Fiallo v. Allstate Insurance Company
The reasonable expectations of the insured control when enforcing insurance contracts and the process best suited to effectuate the intent of the parties where the language is ambiguous as to an issue of historical fact of whether the insured elected to buy a particular policy, is to examine extrinsic evidence to determine the parties' intentions. Mario Fiallo was working as a school maintenance worker when he was struck by an automobile and sustained injuries. After being paid the $20,000 limits of the tortfeasor's motor vehicle insurance policy, Fiallo brought this action against Allstate Insurance Company to recover underinsured motorist benefits under a policy issued to him by Allstate. A jury awarded Fiallo $95,000. Issues relating to reductions under the policy provisions were reserved to the court. Allstate filed a motion to reduce the verdict to $0. Fiallo requested to amend his complaint to add counts to conform to the evidence produced and discovered at trial of alleged misconduct by Allstate. The court denied the plaintiff's request and granted the defendant's motion, in part, reducing the judgment to $24,596.19. The plaintiff appealed contending that the court erred in denying his request to amend the complaint to allege bad faith and in failing to find ambiguity in the insurance policy. The Appellate Court affirmed and reversed the judgment, in part, and remanded the matter. The trial court did not abuse its discretion in denying the plaintiff's request to amend the complaint after the jury verdict and before judgment was rendered. The court impliedly recognized that if the claims are barred in a second action on res judicata grounds, then they should have been seasonably raised in the first action and there was no unfair prejudice in disallowing the amendment. If the claims could not have been timely raised, then they will not be barred in a second action. But, the trial court erred in failing to find an ambiguity in the policy. The issue of whether the plaintiff purchased standard uninsured/underinsured motorist coverage or conversion coverage presented a question of historical fact, rather than one of contract construction. An examination of extrinsic evidence was found appropriate. If this does not resolve the question, other canons of construction, including perhaps the doctrine of contra proferentem, may be applied. Judge Borden concurred separately.