Insurer Loses Summary Judgment for lack of Claiming the Existence of Evidence it Had


Insurer Properly Excluded claim for Plaintiff who was not Hospital Confined but Failed to Prove All Elements of Motion

Appellate courts will often reverse a motion for summary judgment in favor of an insurer on technical grounds even when the decision made by the insurer to deny benefits appeared to be appropriate. In Vanessa Hartwell v. American Fidelity Assurance Company, No. SD36561, Missouri Court of Appeals Southern District Division Two (September 17, 2020) the insurer’s motion was granted by the trial court but was reversed.


Vanessa Hartwell (“Hartwell”) appealed the trial court’s judgment granting summary judgment in favor of American Fidelity Assurance Company (“AFA”) on Hartwell’s petition for breach of insurance contract (Count I) and vexatious refusal to pay an insurance claim (Count II). In three points, Hartwell contended that the trial court erred in granting summary judgment.

Hartwell was the holder of and an insured under an insurance policy issued by AFA (“the Policy”) that was in full force and effect. Hartwell filed an insurance claim with AFA seeking the “Hospital Confinement Benefit” under the Policy for a period of hospitalization from June 11, 2018, through July 4, 2018. AFA agreed with Hartwell that she was hospitalized at Saint Francis Medical Center (“SFMC”) from June 11, 2018, through June 19, 2018, and paid the benefits Hartwell claimed for those dates. It denied, however, that she was entitled to the Hospital Confinement Benefit for the remainder of the days at issue, June 20, 2018, to July 4, 2018.

AFA’s Policy provides that eligibility for the Hospital Confinement Benefit requires that the insured be confined as a patient in a “Hospital” as defined within the Policy (“the Hospital definition”). Furthermore, the Hospital definition contains language excluding from that term an institution used by the insured as “a place for rehabilitation” or as “an extended care facility for the care of convalescent, rehabilitative or ambulatory patients.” With respect to the portion of Hartwell’s claim for Hospital Confinement Benefits that it denied, AFA alleged,

Hartwell was inpatient from June 20, 2018 to July 4, 2018 at a rehabilitation facility located on the SFMC grounds and her stay during this time was used by her as “a place for rehabilitation” and/or “an extended care facility for the care of convalescent, rehabilitative or ambulatory patients.”


A court construing the terms of an insurance policy must apply the meaning which would be attached by an ordinary person of average understanding if purchasing insurance, and resolves ambiguities in favor of the insured. An ambiguity exists when there is duplicity, indistinctness, or uncertainty in the meaning of the language of the policy. An insured cannot create an ambiguity by reading only a part of the policy and claiming that, read in isolation, that portion of the policy suggests a level of coverage greater than the policy actually provides when read as a whole.

With these principles in mind the Hospital definition states:

HOSPITAL means a licensed institution which: (a) has on its premises: (1) laboratory, X-ray equipment and operating rooms where major surgical operations maybe [sic] performed by licensed Physicians; (2) permanent and full-time facilities for the care of overnight resident bed patients under the supervision of a licensed Physician; (3) 24-hour-a-day nursing service by graduate registered nurses; and (4) the patient’s written history and medical records; or: (b) is accredited by the Joint Commission on Accreditation of Hospitals. The term Hospital shall not include an institution used by You as: (a) a place for rehabilitation; (b) a place for rest or for the aged; (c) a nursing or convalescent home; (d) a long term nursing unit or geriatrics ward; or (e) an extended care facility for the care of convalescent, rehabilitative or ambulatory patients.” (Emphasis added by the court.)

No duplicity, indistinctness, or uncertainty exists between the first and second parts of the Hospital definition. When read as a whole it requires that, in order to qualify for inclusion within the Hospital definition, a licensed institution must satisfy the definition’s first part but an institution is excluded from that term if it is used by the insured in any manner described in the definition’s second part. Thus, to an ordinary person of average understanding, an institution qualifies under the Hospital definition if it (1) satisfies the definition’s first part and (2) was not used by the insured in a manner proscribed in the second part. The same person would also understand that, in a different context, an institution, although meeting the Hospital definition’s first part, does not qualify as a Hospital if it was used by an insured in a manner described and excluded by the second part.

Where there is no ambiguity in an insurance policy, a court must enforces the policy as written.

However, a summary judgment can only be granted if there is no genuine issue of material fact and the moving party is entitled to judgment as a matter of law. Hartwell argued that AFA’s motion for summary judgment failed to make a prima facie showing of a right to judgment as a matter of law under the Hospital definition because its statement of uncontroverted material facts (“SUMF”) omitted the material fact that between June 20, 2018, through July 4, 2018, she used SFMC as either “a place for rehabilitation” or “an extended care facility for the care of convalescent, rehabilitative or ambulatory patients.”

If a movant’s motion for summary judgment fails to make a prima facie showing of a right to judgment as a matter of law, any further inquiry into the summary judgment record should end and the motion for summary judgment should be denied. In its attempt to refute the claim she was hospital confined AFA failed to state as an alleged material fact in its SUMF that Hartwell used SFMC in a manner proscribed in that definition.

AFA was required to make a prima facie showing of a right to judgment as a matter of law based upon its asserted uncontroverted material facts. When, and only when, AFA makes the necessary prima facie showing of a right to judgment as a matter of law based upon its SUMF does the burden shift to Hartwell to show that one or more of AFA’s material facts are genuinely disputed. In sum, AFA’s SUMF fails to support a prima facie showing of AFA’s right to judgment as a matter of law under the Hospital definition.

The trial court’s judgment in favor of AFA was reversed, and the case was remanded for further proceedings consistent with the opinion.


To paraphrase Shakespeare: For want of a nail a horse was lost and for want of a horse a kingdom was lost. In this case, for want of a statement in AFA’s SUMF that Hartwell was not in a “Hospital” but in a care facility, its favorable judgment was reversed. The victory for Hartwell is Pyrrhic since all AFA need do is rewrite its motion and add the language that explains Hartwell’s non-Hospital stay. Hartwell and AFA should settle for the costs of bringing a new motion.

© 2020 – Barry Zalma

Barry Zalma, Esq., CFE, now limits his practice to service as an insurance consultant  specializing in insurance coverage, insurance claims handling, insurance bad faith and insurance fraud almost equally for insurers and policyholders. He also serves as an arbitrator or mediator for insurance related disputes. He practiced law in California for more than 44 years as an insurance coverage and claims handling lawyer and more than 52 years in the insurance business. He is available at and

Mr. Zalma is the first recipient of the first annual Claims Magazine/ACE Legend Award.

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