                IN THE SUPREME COURT OF THE STATE OF IDAHO
                               Docket No. 39784
WILLIAM S. SHAPLEY, an individual,            )
                                              )
    Plaintiff-Appellant,                      )
                                              )
v.                                            )
                                              )
CENTURION            LIFE       INSURANCE )
                                                        Boise, June 2013 Term
COMPANY, a foreign corporation, and )
WELLS FARGO FINANCIAL IDAHO, )
                                                        2013 Opinion No. 80
INC., an Idaho corporation,                   )
                                              )
                                                        Filed: June 25, 2013
    Defendants-Respondents,                   )
                                              )
                                                        Stephen W. Kenyon, Clerk
and                                           )
                                              )
JOHN DOES, individually, does 1 through X, )
and JOHN DOE BUSINESS ENTITIES, does )
1 through X,                                  )
                                              )
    Defendants.                               )
       Appeal from the District Court of the Third Judicial District, State of Idaho,
       Canyon County. Hon. Thomas Joseph Ryan, District Judge

       District court order granting summary judgment, affirmed.

       Pedersen & Whitehead, Twin Falls and Richard S. Owen, Nampa, for appellant.
       Brian J. Hilverda argued.

       Hawley, Troxell, Ennis & Hawley, Boise, for respondents. Kenneth C. Howell
       argued.
                           __________________________________
BURDICK, Chief Justice
       William Shapley appeals the Canyon County district court’s dismissal of his breach of
contract and negligence claims against Centurion Life Insurance Company (“Centurion”) and
Wells Fargo Financial (“Wells Fargo”). William Shapley and his wife Barbara Shapley applied
for credit life insurance with Centurion on the same day they closed on a loan with Wells Fargo.
Before Centurion approved their application, Mrs. Shapley passed away. After Centurion denied
Mr. Shapley’s claim for benefits, he brought several actions against both Centurion and Wells
Fargo, which the district court dismissed on summary judgment. Mr. Shapley argues that this

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dismissal was in error, as was the district court’s refusal to allow him to amend his complaint to
add an estoppel claim. We affirm the district court’s decisions.
                    I. FACTUAL AND PROCEDURAL BACKGROUND
       On June 20, 2008, the Shapleys applied for a real estate loan with Wells Fargo. The
Shapleys closed on the loan and submitted an application to Wells Fargo for a joint credit life
insurance policy through Centurion on July 10, 2008. Upon submitting their application, the
Shapleys were provided with a notice of insurance underwriting practices. The Shapleys did not
pay a premium at that time, nor did the application papers require an upfront premium payment.
       The application papers stated that the Shapleys would receive insurance coverage only if
Centurion approved their application. Specifically, the application the Shapleys signed stated, “I
understand that if my application for insurance is not approved by the insurance company, one or
both of the coverages for which I have applied will not become effective and no charge will be
made for that type of insurance.” Additionally, the notice of insurance that the Shapleys received
and signed on the same day explained the underwriting process. This document states:
       Your insurance application will be forwarded to our underwriting department to
       decide if we will approve the insurance coverage(s) you requested. However, the
       underwriter may first need additional information from you regarding your
       answers on the Health Statement. If so, we (or our representative) will contact you
       by telephone to obtain the information we need to make our decision. If we
       require a telephone interview and the interview is not completed for any reason
       we will not approve the insurance coverage(s) you requested.
Nancy Lunn, Centurion’s Claims Manager and Underwriting Manager, explained in her
deposition that Centurion had an underwriting procedures guideline that outlined when an
interview with an applicant was required. She explained that “requirements for an interview are
any yes answers on the health questions, age 55 or older, loan amount 75,000 or more, insurance
added after loan date more than three months, answers changed from yes to no on the health
statement.”
       Centurion never had a chance to have a phone interview with Mrs. Shapley. The day after
the Shapleys closed on their loan, Mrs. Shapley suffered a brain hemorrhage from which she
died four days later. Mr. Shapley contacted Centurion the same day to claim benefits in
connection with Mrs. Shapley’s passing. Centurion denied the claim because it never issued
insurance on Mrs. Shapley’s life. Centurion claims that Mrs. Shapley’s application was tagged
for a phone interview because she was over 55. Because this interview never took place

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Centurion issued insurance solely to Mr. Shapley.
        Mr. Shapley filed a complaint alleging breach of contract, bad faith, intentional infliction
of emotional distress, negligence, misrepresentation, and fraud. He later sought leave from the
court to amend his complaint to include a punitive damages claim, and defendants filed a motion
for summary judgment. The district court took both of these motions under advisement following
a hearing on July 28, 2011. In its November 4, 2011 Memorandum Decision, the district court
granted summary judgment to Centurion and Wells Fargo finding that all of Mr. Shapley’s
claims depended on the existence of a contract to insure Mrs. Shapley’s life and no such contract
was made.
        Later that month, Mr. Shapley filed a motion to amend his complaint to add an estoppel
claim. On November 29, 2011, while that motion was pending, the district court entered a final
judgment in favor of Centurion and Wells Fargo. Mr. Shapley then sought a reconsideration of
the district court’s summary judgment ruling. In doing so, Mr. Shapley argued that his
negligence claim does not depend on the existence of a contract to insure Mrs. Shapley’s life. In
opposing reconsideration, Centurion and Wells Fargo contended that the negligence claim was
barred by the “economic loss rule” even if not dependent on a contract to insure Mrs. Shapley’s
life.
        On February 22, 2012, the district court entered an order denying Mr. Shapley’s motions
because his estoppel claim was futile and the economic loss rule barred any possible negligence
claim not based on a contract. Mr. Shapley then filed a timely notice of appeal.
                                     II. STANDARD OF REVIEW
        This Court’s standard of review for a grant of dismissal on summary judgment was
concisely summarized in Harris v. State:

        When reviewing a ruling on a summary judgment motion, this Court applies the
        same standard used by the district court. Summary judgment is appropriate if the
        pleadings, depositions, and admissions on file, together with the affidavits, if any,
        show that there is no genuine issue as to any material fact and that the moving
        party is entitled to a judgment as a matter of law. The burden of establishing the
        absence of a genuine issue of material fact is on the moving party. This Court
        liberally construes all disputed facts in favor of the nonmoving party, and all
        reasonable inferences that can be drawn from the record are drawn in favor of the
        nonmoving party. Summary judgment is improper if reasonable persons could
        reach differing conclusions or draw conflicting inferences from the evidence
        presented.

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147 Idaho 401, 404–05, 210 P.3d 86, 89–90 (2009) (internal citations and quotations omitted).
       This Court reviews a district court’s denial of a motion to amend a complaint to add
additional causes of action for an abuse of discretion. Taylor v. McNichols, 149 Idaho 826, 832,
243 P.3d 642, 648 (2010). To determine whether a district court has abused its discretion, we
consider:
        (1) whether the court correctly perceived that the issue was one of discretion; (2)
       whether the court acted within the outer boundaries of its discretion and consistently with
       the legal standards applicable to the specific choices available to it; and (3) whether it
       reached its decision by an exercise of reason.
Id.
                                        III. ANALYSIS
A. The district court correctly dismissed all of Mr. Shapley’s claims on summary judgment.
       Because most if not all of the claims Mr. Shapley brought against Centurion and Wells
Fargo are based on the premise that a contract existed between Centurion and Mrs. Shapley, we
first address whether Mr. Shapley raised a material issue of fact as to the existence of this
contract before addressing whether the district court erred in concluding that his negligence
claim was conditioned on the existence of a contract.
       1. Mrs. Shapley and Centurion did not enter into a binding credit life insurance contract.
       For a contract to be formed there must be a meeting of the minds between the parties on
all material terms to the contract. In re Univ. Place/Idaho Water Ctr. Project, 146 Idaho 527,
536, 199 P.3d 102, 111 (2008). “A meeting of the minds is evidenced by a manifestation of
intent to contract which takes the form of an offer and acceptance.” Panike & Sons Farms, Inc. v.
Smith, 147 Idaho 562, 567, 212 P.3d 992, 997 (2009).
       An application for insurance is generally just an offer, and “acceptance by the insurer is
required for the completion of the insurance contract.” 1A Couch on Ins. 3d § 11:4; see also
Rouse v. Household Fin. Corp., 144 Idaho 68, 70, 156 P.3d 569, 571 (2007) (finding that no
contract was formed at the time of application when the language of the application “makes clear
that the applications may or may not be approved”). This Court has previously recognized an
exception to this rule when an application for insurance was ambiguous and required payment in
full of the premium at the time of application. Toevs v. W. Farm Bureau Life Ins. Co., 94 Idaho
151, 483 P.2d 682 (1971). In Toevs, the insurer required full payment of the premium when
Toevs applied, and then issued a conditional premium receipt. This Court concluded that the

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application’s ambiguity as to when insurance coverage began and Toevs’s initial payment of the
full premium gave Toevs reason to believe that he was insured at the time he applied for credit
life insurance. Id. at 154, 483 P.2d at 685. In reaching the decision in Toevs, we also noted that
payment of the premium at the time of application provides obvious benefits to the insurer
without providing any corresponding benefits to the applicant. Id. Thus, in Toevs the ambiguity
as to the date coverage began, the payment of the premium at the time of application, and the
insurer’s use of a conditional premium receipt “created a temporary contract of insurance subject
to a condition, i.e., rejection of Toevs’s application by the insurance company.” Id. at 155, 483
P.2d at 686.
         The conditions that led this Court to adopt the doctrine of temporary insurance in Toevs,
are not present in Mr. Shapley’s case. There was no delivery of a conditional premium receipt to
the Shapleys at the time the application for insurance was completed. Nor did the Shapleys pay a
premium with their application. Although the application gave the date of application as the
proposed effective date, it unequivocally stated that coverage was dependent on Centurion’s
approval of the Shapleys’ application. Specifically, the application the Shapleys signed stated, “I
understand that if my application for insurance is not approved by the insurance company, one or
both of the coverages for which I have applied will not become effective and no charge will be
made for that type of insurance.” Additionally, the notice of insurance that the Shapleys received
and signed on the same day as their application further explained that Centurion had to go
through an underwriting process before their application could be approved. Unlike in Toevs,
these documents were not ambiguous and it was not reasonable for the Shapleys to believe they
were covered when they submitted their application without paying any premiums to Centurion.
Accordingly, we decline to extend the temporary insurance doctrine from Toevs to Mr. Shapley’s
claim.
         The Shapleys’ application amounted to no more than an offer, which Centurion never
accepted as to Mrs. Shapley. In this case as in Rouse, the application’s language makes clear that
the application may or may not be approved. See 144 Idaho at 70, 156 P.3d at 571. Therefore, we
affirm the district court’s decision that a credit life insurance contract between Centurion and
Mrs. Shapley was never formed.
         This conclusion does not conflict with any Idaho law as Mr. Shapley contends. Mr.
Shapley first argues that a contract was formed when the Shapleys closed on their loan and

                                                 5
submitted their application to Centurion through Wells Fargo because I.C. § 41-2307 requires the
term of credit life insurance offered in Idaho to begin on the date of the indebtedness. Idaho
Code section 41-2307 states that:
       The term of any credit life insurance or credit disability insurance shall, subject to
       acceptance by the insurer, commence on the date when the debtor becomes
       obligated to the creditor, except that, where a group policy provides coverage with
       respect to existing obligations, the insurance on a debtor with respect to such
       indebtedness shall commence on the effective date of the policy.
Contrary to Mr. Shapley’s argument, this section does not require an insurer to commence
coverage on the date of indebtedness regardless of whether an application is accepted or rejected.
The date of coverage is clearly conditioned on the insurer’s acceptance of the application. See
I.C. § 41-2307 (“The term of credit life insurance…shall, subject to acceptance by the insurer,
commence on the date when the debtor becomes obligated to the creditor.…”). Section 41-2307
does not require that credit life insurance take effect automatically upon application. This
conclusion is further supported, not contradicted as Mr. Shapley argues, by I.C. § 41-2308.
       Idaho Code section 41-2308 requires a credit life insurance policy to be delivered on the
date the indebtedness is incurred, except in certain circumstances like when payment for credit
life insurance is separate from payment on the subject loan. I.C. § 41-2308(3), (4). Because the
Shapleys’ premium payments were separate from their loan payments, section 41-2308 only
required Centurion to deliver “a copy of the application for such policy or a notice of proposed
insurance” on the day the Shapleys closed on their loan. I.C. § 41-2308(4). This section requires
the insurer to deliver the insurance policy to the debtor within thirty days of the date the
indebtedness is incurred, but only “[u]pon acceptance of the insurance by the insurer.” I.C. § 41-
2308(4). By providing the Shapleys with a copy of their insurance application and a notice of
insurance underwriting practices on the day their loan closed, Centurion fully complied with
section 41-2308. Neither section 41-2307 nor section 41-2308 required Centurion to extend
coverage to the Shapleys on the date their loan closed without first approving their application.
       Finally, Mr. Shapley argues that it was unlawful for Centurion to have declined to insure
Mrs. Shapley’s life because she was unable to participate in an interview. Mr. Shapley contends
that Centurion was limited to the written application including the “Health Statement” to
determine eligibility for credit life insurance. He bases this argument on the following Idaho
Department of Insurance credit life insurance regulation: “No statement made by a debtor shall

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be used by the insurer as a basis for denying eligibility for coverage unless such statement is
contained in a written application for insurance signed by the debtor.” IDAPA 18.01.61.011.
This regulation does not flatly limit an insurer’s risk evaluation to reading the insured’s
application papers as Mr. Shapley appears to argue. The district court correctly held that the
regulation bars the use of interview statements themselves as the basis for declining to issue
credit life insurance, but interview statements may raise concerns that warrant investigation and
ultimately result in a proper basis for declining to issue credit life insurance. Therefore, we
affirm the district court’s finding that no contract existed between Mrs. Shapley and Centurion.
       2. Mr. Shapley waived review of the district court’s dismissal of his negligence
       claim.
       The district court’s initial reason for granting summary judgment against Mr. Shapley’s
negligence claim was that it depended on a nonexistent contract to insure Mrs. Shapley’s life. In
seeking reconsideration, Mr. Shapley argued that his negligence claim does not depend on the
existence of a contract. Ruling on Mr. Shapley’s motion for reconsideration the district court
concluded that Mr. Shapley had not argued a negligence claim independent of the contract, and
even if Mr. Shapley had argued such a claim, it still would have been barred by the economic
loss rule. Centurion and Wells Fargo contend that Mr. Shapley waived review of the dismissal of
his negligence claim because he did not address the district court’s application of the economic
loss rule as a bar to his negligence claim in his opening brief. Mr. Shapley responds that he was
not required to address this issue in his opening brief because judgment was never entered on this
issue and Centurion and Wells Fargo sufficiently addressed this issue in their response brief to
preserve it for appellate review.
       Idaho Appellate Rule 35(a)(6) requires that the opening brief “contain the contentions of
the appellant with respect to the issues presented on appeal, the reasons therefor, with citations to
the authorities, statutes and parts of the transcript and record relied upon.” Thus, this Court has
consistently held that an appellant’s failure to address an independent ground for a grant of
summary judgment in his opening brief and issue statement is fatal to the appeal. Weisel v.
Beaver Springs Owners Ass’n, Inc., 152 Idaho 519, 525, 272 P.3d 491, 497 (2012). In this case,
the district court gave the economic loss rule as an alternate ground for dismissal of Mr.
Shapley’s negligence claim when it ruled on his motion for reconsideration almost three months
after judgment was entered dismissing all of Mr. Shapley’s claims. This judgment states that

                                                 7
“[a]ll of Plaintiff’s claims are based on the allegation that a contract of insurance was in force
and Plaintiff’s case against Defendants is dismissed in its entirety with prejudice.” Mr. Shapley
contends that because this judgment was never amended to include the alternate ground for the
district court’s dismissal of his negligence claim, no final judgment was reached as to this claim.
       The district court was not required to amend the final judgment to include the economic
loss rule as an alternate ground. Indeed, Idaho Rule of Civil Procedure 54(a) prohibits the
inclusion of the court’s legal reasoning in a final judgment. See I.R.C.P. 54(a) (“A judgment
shall not contain … the court’s legal reasoning….”). Accordingly, we have previously held that
“an order granting summary judgment does not constitute a judgment.” Capstar Radio Operating
Co. v. Lawrence, 149 Idaho 623, 625, 238 P.3d 223, 225 (2010) (quoting In re Universe Life Ins.
Co., 144 Idaho 751, 756, 171 P.3d 242, 247 (2007)). The district court’s judgment in this case
only needed to state that all of Mr. Shapley’s claims were dismissed with prejudice, which it
unequivocally did. Therefore, the district court was not required to amend the judgment to
include language regarding the economic loss rule as an alternate ground for dismissal.
       The district court’s order regarding Mr. Shapley’s motion for reconsideration clearly gave
the economic loss rule as an alternate ground for dismissal of his negligence claim. Mr. Shapley
did not address this issue in his opening brief and merely addressing it in the reply brief is not
sufficient to preserve it. See Weisel, 152 Idaho at 525, 272 P.3d at 497. We hold that Mr. Shapley
failed to adequately address the economic loss rule as a bar to his negligence claim and thus has
waived the matter on appeal.
B. This Court upholds the district court’s denial of Mr. Shapley’s motion to amend.
       In conjunction with his request for reconsideration, Mr. Shapley also asked the district
court to allow him to amend his complaint to include an estoppel theory to prevent Wells Fargo
and Centurion from claiming that no contract had been formed. He argues on appeal that both
estoppel and quasi-estoppel apply in this case. However, because Mr. Shapley did not argue the
application of quasi-estoppel below, we will not address it on appeal. See KEB Enterprises, L.P.
v. Smedley, 140 Idaho 746, 752, 101 P.3d 690, 696 (2004) (“This Court’s longstanding rule is
that it will not consider issues raised for the first time on appeal.”). The district court did not
allow Mr. Shapley to amend his complaint to add an estoppel claim because “[w]ithout the
existence of a contract, the legal theory of estoppel cannot apply.” The district court based its
conclusion on this Court’s language that the “purpose of the doctrine of estoppel in insurance

                                                 8
cases is to enforce the contract as originally agreed upon by the parties.” Lewis v. Cont’l Life &
Acc. Co., 93 Idaho 348, 353, 461 P.2d 243, 248 (1969). In Lewis, this Court further explained the
application of the doctrine of estoppel in the insurance context:
        [W]here a policy holder is induced to enter into [a] contract in reasonable
       reliance on promises of or agreements with the soliciting representative of that
       insurance company thereby leaving the insured person or property otherwise
       unprotected, and the company profits from that change of position, that the
       insurance company is estopped to deny the liability for which it actually
       contracted by raising provisions from its own printed policy form.
Id. at 351, 461 P.2d at 246.
       The district court is incorrect that an estoppel claim in the insurance context requires the
existence of a contract. Rather, estoppel requires proof of two elements, neither of which is
dependent upon the existence of a contract: (1) reasonable reliance on inducements in the form
of promises or agreements with the insurance company and (2) the insurer’s realization of a
profit from its change in position. Shoup v. Union Sec. Life Ins. Co., 142 Idaho 152, 154, 124
P.3d 1028, 1030 (2005).
       Indeed, this Court has reversed a district court’s grant of summary judgment in a case
where the insurer argued that no insurance contract existed between the decedent and the insurer.
Id. In Shoup, Union Security contended that coverage was never extended to the decedent,
William Harmon, because the text of the certificate of insurance it issued him and the terms of
the policy for which he applied excluded a man of his age and physical condition. Id. In
response, Harmon’s estate argued that because he relied on statements and conduct by Union
Security and its representatives that coverage had been granted, including the issuance of an
insurance certificate, Union Security must be estopped from denying coverage under the written
policy terms. Id. This Court concluded that Harmon’s estate had offered sufficient evidence to
show a genuine issue of material fact regarding the reasonableness of Harmon’s reliance, thereby
precluding summary judgment on that point. Id. at 157, 124 P.3d at 1033. Although an insurance
policy was issued in Shoup, the existence of the contract was not required for estoppel to apply.
Rather, the question was whether Harmon’s reliance on his insurer’s representations that
coverage existed was reasonable. The same question is raised in this case—whether the
Shapleys’ reliance on alleged representations that coverage began on the date the loan closed was
reasonable.
       Mr. Shapley alleges two instances were Centurion and Wells Fargo made representations
                                                 9
that coverage began on the date the Shapleys submitted their application: (1) the proposed
effective date of the policy was July 10, 2008, and (2) Mr. Ellison told him following Mrs.
Shapley’s death that coverage began on that date. Because Mr. Ellison’s statements were made
after the alleged effective date of coverage and Mrs. Shapley’s death, Mr. Shapley could not
have relied on these statements when he submitted his application. Thus, Mr. Shapley’s reliance
is entirely based on the application listing the policy’s proposed effective date as July 10, 2008.
        Generally, the reasonableness of the insured’s reliance is a question of fact for the jury.
Young v. State Farm Mut. Auto. Ins. Co., 127 Idaho 122, 126, 898 P.2d 53, 57 (1995). However,
in light of all of the application’s clear language that coverage did not begin until Centurion
approved the Shapleys’ application and the fact that the Shapleys did not pay any premiums
along with their application, the proposed effective date alone does not raise a material issue of
fact as to whether the Shapleys’ reliance was reasonable. Unlike the insurer in Shoup, Centurion
never issued a certificate of insurance covering Mrs. Shapley. Moreover, the proposed effective
date of the policy by itself is not a promise or inducement on Centurion’s part. The very
language indicates a proposed or anticipated date of coverage, not one that the parties had agreed
upon.
        While the district court incorrectly concluded that there must be a contract for estoppel to
apply, the denial of Mr. Shapley’s motion to amend was nonetheless appropriate because his
estoppel claim was futile. See Martel v. Bulotti, 138 Idaho 451, 453, 65 P.3d 192, 194 (2003)
(“This Court may uphold decisions on alternate grounds from those stated in the findings of fact
and conclusions of law on appeal.”). Therefore, we affirm the district court’s denial of Mr.
Shapley’s motion to amend because neither Centurion nor Wells Fargo promised the Shapleys
that coverage would begin on the date they submitted their application. To the degree that
including the proposed effective date amounted to a promise that coverage would begin on that
date, Mr. Shapley’s reliance on this one promise is not reasonable in light of the application’s
clear language that coverage did not begin until Centurion approved the Shapleys’ application.
                                       IV. CONCLUSION
        We affirm the district court’s dismissal of all of Mr. Shapley’s claims on summary
judgment. We also affirm the district court’s denial of Mr. Shapley’s motion to amend his
complaint. Costs to respondents.
        Justices EISMANN, J. JONES, W. JONES and HORTON, CONCUR.

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