Wyoming Medical Center, Inc. v. Wyoming Insurance Guaranty Ass'n, 2010 WY 21

Summary

The Wyoming Supreme Court held that the Wyoming Insurance Guaranty Association’s claim for reimbursement of insurance deductibles was not barred by res judicata because the Association was not identical or in privity with the insolvent insurer in the earlier action. The court concluded that the Association could recover deductibles that the solvent insurer would have been entitled to collect. It also held that attorney fees incurred by the insured in defending covered claims were excluded from “covered claims” under the Wyoming Insurance Guaranty Association Act and therefore could not be used as a setoff.

Holdings

1. Res judicata does not bar WIGA's claim because WIGA is not in privity with PHICO and does not stand in its shoes for all purposes.
2. Attorney fees are excluded from 'covered claims' under the Act, so WIGA is not liable for them.

Questions Presented

1. Whether res judicata bars WIGA's claim for deductibles
2. Whether WMC is entitled to a setoff for attorney fees

Disposition

affirmed