{ "id": 1907777, "name": "SHELTER MUTUAL INSURANCE CO. v. Richard William PAGE and Brenda Gilbert", "name_abbreviation": "Shelter Mutual Insurance v. Page", "decision_date": "1994-04-18", "docket_number": "93-1141", "first_page": "623", "last_page": "629", "citations": [ { "type": "official", "cite": "316 Ark. 623" }, { "type": "parallel", "cite": "873 S.W.2d 534" } ], "court": { "name_abbreviation": "Ark.", "id": 8808, "name": "Arkansas Supreme Court" }, "jurisdiction": { "id": 34, "name_long": "Arkansas", "name": "Ark." }, "cites_to": [ { "cite": "238 F.2d 549", "category": "reporters:federal", "reporter": "F.2d", "case_ids": [ 422857 ], "year": 1956, "opinion_index": 0, "case_paths": [ "/f2d/238/0549-01" ] }, { "cite": "53 S.W.2d 422", "category": "reporters:state_regional", "reporter": "S.W.2d", "year": 1932, "opinion_index": 0 }, { "cite": "186 Ark. 311", "category": "reporters:state", "reporter": "Ark.", "case_ids": [ 8721148 ], "year": 1932, "opinion_index": 0, "case_paths": [ "/ark/186/0311-01" ] }, { "cite": "222 N.E.2d 871", "category": "reporters:state_regional", "reporter": "N.E.2d", "weight": 2, "year": 1967, "pin_cites": [ { "page": "874" } ], "opinion_index": 0 }, { "cite": "351 Mass. 609", "category": "reporters:state", "reporter": "Mass.", "case_ids": [ 3861733 ], "year": 1967, "opinion_index": 0, "case_paths": [ "/mass/351/0609-01" ] }, { "cite": "78 A.2d 461", "category": "reporters:state_regional", "reporter": "A.2d", "weight": 2, "year": 1951, "pin_cites": [ { "page": "463" } ], "opinion_index": 0 }, { "cite": "197 Md. 160", "category": "reporters:state", "reporter": "Md.", "case_ids": [ 2226768 ], "year": 1951, "opinion_index": 0, "case_paths": [ "/md/197/0160-01" ] }, { "cite": "13 Ark. App. 89", "category": "reporters:state", "reporter": "Ark. App.", "case_ids": [ 6137519 ], "weight": 2, "year": 1984, "opinion_index": 0, "case_paths": [ "/ark-app/13/0089-01" ] }, { "cite": "311 Ark. 395", "category": "reporters:state", "reporter": "Ark.", "case_ids": [ 1896971 ], "weight": 2, "year": 1993, "opinion_index": 0, "case_paths": [ "/ark/311/0395-01" ] } ], "analysis": { "cardinality": 612, "char_count": 11175, "ocr_confidence": 0.865, "pagerank": { "raw": 1.1345604052222587e-07, "percentile": 0.5769568032730866 }, "sha256": "e3cc9787f52be310ae38e74a797bdd7439dd1dcaec1c9ea4bfaa9e4380b41626", "simhash": "1:116f0895bcafbf9d", "word_count": 1895 }, "last_updated": "2023-07-14T14:45:44.703271+00:00", "provenance": { "date_added": "2019-08-29", "source": "Harvard", "batch": "2018" }, "casebody": { "judges": [], "parties": [ "SHELTER MUTUAL INSURANCE CO. v. Richard William PAGE and Brenda Gilbert" ], "opinions": [ { "text": "Steele Hays, Justice.\nThis appeal involves the \u201ccooperation clause\u201d of a motor vehicle liability policy. The trial court held the clause was not breached by the failure of the insured to cooperate with the insurer. We agree with the trial court.\nShelter Mutual Insurance Company is the appellant. Richard Page and Brenda Gilbert are the appellees. On August 8, 1988, Brenda Gilbert was injured in a collision with a car driven by Richard Page. The accident occurred in Columbia County, Arkansas. Page was insured by Shelter. Page contacted Shelter promptly after the accident and provided the details.\nBrenda Gilbert filed suit against Page on August 7, 1991. Gilbert was unable to obtain personal service on Page so a warning order was published and Page was notified by constructive service. There is no dispute as to the method of service. Page never answered the complaint and he was not subsequently located.\nShelter moved to intervene, the motion was granted and subsequently the trial court found that Page was in default and was liable for the injuries sustained by Mrs. Gilbert. Shelter defended by claiming Page had breached the policy\u2019s cooperation clause by failing to keep Shelter informed of his whereabouts.\nThe trial court found that Page had not breached the cooperation clause and that Shelter had suffered no prejudice. Mrs. Gilbert was awarded damages of $15,000. Shelter appeals from the judgment, contending the trial court erred in finding that Page had not breached the cooperation clause.\nShelter argues Gilbert was not diligent in pursuing her claim against Page because she did not file her suit until one day prior to the running of the statute of limitations, and \u201cthe record is entirely bereft of any attempts\u201d by Gilbert to inform Shelter she had been injured and expected compensation. Shelter insists it made reasonable attempts to locate Page after the suit was filed and it should be released due to Page\u2019s breach of the cooperation clause.\nIn response, Gilbert argues the burden was on Shelter to present evidence that Page\u2019s absence was for \u201cno good reason.\u201d Further, since the hearing was on the issue of damages only, Shelter was not prejudiced by Page\u2019s absence at trial, and, even if it were, Shelter invited the prejudice by not investigating the accident thoroughly at the time it occurred and by failing to act upon publication of the warning notice. Finally, Gilbert argues Shelter was not prejudiced since it participated fully at the hearing and cross-examined all witnesses on the issue of damages.\nAs to Shelter\u2019s argument that Gilbert did not act diligently in filing her suit against Page, Gilbert points out that Shelter did not raise this issue below. We will not consider an argument made for the first time on appeal. Dotson v. Madison County, Arkansas, 311 Ark. 395, 844 S.W.2d 371 (1993).\nShelter cites Fireman\u2019s Ins. Co. of Newark, New Jersey v. Cadillac Ins. Co., 13 Ark. App. 89, 679 S.W.2d 821 (1984), as supporting its position. There, the Court of Appeals affirmed a lower court\u2019s finding that the insured\u2019s failure to appear and defend a suit in negligence before a jury constituted a material breach of the policy. That case is distinguishable from the case at bar in that in Fireman\u2019s the negligence suit was tried on both liability and damages, and before a jury rather than a judge with the jury awarding both compensatory and punitive damages. There the insurer had located the insured, provided him with transportation to the trial and compensation for time off from his job but the insured failed to appear at trial. The court noted that the insured\u2019s attitude was one of \u201creluctant cooperation\u201d throughout and held the insured \u201clacked good reason for his absence from trial.\u201d Finally, the court noted that the failure of the insured to appear undoubtedly had an \u201cintangible effect upon the jury.\u201d\nShelter also cites Indemnity Ins. Co. of North America v. Smith, 197 Md. 160, 78 A.2d 461 (1951). It, too, is distinguishable. In that case the insured was informed that a suit had been filed and the insured disappeared. The insurer employed the services of an investigator in an unsuccessful attempt to locate the insured prior to trial. The cooperation clause in Smith was similar to this one. In finding that the insured breached the clause, the court stated:\nIt is thus a well settled rule that to relieve an insurer of liability on the ground of lack of cooperation, discrepancies in statements made by the insured must be made in bad faith and must be material in nature and prejudicial in effect.\nThe insured under a liability policy containing a cooperation clause is obligated to assist in good faith in making every legitimate defense to a suit for damages. If he refused to give the information which the insurer needs to make the defense, or absents himself so that his testimony cannot be obtained, recovery on the policy should be denied, if the insurer acts with good faith and diligence.\nWe recognize that two questions may arise when the insured has left the State: (1) Was the insured guilty of bad faith in leaving? and (2) Did the insurer use reasonable diligence in trying to locate the insured to procure his attendance at the trial?\nId. at 463.\nShelter also cites Peters v. Saulinier, 351 Mass. 609, 222 N.E.2d 871 (1967). There, the insured was not the owner of the policy but one who was an insured under the terms of the policy. The insured did not report the accident to the insurer as required. After the insurer was informed of the accident later by the policyholder, its investigators found the insured, but he disappeared again. In an attempt to relocate him, the investigators found the insured\u2019s mother but she was unaware of his whereabouts. Finding that the insurer had exercised diligence and good faith in attempting to obtain the insured\u2019s appearance at trial, the court stated:\nAn insurer is not bound to keep in touch with each insured while waiting for a case to be reached on a trial list. It is for the named insured and other insured who have benefited from the policy\u2019s protection to keep themselves reasonably accessible after an accident in which they have participated.\nId. at 874.\nIn U.S. Fidelity & Guaranty Co. v. Brandon, 186 Ark. 311, 53 S.W.2d 422 (1932), this court first addressed an alleged breach of a cooperation clause. The insured told the insurer four days before trial that he would be present but he failed to appear. Finding the insurer had presented \u201cno good reason\u201d why the insured did not make an appearance, we held \u201cit was the duty of the insurance company in this action to go further than showing [the insured\u2019s] mere absence from the trial in order to show lack of cooperation, and to show the reason for such absence.\u201d Id. at 315.\nIn the case at bar, Shelter\u2019s cooperation clause reads in part as follows:\nIn the event of an accident or loss, notice must be given to us promptly. The notice must give the time, place and circumstances of the accident or loss, including the names and addresses of injured persons and witnesses.\n****\nA person claiming coverage under this policy must also:\n(1) Cooperate with us and assist us in any matter concerning a claim or suit;\n(2) Send us promptly any legal papers received relating to any claim or suit[.]\nWe regard the holding in Brandon as consistent with the majority of jurisdictions on this issue. First, the burden of proof is on the insurer to show a breach of the cooperation clause. 14 Rhodes, Couch on Insurance, \u00a7 194 (Second ed. 1982); Pennsylvania Threshermen and Farmer\u2019s Mutual Casualty Insurance Company v. Owens, 238 F.2d 549 (4th Cir. 1956). Second, there is a two-step approach under the law in determining a breach of the cooperation clause when it involves the absence of the insured at trial. The law requires due diligence-on the part of the insurer to locate the insured or to find the reason for their absence. Couch, supra, \u00a7 192; Pennsylvania Threshermen, supra. An excerpt from the opinion in Pennsylvania Threshermen is often quoted:\nThe problem of non-cooperation has a dual aspect: not only what the insured failed t\u00f3 do, but what the insurer on its part did to secure cooperation from an apathetic, inattentive or vanished policy holder, must be considered. Liability insurance is intended not only to protect the insured, but also to protect members of the public who may be injured through negligence. Indeed, such insurance is made mandatory in many states. It would greatly weaken the practical usefulness of policies designed to afford public protection if it were enough to show mere disappearance of the insured without proof of proper efforts by the insurer to locate him.\nHere, the evidence shows that Page reported the accident in a timely manner and there is no allegation that Page failed to disclose the required information fully and accurately. Paul Whitley, Shelter\u2019s agent in Columbia County, testified he issued the policy for Page in 1987 and 1988, and that Page contacted him about the accident. Whitley testified he asked Page to \u201calways keep me informed of where he was.\u201d After Page reported the accident, Whitley\u2019s next and last contact with the family was January 18, 1989, when Page\u2019s wife wanted changes in their policies. Thereafter, Page\u2019s policy lapsed. Following the lapse of the policy, a postcard informing Page of that fact was sent to Page\u2019s last address and the postcard was not returned to Whitley. Whitley testified that he drove by the Page residence frequently. At one point in time the house was empty and then other people were living there. Whitley said he was first aware of Gilbert\u2019s suit in January 1991 or 1992 when he received a call from Shelter\u2019s attorney. Whitley knew Page worked for Bradham Oil Company while he lived in Columbia County. Finally, Whitley testified that while he usually looked at the classified ads in the Banner News, he could not say whether he noticed the warning order to Page.\nThere is no evidence that Shelter investigated the accident at the time it occurred, or that it attempted to locate Page through his employer after it was informed of the suit. There is no evidence that Shelter did anything other than try to call Page at his previous address or drive by his former house.\nContrary to Shelter\u2019s argument, the evidence is it merely called its agent and asked if he knew where Page was. From January of 1992, when Shelter first became aware of Gilbert\u2019s suit, until the hearing on May 4, 1993, the record as abstracted is devoid of any efforts by Shelter to locate Page. Because Shelter failed in its burden to show that it made diligent and good faith efforts to locate Page and failed to show that Page\u2019s absence was attributable to an effort to avoid trial, the trial court was correct in finding that Page did not breach the cooperation clause. We need not reach the question of prejudice.\nAffirmed.", "type": "majority", "author": "Steele Hays, Justice." } ], "attorneys": [ "Compton, Prewett, Thomas & Hickey, P.A., by: Floyd M. Thomas, Jr., for appellant.", "Robert L. Depper, Jr., for appellee." ], "corrections": "", "head_matter": "SHELTER MUTUAL INSURANCE CO. v. Richard William PAGE and Brenda Gilbert\n93-1141\n873 S.W.2d 534\nSupreme Court of Arkansas\nOpinion delivered April 18, 1994\nCompton, Prewett, Thomas & Hickey, P.A., by: Floyd M. Thomas, Jr., for appellant.\nRobert L. Depper, Jr., for appellee." }, "file_name": "0623-01", "first_page_order": 657, "last_page_order": 663 }