would  be  injured  by  falling
merchandise.
In this case, there was undisputed testimony from the two UM adjusters and their
supervisor that it was company policy not to pay any medical expenses out of UM coverage until
the entire UM claim was settled.   That was sufficient to establish corporate liability for punitive
damages regarding the handling of the UM coverage.   Because that evidence was undisputed, it
was harmless error for the district court to fail to instruct the jury regarding the requirements for
holding a corporation liable for punitive damages.
D.   Did the District Court Err in Failing to Grant Liberty Mutual’s Motions for a Directed
Verdict, Judgment Notwithstanding the Verdict, or New Trial Because the Weinsteins
Failed to Prove a Claim of Bad Faith?
At the end of the Weinsteins‘ case, Liberty Mutual moved for a directed verdict on the
issue of bad faith.  After the trial, it moved for a judgment notwithstanding the verdict and a new
14




trial on the issue of bad faith.   The motion for a new trial on that issue was based upon the
alleged insufficiency of the evidence to justify the verdict.
―In reviewing a decision to grant or deny a motion for directed verdict or a judgment
notwithstanding the verdict, this Court applies the same standard as that applied by the trial court
when originally ruling on the motion.‖   Waterman v. Nationwide Mut. Ins. Co., 146 Idaho 667,
672, 201 P.3d 640, 645 (2009).   ―[W]e determine whether there was sufficient evidence to justify
submitting the claim to the jury, viewing as true all adverse evidence and drawing every
legitimate inference in favor of the party opposing the motion for a directed verdict.‖   Todd v.
Sullivan Constr. LLC, 146 Idaho 118, 124, 191 P.3d 196, 202 (2008).   This Court ―must simply
determine whether there is  substantial  evidence to  support the jury‘s  verdict.    Substantial
evidence is such relevant evidence as a reasonable mind might accept as adequate to support a
conclusion.‖   Howell v. Eastern Idaho R.R., Inc., 135 Idaho 733, 737, 24 P.3d 50, 54 (2001)
(citation omitted).
A trial judge may grant a new trial on the ground that the evidence was insufficient to
justify the verdict if:                                                                                (a) ―after making his or her own assessment of the credibility of the
witnesses and weighing the evidence, the judge determines that the verdict is not in accord with
the clear weight of the evidence‖ and (b) the judge ―conclude[s] that a different result would
follow a retrial.‖   Hudelson v. Delta Intl. Mach. Corp., 142 Idaho 244, 248, 127 P.3d 147, 151
(2005)  (citation omitted).    We review a trial court‘s decision under an abuse-of-discretion
standard.  Id.
In order for a first-party insured to recover on a bad faith claim, the insured must show:
―1) the insurer intentionally and unreasonably denied or withheld payment; 2) the claim was not
fairly debatable; 3) the denial or failure to pay was not the result of a good faith mistake; and 4)
the resulting harm is not fully compensable by contract damages.‖   Robinson v. State Farm Mut.
Auto. Ins. Co., 137 Idaho 173, 176, 45 P.3d 829, 832 (2002).   Liberty Mutual contends that the
Weinsteins did not prove any of these elements.
Breach of contract.   The jury found that Liberty Mutual had breached both the MedPay
and UM provisions of the insurance policy and that it had committed bad faith in its handling of
the UM provision of the insurance contract.   Although the tort of bad faith is not a breach of
contract claim, to find that Liberty Mutual committed bad faith in handling the UM provision,
there must also have been a duty under the contract that was breached.   Robinson v. State Farm
15




Mut. Auto. Ins. Co., 137 Idaho 173, 179, 45 P.3d 829, 835 (2002).   Thus, both the breach of
contract claim and the bad faith claim depend upon the provisions of the insurance policy.
With respect to the breach of contract claim, Liberty Mutual states, ―Plaintiffs‘ breach of
contract claim as to the UM coverage is based on an assertion that Idaho law requires a UM
carrier to pay a UM claim on a piecemeal basis as bills trickle in from the claimant, and that
Defendants failed to comply.‖   With respect to the bad faith claim, it states, ―it was and is
debatable—i.e., a ‗legal question of first impression‘—whether Defendants had an obligation to
make multiple payments as bills were submitted rather than doing a single evaluation and
payment.‖   Because both of these arguments involve the same provision of the insurance policy,
we will discuss them together.
Part 4 of the policy describes UM coverage.   The provision upon which Liberty Mutual
relies is as follows:
A. OUR OBLIGATIONS TO YOU (PART 4)
Uninsured Motorists Bodily Injury Coverage
If you have these coverages (see your Declarations), we will pay up to our Limit Of
Liability for bodily injury as described in How We Will Settle A Claim when an
insured or an insured‘s car is struck by an uninsured motor vehicle or trailer.   Our
payment is based on the amount that an insured is legally entitled to recover for
bodily injury but could not collect from the owner or operator of the uninsured
motor vehicle because:
1. THE OWNER OR OPERATOR IS NOT INSURED
The owner or operator responsible for the accident has no liability insurance or
liability bond or has coverage in an amount that is less than required by your state‘s
financial responsibility law.
Liberty Mutual relies upon the policy language stating, ―Our payment is based on the
amount that an insured is legally entitled to recover for bodily injury but could not collect from
the owner or operator of the uninsured motor vehicle.‖    It argues,  ―‗Payment‘ is singular.
‗Amount‘ is singular.   Nothing in the Policy supports multiple payments; the Policy refers to one
‗payment‘ and one ‗amount.‘   Thus, there was no contractual duty to make multiple, piecemeal
payments before the Company can evaluate the UM claim in its entirety.‖
―Whether an insurance policy is ambiguous is a question of law over which this Court
exercises free review.                                                                               . . . When deciding whether or not a particular provision is ambiguous, we
must consider the provision within the context in which it occurs in the policy.‖   Purdy v.
Farmers Ins. Co. of Idaho, 138 Idaho 443, 445-46, 65 P.3d 184, 186-87 (2003).
16




The word ―payment‖ can mean both ―the act of paying‖ and ―an amount paid.‖   Random
House, Inc. Dictionary.com., http://dictionary.reference.com/browse/payment (accessed:
February 8, 2010).  It is clear from the context that it has the latter meaning.
The first sentence states, ―If you have [UM coverage], we will pay up to our Limit Of
Liability for bodily injury.‖                                                                           (Emphasis added.)   This sentence states the maximum amount
Liberty Mutual will pay under UM coverage.   It cannot exceed the limit of liability for bodily
injury as set forth in the policy.   The phrase ―we will pay‖ cannot reasonably be construed as
indicating it will make only one payment.   For example, the policy provision covering MedPay
states,                                                                                                 ―We will pay  . . . up to our limit of liability for medical payments coverage  . . .     .‖
(Emphasis added.)  There is no contention that the phrase ―We will pay‖ there means it will only
make one payment under MedPay coverage.
The second sentence begins, ―Our payment is based on the amount that an insured is
legally entitled to recover for bodily injury . . .                                                     .‖   The word ―payment‖ clearly refers to the
phrase ―we will pay‖ in the first sentence.   Otherwise, there would be no maximum limit on the
amount Liberty Mutual was obligated to pay.    The second sentence provides that Liberty
Mutual‘s  ―payment is based on the amount that an insured is legally entitled to recover.‖
(Emphasis added.)  In context, this portion of the sentence merely further defines the amount that
Liberty Mutual is obligated to pay under UM coverage.
To make sense, the two sentences have to be read together.   The first sets forth Liberty
Mutual‘s maximum obligation under UM coverage, and the second sets forth how the amount of
its actual obligation will be determined in particular instances.    When read in context, the second
sentence could not reasonably be construed as stating that there will be only one payment made
under UM coverage.
There is a policy provision in the UM coverage section entitled ―How We Will Settle a
Claim (Part 4).‖   It states that the UM limit of liability on the declarations ―is the maximum we
will pay for all damages arising out of bodily injury to one person as a result of any one
accident.‖                                                                                              (Emphasis added.)   It does not state that how Liberty Mutual will settle a claim under
the UM coverage is by making only one payment.   It uses the same language (―we will pay‖) as
in the MedPay provisions.  There is no basis for holding that the phrase ―we will pay‖ means one
thing under the MedPay coverage and something else under the UM coverage.
17




Liberty Mutual also quotes from Ryals v. State Farm Mutual Automobile Insurance Co.,
134 Idaho 302, 307, 1 P.3d 803, 808 (2000), wherein we stated, when addressing a different
issue, ―[T]he purpose of Idaho‘s uninsured motorist statute which is to afford the same protection
to a person injured by an uninsured motorist as would have been enjoyed had the tortfeasor
carried liability insurance.‖   Based upon that quotation, it argues that because Sarah could have
obtained only a single judgment or settlement from the tortfeasor and could not have brought a
new lawsuit each time a medical expense was incurred, an insurance company‘s responsibility to
pay under UM coverage should be held to be the same.
Ryals does not support Liberty Mutual‘s argument.   Ryals did not hold that a motorist
with UM coverage who is injured by an uninsured tortfeasor should in all respects recover just as
if the motorist had sued and the tortfeasor carried liability insurance.   In Ryals, the accident
occurred in New York, and under that state‘s no-fault law Ryals would not have been able to
recover against the tortfeasor had she sued him.    We did not hold that Ryals‘s insurance
company should be treated just as if it was the tortfeasor.  Rather, we held that the torfeasor, who
had liability insurance, was not rendered uninsured by New York‘s no-fault law.  We have never
held that the relationship between an insurance company providing UM coverage and its insured
is the same as the relationship between its insured and the uninsured tortfeasor.   The Weinsteins
had not entered into a contract with, and were not making premium payments to, the tortfeasor.
The relationship between the insurance company and its insured does not vary depending upon
whether the insured is making a claim under UM coverage or another type of coverage.                   ―The
tort of bad faith breach of insurance contract … is founded upon the unique relationship of the
insurer and the insured, the adhesionary nature of the insurance contract including the potential
for overreaching on the part of the insurer, and the unique,  ‗non-commercial‘ aspect of the
insurance contract.‖   White v. Unigard Mut. Ins. Co., 112 Idaho 94, 100, 730 P.2d 1014, 1020
(1986).   Those factors apply to all types of coverage.   When a claim is made under UM or
underinsured  motorist  coverage,  the  insurance  company  can  certainly  raise  any  issues  or
defenses that the tortfeasor could have raised, but it cannot raise frivolous issues and defenses in
bad faith even though the tortfeasor could get away with such conduct.   As we stated in Sullivan
v. Allstate Insurance Co., 111 Idaho 304, 306, 723 P.2d                                                848, 850 (1986) (emphasis in original),
―[W]e do not agree with those courts who hold that in all circumstances the relationship
[between the insurance carrier and its insured making a claim under UM coverage] is adversarial
18




in nature and no obligation or liability rests upon the insurance carrier until the ‗legal liability‘ of
the uninsured motorist has been either admitted or adjudicated.‖   The insurance company has a
duty to act in good faith even when its insured makes a claim under the UM coverage of the
policy.  Bantz v. Bongard, 124 Idaho 780, 785, 864 P.2d 618, 623 n.5 (1993).
―The covenant requires the parties to perform, in good faith, the obligations contained in
their agreement,‖ Van v. Portneuf Med. Ctr., 147 Idaho 552, 562, 212 P.3d 982, 9092 (2009), but
―contract terms are not overridden by the implied covenant of good faith and fair dealing,‖ Bushi
v. Sage Health Care, PLLC,  146 Idaho  764,  768,  203 P.3d  694,  698  (2009)  (emphasis in
original).   Liberty Mutual was entitled to rely upon the terms of the insurance policy, but it was
not entitled to delay payments based solely upon its internal policies that were not part of the
policy.
In this case Liberty Mutual almost immediately determined that the driver who caused
the accident was both uninsured and solely at fault.   Once it had made that determination, its
analysis in deciding whether to pay particular medical bills under UM coverage would be no
different from its analysis in deciding whether to pay those bills under MedPay coverage, up to
the applicable coverage limits.   The policy states what ―[p]ersons making a claim under this
policy must [do],‖ but it does not require them to specify the particular coverage under which
they wish to be paid.   It was Liberty Mutual that divided the Weinsteins‘ request for payment
into a MedPay claim and a UM claim.   Liberty Mutual decided, based upon its internal policies,
that medical bills would not be paid under UM coverage until the MedPay coverage was
exhausted and that once MedPay coverage was exhausted medical bills would not be paid under
UM coverage until the insured‘s medical treatment was completed, even if that took years.
Liberty Mutual‘s obligation to pay under the UM coverage was based upon the terms of
its contract with the Weinsteins.   The fact that it was entitled to raise any issues or defenses that
could have in good faith been raised by the tortfeasor does not alter the terms of the insurance
policy, nor does it add provisions to the policy.   Liberty Mutual has not pointed to any policy
provision stating that UM benefits are only paid in one lump sum.   It has also not pointed to any
policy provision stating when UM benefits are to be paid.   The well-established law in Idaho is,
―Where no time is expressed in a contract for its performance, the law implies that it shall be
performed within a reasonable time as determined by the subject matter of the contract, the
situation of the parties, and the circumstances attending the performance.‖   Curzon v. Wells
19




Cargo, Inc., 86 Idaho 38, 43, 382 P.2d 906, 908 (1963).   Thus, under its contract with the
Weinsteins, Liberty Mutual was required to pay under the UM coverage within a reasonable
time.
Liberty Mutual offered evidence that it was common practice in the insurance industry to
make one payment under UM coverage which would include the entire UM claim.    That
common practice cannot alter or supplement the terms of the Weinsteins‘ insurance policy.2  The
finding that Liberty Mutual breached the terms of the policy by failing to make payments under
the UM coverage within a reasonable time is supported by substantial evidence.
Intentional and unreasonable delay in payment.   To prove the tort of insurance bad
faith, an insured must prove that ―the insurer intentionally and unreasonably denied or withheld
payment.‖   Robinson v. State Farm Mut. Auto. Ins. Co., 137 Idaho 173, 176, 45 P.3d 829, 832
(2002).   Liberty Mutual contends that any delay in this case was caused solely by the failure of
Bistline, the Weinsteins‘ first attorney, to provide medical records in a timely manner.   Liberty
Mutual argued this to the jury, but it did not accept the argument undoubtedly because it is
contrary to the evidence.
The coverage at issue with respect to the finding of bad faith is UM coverage.   On
December  5,  2002,  Mrs.  Weinstein  sent  Liberty  Mutual‘s  UM  adjuster  a  signed  medical
authorization that had been provided by the adjuster and a list of medical providers.  The adjuster
testified that she did not use that medical authorization to gather any information because Liberty
Mutual did not gather medical information regarding medical bills to be paid under UM coverage
until the insured was ready to discuss settlement of the entire UM claim, and Sarah was still
receiving treatment.    Bistline  did  not  notify  Liberty Mutual  that  he  was  representing  the
Weinsteins until October 2003.   On November 3, 2003, the adjuster had a conversation with
Bistline, and her notes of the conversation included, ―If you don‘t dispute liability and we don‘t
dispute the bill, we have to pay under UM.‖   She testified that she disagreed with him because
her understanding was that ―UM coverage was an evaluation and a settlement of the claim in its
entirety.‖   She also agreed that the company‘s duty to investigate the claim is independent of
2 Liberty Mutual has not contended that the provisions in the Weinsteins‘ insurance policy were supplemented by a
custom or usage in the insurance industry regarding how or when UM coverage is paid.
20




whatever the insured‘s attorney does.   The adjuster had a list of medical providers, but did not
seek to obtain medical records from any of those providers.
The UM adjuster who commenced handling this claim in June 2004 also testified, ―[W]e
needed records, as well as bills, to evaluate the claim.   And normally we didn‘t request the
records until the treatment was completed.‖    The adjusters‘ supervisor testified that the standard
practice of Liberty Mutual was to investigate to make sure there was an uninsured motorist
involved and to investigate liability, and then to wait and see how the insured‘s treatment went.
―And then as soon as the treatment was nearing an end, we would gather the information, get the
records, and evaluate the claim.‖  That is what Liberty Mutual did in this case.
On June 11, 2004, Liberty Mutual wrote Bistline a letter in which it stated, ―In response
to your request that we pay Ms Weinstein‘s medical expenses, we have been advised by our
Idaho defense counsel that there is no legal obligation to do so.‖  The letter also stated, ―We will
evaluate Ms Weinstein‘s damages when her medical treatment is completed or when you submit
a settlement demand with all the medical documentation and proofs.‖
Liberty Mutual did not make any payments under UM coverage until after the Weinsteins
filed this lawsuit.   The evidence showed that the delay in making payments was due to its
standard practice in handling UM coverage, not because of any neglect of Bistline in providing
records.   When it did pay bills under the UM coverage, the adjuster testified that she did not
analyze them.  She paid them because she was directed to do so by counsel.  One of the bills was
the unpaid balance of $1,104.19 owing to the hospital for Sarah‘s surgery.   The other half of the
bill had been paid a year earlier under MedPay coverage.   Obviously, because Liberty Mutual
had paid about half the hospital bill under MedPay coverage, the jury could reasonably have
concluded that its year-long delay in paying the remainder of the bill under UM coverage was
not based upon any lack of records.
The Liberty Mutual representative who supervises adjusters testified that he knew Liberty
Mutual owed the Weinsteins under their UM coverage from the day after the accident.   Liberty
Mutual also knew that the accident was caused solely by the negligence of the uninsured driver.
Although the first adjuster mistakenly believed that the policy required that Sarah‘s medical bills
had to be first submitted to her health insurer before they would be paid under MedPay coverage,
there was no testimony that anyone from Liberty Mutual believed that such requirement applied
to the payment of medical bills under UM coverage.   The first adjuster also agreed, from her
21




review of the file, that there was no indication that anyone employed by Liberty Mutual ―ever
debated one of these bills or disputed one of these bills that were submitted.‖
Liberty Mutual‘s position was that it was not required to make any payments under UM
coverage until the entire UM claim was settled, even if liability and the medical bills were
undisputed.   It could not point to any provision in the insurance policy so providing.   It admitted
during oral argument that its internal company policy cannot modify the terms of the insurance
policy.    There was sufficient evidence that Liberty Mutual intentionally and unreasonably
withheld payment.
The dissent argues, ―The district court erred by permitting the jury to determine when
medical payments were due on the Weinsteins‘ UM ‗claim‘ . . .                                             .‖ and ―Because the jury was
improperly instructed that the Weinsteins were entitled to multiple payments under the terms of
their insurance policy, .  . . Liberty Mutual was entitled to a directed verdict or a judgment
notwithstanding the verdict in its favor.‖   Liberty Mutual has not made these arguments on
appeal, probably because it stipulated to a jury instruction that included the following:
The terms of the contract are in dispute as to whether the Defendants were
in compliance with the medical payments and uninsured motorist provisions of
the insurance contract.   You must determine what was intended by the parties as
evidenced by the contract in this case.   In making this determination you should
consider, from the evidence, the following:
6.                                                                                                        In insurance cases money becomes due as provided under the
express terms of the insurance contract.
7.                                                                                                        If an insurance policy may be given either of two reasonable
meanings, one which permits recovery and one which does not, the meaning more
favorable to the insured should be adopted.
9.                                                                                                        When a contract expresses no specific time for its performance, the
law implies that it is to be performed within a reasonable time, as determined by
the  subject  matter  of  the  contract,  the  situation  of  the  parties,  and  the
circumstances attending the performance.
In fact, Liberty Mutual drafted the above-quoted jury instruction.   Liberty Mutual also
did not object to the jury instruction informing the jury that Plaintiffs could show that Liberty
Mutual breached the insurance policy as to UM coverage by proving, as one of the elements,
―that payments [plural] were not timely made.‖
Rule 51(b) of the Idaho Rules of Civil Procedure states, ―No party may assign as error the
giving of or failure to give an instruction unless the party objects thereto before the jury retires to
22




consider its verdict, stating distinctly the instruction to which that party objects and the grounds
of the objection.‖   Without addressing that Rule, or our opinions applying it such as Saint
Alphonsus Diversified Care, Inc. v. MRI Associates, LLP, 148 Idaho 479, 481, 224 P.3d 1068,
1080 (2009); Chapman v. Chapman, 147 Idaho 756, 761, 215 P.3d 476, 481 (2009); Bates v.
Seldin,  146 Idaho  772,  775-76,  203 P.3d  702, 705-06  (2009), the dissent argues that  ―[t]he
majority opinion nonetheless contends that Liberty Mutual waived the issue by stipulating to
Instruction 13 . . .                                                                                      .‖   We   do not contend that Liberty Mutual waived the issue.   We   infer that
Liberty Mutual did not raise on appeal the objections to these instructions because Liberty
Mutual did not object to the instructions.   In its argument, the dissent misses the point.   It is the
dissent, not Liberty Mutual, who contends on appeal that the district court erred in giving these
instructions to the jury.                                                                                 The dissent continues, ―There was no factual issue for the jury to
settle.  This is because ‗[m]ost courts reason . . . that the language ―legally entitled to recover‖ is
clear and unambiguous.‘‖   Citing opinions from other jurisdictions, the dissent states, ―There is
no UM ‗claim‘ until the claimant is ready to show the extent of damages caused by the tortfeasor
or, stated another way, to show the full extent of damages the claimant is legally entitled to
recover from the tortfeasor if he were insured.‖   (Emphasis in original.)
The dissent bases its argument on opinions from other courts interpreting the words
―legally entitled to recover.‖  However, Liberty Mutual did not base its construction of the policy
on how this Court should, or other courts have, construed those words.   Rather, it based its
argument on appeal on the fact that the words ―payment‖ and ―amount‖ were in the singular,
rather than the plural, in the sentence beginning, ―Our payment is based on the amount that an
insured is legally entitled to recover . . .                                                              .‖   Liberty Mutual‘s entire argument in its opening brief
on the interpretation of the wording in this sentence was as follows:
The Policy provides:                                                                                      ―Our payment is based on the amount that an insured is
legally entitled to recover for bodily injury but could not collect from the owner
or operator of the uninsured motor vehicle                                                                .‖                                                                                 ―Payment‖ is  singular.
―Amount‖ is singular.   Nothing in the Policy supports multiple payments; the
Policy refers to one ―payment‖ and one ―amount.‖  Thus, there was no contractual
duty to make multiple, piecemeal payments before the Company can evaluate the
UM claim in its entirety.   (Emphasis in original.)
More  importantly,  when  interpreting  their  insurance  policies,  we  do  not  expect
policyholders to know how most courts around the country have construed certain words or to
have the knowledge of those who have spent their careers working in or with the insurance
23




industry.                                                                                                ―‗Unless  contrary intent  is  shown,  common, non-technical  words  are  given  the
meaning applied by laymen in daily usage—as opposed to the meaning derived from legal
usage—in order to effectuate the intent of the parties.‘‖  Armstrong v. Farmers Ins. Co. of Idaho,
147 Idaho 67, 69, 205 P.3d 1203, 1205 (2009) (quoting from Howard v. Oregon Mut. Ins. Co.,
137 Idaho 214, 217, 46 P.3d 510, 513 (2002)).
In  this  case,  Liberty  Mutual  misconstrued  the  policy as  to  its  obligation  to  make
payments under the MedPay coverage, and it contended that it did not have to pay any medical
bills under the UM coverage until the MedPay coverage was exhausted.  When asked during oral
argument whether there was anything in the policy stating that a policyholder cannot receive
payment under the UM coverage until the MedPay coverage was exhausted, Liberty Mutual‘s
attorney answered, ―Nothing specific.‖  Liberty Mutual also contended that it did not have to pay
anything  under  the  UM  coverage  until  the  Weinsteins  were  ready  to  settle  all  damages
recoverable under that coverage.   During his trial testimony, one of Liberty Mutual‘s in-house
counsel was asked whether the UM provision in the policy could have said that Liberty Mutual
would not pay under the UM coverage ―until the end of the claim, when all the bills come in and
you‘re done with treatment and everything else.‖   In answering the question, Liberty Mutual‘s
counsel testified, ―They could have.   They didn‘t.‖   During his testimony, Liberty Mutual‘s in-
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