                          IN THE SUPREME COURT OF MISSISSIPPI
                                   NO. 93-CA-00491-SCT
JAN COSSITT
v.
ALFA INSURANCE CORPORATION FORMERLY
KNOWN AS FEDERATED GUARANTY MUTUAL
INSURANCE COMPANY

DATE OF JUDGMENT:                               04/02/93
TRIAL JUDGE:                                    HON. JAMES E. GRAVES, JR.
COURT FROM WHICH APPEALED:                      HINDS COUNTY CIRCUIT COURT
ATTORNEYS FOR APPELLANT:                        WAYNE E. FERRELL, JR.
                                                KARLA J. PIERCE
ATTORNEYS FOR APPELLEE:                         CHRIS J. WALKER
                                                AL NUZZO
NATURE OF THE CASE:                             CIVIL - INSURANCE
DISPOSITION:                                    AFFIRMED IN PART; REVERSED AND
                                                REMANDED IN PART - 9/10/98
MOTION FOR REHEARING FILED:                     10/15/98
MANDATE ISSUED:                                 12/17/98




     EN BANC.


     PITTMAN, PRESIDING JUSTICE, FOR THE COURT:




¶1. On February 4, 1986, Federated Guaranty Mutual Insurance Company, now Alfa Insurance
Company ("Alfa"), filed a declaratory judgment action to determine its obligations to Cossitt under
its policy of automobile insurance, particularly with regard to its obligations concerning the policy's
uninsured motorist provisions. On February 27, 1986, Cossitt filed her Answer and Counter-Claim
against Alfa alleging she was entitled to the total amount of medical expenses incurred by her, and a
sum equal to the uninsured motorist coverage under said policy, and further sought to collect
punitive damages alleging that Alfa failed to act in good faith.

¶2. The trial court granted Alfa's Motion for Summary Judgment. The court found that there was no
evidence of any acts of bad faith in the handling of Cossitt's claim for both medical and uninsured
motorist coverage by Alfa, and further found that Cossitt was not entitled to uninsured motorist
benefits.

¶3. Cossitt appealed this order to the Court, and the Court affirmed the trial court's ruling that Cossitt
was not entitled to uninsured motorist benefits. The Court further affirmed the dismissal of Cossitt's
claim for alleged bad faith for failure to pay uninsured motorist coverage. However, this Court
reversed the trial court's findings concerning Cossitt's claim for punitive damages relevant to the
medical payments coverage under the policy, and remanded the case to the trial court "for the limited
purpose of allowing the additional development of facts surrounding Federated Guaranty's failure to
pay medical benefits to [Jan] Cossitt following November 1, 1985." Cossitt v. Federated Guar. Mut.
Ins. Co., 541 So. 2d 436, 445 (Miss. 1989) ( Cossitt I).

¶4. After remand the parties conducted additional discovery. Alfa moved for a protective order based
on Cossitt's requests for discovery. Cossitt filed a motion to amend her answer and counterclaim
seeking all medical payments to which she was entitled under the policy of insurance and exemplary
and punitive damages for Alfa's alleged wrongful refusal to pay such benefits. Cossitt further claimed
that she was entitled to $10,000.00 under the uninsured motorist provisions of Alfa's policy as a
result of the coverage of the church's bus policy of insurance. Also, Cossitt demanded exemplary and
punitive damages alleging Alfa wrongfully refused to tender the underinsured motorist and medical
benefits.

¶5. The Honorable James Graves, Circuit Court judge, ruled that Cossitt's Motion exceeded the
scope of this Court's mandate and further ordered that Cossitt would be "prohibited from conducting
discovery, introducing evidence at any hearing and introducing into evidence at the trial any evidence
not directly related to the development of facts surrounding Federated Guaranty's failure to pay
medical benefits to Cossitt."

¶6. Alfa filed a Supplemental Motion for Summary Judgment. On April 1, 1993, after a hearing held
on February 25, 1993, Judge Graves entered an order granting summary judgment in favor of Alfa on
the issue of Alfa's alleged bad faith refusal to pay at least $1,000.00 in medical benefits. The court
specifically found that Cossitt was entitled to $1,000.00 of medical benefits. Cossitt appeals these
two orders.

                                      MOTION PASSED FOR

                                         CONSIDERATION

¶7. Between the hearing and ruling on February 25, 1993, and April 1, 1993, the date Judge Graves
entered his Order, Cossitt filed a Motion for Reconsideration of Order Granting Plaintiff's Summary
Judgment and a document entitled "Second Response to Plaintiff's Motion for Summary Judgment"
with exhibits attached. Among the exhibits were the deposition of Harold Cain, district claims
manager of Federated Guaranty, deposition of Charles Wilbanks, Cossitt's former attorney, and
correspondence between Alfa and Wilbanks. Both depositions were taken in 1991, and the
correspondence is between 1985-89.

¶8. Alfa has filed a motion to prohibit any consideration of these issues by the Court, as the record on
appeal is devoid of any evidence that a hearing on Cossitt's motion was ever conducted. Alfa argues
that, because there is not an order in the record either granting or denying Cossitt's Motion for
Reconsideration, the issues raised in the Motion are presumed waived or abandoned. See 60 C.J.S.
Motions and Orders § 42 (1969). They also cite in support Miss. Sup. Ct. R(1). 10(e) which provides
that the parties by stipulation, or the trial court, either before or after the record is transmitted to this
court, or this court on proper motion may order that misstatements in the record be corrected.
Furthermore, pursuant to 10(f), nothing in Rule 10 shall be construed as empowering the parties to
add to or subtract from the record except insofar as may be necessary to convey a fair, accurate and
complete account of what transpired in the trial court with respect to those issues that are the basis of
appeal. Alfa asserts that because Cossitt's Response and corresponding exhibits were not introduced
before or during the hearing before Judge Graves, they violate 10(f) and should be excluded from
consideration in the appeal.

¶9. Alfa quotes Rule 56(c) of the M.R.C.P. in pertinent part as follows:

     . . .The [Summary] judgment sought shall be rendered forthwith if the pleadings, depositions,
     answers to interrogatories 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. (emphasis added)

Alfa argues that the depositions of Cain and Wilbanks and the correspondence attached to Cossitt's
Response were not "on file" on February 25, 1993, the date of the hearing before Judge Graves,
because they were not filed until March 12, 1993. Thus, these documents should be stricken from the
record along with all arguments in Cossitt's brief relating thereto.

¶10. Cossitt argues that under Miss. Sup. Ct. R. 10(b)(5), Alfa had an opportunity to and did review
the record in October, 1993 and make the corrections which it deemed appropriate. That rule
provides that the appellee is allowed seven days to review the record and at that time may append
corrections, which if disputed shall be determined by the trial court to be proper or not. Miss. Sup.
Ct. R. 10 (1994). This is Alfa's third attempt to modify the record. Cossitt argues that an excessive
amount of time has passed since this appeal was filed and briefing is still incomplete due to Alfa's
continuous filings to modify the record which it should have addressed long ago.

¶11. Cossitt also argues that the issues raised in her Second Response to Plaintiff's Motion for
Summary Judgment were raised by counsel for Cossitt in the hearing on the Motion, and the
documents attached were a part of the pleadings on file at said hearing and/or considered by the court
prior to the entry of the Orders granting summary judgment in favor of Alfa.

¶12. Alfa makes a great deal out of the fact that the attachments to Cossitt's Response were not "on
file" with the court and thus not before Judge Graves at the time of his ruling. Therefore, they should
not be a part of the record. The emphasis by Alfa on the words "on file" in Rule 56(c) is misplaced.
The Rule separates the different documents to be considered by commas and "on file" refers only to
admissions. See II James W. Moore, Moore's Federal Practice, § 56.11[6] (3d ed. 1998) (discussing
why admissions must be "on file" under F.R.C.P. 56(c)). However, the record reflects that Judge
Graves did not consider any of those documents attached to the Response in his ruling. Furthermore,
there was no disposition of the Motion by Judge Graves. "[T]he affirmative duty rests upon the party
filing the motion to follow up his action by bringing it to the attention of the trial court." Cossitt I,
541 So. 2d at 446. A motion that is not ruled upon is presumed abandoned. See 60 C.J.S. Motions &
Orders § 42 (1969); Prather v. McGrady, 634 N.E.2d 299, 303 (Ill. App. Ct. 1994).
¶13. Alfa's Motion is well taken. There is no reference at the hearing to Cain's or Wilbanks's
deposition or the correspondence nor are they among the exhibits introduced at the hearing. Nor did
Cossitt submit affidavits in response. Cossitt did submit supplemental responses to interrogatories at
the hearing. However, these are nowhere to be found in the record on appeal. Alfa asserts that the
interrogatories referred to at the hearing are improper as they are not signed by Cossitt as required by
M.R.C.P. 33 and are signed only by Cossitt's attorney. They further assert that these interrogatories
were not under oath. The interrogatories are not in the record, and thus the Court cannot review
them. Cossitt is appealing the order of the trial court, and so, she has the burden of seeing that the
record before the Court contains all data essential to matters relied upon for reversal. Shelton v.
Kindred, 279 So. 2d 642, 644 (Miss. 1973)(Smith, J.).

¶14. The documents in Cossitt's Response were not considered at the hearing. Judge Graves did not
rule on the Response and it was not addressed in the entered Order on April 1, 1993. In fact the
entered Order was identical to Judge Graves's ruling at trial. Therefore, the addition of Cossitt's
Response in the Motion is not a fair, accurate and complete account of what transpired in the trial
court with respect to those issues. Alfa's Second Motion to Correct or Modify the Record is granted
and all arguments referring to the documents contained in Cossitt's Response are stricken.

                                  STATEMENT OF THE ISSUES


     I. THE TRIAL COURT ERRED IN GRANTING SUMMARY JUDGMENT IN FAVOR OF
     FEDERATED GUARANTY.

     A. The Trial Court Erred in Granting Summary Judgment in Favor of Federated Guaranty on
     the Issue of Bad Faith in Light of Evidence that the Tender of The Undisputed Amount of
     Medical Pay Benefits was Unreasonably Delayed

     B. The Trial Court Erred in Granting Summary Judgment on the Issue of the Limit of Medical
     Payments Coverage Under the Policy.

     II. THE TRIAL COURT ERRED IN REJECTING COSSITT'S CLAIM FOR
     PREJUDGMENT INTEREST.

     III. THE TRIAL COURT ERRED IN DENYING COSSITT'S MOTION FOR LEAVE TO
     AMEND ANSWER AND COUNTERCLAIM TO ASSERT AN ADDITIONAL BASIS FOR
     INVOKING UNINSURED MOTORIST COVERAGE AND TO ASSERT THAT
     FEDERATED GUARANTY MAINTAINED AN ILLEGAL PROVISION IN ITS POLICY,
     AND IN PRECLUDING COSSITT FROM CONDUCTING DISCOVERY ON THIS ISSUE.

                                  STATEMENT OF THE FACTS

¶15. This is the second time this case has been before the Court. Cossitt, Odom McDaniel, and
Joseph Q. White were struck by a vehicle owned and operated by Lester Davis. Cossitt sustained in
excess of $10,000.00 in bodily injury. The other two claimants exhausted the tortfeasor's liability, and
this action arose from Cossitt's claim against her own uninsured motorist policy with Alfa. The Court
affirmed in Cossitt I the trial court's grant of summary judgment to Alfa on all issues except one:
Alfa's failure to make medical payments under the policy. The Court reversed and remanded for a
more complete development of facts surrounding Alfa's failure to pay at least $1,000.00 in medical
benefits. Cossitt I, 541 So. 2d at 446.

¶16. The policy issued to Cossitt in pertinent part provides:

     Coverage C--Medical Payments.

     To pay the reasonable expense of necessary medical . . . services . . . incurred within one year
     from date of accident to or for:

                                                  ***

     Limits of Liability (1) Coverages A, B and C.

     The limits of bodily injury liability stated in the declarationsas applicable to "each person"
     is the limit of the Company's liability for all damages . . .

     Coverage C-1-Major Medical Payments.

     To pay the medical expenses as defined and set forth under Coverage C incurred up to but
     not exceeding $5,000.00, to or for each person who sustains bodily injury in any one accident,
     subject to all the provisions of Coverage C, and subject to the limits of liability as hereinafter set
     forth.

     Limit of Liability-Coverage C-1

     The Company's limit of liability shall not exceed . . . $5,000.00 for all expenses incurred for
     each person who sustains bodily injury in any one accident.

     Coverage C-2-AUTO-matic PAY.

     Medical Expense Benefits

     To pay all reasonable expenses resulting from bodily injury . . . for necessary medical . . .
     services, subject to the limits stated below under Limits of Liability.

                                                  ***

     Limits of Liability-The limit of liability stated in the Declarations shall be the limit of the
     company's liability under coverage C-2 . . .

The declaration page applicable at the time of the incident indicates that medical coverage is limited
to $1,000.00.

¶17. In support of its Supplemental Motion for Summary Judgment and Notice of Hearing, Alfa
submitted the letter of its former attorney, Bill Patterson, affirming that Patterson on behalf of Alfa
twice tendered Cossitt's former attorney, Wilbanks, $1,000.00 for payment of her med-pay benefits.
The correspondence between Patterson and Wilbanks is attached as exhibits to the motion. Wilbanks
refused to negotiate the check unless it was to cover the "undisputed" amount only.

¶18. In the record there is no response by Cossitt to the summary judgment until the hearing before
Judge Graves.

                                           ANALYSIS


     I. DID THE TRIAL COURT ERR IN GRANTING SUMMARY JUDGMENT IN
     FAVOR OF FEDERATED GUARANTY?

     A. Did the Trial Court Err in Granting Summary Judgment in Favor of Federated Guaranty on
     the Issue of Bad Faith in Light of Evidence that The Tender of the Undisputed Amount of
     Medical Pay Benefits was Unreasonably Delayed?

¶19. The Court reviews de novo a trial court's grant of summary judgment. Short v. Columbus
Rubber & Gasket Co., 535 So. 2d 61, 63 (Miss. 1988). Evidentiary matters are judged in the light
most favorable to the nonmoving party. Palmer v. Biloxi Regional Med. Ctr., Inc., 564 So. 2d
1346, 1354 (Miss. 1990). If any issues of fact are triable, the trial court's decision to grant summary
judgment will be reversed.

¶20. Alfa has admitted in its brief owing Cossitt $1,000 for medical payments as stated on the
declaration page of the insurance policy. Cossitt contends that Alfa owes $5,000 per the language of
the policy. Alfa tendered Cossitt $1,000.00 on three occasions (March 25, 1987, March 10, 1989,
April 13, 1989) to cover her medical payments under the policy. Cossitt responded that she would
not negotiate the check unless the check was to cover the "undisputed amount" only. The trial court
ordered Alfa to pay $1,000 in its Order Granting Summary Judgment. Cossitt argues that the refusal
to pay the $1,000 unconditionally constituted bad faith on the part of Alfa.

¶21. The trial court found that Cossitt's claim for med-pay benefits was never denied by Alfa; "rather,
a legitimate pocketbook dispute existed between the parties as to the amount of med-pay benefits
available." The trial court further stated that based on the policy language and the declarations page,
Alfa had "a legitimate and arguable basis in law for tendering Cossitt $1,000 in med-pay benefits and
that Cossitt's refusal to accept the $1,000 cannot constitute bad faith" on Alfa's part. The trial court
held that Alfa's conduct did not rise to the level of a "heightened" tort necessary to prove bad faith
and recover punitive damages. Thus, the court held that Alfa was entitled to judgment as a matter of
law.

¶22. Cossitt contends that the trial court erred in its determination. Specifically, Cossitt argues that
while there may have been a legitimate reason for Alfa to dispute Cossitt's position that she was
entitled to $5,000 rather than $1,000 in medical payment benefits, there is no justification or arguable
reason for Alfa's refusal and delay to pay the undisputed amount after more than seven years of
demands.

¶23. In support of her position Cossitt cites two Louisiana cases where the appellate courts in
Louisiana stated that the failure of the insurance companies to pay the claims of the insureds within
60 days of the receipt of satisfactory proof of loss was arbitrary and capricious as a matter of law.
Marcel v. Allstate Ins. Co., 536 So. 2d 632 (La. Ct. App. 1988), Hart v. Allstate Ins. Co., 437 So.
2d 823 (La. 1983). In Marcel the court noted that attorneys' fees and penalties could have been
avoided by the unconditional tender of a reasonable amount when a disagreement existed over the
total amount owed. Marcel, 536 So. 2d at 637. These cases are not particularly applicable to the case
at hand, because they centered on a Louisiana statute that required an uninsured motorist carrier to
pay the claim of its insured within sixty days of receipt of satisfactory proof of loss. Nevertheless,
Cossitt asserts that they are instructive on the standard of conduct of an insurance company in
delaying or failing to pay legitimate claims of its insureds.

¶24. Cossitt also cites the Court's decision in Blue Cross & Blue Shield of Mississippi, Inc. v.
Maas, 516 So. 2d 495 (Miss. 1987). Maas was seeking coverage under her husband's employer's
group plan. Weeks later her husband quit, and Blue Cross received notice to terminate his insurance
October 31, 1984. Blue Cross erroneously canceled the plaintiff's coverage effective October 1,
1984, and rejected Maas's claims on her hospital bills. Id. at 495-96. Two months after the plaintiffs
filed suit, Blue Cross tendered medical benefits to the plaintiffs and admitted its liability for the
amount. The Court affirmed the jury award of actual and punitive damages noting especially Blue
Cross's failure to investigate and respond after being contacted by the plaintiffs and its failure to remit
payment until six weeks after its investigation revealed that the original claim had been improperly
denied. Id. at 497-98.

¶25. Cossitt submits that Alfa's conduct is even more egregious than those acts held to justify an
award of punitive damages in Maas. Her argument is based on the 7 ½ year delay as opposed to the
six week delay in Maas.

¶26. Cossitt also argues this Court's decision in Standard Life Ins. Co. of Indiana v. Veal, 354 So.
2d 239 (Miss. 1977). In that case the Court discussed the propriety of awarding punitive damages
stating that "[i]f an insurance company could not be subjected to punitive damages it could
intentionally and unreasonably refuse payment of a legitimate claim with veritable impunity." Id. at
248. The Court recognized that if an insurance company has a legitimate or an arguable reason for
failing to pay a claim, punitive damages will not lie. Id.

¶27. Cossitt argues that there is no legitimate reason to unconditionally withhold the $1,000. She
asserts that if an insurance company is permitted to withhold payments of sums which it admits
owing, with the obvious goal of forcing its insured to withdraw her claims for additional coverage,
there is no motivation for insurance companies to promptly pay claims.

¶28. Alfa argues that the trial court did not err in granting summary judgment on this point. It argues
that M.R.C.P. 56 states that a summary judgment shall be rendered forthwith if the pleadings,
depositions, answers to interrogatories 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. Further, when such a motion is made, an adverse party may not rest
upon the mere allegations or denials of his pleadings, but his response, by affidavits or otherwise
provided in this rule, must set forth specific facts showing that there is a genuine issue for trial. If
there is not such a response, summary judgment, if appropriate, shall be entered against the adverse
party. Miss. R. Civ. P. 56(e). Alfa contends that Cossitt has failed to meet this burden since she failed
to respond to Alfa's Motion for Summary Judgment and, therefore, failed to set forth specific facts
showing that there is a genuine issue for trial on the bad faith allegations.

¶29. Alfa argues that it attached the affidavit of Bill Patterson to its Motion, and Cossitt presented no
affidavit in rebuttal nor was there testimony in opposition at the hearing. The depositions of Cain and
Wilbanks were not produced until after Judge Graves's ruling from the bench. Alfa asserts that
Cossitt cannot rely on unsworn allegations in the pleadings or on arguments and assertions in the
briefs or legal memorandum to defeat summary judgment. Magee v. Transcontinental Gas Pipeline
Corp., 551 So. 2d 182, 186 (Miss. 1989). Alfa argues that since the remand of this case, no
additional sworn facts were presented to Judge Graves prior to the hearing.

¶30. Alfa asserts that because the foundation of Cossitt's arguments on appeal (testimony of Alfa
claims manager Cain that he saw no reason not to pay the $1,000) was not before Judge Graves, the
arguments in her brief are groundless and must be precluded on appeal. Thus, Judge Graves should
be affirmed.

¶31. Alternatively, Alfa argues that Cossitt has not shown that Alfa acted with (1) malice or (2) gross
negligence or reckless disregard for the rights of others. Universal Life Ins. Co. v. Veasley, 610 So.
2d 290, 293 (Miss. 1992). Furthermore, Alfa notes that it is the trial court's responsibility to review
the evidence before it in order to ascertain whether there is a legitimate or arguable reason not to pay
the claim and if not submit the issue of punitive damages to the jury. Veasley defined an arguable
reason as "'nothing more than an expression indicating the act or acts of the alleged tortfeasor do not
rise to heightened level of an independent tort.'" Id. (quoting Pioneer Life Ins. Co. of Illinois v.
Moss, 513 So. 2d 927, 930 (Miss. 1987)). Alfa argues that it never denied Cossitt's claim, because it
tendered several checks to Cossitt.

¶32. Alfa also notes a case concerning a similar situation in a dispute over an automobile policy.
State Farm Mut. Auto. Ins. Co. v. Roberts, 379 So. 2d 321 (Miss. 1980). In Roberts the dispute
arose from a totally demolished automobile covered by State Farm. At the time of the accident, the
vehicle was worth $3,700 and Roberts owed $4,700 on it. State Farm offered to pay their contractual
obligations under the policy (the actual cash value) and Roberts refused this settlement. Roberts sued
for the amount owed on the car and sought punitive damages. The Court held:

     . . .A research of the record reveals nothing other than a legitimate pocketbook dispute between
     the parties as to the amount that was due for the demolished automobile, one claiming the sum
     owed the bank on the automobile and the other admitting coverage in the amount of its policy,
     specifically, the actual cash value of the automobile. In our judgment, these differences of
     opinion did not rise to the level of wanton, gross or intentional conduct in the nature of an
     independent tort.

Id. at 322.

¶33. Roberts is very similar to the situation at hand. Cossitt says she is owed $5,000; Alfa says $1,
000. While it seems that Alfa could easily unconditionally tender the $1,000 (as State Farm could
have tendered the $3,700), its actions appear to be more over a dispute over the amount owed and
do not rise to the level of an independent tort as articulated in Roberts.

¶34. Cossitt was not diligent in her response to the Motion for Summary Judgment with specific
facts. Based on the record before Judge Graves at the time of his ruling, summary judgment was
appropriate.

¶35. Alternatively, this case is nothing more than a pocketbook dispute and does not rise to the
heightened level of an independent tort. Summary judgment in favor of Alfa on the issue of bad faith
is affirmed.

     B. Did the Trial Court Err in Granting Summary Judgment on the Issue of the Limit of Medical
     Payments Coverage Under the Policy?

¶36. Cossitt argues that the trial court erred in determining as a matter of law that the policy in
question was unambiguous and provided only $1,000.00 in medical payments. The policy contains
three different coverages for medical expenses: "Coverage C-Medical Payments," "Coverage C-1-
Major Medical Payments," and "Coverage C-2-AUTO-Matic Payments." Coverage C-Medical
Payments specifically provides that the limit of liability for that coverage of medical expenses is stated
in the declaration page. Cossitt's declaration page stated she had a $1,000.00 medical limit. Cossitt
asserts, though, that the policy is ambiguous. Coverage C-1 Major Medical Payments provides for
payment of medical expenses incurred up to $5,000.00 and is subject only to limits of liability of $1,
000.00 for funeral expenses and $5,000.00 for all other expenses. Because Coverage C-1-Major
Medical Payments does not state that it is limited to the limits of liability set forth in the declarations
page and does provide limits of $5,000.00, Cossitt asserts that she is entitled to the $5,000.00 liability
limits under Coverage C-1. She argues that at the very least the policy is ambiguous. Cossitt notes
that the Court has held that any ambiguities in insurance provisions are to be construed in favor of the
injured insured motorist. Atlanta Cas. Co. v. Payne, 603 So. 2d 343, 346 (Miss. 1992)(citing
Commercial Union Ins. Co. v. Dairyland Ins. Co., 584 So. 2d 405, 408 (Miss. 1991)).

¶37. In support of her position, Cossitt also refers the Court to Government Employees Ins. Co. v.
Brown, 446 So. 2d 1002 (Miss. 1984). Brown concerned an issue certified by the Fifth Circuit as to
whether the language contained in the "limits of liability" clause in the uninsured motorist provisions
of an automobile policy was sufficiently clear and unambiguous to prevent the stacking of uninsured
motorist coverage where separate premiums were charged for more than one vehicle under a single
policy. Id. at 1003. The policy contained a provision limiting liability for uninsured motorist coverage
to the amount stated in the declarations page as applicable to each person ($10,000.00), regardless of
the number of automobiles to which the policy applied. Id. at 1004-05. The declarations page,
however, described three vehicles owned by the parties and covered under the single policy with
separate premiums charged for each automobile. Id. at 1005.

¶38. The Court held that the policy language under the "limits of liability" clause, when read together
with the declarations page, was ambiguous and void. "[W]hile the language within the 'limits of
liability' clause is clear and unambiguous as to what is intended, when read together with the
declaration sheet it becomes unclear and ambiguous." Id. at 1006. Cossitt argues the limits of liability
clause contained in Coverage C-1-Major Medical Payments conflicts with the declaration page.
Secondly, the declarations page itself is ambiguous, given that it does not differentiate between
Coverages C, C-1 and C-2, but only states that "Medical" coverage is limited to $1,000.00.

¶39. Alfa argues that Cossitt ignores the language in the initial paragraph of Coverage C-1 which
makes the agreement "subject to all of the provisions of Coverage C . . .". Included under Coverage
C is the limits of liability which clearly states that such limits are as stated on the declaration page. In
this case, the limits of med-pay benefits on the declaration page is $1,000.00.

¶40. Alfa's argument seems to be a stretch. If the limit of all of the coverages listed in the policy is
what is on the declaration page, then it would be quite pointless to put more limiting language in the
policy under Coverage C-1. Furthermore, the limiting language Alfa refers to is surrounded by
language that negates the $1,000.00 limit argument. Specifically, the full sentence states, "[t]o pay
the medical expenses as defined and set forth under Coverage C incurred up to but not exceeding $5,
000, to or for each person who sustains bodily injury in any one accident, subject to all the
provisions of Coverage C, and subject to the limits of liability as hereinafter set forth."
(emphasis added). To say that Coverage C-1 is subject to the liability in the declaration page as
required by Coverage C when it clearly says it is subject to the limits of liability "as hereinafter set
forth" is nonsensical. Had the declarations page stated that Cossitt was subject to Coverage C med-
pay benefits, there would be no conflict. The policy, however, states only medical limits of $1,000 for
the premium listed. There is no indication of how they arrived at this limit in terms of which coverage
Cossitt had. In fact the declarations page states that "[t]he limit of the Company's liability against
each such coverage shall be as stated herein subject to all terms of the policy having reference
thereto." (emphasis added) There may very well be proof that the agent told Cossitt that if she was
paying a certain premium she would only be entitled to Coverage C, however, that is not in the
record. At the very least there is a genuine issue of material fact as to whether Alfa is liable for $5,
000 coverage, and the trial court erred by granting summary judgment on this point. The trial court is
reversed on this point, and this issue is remanded for a trial on the merits.

     II. DID THE TRIAL COURT ERR BY FAILING TO GRANT PREJUDGMENT
     INTEREST?

¶41. The trial court ordered Alfa to pay Cossitt the sum of $1,000. On remand from Cossitt I, Cossitt
had claimed she was entitled to an award of prejudgment interest on the medical benefits to which
she was entitled to recover. Cossitt submits that the refusal to grant interest is reversible error.

¶42. In support of her position, Cossitt cites the general rule that in actions for breach of a contract
of insurance, the insured is entitled to prejudgment interest on the amount of benefits which were
withheld by the insurer after payment was due. State Farm Mut. Auto. Ins. Co. v. Bishop, 329 So.
2d 670, 673 (Miss. 1976). The only exception to this rule applies when the amount due the insured is
uncertain or unliquidated. Cossitt claims that this exception does not apply since Alfa admits owing
the sum of $1,000 as of November 1, 1985.

¶43. Alfa asserts that Cossitt is not entitled to prejudgment interest based on Simpson v. State Farm
Fire and Casualty Co., 564 So. 2d 1374, 1381 (Miss. 1990). Alfa appears to have the supporting
law in Simpson. There, the Court held that "[t]he insured must include a proper demand or
request for prejudgment interest, including from when it is allegedly due, in the pleadings. Id. at
1380-81 (citing Maryland Cas. Co. v. Legg, 247 So. 2d 812 (Miss. 1971)) (emphasis added).
Because Cossitt's Answer and Counterclaim failed to include such a demand, Alfa asserts that the
trial court did not err in its award to Cossitt. Cossitt makes no response to this argument in her Reply
Brief. (Cossitt did claim she was entitled to prejudgment interest in her attempt to amend her answer.
However, the trial court denied her motion based on this Court's limited inquiry on remand.)
¶44. Cossitt's request for prejudgment interest is not in the pleadings. Therefore, she is not entitled to
such an award per this Court's holding in Simpson. Accordingly, the trial court's denial of
prejudgment interest is affirmed.

     III. DID THE TRIAL COURT ERR IN DENYING COSSITT'S MOTION FOR LEAVE
     TO AMEND ANSWER AND COUNTERCLAIM TO ASSERT AN ADDITIONAL
     BASIS FOR INVOKING UNINSURED MOTORIST COVERAGE AND TO ASSERT
     THAT ALFA MAINTAINED AN ILLEGAL PROVISION IN ITS POLICY, AND IN
     PRECLUDING COSSITT FROM CONDUCTING DISCOVERY ON THIS ISSUE?

¶45. On remand, Cossitt attempted to amend her Answer and Counterclaim asserting an additional
basis for invoking uninsured motorist coverage and to assert that Alfa maintained an illegal provision
in its policy. In Cossitt I the Court found that Cossitt was not entitled to uninsured motorist benefits
under her coverage. Cossitt I, 541 So. 2d at 443.

¶46. The trial court denied Cossitt's motion to amend, holding that this Court's mandate in Cossitt I
limited the trial court's inquiry on remand.

¶47. Cossitt recognizes the law of the case doctrine in Mississippi:

     The doctrine of the law of the case is similar to that of former adjudication, relates entirely to
     questions of law, and is confined in its operation to subsequent proceedings in the case.
     Whatever is once established as the controlling legal rule of decision, between the same parties
     in the same case, continues to be the law of the case, so long as there is a similarity of facts.
     This principle expresses the practice of courts generally to refuse to reopen what has previously
     been decided. It is founded on public policy and the interests of orderly and consistent judicial
     procedure.

Simpson v. State Farm Fire and Cas. Co., 564 So. 2d 1374, 1376 (Miss. 1990) (quoting
Mississippi College v. May, 241 Miss. 359, 366, 128 So. 2d 557, 558 (1961)). However, she argues
the following exception as applicable to her case. "[I]f the facts are different so that the principles of
law announced on the first appeal are not applicable, as where there are material changes in the
evidence, pleadings or findings, a prior decision is not conclusive upon questions submitted on the
subsequent appeal." Cossitt asserts that her amendments are based on significantly different theories.

¶48. Her amendment as to the uninsured motorist theory was to stack the coverage for the church
bus--in which the victims were riding--with her coverage to make the tortfeasor an uninsured
motorist. In Cossitt I she argued that she was entitled to uninsured motorist coverage under her
policy with Alfa, because the limits of the tortfeasor's coverage ($20,000/accident) were exhausted by
the other victims, thus, the tortfeasor was underinsured. Cossitt I, 541 So. 2d at 439-43.

¶49. This amendment does not escape the law of the case doctrine. No material changes in the
evidence, pleadings or findings have materially affected the facts so as to change the principles of
law. While Cossitt's theory as to how the tortfeasor is an underinsured motorist may be different, the
facts simply are not. The law of the case dealing with uninsured motorist coverage was conclusive in
Cossitt I, and the trial court was correct in so ruling.
¶50. Cossitt argues that the second amendment-the alleged illegal provision-is not even remotely
related to any of the issues vested in the first appeal and would not violate any of the principles
announced therein. In support, she cites Poole v. McCarty, 233 Miss. 724, 728, 103 So. 2d 922, 924
(1958), where the Court ruled that proposed amendments that did not attempt to present the same
matter which was before the Court on the original appeal or to try to contravene the principles
announced by the Court in the case did not run counter to the law of the case.

¶51. Alfa argues that the mandate in Cossitt I bars consideration of either of these amendments. The
mandate in pertinent part states:

     . . . The judgment of the lower court granting summary judgment in favor of [Alfa] is affirmed
     on all issues except [Alfa's] failure to make medical benefit payments after the condition
     precedent to its duty to pay was performed on November 1, 1985. As to this issue, we reverse
     and remand to allow for a more complete development of facts surrounding [Alfa's] failure to
     pay at least $1,000.00 in medical benefits.

Cossitt I, 541 So. 2d at 446.

¶52. The Poole case states that the chancellor has full power to allow amendments to the pleadings as
he did before the decree appealed from was rendered provided the amendment does not run counter
to the law of the case. Thus, the standard of review for the allowance of amendments to the pleadings
is applicable. The Court has stated that it will reverse a judge's decision not to amend pleadings when
it is evident the trial court has abused its discretion. Knotts v. Hassell, 659 So. 2d 886, 889 (Miss.
1995).

¶53. Because the mandate of the Court in Cossitt I was very specific in its inquiry, the trial court did
not abuse its discretion by denying this amendment. The trial court's denial of the Motion to Amend
the Answer and Counterclaim is affirmed.

                                           CONCLUSION

¶54. Based on the foregoing analysis, the trial court is affirmed on all issues except I(b), the amount
of medical payments owed Cossitt by Alfa. This issue amounts to a factual dispute and is remanded
on the basis that summary judgment was not appropriate.

¶55. AFFIRMED IN PART; REVERSED AND REMANDED IN PART FOR
PROCEEDINGS NOT INCONSISTENT WITH THIS OPINION.

PRATHER, C.J., SMITH AND MILLS, JJ., CONCUR. BANKS, J., DISSENTS WITH
SEPARATE WRITTEN OPINION JOINED BY SULLIVAN, P.J. SULLIVAN, P.J.,
DISSENTS IN PART WITH SEPARATE WRITTEN OPINION JOINED BY BANKS AND
ROBERTS, JJ. McRAE AND WALLER, JJ., NOT PARTICIPATING.


     BANKS, JUSTICE, DISSENTING:
¶56. In my view, the record and the original opinion for the Court in Cossitt v. Federated Guaranty
Mutual Insurance Co., 541 So. 2d 436 (Miss. 1989) compel the conclusion that the trial court erred
in granting summary judgment on the issue of bad faith on the medical pay claim. Accordingly, I
dissent.

¶57. The trial court came to the conclusion that Federated tendered $1,000 on three occasions and
that it had an arguable basis for tendering that amount. The question put by this Court in its 1989
opinion was why Federated did not tender the $1,000 during the period from November 1, 1985,
when the medical bills were submitted, until March 25, 1987, at the point where Federated got
summary judgment on the other issues. From my view of the record, March 25, 1987 is the date of
the first tender by Attorney Patterson for Alfa. There is no mention of this tender in the 1989 opinion
most probably because it was not in the record before this Court which was an appeal of an order
dated March 23, 1987. Thus what troubled the Court in 1989 was the lack of an explanation for the
failure to have tendered the undisputed $1,000 at some time reasonably soon after November 1, 1985
when the medical bills were submitted. Nothing in this record, as I read it, or in the trial court's bench
ruling or order supplies that answer.

¶58. Cossitt returned the March 1987 tender stating that she was taking an appeal. Upon remand an
additional tender was made and by April 1989, that tender was made expressly without condition.
Thus, Cossitt's claim regarding 7-1/2 years of deprivation is without merit. Any refusal to tender
ended at least by April 1989, after this Court's March 1989 decision. In fact, in March 1987 when
Cossitt returned the initial draft for $1,000 there was no suggestion by Federated that it was paying
on any condition and Cossitt did not bother to clarify the issue before returning the draft. It seems
clear then that the period of March 1987 to March 1989 would not be a period of bad faith refusal.
This leaves the period of November 1985 to March 1987 unexplained.

¶59. Justice Sullivan suggests in dissent that the majority opinion holds that the refusal to submit the
$1,000 unconditionally is acceptable practice. The fact is that the record does not reflect such a
refusal as I see it. The record reflects nothing for the period November 1, 1985 to March 1987 in
terms of a discussion of payment of the $1,000. Perhaps this can be explained. Federated hired
counsel and sought a declaratory judgment within a few months. Our 1989 opinion suggests,
however, that this does not let them off the hook for the $1,000. I do not see what has changed.

¶60. Finally, as to State Farm v. Roberts, cited by the majority, I see a distinction between different
positions, as between insurer and insured, on unliquidated damages and different positions as to the
amount of coverage with respect to the duty to tender. Where there is a dispute as to the latter, the
insurer should tender the amount that it contends it owes unconditionally.

¶61. I would reverse the judgment of the trial court with respect to summary judgment on the
medical pay bad faith issue. That issue cannot be decided any more on the record before us than it
was on the record before us in 1989. This is especially so when we do not consider the deposition
testimony, which may be the only evidence in the record for the period November 1985 until March
1987.

SULLIVAN, P.J., JOINS THIS OPINION.

     SULLIVAN, PRESIDING JUSTICE, DISSENTING IN PART:
¶62. I agree with the majority's conclusions regarding all issues in this case other than Issue I(B) on
Cossitt's claim of bad faith. Because I believe that the result reached by the majority opens the door
for future abuse by insurance companies in denying legitimate claims, I must respectfully dissent.

¶63. In order to establish a prima facie case of bad faith against Alfa, Cossitt was required to prove
that in denying or delaying Cossitt's claim, Alfa "acted with (1) malice, or (2) gross negligence or
reckless disregard for the rights of others." Caldwell v. Alfa Ins. Co., 686 So.2d 1092, 1095 (Miss.
1996) (quoting Blue Cross & Blue Shield v. Maas, 516 So. 2d 495, 496 (Miss. 1987)). The majority
concludes that Alfa never actually denied Cossitt's claim, but finds instead that there was merely a
reasonable delay due to the legitimate "pocketbook dispute" as to the amount owed to Cossitt under
the policy. I do not join the majority's opinion on this matter, and to the extent that this Court's
previous decision in State Farm Mutual Automobile Insurance Co. v. Roberts, 379 So.2d 321
(Miss. 1980), holds otherwise, I would overrule that opinion.

¶64. As Cossitt points out in her brief to this Court, there was no dispute between the parties
regarding the $1,000 which Alfa admitted that it owed to Cossitt. The majority concedes that Alfa
could easily have tendered the undisputed $1,000, but holds that Alfa's refusal to unconditionally
tender the amount does not rise to the level of an intentional tort. I disagree. By offering the $1,000
check, but only upon the condition that the payment was for full satisfaction of Cossitt's medical
coverage, Alfa essentially forced Cossitt into refusing the partial payment for fear of losing any
additional coverage to which she might be entitled. The better result would be to require Alfa to pay
the undisputed amount unconditionally and proceed to trial on any remaining claimed coverage. To
hold otherwise opens the door for other insurance companies to similarly back their insureds into a
corner, forcing them to choose between an amount lesser than the total amount of coverage or
nothing. Consumers purchase insurance to protect themselves against economic hardship in the face
of an unexpected accident or illness. Considering the number of insureds who are financially
dependent upon payment of their coverage, we should not tolerate delay in payment of any
undisputed amounts of coverage by insurance companies.

¶65. In Travelers Indemnity Co. v. Wetherbee, 368 So.2d 829 (Miss. 1979), this Court addressed
whether a jury instruction on punitive damages was appropriate when an insurer delays or denies
payment of an undisputed item of coverage while investigating any remaining coverage under a single
policy. We held:

     [I]f a separate item of coverage in a multi-coverage policy may be unenforceable because of the
     misrepresentations of the insured, then surely nonpayment of a separate item of coverage by the
     insurer is likewise subject to penalty. Differently stated, an insured is penalized for
     misrepresentations through loss of coverage, whereas the insurer is penalized for wrongful acts
     through punitive damages.

Wetherbee, 368 So.2d at 835. The insurer may be held liable for punitive damages for delaying or
denying payment on one item of coverage even if payment on the other item(s) is legitimately delayed
due to a dispute between the insurer and the insured. Id. Similarly, the jury in the present case should
have been allowed to consider whether Alfa was liable for punitive damages for delaying payment of
the uncontested $1,000 while the dispute over any remaining coverage was resolved.

     Where an insurance carrier denies or delays payment of a valid claim, punitive damages will not
     lie if the carrier has a reasonable cause for such denial or delay. . . . Thus, where the parties
     dispute the existence and legitimacy of the carrier's reason for delay or denial, these issues are
     ones of material fact, and the plaintiff is entitled to have a jury pass upon his claim for punitive
     damages if reasonable minds could differ as to the legitimacy of the carrier's reason.

Stamps v. Estate of Watts, 528 So.2d 812, 814-15 (Miss. 1988) (citations omitted). Reasonable
minds could differ on the issue of whether Alfa's delay in tendering the $1,000 due to the dispute
over the remaining claimed coverage was legitimate. The jury should have been allowed to consider
whether Alfa's delay in unconditionally tendering payment of the undisputed $1,000 to Cossitt
amounted to bad faith.

¶66. Cossitt entered into a business contract with Alfa for which she paid. That contract provided
among other things for payment of the $1,000 under the circumstances of this case, which Alfa
admits to owing. For Alfa to take the position which it does here, and to which the majority gives its
blessing, is not only bad faith but bad business practice which should not be countenanced.

¶67. Cossitt presented sufficient evidence to the trial court to survive Alfa's motion for summary
judgment and require that the issue of bad faith be presented to the jury. I would reverse the trial
court's award of summary judgment on the issues of bad faith and the amount of medical payments
owed to Cossitt and remand the case for further jury findings.

BANKS AND ROBERTS, JJ., JOIN THIS OPINION.




1. Now M.R.A.P. 10(e).
