Hoffman

MEMORANDUM *

GEICO appeals a grant of summary judgment in favor of Kenneth Hoffman and his guardian Donna Hoffman (collectively “the Hoffmans”) on their claims for additional stacked underinsured motorist insurance payments after Kenneth Hoffman sustained serious injuries as a passenger in an auto accident. The district court found the Hoffmans’ prior release of those claims invalid for lack of consideration. GEICO appeals, conceding that at least $670,000 in damages have now been incurred, but arguing that the Release was valid as obtained for consideration or because consideration was not required. GEICO also appeals an order awarding attorney fees and prejudgment interest to the Hoffmans. We affirm.

The district court correctly determined that the Release was invalid because GEICO provided the Hoffmans with no new consideration in order to obtain it. When GEICO paid the Hoffmans $100,000, it was merely fulfilling its preexisting legal duty under its contract with the Hoffmans. Although GEICO late in the game tried to change its posture on excess damages as of the time the Release was obtained, it twice formally conceded the damages issue, once in its original Answer and again…

dissenting:

I respectfully dissent. Even assuming that the Release was invalid, the Hoffmans cannot bring this breach of contract suit against GEICO under Montana law.

When GEICO paid the Hoffmans $100,000 on July 5, 2001, that sum was the entire amount available under the Hoff-mans’ insurance contract under then-existing Montana law, which prohibited stacking. 1 Accordingly, the Hoffmans’ claim with GEICO was closed by accord and satisfaction on July 5, 2001, regardless of the validity of any accompanying Release. In 2003, two years after GEICO paid the full amount of the Hoffmans’ insurance policy available under then-applicable law, the Montana Supreme Court held Montana’s anti-stacking statute to be unconstitutional, Hardy v. Progressive Specialty Ins. Co., 315 Mont. 107 , 67 P.3d 892 (2003), but left open whether Hardy’s holding retroactively applied to already-paid claims. In 2004, the Montana Supreme Court squarely addressed the Hardy retroactivity issue, stating:

*299 Dempsey v. Allstate Ins. Co., 325 Mont. 207 , 104 P.3d 483, 490 (2004).

In my view, Dempsey makes plain that Hardy retroactivity does not apply to the Hoffmans’ fully-paid claim. First, the plain meaning…