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DAVIS V. FARMERS INSURANCE CO. OF ARIZONA, 2006-NMCA-099, 140 N.M. 249, 142 P.3d 17
ROBERT DAVIS, Individually and as a
Representative of a class of persons within
the State of New Mexico,
Plaintiff-Appellant,
v.
FARMERS INSURANCE COMPANY OF
ARIZONA, and each affiliate within
Farmers Insurance Group, a joint venture,
Defendants-Appellees.

Docket No. 25,312
COURT OF APPEALS OF NEW MEXICO
2006-NMCA-099, 140 N.M. 249, 142 P.3d 17
June 13, 2006, Filed

APPEAL FROM THE DISTRICT COURT OF BERNALILLO COUNTY, Valerie A. Mackie Huling, District Judge Certiorari Granted, No. 29,895, September 13, 2006. Certiorari Quashed, No. 29,895, August 30, 2007. Released for publication September 5, 2006.
COUNSEL
Morgan Law Office, Limited, Ron Morgan, Albuquerque, NM, Whitney Buchanan, P.C., Whitney Buchanan, Albuquerque, NM, for Appellant Rodey, Dickason, Sloan, Akin, & Robb, P.A., Andrew G. Schultz, Albuquerque, NM, Jackson Walker, L.L.P., Thomas T. Rogers, Mark L. Walters, Austin, TX, for Appellees

JUDGES
RODERICK T. KENNEDY, Judge. WE CONCUR: LYNN PICKARD, Judge, CELIA FOY CASTILLO, Judge AUTHOR: RODERICK T. KENNEDY

OPINION
KENNEDY, Judge.
{1} The dispute in this case concerns coverage under an automobile insurance policy.  The question in this appeal is whether, under Plaintiff's collision coverage, Farmers Insurance Company (Farmers) must pay for the vehicle's loss of market value on top of adequately repairing the damaged vehicle.  The trial court granted summary judgment in favor of Farmers and Plaintiff appeals.
{2} This is an issue of first impression in New Mexico.  There is a nationwide split in authority on whether, under policies like Plaintiff's, insureds can recover the diminished  market value of their vehicle after having the vehicle fully and adequately repaired.  While this question must always depend upon the actual language of the insurance policy, the language in certain coverage provisions has been analyzed extensively in other jurisdictions. Today, we choose to follow the majority trend towards disallowing recovery for the diminished market value under the terms of Plaintiff's insurance policy.  We affirm.

BACKGROUND AND FACTS
{3} Two months after buying a new truck, Plaintiff wrecked it.  He was insured by Farmers, who adequately repaired the truck. After the repairs were completed, Plaintiff traded his truck in for another new one. Plaintiff accepted as a trade-in value $15,000 less than he estimated his old truck was worth before it was wrecked.  Plaintiff then claimed that he was entitled to payment for this "loss in market value" under his insurance policy.  Farmers disagreed, and refused to pay this claim.
{4} Part IV of Plaintiff's insurance policy stated that Farmers would "pay for loss to your insured car caused by collision." This section defined "loss" as the "direct and accidental loss of or damage to your insured car, including its equipment."  In the "Limits of Liability" section, the policy stated that Farmers' "limits of liability for loss shall not exceed . . . [t]he  amount which it would cost to repair or replace damaged . . . property with other of like kind and quality; or with new property less an adjustment for physical deterioration and/or depreciation."  In the "Payment of Loss" section, Farmers stated that it would "pay the loss in money or repair or replace damaged . . . property."
{5} Plaintiff filed a complaint against Farmers claiming:  (1) breach of contract, (2) violation of the covenant of good faith and fair dealing, (3) violation of the New Mexico Insurance Code,
(4) violation of the New Mexico Unfair Practices Act, and (5) breach of fiduciary duty.  Farmers moved to dismiss the complaint and Plaintiff moved for summary judgment.  The trial court denied Plaintiff's motion for summary judgment and granted summary judgment in favor of Farmers.  Plaintiff appeals and we affirm.
DISCUSSION

Standards of Review and Policy Interpretation
{6} "Summary judgment is appropriate where there are no genuine issues of material fact and the movant is entitled to judgment as a matter of law."  Self v. United Parcel Serv., Inc., 1998-NMSC-046,

Download 2006-NMCA-099.pdf

New Mexico Law