in the supreme court of appeals of...atv.4 on june 27, 2014, an answer was filed on behalf of the...

IN THE SUPREME COURT OF APPEALS OF lJl=i~~T DTTD~rr~~[g ~

No 16-1151 In MAR I 32011 U

ERIE INSURANCE COMPANY z RORY L PERRY n CLERKDefendant-Below Petitioner ~~~ tlUPREME COURT OF APPEALS bulli OF WEST VIRGINIA

v

RICKY ADOLLY Plaintiff-Below Respondent

Honorable Charles E ParsonsJudge Circuit Court of Hampshire County

Civil Action No 14-C-62

BRIEF OF THE PETITIONER

Counsel for Petitioner Counsel for Respondent

Ancil G Ramey Esq Jonathan G Brill Esq WV State Bar No 3013 WV Bar No 11316 Hannah C Ramey PO Box 932 WVBarNo7700 Romney WV 26757 Steptoe amp Johnson PLLC Telephone (304) 822-7110 PO Box 2195 Facsimile (304) 822-7109 Huntington WV 25722-2195 jonathangbrillgmailcom Telephone (304) 526-8133 Facsimile (304) 933-8738 ancilrameysteptoe-johnsoncom hannahrameysteptoe-johnsoncom

Eric J Hulett Esq WV Bar No 6332 Steptoe amp Johnson PLLC 1250 Edwin Miller Blvd Suite 300 Martinsburg WV 25404 Telephone (304) 262-3519 Facsimile (304) 262-3541 erichulettsteptoe-johnsoncom

TABLE OF CONTENTS

I ASSIGNMENTS OF ERROR 1

II STATEMENT OF THE CASE

A PROCEDURAL BACKGROUND 1

B LITIGATION HISTORY 2

C MOTION TO DISMISS BAD FAITH CLAIMS BARRED BY ONE-YEAR STATUTE

OF LIMITATIONS 3

D CRoss-MOTIONS FOR DECLARATORYJUDGMENT 4

III SUMMARY OF ARGUMENT 7

IV STATEMENT REGARDING ORAL ARGUMENT ANDDECISION7

V ARGUMENT

A STANDARD OF REVIEW 8

B THE CIRCUIT COURT ERRED BY RULING THAT THE EXCLUSION OF

UNINSURED MOTORIST COVERAGE FOR A TRAILER AND AN ATV

VIOLATED THE MOTOR VEHICLE SAFETY RESPONSIBILITY LAW 8

C THE CIRCUIT COURT ERRED BY DENYING ERIES MOTION TO DISMISS

STATUTORY AND COMMON LAW BAD FAITH CLAIMS THAT ARE CLEARLY

BARRED BY THE ApPLICABLE ONE-YEAR STATUTE OF LIMITATIONS 13

1 Under Wilt Statutory Bad Faith Claims Must Be Filed Within One Year of the Denial of an Insurance Claim and the Circuit Court Erred by Refusing to Dismiss the Statutory Bad Claim in this Case Filed More Than One-Year After Written Denial of the Claim 14

2 This Courts Recent Decision in Beane Conflicts with the Previous Decisions of this Court Regarding When a Common Law Bad Faith Cause of Action Accrues and the Decisions of Federal Courts Applying a One-Year Statute ofLimitations to Common Law Bad Faith Claims 20

VI CONCLUSION 24

TABLE OF AUTHORITIES

CASES

Blake v State Farm Mut Auto Ins Co 224 W Va 317 685 SE2d 895 (2009) 6 13

Bluefield Gas Co v Abbs Valley Pipeliney LLCy 2012 WL 40460 (4th Cir) 14

Boniey v Kuchinski 223 W Va 486 677 SE2d 922 (2009) 6 11-13

Cava v National Union Fire Ins Co 232 W Va 503 753 SE2d 1 (2013) 19

Elliott v AAA Ins 2016 WL 2766651 (ND W Va) 16-17

Ewing v Board ofEduc 202 W Va 228 503 SE2d 541 (1998) 8

Fluker v Cava 2012 WL 8481966 Circuit Court ofMarion Co Civil Action No 09-C-110 (Jan 3 2012) 19

Forshey v Jackson 222 W Va 743 671 SE2d 748 (2008) 14

Ghafourifar v Community Trust Banky Inc 2014 WL 4809794 (SD W Va) 19

Hayseedsy Inc v State Farm Fire amp Casualty 177 W Va 323 352 SE2d 73 (1986) 20

Humble Oil amp Ref Co v Lane 152 WVa 578 165 SE2d 379 (1969) 14

In re TO 2017 WL 562828 CW Va) 21

Knapp v American General Finance Inc 111 FSupp2d 758 (SD W Va 2000) 15-16

11

Johnson p Nedejf 192 W Va 260 452 SE2d 63 (1994) 14

Kimble v Erie Ins Prop amp Cas Co No 13-C-22 (Oct 28 2013) 18-19

State v McKinley 234 W Va 143 764 SE2d 303 (2014) 21-22

Noland v Virginia Insurance Reciproca~ 224 W Va 372 686 SE2d 23 (2009) passim

Painter v Peavy 192 W Va 189 451 SE2d 755 (1994) 8

Parsons p Standard Ins Co and Minn Life Ins Co 185 FSupp3d 909 (ND W Va 2016) 17-18

Perdue v Hess 199 W Va 299 484 SE2d 182(1997) 14

State ex rei Erie Ins Prop and Cas Co v Beane 2016 WL 3392560 (W Va)(memorandum) passim

Watson v National Union Fire Insurance Co 2013 WL 2000267 (SD W Va) 16 18

Wiltv State Auto Mut Ins Co 203 W Va 1655 06 SE2d 608 (1998) passim

STATUTES

W Va Code sect 17D-2A-2 9

W Va Code sect 17D-4-2(a) 910


W Va Code sect 17D-4-12(f)( 4) 9

W Va Code sect 33-6-31(b) 10

W Va Code sectsect 33-11-4 et seq 14

111

RULES

R App P 5(h) 7

R App P 20 7

IV

I ASSIGNMENT OF ERROR

1 The Circuit Court erred by applying the motor vehicle responsibility statute to an

insurance policy which provided no coverage for the claimed property damage loss

2 The Circuit Court erred by denying a motion to dismiss statutory and common

law bad faith claims that were not asserted for more than one year following denial of coverage for

the claimed property damage loss


A PROCEDURAL BACKGROUND On May 2 2014 Respondent Ricky A Dolly

[Mr Dolly] filed suit arising from an automobile accident On March 22 2016 almost two

years later Mr Dolly amended his complaint to assert claims against Petitioner Erie Insurance

Company [Erie] based upon his argument that he was entitled to property damage coverage

for a trailer damaged in the automobile accident

Erie moved to dismiss Mr Dollys bad faith claims as barred by the one-year statute of

limitations which was denied and subsequently counterclaimed for declaratory relief regarding

the existence or absence of coverage for damage to Mr Dollys trailer

On November 11 2016 the Circuit Court agreed that there was no coverage for damage

to Mr Dollys trailer under Eries policy but held that Mr Dolly could nevertheless recover for

property damage to his trailer up to the mandatory minimum limits of the motor vehicle

responsibility statute

It is from the Circuit Courts orders denying Eries motion to dismiss and granting Mr

Dollys motion for summary judgment that Erie prosecutes its appeal

B LITIGATION HISTORY On September 13 2013 Mr Dolly was involved in an

automobile accident and submitted an uninsured motorist [UM] claim to Erie which paid his

UM claim for damages to his truck but denied his UM claim as to a trailer and A TV also

damaged in the accident I

On May 8 2014 after Mr Dollys UM had been paid as to his damages for his truck but

denied as to damages to his trailer and ATV Mr Dolly filed a suit against Defendants Ronald

W Cole and Emily M Cole the owner and operator of an uninsured motor vehicle in which Mr

Dolly was involved in an accident2 Mr Dollys complaint noted that Plaintiffs insurer Erie

Insurance has reimbursed Plaintiff in full for damages sustained to his Ford Ranger Pick-up3

but that he had not been reimbursed as of May 8 2014 for damages to his utility trailer and

ATV4 On June 27 2014 an answer was filed on behalf of the defendants 5

Eventually on September 30 2015 the parties filed a petition to approve a settlement

consisting of an admission by Ms Cole as to liability and a stipulation as to Mr Dollys damages6

Those damages totaling $19420727 were comprised of $1500 for the trailer $1492072 for the

ATV and $3000 for storage feess

1 [APP 137]

2 [APP 8-13J

3 Id atltj[ 28

4 Id at ltj[ltj[ 25 28 and 29

5 [APP 16-19]

6 [APP 47-54J

7 [APP 51J

8 [APP 43]

2

On November 2 2015 an order was entered approving this settlement between Mr Dolly

and Ms Cole9 Significantly because it resolved all issues as to all parties this order provided

Nothing further to be done this day the matter is removed from the docket and placed among

those matters ended 10 At that point Mr Dollys UM claim had been resolved by Erie over a

year earlier and Mr Dolly had a judgment against Defendants Ronald W Cole and Emily M

Cole against whom he could seek enforcement ofthat judgment

On March 9 2016 however even though the case had been dismissed from the docket

because there was nothing further to be litigated between the parties Mr Dolly filed a motion to

amend his dismissed complaint to assert claims against Eriell Mr Dollys motion noted that the

accident occurred on September 12201312 and of course when he filed his suit on May 8 2014

Erie had reimbursed him for damages to his truck but had refused to reimburse him for damages

to his trailer and ATV because neither was covered under Mr Dollys policy

C MOTION TO DISMISS BAD FAITH CLAIMS BARRED BY ONE-YEAR STATUTE OF

LIMITATIONS On April 29 2016 Erie filed its motion to dismiss the bad faith counts of the

amended complaint as barred by the one-year statute of limitations noting that it had sent Mr

Dolly a letter dated November 42013 well prior to his moving to amend on March 9 2016 in

which it had denied coverage for Mr Dollys trailer and ATV because Mr Dollys policy

9 [APP 54-57]

10 [APP 57]

II [APP 58-78]

12 [APP 58]

3

expressly excludes coverage for trailers and A TV S13 Indeed attached to Eries motion to

dismiss was a copy of its letter of November 42013 to Mr Dolly denying coverage for his trailer

and ATVI4 The November 42013 denial letter is also attached hereto as Exhibit A

On July 11 2016 however the Circuit Court denied Eries motion to dismiss without

explanation stating only as follows

Based upon the argument of counsel and upon all matters on record the Court ORDERS and ADJUDGES that Eries Motion to Dismiss for Violation of the Statute ofLimitations shall be and is hereby DENIED Eries objection is saved

The Court FURTHER ORDERS and ADJUDGES that counsel shall file respective memorandum oflaw regarding the declaratory judgment coverage issue in this case and shall file the memoranda not later than July 15 2016 Upon filing counsel shall coordinate and schedule the declaratory judgment coverage issue for oral argumentIS

D CRoss-MoTIONS FOR DECLARATORY JUDGMENT On August 15 2016 Erie

filed its memorandum in support of declaratory judgment noting as follows

The UM Endorsement states in pertinent part that

UninsuredUnderinsured Motorists Coverage is not provided for any trailer whether or not the trailer is attached to another motor vehicle or miscellaneous vehicle No separate limit of protection for UninsuredUnderinsured Motorists Coverage is available for a trailer whether attached or unattached to a motor vehicle or miscellaneous vehicle UninsuredUnderinsured Motorists Coverage does not apply to a miscellaneous vehicle owned or leased by you or a relative unless the miscellaneous vehicle is listed on the Declarations and a premium is shown for this coverage

13 [APP 137] Indeed attached to Eries motion to dismiss was a copy of its letter of November 4 2013 to Mr Dolly denying coverage for his trailer and A TV [Exhibit A]

14 [APP 153]

15 [APP 208]

4

See Policy attached hereto as Exhibit A bates stamped Erie 000001 - 000033 at UninsuredUnderinsured Motorists Coverage Endorsement - West Virginia at 3 identified as ERIE 000026 (emphasis in original)

The policy defines trailer as a vehicle designed to be pulled by a private passenger auto if not being used for business purposes except with a private passenger auto Exhibit A at General Policy Definitions at 4 identified as ERIE 000009 (emphasis in original) The policy definition of miscellaneous vehicle includes all terrain vehicle and any similar recreational vehicle Exhibit A at General Policy Definitions at 3 identified as ERIE 000008 Moreover the Amended Declarations list three vehicles but no trailer or ATV Exhibit A at Declarations identified as ERIE 000002

Without question the trailer pulled by Plaintiffs pickup truck was a trailer under the Policy and the ATV being hauled by Plaintiff on that trailer was a miscellaneous vehicle under the Policy Plaintiff describes them as a trailer and an ATV in the Amended Complaint (parag 10) and describes them as a trailer and a four wheeler in his recorded statement attached as Exhibit C bates stamped Erie 000039 - Erie 000043) Therefore as a matter oflaw there is no property damage coverage within the Policy under the UM Endorsement for the trailer and ATV As such Erie is entitled to judgment on Count II of Plaintiffs Amended Complaint finding that there was no coverage

Notably the UM Endorsement has been approved by the West Virginia Offices of the Insurance Commissioner See Filing at a Glance Revised UninsuredUnderinsured Motorists Coverage Endorsement AFWUOI Effective (Ed ln) attached hereto as Exhibit B bates stamped Erie 000065 - Erie 000109 Therefore Plaintiffs argument that the UM Endorsement andor Policy violate West Virginia public policy is foreclosed by this approval and the lack of any direct precedent from the Supreme Court of Appeals of West Virginia holding this Endorsement to be invalid16

In other words not only did Eries policy clearly and unambiguously exclude coverage for Mr

Dollys trailer and ATV the policy language has been approved by the West Virginia Insurance

Commissioner

In response to this argument that this policy language approved by the West Virginia

Insurance Commissioner plainly excludes uninsured motorist coverage for trailers and ATVs

16 [APP 401-402]

5

Mr Dolly made the curious argument that because he is required by West Virginia law to

maintain liability insurance protecting other motorists from his negligence he should be able to

recover for property damage for another motorists negligence up to the property damage limits

he is required to maintain17 Not only does this stand the motor vehicle safety responsibility

statute on its head it is otherwise inconsistent with West Virginia law

In reply to this argument Erie noted that this Court held in Syllabus Point 8 of Boniey v

Kuchinski 223 W Va 486 677 SE2d 922 (2009) that A provision in a motor vehicle liability

insurance policy excluding an off-road all-terrain vehicle or ATV from uninsured motorist

coverage does not violate the intent and purpose of the uninsured motorist statute at W Va

Code sect 33-6-31(b) (1998)18 Accordingly Erie clearly had the right to exclude ATVs from the

property damage provisions ofMr Dollys uninsured motorist coverage

With respect to damage to the trailer Erie noted that this Court held in Blake v State

Farm Mut Auto Ins Co 224 W Va 317 685 SE2d 895 (2009) that an exclusion for property

damages coverage for a trailer did not violate the motor vehicle safety responsibility statute19

On November 10 2016 however without any analysis of the Boniey opinion the Blake

opinion or the motor vehicle safety responsibility statute the Circuit Court granted a declaratory

judgment in favor ofMr Dolly holding as follows

17 [APP 495-501]

18 [APP 511] See also APP 528-529 (ATVs however are excepted from the mandatory minimums set forth in the Motor Vehicle Safety Responsibility Law including motor vehicle liability insurance coverage mandated by W Va Code sect 17D-4-2 Boniey v Kuchinski 223 W Va 486 491 677 SE2d 922927 (2009) Accordingly an ATV exclusion does not conflict with the intent of the uninsured motorist statute )

19 [APP 511-512] See also APP 529 (Moreover the Supreme Court of Appeals has previously upheld an exclusion of coverage to mandatory first-party coverage as it relates to a trailer See Blake v State Farm Mut Auto Ins Co 224 W Va 317 685 SE2d 895899 (2009))

6

28 Had Ms Emily Cole procured the statutorily required amount of liability insurance her policy of insurance would have compensated Mr Dolly for the losses sustained to his A TV and trailer

29 Because statutory provisions mandated by the uninsured motorist law may not be altered by insurance policy exclusions and because Mr Dolly has suffered damages at the hands of a financially irresponsible uninsured motorist Mr Dolly is entitled to receive the statutory minimum limits ofuninsured motorist coverage

30 There is no dispute that the insurance company has the right to exclude coverage in excess of the statutory minimum coverage of $1000000 for injury to or destruction ofpersonal property

31 The insurance companys exclusion precluding the statutory mandated minimum of $1000000 is not consistent with the spirit and intent of the uninsured and underinsured motorist statute

The Court therefore concludes that the exclusion as set forth in the insurance policy does not apply to the trailer and the all-terrain vehicle to the extent of the minimum amount of $1000020

It is from this order and the earlier denial of Eries motion to dismiss the bad faith claims

that Erie is prosecuting its appeal

ill SUMMARY OF ARGUMENT

Erie respectfully submits that the Circuit Court erred in denying its motion to dismiss Mr

Dollys bad faith claims which were filed well beyond one-year after it denied his UM claims and

erred in denying its motion for summary judgment on coverage under policy language approved

by the Insurance Commissioner

IV STATEMENT REGARDING ORAL ARGUMENT AND DECISION

Pursuant to R App P 5(h) [TJhe Court will (1) decide the case on the merits without

oral argument or (2) set the case for oral argument and then decide the case on the merits raquo

Petitioner respectfully submits that this case is suitable for oral argument under R App P 20

20 [APP 592-593]

7

because the Circuit Court erred by applying the motor vehicle responsibility statute to an

insurance policy which provided no coverage and by denying a motion to dismiss bad faith claims

that were not asserted for more than one year following denial of coverage for the claimed

property damage loss requesting that this Court reconsider its recent decision in State ex rei Erie

Ins Prop and Cas Co v Beane 2016 WL 3392560 (W Va) (memorandum)1 which conflicts

with the previous decisions of this Court and the decisions of federal courts applying a one-year

statute oflimitations to common law first-party bad faith claims

VARGUMENT

A STANDARD OF REVIEW

With respect to Eries appeal from the Circuit Courts denial of its motion for summary

judgment on the issue of coverage the applicable standard of review is de novo22 Similarly with

respect to Eries appeal from the Circuit Courts denial of its motion to dismiss the statutory and

common law first-party bad faith claims as barred by the statute of limitations the applicable

standard of review is de novo23

B THE CIRCUIT COURT ERRED BY RULING THAT THE EXCLUSION OF UNINSURED

MOTORIST COVERAGE FOR A TRAILER AND AN ATV VIOLATED THE MOTOR VEIDCLE

SAFETY RESPONSmILITY LAW

West VirginiaS Motor Vehicle Safety Responsibility Law is found in Chapter 17D of the

West Virginia Code

21 The Beane case was decided after the Circuit Courts ruling which is the subject ofEries appeal in this case

22 Syl pt 1 Painter v Peavy 192 W Va 189 451 SE2d 755 (1994)

23 Syl pt 4 Ewing v Board ofEduc 202 W Va 228503 SE2d 541 (1998)

8

The law only applies to the operation of all motor vehicles required to be registered or

operated on the roads and highways to have the security in effect as provided in section three

article two-a of this chapter W Va Code sect 4-4(aa-ZA-Z

W Va Code sect 17D-4-Z(a) defines proof of financial responsibility as proof of ability

to respond in damages for liability on account of accident occurring subsequent to the effective

date of the proof arising out of the ownership operation maintenance or use of a motor vehicle

trailer or semitrailer in the amount of $10000 because of injury to or destruction of property

of others in anyone accident

One method of proof if financial responsibility is a certificate of insurance under W

Va Code sect 17D-zA-4 for motor vehicle policy as defined under W Va Code sect 17D-4-1Z(a)

which defines such term as an owners policy or an operators policy ofliability insurance

certified as provided in section ten or section eleven of this article as proof of financial

responsibility and issued except as otherwise provided in section eleven

The law makes clear that any policy provision that does not directly conflict with the

statute is valid and enforceable Every motor vehicle liability policy is subject to the following

provisions which need not be contained therein The policy the written application therefor if

any and any rider or endorsement which does not conflict with the provisions of this chapter

constitutes the entire contract between parties W Va Code sect 17D-4-1Z(f)(4)

So the Circuit Court was correct that if Ms Cole had complied with the law she was

operating a motor vehicle required to be licensed and the vehicle she was operating should have

had a motor vehicle liability policy with minimum coverage of $10000 for property damage for

which she was liable as a result of a motor vehicle accident in which she was at fault Because

9

there was no available motor vehicle policy Mr Dolly was then permitted to make a claim for

property damage under his own uninsured motorist coverage

West Virginias uninsured motorist statute is found at W Va Code sect 33-6-31(b) and

provides as follows

Nor may any such [motor vehicle] policy or contract be so issued or delivered unless it contains an endorsement or provisions undertaking to pay the insured all sums which he or she is legally entitled to recover as damages from the owner or operator of an uninsured motor vehicle within limits which shall be no less than the requirements of section two article four chapter seventeen-d of this code as amended from time to time

So reasoned the Circuit Court if W Va Code sect 33-6-31(b) requires that every motor

vehicle policy have an uninsured motorist provision with limits no less than the amount of

$10000 because of injury to or destruction of property of others in anyone accident found in

W Va Code sect 17D-4-2(a) Eries policy violated the uninsured motorist statute because it

excluded trailers and A TV s from coverage

The question is not the one posed by the Circuit Court ie whether Ms Coles policy

would have provided at least $10000 in coverage for Mr Dollys property damage Rather the

question is if Ms Cole had been operating a trailer or ATV without a motor vehicle liability

policy whether she would have been violating the West Virginias Motor Vehicle Safety

Responsibility Law

Again the exclusion at issue approved by the Insurance Commissioner provides as

follows

UninsuredUnderinsured Motorists Coverage is not provided for any trailer whether or not the trailer is attached to another motor vehicle or miscellaneous vehicle No separate limit of protection for UninsuredUnderinsured Motorists Coverage is available for a trailer whether attached or unattached to a motor vehicle or miscellaneous

10

vehicle UninsuredUnderinsured Motorists Coverage does not apply to a miscellaneous vehicle owned or leased by you or a relative unless the miscellaneous vehicle is listed on the Declarations and a premium is shown for this coverage24

In other words Eries policy provided coverage only for motor vehicles and not trailers or

ATVs which are not subject to the motor vehicle safety responsibility statute

As this Court observed in Boniey5 supra at 491-492677 SE2d at 927-928

Significantly the Legislature has not required all motor vehicles to maintain security in the form of an insurance policy within the limits of W Va Code sect 17D-4-2 Instead the Legislature has expressly indicated that the security requirement applies to [e ]very owner or registrant of a motor vehicle required to be registered and licensed in this state W Va Code sect 17D-2A-3(a) (emphasis added) See also W Va Code sect 17D-2A-2 (1982) (applying proof of security in article 2A to the operation of all motor vehicles required to be registered (emphasis addedraquo W Va Code 17D-2A-l (purpose of article 2A is to promote the public welfare by requiring every owner or registrant of a motor vehicle licensed in this State to maintain certain security during the registration period for such vehicle (emphasis addedraquo Therefore a motor vehicle that is not required to be registered and licensed pursuant to W Va Code sectsect 17A-3-1 et seq is excepted from the mandatory security provisions in the Motor Vehicle Safety Responsibility Law including motor vehicle liability insurance coverage mandated by W Va Code sect 17D-4-2

In order to determine whether a motor vehicle is required to be registered and licensed we look to WVa Code sect 17A-3-2(a) (2004) This code section provides that [e ]very motor vehicle trailer semitrailer pole trailer and recreational vehicle when driven or moved upon a highway is subject to the registration and certificate of title provisions of this chapter There are however several exceptions to this rule The exception applicable to the instant case is found in W Va Code sect 17A-3-2(a)(6) which provides that [t]he following recreational vehicles are exempt from the requirements of annual registration license plates and fees unless otherwise specified by law but are subject to the certificate of title provisions of this chapter regardless of highway use Motorboats all-terrain vehicles and snowmobiles [J)) (Emphasis added) Pursuant to this code section

24 [APP 401]

25 In Boniey the insured was riding an A TV owned by another person which was not insured at the time of the accident The insureds carrier State Farm denied coverage as its policy like Eries excluded uninsured motorist coverage for A TVs

11

ATVs are expressly excepted from the requirements of annual registration and licensing under W Va Code sect 17A-3-1 et seq We conclude therefore that because A TVs are not required to be registered and licensed in this State such vehicles also are not required to have motorist liability insurance coverage pursuant to the financial responsibility law at WVa Code sect 17D-4-2

As noted above uninsured motorist coverage is intended to provide the equivalent of motor vehicle liability coverage under our financial responsibility law In other words uninsured motorist coverage is intended to place a motorist who is injured by the negligence of an uninsured motorist in the position he or she would have been in if the negligent motorist had complied with the financial responsibility law and procured the required amount of liability insurance Where no liability insurance coverage is required on a motor vehicle under the financial responsibility law obviously no uninsured motorist coverage is mandated to provide the equivalent of such coverage Consequently it would not further the purpose of the uninsured motorist statute to construe the statute to require uninsured motorist insurance to cover those motor vehicles which are not required by the financial responsibility law to have liability insurance coverage Therefore we find that a vehicle which is not required to have liability insurance coverage in the amounts specified by W Va Code sect 17D-4-2 is not an uninsured motor vehicle within the meaning of W Va Code sect 33-6-31(b) This finding is consistent with the definition of uninsured motor vehicle in W Va Code sect 33-6-31(c) which provides in relevant part that the telm uninsured motor vehicle shall mean a motor vehicle as to which there is no Bodily injury liability insurance and property damage liability insurance both in the amounts specified by [W Va Code sect 17D-4-2] (Emphasis added)

Based on the above this Court determines that because an A TV is not required to have liability insurance coverage under the financial liability law an A TV is not an uninsured motor vehicle for the purposes of W Va Code sect 33-6-31(b) Accordingly we conclude that an insurance policy provision excluding ATVs from the uninsured motorist coverage mandated by W Va Code sect 33-6-31(b) does not violate the intent and purpose of the uninsured motorist statute26

In other words because the insured was riding on an A TV at the time of the accident and our

financial responsibility statute does not require liability insurance for A TVs State Farms

exclusion ofATV s from uninsured motorists coverage was not contrary to the statute

26 [Footnotes omitted]

12

This Courts decision in Boniey is consistent with its decision in Blake where the

policyholder borrowed a trailer from his neighbor which was subsequently destroyed in a single

vehicle accident in which the policyholder was at fault The subject policy in Blake excluded

property damage coverage for ANY DAMGES TO PROPERTY IN THE CHARGE OF

OR TRANSPORTED BY AN INSURED)) which would have included the borrowed trailer

Rejecting the policyholders argument that such exclusion violated the motor vehicle safety

responsibility statute this Court stated

It is important that one of the purposes of the Motor Vehicle Safety Responsibility Law West Virginia Code sectsect 17D-l-l to -6-7 (2009) is to provide a minimum level of financial security to third-parties who might suffer bodily injury or property damage from negligent drivers Dairyland Ins Co V East 188 W Va 581 585 425 SE2d 257 261 (1992)(quoting Jones V Motorists Mut Ins Co 177 W Va 763 766 356 SE2d 634 637 (1987raquo As the Court of Appeals of Idaho concluded in McMinn V Peterson 116 Idaho 541 777 P2d 1214 (Id Ct App 1989) in analyzing language in the Idaho Code similar to that found here [t ]he in charge of exclusion ofautomobile liability insurance does not contravene any public policy of protecting innocent victims of negligent and financially irresponsible motorists so as to render such exclusion invalid Id at 1217 Unquestionably liability coverage would have been applicable in this case had the trailer that was attached to Mr Blakes vehicle caused personal injury or property damage to another while affixed to Mr Blakes vehicle This event however did not occur The loss that occurred in this case was not only outside the coverage provided by the State Farm policy as the insured only purchased liability coverage and not comprehensive or collision coverage but it is also outside the coverage that is mandated by the provisions of West Virginia Code sect 17D-4-12( e) 27

Accordingly Erie respectfully submits that the Circuit Court erred by discounting the

Insurance Commissioners approval of the language in Eries uninsured motorist endorsement

which clearly excludes coverage for either a trailer or a miscellaneous vehicle which would

include Mr Dollys trailer and ATV

27 Blake supra at 322 685 SE2d at 900

13

c THE CIRCUIT COURT ERRED BY DENYING ERIES MOTION TO DISMISS STATUTORY

AND COMMON LAW BAD FAITH CLAIMS THAT ARE CLEARLY BARRED BY THE

ApPLICABLE ONE-YEAR STATUTE OF LIMITATIONS

As noted Mr Dolly was provided the denial letter from Erie on November 4 2013

informing him that Erie declined to pay the property damage claims for his trailer and ATV Mr

Dolly did not even though he had the assistance of counsel during the interim file his amended

complaint alleging UTPA28 violations and common law bad faith against Erie until March 22

2016 well after the one-year limitations period expired

The law favors statutes of limitation and construes them liberally to achieve dismissal of

untimely actions This Court has acknowledged its history of strictly adhering to statutes of

limitation and repose ))29

Moreover (( [i]t is evident from the foregoing authorities that statutes of limitations are

favored in the law and cannot be avoided unless the party seeking to do so brings himself strictly

within some exception It has been widely held that such exceptions are strictly construed and

are not enlarged by the courts upon considerations of apparent hardship 30

28 ((Unfair Trade Practices Act W Va Code sectsect 33-11-4 et seq

29 Forshey v Jackson 222 W Va 743 758 671 SE2d 748 763 (2008) (Benjamin J concurring) see also Johnson v Nedeff 192 W Va 260263452 SE2d 63 66 (1994) laquo((At one time the attitude of courts was hostile toward the enforcement of statute of limitations However legislative policy in enacting such statutes is now recognized as controlling and courts fully acknowledging their effect look with favor upon such statutes as a defense Statutes of limitations are now considered as wise and beneficent in their purpose and tendency and are held to be rules of property vital to the welfare of society ) Humble Oil amp Ref Co v Lane 152 WVa 578 582 165 SE2d 379 383 (1969) (dismissal cannot be avoided by rhetoric and argument but a plaintiff must ((bring himself strictly within some exception)

30 Perdue v Hess 199 W Va 299 303 484 SE2d 182 186 (1997) (citation omitted)(neither equitable tolling nor excusable neglect toll limitation period) Bluefield Gas Co v Abbs Valley Pipeline) LLC 2012 WL 40460 7 (4th Cir) laquo(( Statutes of limitations are not mere technicalities Rather they have long been respected as fundamental to a well-ordered judicial system )

14

Based upon the foregoing standards Mr Dollys UTPA and common law bad faith

allegations should have been dismissed

1 Under Wilt Statutory Bad Faith Claims Must Be Filed Within One Year of the Denial of an Insurance Claim and the Circuit Court Erred by Refusing to Dismiss the Statutory Bad Claim in this Case Filed More Than One-Year After Written Denial of the Claim

West Virginia law is clear that claims brought under the UTPA have a one-year statute of

limitations31 This Court used the reasoning in Wilt to hold that [t]he one year statute of

limitations applies to a common law bad faith claim 32

West Virginia generally adheres to the discovery rule for determining when the statute

of limitations begins to run In other words the statute of limitations begins to run when a

plaintiff knew or should have known ofthe existence of a claim

For example in Knapp v American General Finance Inc 111 FSupp2d 758 (SD W Va

2000) involving a first-party claim for UTPA and common law bad faith violations the court

held

The statute of limitations for claims arising under the West Virginia Unfair Trade Practices Act (UTPA) West Virginia Code sectsect 33-11-1 et seq) is one year See Wilt v State Auto Mut Ins Co) 203 W Va 165 506 SE2d 608 (1998) Because the Knapps loan agreement was entered into on November 26 1997 and this action was not brought until May 21 1999 Defendants argue their UTPA claim should be barred by the statute oflimitations

In a variety of cases however the Supreme Court ofAppeals of West Virginia has applied the Discovery Rule holding that a right of action does not accrue until the plaintiffs knew or should have known by the exercise of reasonable diligence of

31 Wilt v State Auto Mut Ins Co 203 W Va 165 171 506 SE2d 608 614 (1998) ([W]e determine that claims involving unfair settlement practices that arise under the Unfair Trade Practices Act are governed by the one-year statute of limitations set forth in West Virginia Code sect 55-2-12(c))

32 Syl pt 4 Noland v Virginia Insurance Reciprocal 224 W Va 372 686 SE2d 23 (2009)

15

the nature of their claims Stemple v Dobson) 184 W Va 317 320 400 SE2d 561564 (1990)33

In the instant case it is undisputed that Mr Dolly knew or should have known of the existence of

his UTPA and common law bad faith claims when Erie denied in writing the uninsured motorist

property damage claims in question on November 42013

This Court in Noland exhaustively examined the date the statute of limitations begins to

run and affirmed the decision of the Raleigh County Circuit Court which held that the statute of

limitations began to run on the plaintiffs claims of UTPA and common law bad faith for

wrongful failure to defend as of the date when the insured knew or reasonably should have known

that the insurer refused to defend him or her in an action 34

Dismissal for this reason is not unusual Other West Virginia circuit courts and federal

district courts have dismissed actions alleging UTPA violations and common law bad faith for

violation of the one-year limitation period as exemplified by the Elliott Parsons Watson and

Kimble cases discussed below

In Elliott v AAA Ins 2016 WL 2766651 (ND W Va) Judge Stamp granted the

insurance companys motion to dismiss the UTPA and common law bad faith claims for being

filed outside the one-year limitation period The insured Elliott sued the insurer for requiring

release of extra-contractual claims during negotiations over a disputed underinsured motorist

33 Id at 765

34 Syl pt 4 and 5 Nolan supra (adopting the rationale of Daugherty V Allstate Insurance Co 55 P3d 224 (Colo Ct App 2002) (superseded by statute as stated in Broduer V American Home Assur Co 169 P3d 139 (2007raquo and Adamski V Allstate Ins Co 738 A2d 1033 CPa Super Ct 1999) see also Watson v National Union Fire Insurance Co 2013 WL 2000267 (SD W Va) (applying the one-year statute of limitations applicable to UTPA and common law bad faith claims to preclude the plaintiffs claim as the statute began to run on the date the plaintiff became aware of the denial of insurance benefits)

16

claim Judge Stamp rejected the plaintiffs argument that the continuous tort doctrine applied to

toll the limitation period finding that courts have found the doctrine to not apply when a party

received separate and continued refusals by his insurer to provide coverage under an insurance

policy[] 35 Further the limitations period began to run when the plaintiff-insured was informed

of the global release upon receipt of the settlement agreement but failed to file the Complaint for

more than one year36 Judge Stamp applied Noland to hold that the alleged harm occurred

when the insurers position was made clear by the 1986 [coverage denial] letter and the insurer

maintained that position by subsequently refusing to defend of indemnify Therefore the

Court in Adamski found that the plaintiff could not now avoid an applicable statute of

limitations by asserting the continuing refusal to cover the insured was a separate act of bad

faith 37

In Parsons v Standard Ins Co and Minn Life Ins Co 185 FSupp3d 909 (ND W Va

2016) Judge Keeley granted the insurance companys motion to dismiss the UTPA and common

law bad faith claims for being filed outside the one-year limitation period finding that the

limitations period accrued on the date of the denial of coverage letter from the insurer Applying

Noland Judge Keeley held that the claims accrued when he received the insurers coverage

denial letter and the limitations period began to run on that date38 Also rejected was plaintiffshy

insureds argument that because the insurers denial letter informed him of his right to seek

35 Id at 3

36 Id at 5

37Id

38 Id at 915

17

review of the denial he is entitled to equitable estoppel to prevent application of the limitations

period39 Consequently the plaintiff-insureds complaint filed more than one year after the

coverage denial letter was received was dismissed

In Watson supra at 4Judge Berger granted an insurance companys motion to dismiss a

policyholders statutory and common law bad faith claims under an underinsurance motorist

policy because the policyholder failed to file his claims within one year of the denial letter stating

The Court has considered the allegations set forth in Plaintiffs First Amended Complaint which clearly establishes the date of Plaintiffs accident the date he sought the benefit of the Defendant NUFIC issued insurance policy and the date of the denial of benefits by Defendant Chartis on November 11 2009 The West Virginia Supreme Court of Appeals has established that the statute of limitations for both a bad faith claim and for violations of the UTPA is one year See Wilt v State Auto Mut Ins Co 506 SE 2d 608 614 (W Va 1998) (establishing that the one-year statute of limitations set forth in W Va Code sect 55-2-12(c) applies to claims involving unfair settlement practices under the UTPA) Noland v Virginia Ins Reciprocal 686 SE2d 23 (W Va 2009) (holding that the one-year statute of limitations contained in W Va Code sect 55-2-12(c) applies to common law bad faith claims) As is obvious from the pleading Plaintiff became aware of the denial of insurance benefits on November 112009 He has not stated any reason in the amended pleading to prompt an inquiry regarding whether the statute of limitations should be tolled Therefore a timely claim was required to be filed by November 11 2010 Plaintiffs initial complaint was filed in October 2012 Therefore taking Plaintiffs allegations as true Plaintiffs alleged bad faith and UTPA claims are time-barred by the applicable one year statute of limitations Thus this Court finds that Counts 2 and 3 of the First Amended Complaint should be dismissed for Plaintiffs failure to state a claim upon which relief can be granted

In Kimble v Erie Ins Prop amp Cas Co No 13-C-22 (Oct 28 2013 Judge Jordan granted

the insurance companys motion to dismiss the UTPA and common law bad faith claims because

the complaint was filed over one year following the denial of the claim by Erie Insurance

39Id

18

Companys coverage denial letter to the plaintiff-insured40 Judge Jordan applied Wilt and

Noland to hold that the one-year limitation period was exceeded and required dismissal of the

plaintiffs first-party property damage claim41 The case proceeded on the breach of contract and

coverage case

Count III of Mr Dollys complaint alleges a violation of the UTPA42 It is solely

predicated upon Eries processing of his claim allegedly in violation of the UTPA which

cumulated in Eries denial of his claim by letter dated November 4 2013 Accordingly Mr

Dollys UTPA claim accrued for purposes of the UTPA on November 4 2013 and he had

40 Id at 2

41 See also Flukerv Cava 2012 WL 8481966 Circuit Court of Marion Co Civil Action No 09-Cshy110 Gan 3 2012) affIrmed by Cava v National Union Fire Ins Co 232 W Va 503 753 SE2d 1 (2013)(Attorney Schillace received the November 112009 coverage denial letter on November 162009 at 1252 pm via certified mail On December 2 2010 Third-Party Plaintiffs filed a Third-Party Complaint against National Union alleging bad faith and violations of the West Virginia Unfair Trade Practices Act laquoUTPA) for an alleged failure to defend Third-Party Plaintiffs and original Defendant Sonny Nicholson in the lawsuit by Plaintiff Johnnie Fluker Jr The West Virginia Supreme Court of Appeals has determined that ([c ]laims involving unfair settlement practices arising under the [UTPA] [citation omitted] are governed by the one-year statute of limitations set forth in West Virginia Code sect 55shy2-12(c) SyI ptl of Wiltv State Auto Mut Ins Co 203 W Va 165 506 SE2d 608 (1998) The oneshyyear statute oflimitations contained in W Va Code sect 55-2-12(c) also applies to common law (bad faith claims SyI pt 4 of Noland v Va Ins Reciprocal 224 W Va 372 686 SE2d 23(2009) (In a firstshyparty bad faith claim that is based upon an insurers refusal to defend and is brought under [the UTPA] andor as a common law bad faith claim the statute of limitations begins to run on the claim when the insured knows or reasonably should have known that the insurer refused to defend him or her in an action SyI pt 5 ofNoland The Court finds and concludes as a matter of law that the statue of limitations on the bad faith claims expired on November 11 2010 and that those claims are therefore barred) Ghafourifarv Community TrustBankJ Inc 2014 WL 4809794 at 4 (SD W Va)(Moreover in West Virginia there is a one year statute of limitations in which to bring a claim for bad faith See Noland v Virginia Ins Reciprocal 224 WVa 372 686 SE2d 23 33 (WVa 2009) In his complaint Plaintiff states that he requested a loan modification in 2011 ECF No 1 As the Magistrate Judge properly noted Defendant modified the loan document and Plaintiff was aware of the changes to the loan document in December 2011 ECF NO1 ECF No7 Plaintiff did not institute this action until December 2013 ECF No 1 Thus even ifPlaintiff does have a valid claim for bad faith he did not file his claim within the applicable limitations period and his claim is time barred )

42 [APP 90-92]

19

until November 42014 to file that claim under Wilt but failed to do so

Accordingly the Circuit Court clearly erred as a matter of law in denying Eries motion

to dismiss Mr Dollys statutory bad faith claim which accrued on November 42013

2 This Courts Recent Decision in Beane Conflicts with the Previous Decisions of this Court Regarding When a Common Law Bad Faith Cause of Action Accrues and the Decisions of Federal Courts Applying a One-Year Statute of Limitations to Common Law Bad Faith Claims

Recently with respect to a property damage claim under a homeowners insurance policy

and alleged common law bad faith for denial of insurance benefits under Hayseeds) Inc v State

Farm Fire amp Casualty 177 W Va 323 352 SE2d 73 (1986) this Court determined in the

unpublished memorandum decision in Beane supra that the one-year statute of limitations did

not begin to run on the date the insureds became aware of the denial of their insurance claim

Rather the one-year statute of limitations in a Hayseeds common law bad faith action does not

begin to run until the policy holder prevails in his or her property damage suit 43

First the Court in Beane did not address the one-year statute of limitations as it applies to

UTPA violation claims Wilt clearly holds that it begins to run when an insurer refuses coverage

Accordingly there is now a conflict between Wilt and Beane regarding when a claim accrues

for purposes of a statutory versus a common law first-party bad faith claim

Second Erie respectfully submits that the decision in Beane does not take into account

the realities of bad faith litigation ie an insured typically does not sue over the denial of

coverage and then once suit is over files a second Hayseeds suit The insured cannot have it

both ways Either the insured asserts the Hayseeds claim within one year of denial of insurance

43 Id at 4

20

benefits in order to preserve it should he or she prevail in the coverage dispute or if the accrual

date is that point in time when all the elements of the cause of action have come into existence

then the insured must wait until after he or she prevails in the coverage dispute to assert the

Hayseeds claim

Third although this Court has explained memorandum decisions are pronouncements

on the merits that fully comply with the constitutional requirements44 and may be cited as legal

authority and are legal precedent 45 it has also noted that they are supposed to involve the

Courts application of settled law to the facts of a particular case 46 Accordingly this Court has

cautioned that where a conflict exists between a published opinion and a memorandum

decision the published opinion controls47ll This Court summarized these principles in Syllabus

Points 1 through 6 ofMcKinley supra as follows

1 Signed opinions containing original syllabus points have the highest precedential value because the Court uses original syllabus points to announce new points oflaw or to change established patterns of practice by the Court

2 Signed opinions that do not contain original syllabus points also carry significant instructive precedential weight because such opinions apply settled principles of law in different factual and procedural scenarios than those addressed in original syllabus point cases

3 Signed opinions both those including new syllabus points and those not containing new syllabus points are published opinions of the Court As such they should be the primary sources relied upon in the development of the common law

44 In re TO 2017 WL 562828 at 8 (W Va) see also W Va Const art VIII sect 4 in part (When a judgment or order of another court is reversed modified or affirmed by the court every point fairly arising upon the record shall be considered and decided the reasons therefor shall be concisely stated in writing and preserved with the record[])

45 Syl pt 5 in part State 1) McKinley 234 W Va 143764 SE2d 303 (2014)

46 TO supra at 8

47 McKinley supra at 146 764 SE2d at 308

21

4 Memorandum decisions are decisions by the Court that are not signed do not contain a Syllabus by the Court and are not published

5 While memorandum decisions may be cited as legal authority and are legal precedent their value as precedent is necessarily more limited where a conflict exists between a published opinion and a memorandum decision the published opinion controls

6 To the extent our prior holdings in Walker v Doe 210 WVa 490 558 SE2d 290 (2001) are inconsistent with this Courts recognition that signed opinions will be used both in cases that articulate new points oflaw and in cases in which a new point of law is not required such prior holdings are expressly overruled

In Syllabus Point 4 of Noland supra this Court held The one year statute of limitations

contained in W Va Code sect 55-2-12(c) (1959) (Repl Vol 2008) applies to a common law bad

faith claim and as previously discussed every other court that had consider the issue prior to

Beane had applied the same notice of denial standard set forth in Syllabus Point 5 ofNoland to

property damage claims Accordingly Erie submits that Beane a memorandum decision

effectively overruled Noland which should have been reserved for a signed opinion

Finally this Court has held a common law bad faith claim sounds in tort48 and the

tort in a common law bad faith claim obviously does not occur when the policyholder

substantially prevails as this Court erroneously held in Beane but as every other court which has

ever considered the issue has held when the policyholders claim is denied As this Court held

in Wilt with respect to statutory bad claims which also sound in tort

The WVUTP A is considered a tort action for this purpose See Kenney v Indep Order ofForesters 744 F3d 901 907 (4th Cir 2014) The discovery rule tolls the statute of limitations until a claimant knows or by reasonable diligence should know of his claim Marple v Allstate Ins Co No 510CV3 2010 WL 3788048 at 3 (ND W Va Sept 23 2010) (citing Dunn 689 SE2d at 262 (quoting Gaither

48 Noland supra at 383 686 SE2d at 34

22

487 SE2d at 906)) A plaintiff who knows offacts that place him or her on notice of a possible duty of care breach has an affirmative duty to further and fully investigate the facts surrounding that potential breach McCoy P Miller 578 SE2d 355 359 (W Va 2003)

Fourth if the plaintiff does not benefit from the discovery rule then the Court must look at whether the defendant fraudulently concealed facts that prevented the plaintiff from discovering or pursuing the cause of action See Dunn 689 SE2d at 265 Lastly the Court must inquire whether some other tolling doctrine affects the statute oflimitations period See id

In Parsons P Standard Insurance Co the plaintiffs WVUTPA and common law bad faith claims were asserted as a result of the defendant insurance companys denial of coverage and cessation of any further benefit payments both of which occurred on February 13 2014 No 116CV20 2016 WL 2599143 at 2-3 (ND W Va May 52016) The plaintiff was put on notice of the Defendants [denial] when he received the February 13 2014 letter Id at 2 Therefore the Court applied the discovery rule and concluded that the cause of action accrued the day he received the letter See id It further held that it was clear from the face of Parsons complaint that he was aware of the denial of coverage and cessation of benefit payments when he received the defendants denial letter The Court therefore conclude [ d] that the statute of limitations began to run on that date Id at 3 (applying the one-year statute of limitations applicable to WVUTPA and common law bad faith claims)

Here the claims requisite elements occurred between February 9 2007 when Ms Wilt first applied for the insurance and April 24 2014 when her insurance benefits ceased (See ECF No 3-1 at 13 If 1 14 If 12) Defendants representative made the alleged misrepresentation regarding the length of the insurance coverage the day she enrolled in the credit disability insurance (See id ltif 7) Plaintiff then received a letter in the mail on July 26 2013 stating that her benefits would terminate on April 24 2014 (Id ltif 12) She claims to have learned through this letter that Households salespersons statements from 2007 were false (See id) Plaintiff filed this action in state court on November 212014

Applying the discovery rule to Plaintiffs claims under WVUTPA sect 33-11-4(1)(a) (2)8 (9)(a) (11) and her first-party insurance bad faith claim Ms Wilt knew of the alleged WVUTPA and first-party insurance bad faith violations when she read the July 26 2013 letter mailed to her restating that the insurance policy benefits coverage only lasted 24 months (See ECF No 3-1 at 2 If 12) This is very similar to the letter received by the plaintiff in Parsons notifying the insured that disability insurance payments would cease There the cause of action accrued and the statute of limitations began to run on the date he received the letter Likewise the one-year statute oflimitations on the present claims began to run on July 26 2013

23

This Courts Beane memorandum decision confuses what is the measure of damages in a

first-party common law bad faith claim ie Whenever a policyholder substantially prevails in a

property damage suit against its insurer the insurer is liable for (1) the insureds reasonable

attorneys fees in vindicating its claim (2) the insureds damages for net economic loss caused by

the delay in settlement and damages for aggravation and inconvenience)) from Syllabus Point 1

ofHayseeds) Inc v State Farm Fire amp Casualty 177 W Va 323 352 SE2d 73 (1986) with when a

first-party bad faith claim accrues ie when a policyholder claim is denied

In this matter the pleadings clearly establish that Mr Dolly knew of the denial of the

insurance claim by Erie no later than November 4 2013 but failed to file the Amended

Complaint asserting UTPA violations and common law bad faith until March 22 2016 In other

words Mr Dolly filed the Amended Complaint asserting UTPA violations and common law bad

faith against Erie more than one year after Mr Dolly knew or should have known from the

declination letter provided by Erie of his claims against Erie

Accordingly Mr Dollys UTPA claim should have been dismissed as barred by the oneshy

year statute of limitations Mr Dollys common law bad faith claim also should have been

dismissed as barred by the one-year statute of limitations or in the alternative for failure to state

a claim because a Hayseeds claim has not yet accrued

VI CONCLUSION

WHEREFORE Petitioner Erie Insurance Company respectfully requests that this

Court reverse the orders of the Circuit Court of Hampshire County and remand with directions

to enter judgment on either the issue of coverage or on the issue of whether the statutory and

common law bad faith claims are barred by the applicable one-year statute oflimitations

24

ERIE INSURANCE COMPANY

By Counsel

Hannah C Ramey WV Bar No 7700 Steptoe ampJohnson PLLC PO Box 2195 Huntington WV 25722-2195 Telephone (304) 526-8133 Facsimile (304) 933-8738 ancilrameysteptoe-johnsoncom hannahrameysteptoe-johnsoncom

Eric J Hulett Esq WV Bar No 6332 Steptoe ampJohnson PLLC 1250 Edwin Miller Blvd Suite 300 Martinsburg WV 25404 Telephone (304) 262-3519 Facsimile (304) 262-3541 erichulettsteptoe-johnsoncom

25

Enie u=-Iil linsuranceo nUlIgtch Ollieo bull leO) Mwrl RidDO Olivo PO 00( 605 luuysiIIamp PA lamp6oa-ooo5 72middot~ _ 3257100 middot lell fro s 1600553)81 Fnt 72~32 7715middot iOlioillsule)Cocom

November 4 2013

Ricky A Doll He 87 Box 117 Yellow Spring Wv 26865

Rc ERJE Claim 010950685772

Dear Mr Doily

ERJE Insured Dale ofloss

RicKY -amp Mary Lou Dolly 913n3

1111S letter vjIJ confinn our telephone-conversation of October 3D 2013 regnrding thcnbovc-rcfcrcnccd~ motor vehicle accident whichmiddotoccurred onSeptember 13 2013

As Iwhiised ~here is nocovernge under the middoti9l]surcct Mot9riS~ l)1fo~erty Damage ~ndorserpent for the damagc~ susuuncd ~o )our-trilJ ler und AT-V w))JCnoccurredm-thiS accIdent Our dcclslonwllS based upon the UninsurcdlUnderinsuredMotorists Coverage Endorsement - West Virginia which docs not providecovcrage for any trailer normiddot docs it provide coverage for a miscellaneous vehiclc owned by you unlcsslil is listed on the Declarationspage undiD premium ischarged for it Thc ATV was nlt listed on your Declarations pagc of the policy Please refermiddotto page 3 of the UtJinsilledJUildcrinsurciIr1otoTlstsCoverageEldorsemenl -West Virginia (Ed If II) -under the section

LIMIT OFI~ROTECTION

timitations of Payment

UninsuredlUnderinsured Motoristsi Cavcr~cmiddot is not pfovidcd for allY trni leri whetheror not the ti-ailer is attached io another rilOtor vehicle or miscellaneous vehiCle No separate -limit of protection for UninsuredlUnderinsured Motorists ltovcragc S avail~blc for n trailer W17thcr attached orunnttachedltoa motormiddotvelucle or mlscellaneousrvehlcle UmnsuredlUndcnnsured Motorists Covcragcdocsmiddotnot apply 0 a misceJlimeous vehicle owned or leasedby yoti or a relative uhlcss U1C II miscellaneous vehicle 5 listed OI1thc DeclarD~ions aJ]dI2jprel1iulP is shown for this covlfrage

You have ~~ optIon of coqtacting thc Oficcofthe InslflIDcc COIJ1lission at Po BoI 50540 Charles~on Wes VirgOIl 25305 tclephone 1-888c558~1296 website wwwwvtnsurancegov

shoujd you haveinny qtlC~tiOl5 regarding the -abovc please COltact iITle

Sincerely

Vema M Cavalieri Senior Liability AdjusterPO Box605 Murrysvillc PA 15668

VMClml -866middot330middot0738

Enclosure UninsuredlUndcrinsurcd Motorists Coverage Endorsement - West Virginia (Ed f IImiddot)

cc Wilkins Ins Agency Inc PO Box 2960 Wincpester VA ~2604

~_IIIIIIIIIIIIIIIIIIIIIJIIIIIII_IIWJ8761Upoc EXHIBIT

I A

000227

CERTIFICATE OF SERVICE

I do hereby certify that on March 13 2017 I caused to be deposited in the United States

Mail postage prepaid a true copy of the BRIEF OF THE PETITIONER addressed as follows

Jonathan G Brill Esq PO Box 932

Romney WV 26757 Counselfor Respondent

TABLE OF CONTENTS

I ASSIGNMENTS OF ERROR 1


A PROCEDURAL BACKGROUND 1

B LITIGATION HISTORY 2

C MOTION TO DISMISS BAD FAITH CLAIMS BARRED BY ONE-YEAR STATUTE

OF LIMITATIONS 3

D CRoss-MOTIONS FOR DECLARATORYJUDGMENT 4

III SUMMARY OF ARGUMENT 7

IV STATEMENT REGARDING ORAL ARGUMENT ANDDECISION7

V ARGUMENT

A STANDARD OF REVIEW 8

B THE CIRCUIT COURT ERRED BY RULING THAT THE EXCLUSION OF

UNINSURED MOTORIST COVERAGE FOR A TRAILER AND AN ATV

VIOLATED THE MOTOR VEHICLE SAFETY RESPONSIBILITY LAW 8

C THE CIRCUIT COURT ERRED BY DENYING ERIES MOTION TO DISMISS

STATUTORY AND COMMON LAW BAD FAITH CLAIMS THAT ARE CLEARLY

BARRED BY THE ApPLICABLE ONE-YEAR STATUTE OF LIMITATIONS 13

1 Under Wilt Statutory Bad Faith Claims Must Be Filed Within One Year of the Denial of an Insurance Claim and the Circuit Court Erred by Refusing to Dismiss the Statutory Bad Claim in this Case Filed More Than One-Year After Written Denial of the Claim 14

2 This Courts Recent Decision in Beane Conflicts with the Previous Decisions of this Court Regarding When a Common Law Bad Faith Cause of Action Accrues and the Decisions of Federal Courts Applying a One-Year Statute ofLimitations to Common Law Bad Faith Claims 20

VI CONCLUSION 24


CASES












In re TO 2017 WL 562828 CW Va) 21


11











STATUTES







111

RULES

R App P 5(h) 7

R App P 20 7

IV





































1 [APP 137]

2 [APP 8-13J

3 Id atltj[ 28


5 [APP 16-19]

6 [APP 47-54J

7 [APP 51J

8 [APP 43]

2


















9 [APP 54-57]

10 [APP 57]

II [APP 58-78]

12 [APP 58]

3













14 [APP 153]

15 [APP 208]

4







Commissioner



16 [APP 401-402]

5


















17 [APP 495-501]



6

















20 [APP 592-593]

7








VARGUMENT











West Virginia Code




8























9




provides as follows











Responsibility Law


follows


10







24 [APP 401]


11








12














13



















14












held





15


















33 Id at 765


16











faith 37








35 Id at 3

36 Id at 5

37Id

38 Id at 915

17











39Id

18




coverage case





40 Id at 2


42 [APP 90-92]

19




















43 Id at 4

20




Hayseeds claim













46 TO supra at 8


21

















22






23


















VI CONCLUSION





24


By Counsel



25


November 4 2013



Dear Mr Doily





LIMIT OFI~ROTECTION





Sincerely






I A

000227







CASES












In re TO 2017 WL 562828 CW Va) 21


11











STATUTES







111

RULES

R App P 5(h) 7

R App P 20 7

IV





































1 [APP 137]

2 [APP 8-13J

3 Id atltj[ 28


5 [APP 16-19]

6 [APP 47-54J

7 [APP 51J

8 [APP 43]

2


















9 [APP 54-57]

10 [APP 57]

II [APP 58-78]

12 [APP 58]

3













14 [APP 153]

15 [APP 208]

4







Commissioner



16 [APP 401-402]

5


















17 [APP 495-501]



6

















20 [APP 592-593]

7








VARGUMENT











West Virginia Code




8























9




provides as follows











Responsibility Law


follows


10







24 [APP 401]


11








12














13



















14












held





15


















33 Id at 765


16











faith 37








35 Id at 3

36 Id at 5

37Id

38 Id at 915

17











39Id

18




coverage case





40 Id at 2


42 [APP 90-92]

19




















43 Id at 4

20




Hayseeds claim













46 TO supra at 8


21

















22






23


















VI CONCLUSION





24


By Counsel



25


November 4 2013



Dear Mr Doily





LIMIT OFI~ROTECTION





Sincerely






I A

000227
















STATUTES







111

RULES

R App P 5(h) 7

R App P 20 7

IV





































1 [APP 137]

2 [APP 8-13J

3 Id atltj[ 28


5 [APP 16-19]

6 [APP 47-54J

7 [APP 51J

8 [APP 43]

2


















9 [APP 54-57]

10 [APP 57]

II [APP 58-78]

12 [APP 58]

3













14 [APP 153]

15 [APP 208]

4







Commissioner



16 [APP 401-402]

5


















17 [APP 495-501]



6

















20 [APP 592-593]

7








VARGUMENT











West Virginia Code




8























9




provides as follows











Responsibility Law


follows


10







24 [APP 401]


11








12














13



















14












held





15


















33 Id at 765


16











faith 37








35 Id at 3

36 Id at 5

37Id

38 Id at 915

17











39Id

18




coverage case





40 Id at 2


42 [APP 90-92]

19




















43 Id at 4

20




Hayseeds claim













46 TO supra at 8


21

















22






23


















VI CONCLUSION





24


By Counsel



25


November 4 2013



Dear Mr Doily





LIMIT OFI~ROTECTION





Sincerely






I A

000227






RULES

R App P 5(h) 7

R App P 20 7

IV





































1 [APP 137]

2 [APP 8-13J

3 Id atltj[ 28


5 [APP 16-19]

6 [APP 47-54J

7 [APP 51J

8 [APP 43]

2


















9 [APP 54-57]

10 [APP 57]

II [APP 58-78]

12 [APP 58]

3













14 [APP 153]

15 [APP 208]

4







Commissioner



16 [APP 401-402]

5


















17 [APP 495-501]



6

















20 [APP 592-593]

7








VARGUMENT











West Virginia Code




8























9




provides as follows











Responsibility Law


follows


10







24 [APP 401]


11








12














13



















14












held





15


















33 Id at 765


16











faith 37








35 Id at 3

36 Id at 5

37Id

38 Id at 915

17











39Id

18




coverage case





40 Id at 2


42 [APP 90-92]

19




















43 Id at 4

20




Hayseeds claim













46 TO supra at 8


21

















22






23


















VI CONCLUSION





24


By Counsel



25


November 4 2013



Dear Mr Doily





LIMIT OFI~ROTECTION





Sincerely






I A

000227










































1 [APP 137]

2 [APP 8-13J

3 Id atltj[ 28


5 [APP 16-19]

6 [APP 47-54J

7 [APP 51J

8 [APP 43]

2


















9 [APP 54-57]

10 [APP 57]

II [APP 58-78]

12 [APP 58]

3













14 [APP 153]

15 [APP 208]

4







Commissioner



16 [APP 401-402]

5


















17 [APP 495-501]



6

















20 [APP 592-593]

7








VARGUMENT











West Virginia Code




8























9




provides as follows











Responsibility Law


follows


10







24 [APP 401]


11








12














13



















14












held





15


















33 Id at 765


16











faith 37








35 Id at 3

36 Id at 5

37Id

38 Id at 915

17











39Id

18




coverage case





40 Id at 2


42 [APP 90-92]

19




















43 Id at 4

20




Hayseeds claim













46 TO supra at 8


21

















22






23


















VI CONCLUSION





24


By Counsel



25


November 4 2013



Dear Mr Doily





LIMIT OFI~ROTECTION





Sincerely






I A

000227























9 [APP 54-57]

10 [APP 57]

II [APP 58-78]

12 [APP 58]

3













14 [APP 153]

15 [APP 208]

4







Commissioner



16 [APP 401-402]

5


















17 [APP 495-501]



6

















20 [APP 592-593]

7








VARGUMENT











West Virginia Code




8























9




provides as follows











Responsibility Law


follows


10







24 [APP 401]


11








12














13



















14












held





15


















33 Id at 765


16











faith 37








35 Id at 3

36 Id at 5

37Id

38 Id at 915

17











39Id

18




coverage case





40 Id at 2


42 [APP 90-92]

19




















43 Id at 4

20




Hayseeds claim













46 TO supra at 8


21

















22






23


















VI CONCLUSION





24


By Counsel



25


November 4 2013



Dear Mr Doily





LIMIT OFI~ROTECTION





Sincerely






I A

000227


















14 [APP 153]

15 [APP 208]

4







Commissioner



16 [APP 401-402]

5


















17 [APP 495-501]



6

















20 [APP 592-593]

7








VARGUMENT











West Virginia Code




8























9




provides as follows











Responsibility Law


follows


10







24 [APP 401]


11








12














13



















14












held





15


















33 Id at 765


16











faith 37








35 Id at 3

36 Id at 5

37Id

38 Id at 915

17











39Id

18




coverage case





40 Id at 2


42 [APP 90-92]

19




















43 Id at 4

20




Hayseeds claim













46 TO supra at 8


21

















22






23


















VI CONCLUSION





24


By Counsel



25


November 4 2013



Dear Mr Doily





LIMIT OFI~ROTECTION





Sincerely






I A

000227












Commissioner



16 [APP 401-402]

5


















17 [APP 495-501]



6

















20 [APP 592-593]

7








VARGUMENT











West Virginia Code




8























9




provides as follows











Responsibility Law


follows


10







24 [APP 401]


11








12














13



















14












held





15


















33 Id at 765


16











faith 37








35 Id at 3

36 Id at 5

37Id

38 Id at 915

17











39Id

18




coverage case





40 Id at 2


42 [APP 90-92]

19




















43 Id at 4

20




Hayseeds claim













46 TO supra at 8


21

















22






23


















VI CONCLUSION





24


By Counsel



25


November 4 2013



Dear Mr Doily





LIMIT OFI~ROTECTION





Sincerely






I A

000227























17 [APP 495-501]



6

















20 [APP 592-593]

7








VARGUMENT











West Virginia Code




8























9




provides as follows











Responsibility Law


follows


10







24 [APP 401]


11








12














13



















14












held





15


















33 Id at 765


16











faith 37








35 Id at 3

36 Id at 5

37Id

38 Id at 915

17











39Id

18




coverage case





40 Id at 2


42 [APP 90-92]

19




















43 Id at 4

20




Hayseeds claim













46 TO supra at 8


21

















22






23


















VI CONCLUSION





24


By Counsel



25


November 4 2013



Dear Mr Doily





LIMIT OFI~ROTECTION





Sincerely






I A

000227






















20 [APP 592-593]

7








VARGUMENT











West Virginia Code




8























9




provides as follows











Responsibility Law


follows


10







24 [APP 401]


11








12














13



















14












held





15


















33 Id at 765


16











faith 37








35 Id at 3

36 Id at 5

37Id

38 Id at 915

17











39Id

18




coverage case





40 Id at 2


42 [APP 90-92]

19




















43 Id at 4

20




Hayseeds claim













46 TO supra at 8


21

















22






23


















VI CONCLUSION





24


By Counsel



25


November 4 2013



Dear Mr Doily





LIMIT OFI~ROTECTION





Sincerely






I A

000227













VARGUMENT











West Virginia Code




8























9




provides as follows











Responsibility Law


follows


10







24 [APP 401]


11








12














13



















14












held





15


















33 Id at 765


16











faith 37








35 Id at 3

36 Id at 5

37Id

38 Id at 915

17











39Id

18




coverage case





40 Id at 2


42 [APP 90-92]

19




















43 Id at 4

20




Hayseeds claim













46 TO supra at 8


21

















22






23


















VI CONCLUSION





24


By Counsel



25


November 4 2013



Dear Mr Doily





LIMIT OFI~ROTECTION





Sincerely






I A

000227




























9




provides as follows











Responsibility Law


follows


10







24 [APP 401]


11








12














13



















14












held





15


















33 Id at 765


16











faith 37








35 Id at 3

36 Id at 5

37Id

38 Id at 915

17











39Id

18




coverage case





40 Id at 2


42 [APP 90-92]

19




















43 Id at 4

20




Hayseeds claim













46 TO supra at 8


21

















22






23


















VI CONCLUSION





24


By Counsel



25


November 4 2013



Dear Mr Doily





LIMIT OFI~ROTECTION





Sincerely






I A

000227









provides as follows











Responsibility Law


follows


10







24 [APP 401]


11








12














13



















14












held





15


















33 Id at 765


16











faith 37








35 Id at 3

36 Id at 5

37Id

38 Id at 915

17











39Id

18




coverage case





40 Id at 2


42 [APP 90-92]

19




















43 Id at 4

20




Hayseeds claim













46 TO supra at 8


21

















22






23


















VI CONCLUSION





24


By Counsel



25


November 4 2013



Dear Mr Doily





LIMIT OFI~ROTECTION





Sincerely






I A

000227












24 [APP 401]


11








12














13



















14












held





15


















33 Id at 765


16











faith 37








35 Id at 3

36 Id at 5

37Id

38 Id at 915

17











39Id

18




coverage case





40 Id at 2


42 [APP 90-92]

19




















43 Id at 4

20




Hayseeds claim













46 TO supra at 8


21

















22






23


















VI CONCLUSION





24


By Counsel



25


November 4 2013



Dear Mr Doily





LIMIT OFI~ROTECTION





Sincerely






I A

000227













12














13



















14












held





15


















33 Id at 765


16











faith 37








35 Id at 3

36 Id at 5

37Id

38 Id at 915

17











39Id

18




coverage case





40 Id at 2


42 [APP 90-92]

19




















43 Id at 4

20




Hayseeds claim













46 TO supra at 8


21

















22






23


















VI CONCLUSION





24


By Counsel



25


November 4 2013



Dear Mr Doily





LIMIT OFI~ROTECTION





Sincerely






I A

000227



















13



















14












held





15


















33 Id at 765


16











faith 37








35 Id at 3

36 Id at 5

37Id

38 Id at 915

17











39Id

18




coverage case





40 Id at 2


42 [APP 90-92]

19




















43 Id at 4

20




Hayseeds claim













46 TO supra at 8


21

















22






23


















VI CONCLUSION





24


By Counsel



25


November 4 2013



Dear Mr Doily





LIMIT OFI~ROTECTION





Sincerely






I A

000227
























14












held





15


















33 Id at 765


16











faith 37








35 Id at 3

36 Id at 5

37Id

38 Id at 915

17











39Id

18




coverage case





40 Id at 2


42 [APP 90-92]

19




















43 Id at 4

20




Hayseeds claim













46 TO supra at 8


21

















22






23


















VI CONCLUSION





24


By Counsel



25


November 4 2013



Dear Mr Doily





LIMIT OFI~ROTECTION





Sincerely






I A

000227

















held





15


















33 Id at 765


16











faith 37








35 Id at 3

36 Id at 5

37Id

38 Id at 915

17











39Id

18




coverage case





40 Id at 2


42 [APP 90-92]

19




















43 Id at 4

20




Hayseeds claim













46 TO supra at 8


21

















22






23


















VI CONCLUSION





24


By Counsel



25


November 4 2013



Dear Mr Doily





LIMIT OFI~ROTECTION





Sincerely






I A

000227























33 Id at 765


16











faith 37








35 Id at 3

36 Id at 5

37Id

38 Id at 915

17











39Id

18




coverage case





40 Id at 2


42 [APP 90-92]

19




















43 Id at 4

20




Hayseeds claim













46 TO supra at 8


21

















22






23


















VI CONCLUSION





24


By Counsel



25


November 4 2013



Dear Mr Doily





LIMIT OFI~ROTECTION





Sincerely






I A

000227
















faith 37








35 Id at 3

36 Id at 5

37Id

38 Id at 915

17











39Id

18




coverage case





40 Id at 2


42 [APP 90-92]

19




















43 Id at 4

20




Hayseeds claim













46 TO supra at 8


21

















22






23


















VI CONCLUSION





24


By Counsel



25


November 4 2013



Dear Mr Doily





LIMIT OFI~ROTECTION





Sincerely






I A

000227
















39Id

18




coverage case





40 Id at 2


42 [APP 90-92]

19




















43 Id at 4

20




Hayseeds claim













46 TO supra at 8


21

















22






23


















VI CONCLUSION





24


By Counsel



25


November 4 2013



Dear Mr Doily





LIMIT OFI~ROTECTION





Sincerely






I A

000227









coverage case





40 Id at 2


42 [APP 90-92]

19




















43 Id at 4

20




Hayseeds claim













46 TO supra at 8


21

















22






23


















VI CONCLUSION





24


By Counsel



25


November 4 2013



Dear Mr Doily





LIMIT OFI~ROTECTION





Sincerely






I A

000227

























43 Id at 4

20




Hayseeds claim













46 TO supra at 8


21

















22






23


















VI CONCLUSION





24


By Counsel



25


November 4 2013



Dear Mr Doily





LIMIT OFI~ROTECTION





Sincerely






I A

000227









Hayseeds claim













46 TO supra at 8


21

















22






23


















VI CONCLUSION





24


By Counsel



25


November 4 2013



Dear Mr Doily





LIMIT OFI~ROTECTION





Sincerely






I A

000227






















22






23


















VI CONCLUSION





24


By Counsel



25


November 4 2013



Dear Mr Doily





LIMIT OFI~ROTECTION





Sincerely






I A

000227











23


















VI CONCLUSION





24


By Counsel



25


November 4 2013



Dear Mr Doily





LIMIT OFI~ROTECTION





Sincerely






I A

000227























VI CONCLUSION





24


By Counsel



25


November 4 2013



Dear Mr Doily





LIMIT OFI~ROTECTION





Sincerely






I A

000227







By Counsel



25


November 4 2013



Dear Mr Doily





LIMIT OFI~ROTECTION





Sincerely






I A

000227







November 4 2013



Dear Mr Doily





LIMIT OFI~ROTECTION





Sincerely






I A

000227






in the supreme court of appeals of...atv.4 on june 27, 2014, an answer was filed on behalf of the...

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