Kramer v. Fergus Farm Mutual Insurance Company

Summary

The Montana Supreme Court reviewed a district court order certifying classes of insureds in a dispute over payment of general contractor overhead and profit under Fergus Farm Mutual insurance policies. The Court held that common questions concerning the insurer’s contractual duty and claim practices predominated over individualized issues, supporting class certification. It affirmed in part, reversed in part, and remanded because the district court had prematurely resolved factual and legal issues concerning policy ambiguity and claim-settlement practices.

Holdings

1. Common questions concerning Fergus Farm's duty under its insurance policy to pay general contractor overhead and profit, and whether its claim-settlement practices violated Montana's Unfair Trade Practices Act, predominated over individualized inquiries, so class certification was proper.
2. The District Court erred by declaring the policy ambiguous based partly on evidentiary conflicts and by invalidating Fergus Farm's 'reasonably necessary' inquiry and subcontractor-documentation requirement before resolving factual disputes concerning the parties' conduct and interpretation of the policy.

Questions Presented

1. Whether the District Court abused its discretion by determining that common questions of law predominated under Montana Rule of Civil Procedure 23(b)(3).
2. Whether the District Court abused its discretion by entering incorrect legal conclusions and clearly erroneous factual findings during class certification.

Disposition

reversed_and_remanded