Collision repair shop owner Steve Piispanen didn’t hire an attorney because he considers them to be “not educated” when it comes to insurance law.
He represented himself when he appealed a local judge’s decision to dismiss a $1,093.37 claim against State Farm Mutual Automobile Insurance Co. He wrote his own brief and personally appeared to make oral arguments before the New Hampshire Supreme Court.
Piispanen has no legal training. “Heck no,” he said. “I just winged it.”
No matter. Piispanen persuaded the state Supreme Court that a Circuit Court judge in Keene erred by dismissing his claim. In a 3-2 decision Tuesday, the high court ruled that an “anti-assignment clause” in an auto insurance policy applies only to pre-loss assignments, clearing the way for Piispanen to pursue a small claims action against the insurer.
The court majority rejected State Farm’s argument that allowing post-loss assignments would expose insurers to greater risk.
“Although assignees may be more sophisticated or more well-funded than insureds, we do not consider the greater possibility that an insurer will have to pay funds that it is already contractually obligated to pay as an increase in risk; otherwise, we would ‘reward the insurer which refuses to honor its contractual obligations,’” the majority opinion says, citing a 1975 decision by the Arizona Court of Appeals.
Caleb Meagher brought his vehicle into Piispanen’s shop, Keene Auto Body, for repairs. He assigned his right to pursue a claim against State Farm after the insurer refused to pay the full amount that Piispanen said was necessary to repair the vehicle.
Piispanen filed a small claims complaint. State Farm argued that the policy issued to Meagher clearly states that any assignment of benefits is invalid unless State Farm approves the assignment. Circuit Court Judge James Gleason dismissed the claim without explaining the reason.
That didn’t end the fight. Piispanen is the third-generation owner of an auto body shop that was founded in 1928 by a Finnish immigrant. He said he regularly confers with other “like-minded” auto body shop owners and knew that courts in other states have not looked favorably on insurance contracts that bar post-loss assignment-of-benefit claims.
He said State Farm had refused to pay for parts that clearly had to be replaced. For example, the insurer insisted that he install a halogen headlight rather than the LED headlight that was provided by the original equipment manufacturer, which cost $300 more. The insurer also refused to pay for calibration of the vehicle’s safety systems.
Piispanen said Gleason dismissed the Meagher claim along with many other small claims actions that totaled $30,000. But he said he also has a strong record of defeating insurers in court.
“If I were a Major League player, I’d be in the Hall of Fame,” he said.
After the New Hampshire Supreme Court accepted review of the Meagher claim, the New Hampshire Automobile Dealers Association joined the fight by filing an amicus brief. The association said courts “from Maine to California” have ruled that anti-assignment clauses in insurance contracts are not enforceable post loss.
“As the Supreme Court of Iowa put it, ‘[t]he great weight of authority supports the rule that an anti-assignment clause does not apply to the assignment of claims arising after the loss,’” the association’s amicus brief says.
The New Hampshire court’s majority followed its own line of reasoning when deciding the case. It said the State Farm policy in the Meagher case was ambiguous because the language did not specifically state that it applies to post-loss claims.
“We express no opinion as to whether an unambiguous clause prohibiting assignment of post-loss claims would be enforceable,” the court said.
Chief Justice Gordon J. MacDonald and Justice Anna Barbara Hantz Marconi dissented. They said the majority had adopted “novel interpretive principles” without any “prompting or developed legal arguments” from Keene Auto Body.
“The plain and ordinary meaning of the clause is clear and, in the usual course, it is our duty to enforce it,” the minority opinion says.
Top photo: The Keene Auto Body shop in Keene, N.H. Photo courtesy of Keene Auto Body.
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