Justia Insurance Law Opinion Summaries

Lia Kazan (“Lia”) visited an Alexandria, Louisiana motel to meet some friends. During the course of her visit, she went went to the motel parking lot to retrieve something from her vehicle. Anthony Murray, another motel guest, exited his room and approached the vehicle with Lia inside. Audio from the camera footage recorded Lia screaming “stop,” “no,” and calling for help accompanied by repeated honking of the vehicle’s horn. Murray then started the ignition and, with Lia in the passenger seat, reversed out of the parking lot onto the service road. The vehicle was later found submerged in Lake Dubuisson – the bodies of Murray and Lia were recovered in the water. Lia’s death was classified as a homicidal drowning. Ali Kazan and Ebony Medlin filed suit, individually, and on behalf of their daughter, Lia (collectively “Plaintiffs”) against several parties, including the motel’s owner, Vitthal, LLC, and its insurer, Great Lakes Insurance Company SE (“Great Lakes”), seeking damages for Lia’s kidnapping and death. In response, Great Lakes filed a petition for declaratory judgment averring it had no obligation under the operable commercial general liability policy (“the CGL Policy”) to defend or indemnify the other defendants. Great Lakes moved for summary judgment on its petition arguing the CGL Policy contained an exclusion – specifically defining “assault,” “battery,” and “physical altercation” – which barred coverage for Lia’s kidnapping and death. The Louisiana Supreme Court granted review in this case to determine whether an insurance policy, by its own terms, excluded coverage for damages arising from a kidnapping resulting in death. The Court found the clear and unambiguous language of the relevant policy exclusion barred coverage. View "Kazan et al. v. Red Lion Hotels Corporation, et al." on Justia Law

The Louisiana Supreme Court granted review in this case to determine whether a stamped signature on an uninsured/underinsured motorist (“UM”) coverage rejection form, affixed by the administrative assistant of the corporate insured’s owner and president, complied with the statutory requirement that the UM form be signed by the named insured or his legal representative. Because the stamped signature was affixed on behalf of the legal representative and not by the legal representative himself, the Supreme Court agreed with the court of appeal that the lack of prior written authorization to the administrative assistant rendered the UM form invalid. View "Havard v. JeanLouis, et al." on Justia Law

Brown’s company, TME, owned the House of Blues recording studio in Memphis and leased a studio to Falls. Hanover issued separate insurance policies to TME and Falls. Intruders vandalized and burgled the studio, and committed arson. Hanover made advance payments to TME and Falls, then discovered that Brown had submitted false receipts and had been the target of several similar arson incidents. Hanover sued Brown, TME, and Falls, seeking recovery of the prepaid funds and a declaratory judgment. A jury returned a verdict against Brown but found that Falls was entitled to recover the full insurance coverage. Hanover unsuccessfully moved to overturn that verdict because TME was named as an additional insured on Falls’s policy and his policy voided coverage if “you or any other insured” misrepresented a material fact. Meanwhile, Falls sought monetary damages and declaratory relief against Brown and TME in Tennessee state court.Hanover filed an interpleader complaint against Brown, TME, and Falls in federal court, requesting that the court find the insurance award void under Tennessee public policy or, alternatively, determine to whom Hanover should pay the award. The district court enjoined Falls’s state court action, citing the Anti-Injunction Act, 28 U.S.C. 2283, The Sixth Circuit reversed. The Act allows an injunction only for necessity, not simply for efficiency. Because the district court proceedings were not in rem, an injunction was not “necessary” to aid the district court’s jurisdiction. View "Hanover American Insurance Co. v. Tattooed Millionaire Entertainment, LLC" on Justia Law

Plaintiffs-homeowners Dylan O’Malley-Joyce and Eileen Nash appealed a superior court order granting the summary judgment motion filed by defendant Travelers Home and Marine Insurance Company (the insurer), on their claims for damages and declaratory relief. The insured residence was damaged by two leaks — one in November 2017 and the other in early January 2018. The homeowners filed claims under the policy as to both leaks. Thereafter, the parties disagreed about the cost and scope of repairs. In November 2018, the insurer sought to settle the parties’ dispute by providing a contractor “who [was] willing and able to complete the work” and by “paying up to the replacement cost figures on the [contractor’s] estimates less the deductibles for each of the claims.” The policy’s appraisal provision provided, in pertinent part, that if the parties “fail to agree on the amount of loss, either may demand an appraisal of the loss.” Because the parties were unable to reach an agreement, the insurer demanded that they participate in the appraisal process set forth in the homeowners’ policy. In November 2019, the homeowners brought a two-claim complaint against the insurer. In one claim, the homeowners sought a declaratory judgment, and in the other, they sought damages for “breach of contract, bad faith, statutory violations.” Because, on appeal, the homeowners did not contest the grant of summary judgment on either their claim for declaratory judgment or their claim that the insurer violated certain statutes, the New Hampshire Supreme Court focused solely on their claims for breach of contract and breach of the implied covenant of good faith and fair dealing. Because the homeowners filed neither an objection to the insurer’s summary judgment motion nor a motion to reconsider the trial court’s order, the Supreme Court determined they failed to preserve their appellate arguments for review. Nonetheless, the Court reviewed their arguments for plain error, and finding no plain error, the Court affirmed. View "O'Malley-Joyce v. Travelers Home & Marine Insurance Co." on Justia Law

Appellant Marie Yammine, as former wife and primary beneficiary of a two million dollar life insurance policy issued by Respondent ReliaStar Life Insurance Company to her former husband, Dr. Jean Bernard, appealed a declaratory judgment finding the contingent beneficiary, Appellee Roland Ghoussoub, was entitled to the policy's death benefit. Dr. Bernard died after the trial court granted the parties' divorce but prior to final judgment on all issues. The trial court declared Yammine and Bernard were divorced and that 15 O.S.2011 § 178(A) operated to revoke her beneficiary designation to the death benefits. Whether Oklahoma's revocation-upon-divorce statute, 15 O.S.2011 § 178(A), applied when one party dies after the granting of the divorce but prior to final judgment on all issues, was a matter of first impression for the Oklahoma Supreme Court. The Court concluded Section 178(A) required a final judgment on all issues, and that the trial court erred by interpreting 15 O.S.2011 § 178(A) to revoke Yammine's beneficiary designation in Bernard's life insurance policy based on an order granting divorce when the final judgment on all issues remained pending at husband's death. The trial court's declaratory judgment was reversed, and this case was remanded for further proceedings. View "Ghoussoub v. Yammine" on Justia Law

St. Paul Fire and Marine Insurance Company (St. Paul Fire & Marine) and multiple other appellants (collectively, the St. Paul Insurers or sometimes St. Paul) appealed a California trial court’s order staying their declaratory judgment insurance coverage action. The trial court issued the stay in recognition of a "bellwether case of national importance" that was ongoing in West Virginia (WV coverage action), which, like this, arose from the opioid prescription abuse and addiction crisis. The WV coverage action commenced in March 2017, nearly four years before plaintiffs filed their complaint here. At the time the trial court issued its stay, proceedings had progressed significantly in West Virginia. The trial court found that in this action and in the WV coverage action “some of the same insurance policies are at issue in both cases, and the West Virginia court will be interpreting at least one of St. Paul’s policies to determine whether they cover opioid litigation, an answer that presumably will be the same whether the underlying litigation is in West Virginia or some other state.” St. Paul challenged the trial court’s stay order, arguing it constituted an abuse of discretion. The California Court of Appeal concluded St. Paul failed to meet its burden to demonstrate an abuse of discretion, and affirmed the order. View "St. Paul Fire & Marine Ins. Co. v. AmerisourceBergen Corp." on Justia Law

BDC lent $800,000 to a company owned by the Suggs, who personally guaranteed the loan and secured it with a $200,000 mortgage on their Shaker Heights home. Bank of America and MidFirst Bank held more senior mortgages on the home. The Suggs’ home suffered serious water damage from a burst pipe in 2014. State Farm insured the home for up to $352,130. State Farm denied their claim on the ground that the Suggs had failed to heat their home at a temperature required by their policy.The Suggs sued State Farm in an Ohio state court and sued all three lenders with mortgages on their home, explaining that these lenders “have an interest in the policy proceeds” because the policy entitled them to payment even if State Farm had a valid defense against the Suggs. BDC did not appear. After the case settled, the state court found that BDC had no right to the proceeds. BDC did not seek relief in the state court but filed a federal suit alleging that State Farm, its lawyers, and the Suggs’ lawyers colluded to defraud it. The district court dismissed the suit under Ohio’s claim-preclusion law. The SIxth Circuit affirmed. BDC cannot meet the demanding test required to attack the state court’s judgment in this collateral fashion. View "Business Development Corporation of South Carolina v. Rutter & Russin, LLC" on Justia Law

Meemic Insurance Company filed a subrogation claim against Angela Jones, seeking to recover from Jones money it had paid to CitiMortgage, Inc., the mortgagee of a residential house owned by Jones and insured by Meemic, after fire damaged the property. In September 2015, Jones was living at the house when it was damaged by a fire. Meemic paid her $2,500 in partial payment of the claim for insurance benefits. During Meemic’s ensuing investigation, Jones admitted that at the time she secured the policy in 2014, she did not reside at the house but, instead, rented it to a third party. Meemic claimed that Jones’s failure to disclose in the initial policy that her home was being rented to others constituted a material misrepresentation. On the basis of the misrepresentation, Meemic rescinded and voided the insurance policy from its inception and returned Jones’s policy payments. After rescinding the policy, Meemic paid $53,356.49 to CitiMortgage under the lienholder contract of the policy. Jones filed an action against Meemic, claiming breach of contract and sought to recover under the insurance policy. Meemic moved for summary judgment, arguing that it had properly rescinded the policy given Jones’s misrepresentation in the initial policy. The motion was ultimately granted, and Jones' complaint was dismissed with prejudice. In 2018, Meemic filed the underlying action against Jones seeking to recover the $2,500 advance payment made to Jones and the $53,356.49 it had paid to CitiMortgage under the lienholder contract. Jones moved for summary judgment, arguing that she was relieved from any obligations under the insurance policy because Meemic had rescinded the insurance policy; Meemic opposed the motion and filed a countermotion for summary judgment. The Court of Appeal reversed the trial court's grant of summary judgment in favor of Meemic, and Meemic appealed. The Michigan Supreme Court held: an insurer who rescinds a homeowner’s insurance policy that contains a mortgage clause may seek subrogation from the insured under its rescinded policy for the amount paid to the mortgagee under the lienholder contract. The Court of Appeals judgment was reversed because it erred by concluding that Meemic’s rescission of the risk contract precluded it from denying payment to Jones and then asserting rights under the subrogation provision of the lienholder contract. View "Meemic Insurance Co. v. Jones" on Justia Law

Mecosta County Medical Center, d/b/a Spectrum Health Big Rapids (and others) sued Metropolitan Group Property and Casualty Insurance Company and State Farm Mutual Automobile Insurance Company at the Kent Circuit Court, seeking personal protection insurance (PIP) benefits related to a single-car crash involving Jacob Myers. Myers co-owned the vehicle involved in the crash with his girlfriend; his girlfriend’s grandmother had purchased a no-fault insurance policy on the vehicle through Metropolitan Group. Myers assigned plaintiffs his right to collect PIP benefits in the amount of his treatment bills. After the assignment, Myers sued Metropolitan Group and State Farm at the Wayne Circuit Court for PIP benefits related to other costs arising from the crash. Plaintiffs sued defendants at the Kent Court to recover on the assigned claim. Defendants moved for summary judgment against Myers at the Wayne Court. State Farm argued that because Myers did not live with the State Farm policyholders he was not covered by their policy. Metropolitan Group asserted that Myers was not entitled to coverage because he did not personally maintain coverage on the vehicle. The Wayne Court granted both motions and dismissed Myers’s PIP claim with prejudice. Myers did not appeal. While defendants’ motions were pending with the Wayne Court, Metropolitan Group also moved for summary judgment at the Kent Court on the same basis as its motion in the Wayne Court. However, the Wayne Court granted defendants’ motions before the Kent Court considered Metropolitan Group’s motion. After the Wayne Court granted summary judgment for defendants, defendants filed additional motions for summary judgment at the Kent Court, arguing plaintiffs’ claims were barred under the doctrines of res judicata and collateral estoppel because the Wayne Court had concluded that Myers was ineligible for PIP benefits. The Kent Court granted the motion, holding that plaintiffs’ claims were barred by res judicata and collateral estoppel. Plaintiffs appealed, and the Court of Appeals reversed in a split, unpublished opinion. The appellate majority held that an assignee was not bound by a judgment against an assignor in an action commenced after the assignment occurred. The Michigan Supreme Court affirmed, finding that plaintiffs were not in privity with Myers with respect to the judgment entered subsequently to the assignment, and therefore, plaintiffs could not be bound by that judgment under the doctrines of res judicata and collateral estoppel. View "Mecosta County Medical Center v. Metropolitan Group Property, et al." on Justia Law

A Surety on a $50,000 bail bond appeals from an order denying its motion to set aside a summary judgment entered on the bond. Surety contends the summary judgment entered on the bail bond is voidable and must be vacated because it was not filed within 90 days after the appearance period expired as required by Penal 2 Code section 1306, subdivision (c).   The trial court concluded the Surety was estopped from arguing the reinstatement order was void. As Surety’s challenge to the summary judgment was based on the invalidity of the reinstatement order, the court concluded that the challenge must fail.   The Fifth Appellate District agreed with Surety’s contention that the trial court lacked the authority to reinstate the bond after the appearance period expired. However, the trial court correctly decided that Surety’s conduct estopped it from raising the invalidity of the reinstatement order as a basis for vacating the summary judgment. Here, Surety (1) had prior notice that a reinstatement order would be entered, (2) gave its written consent to the reinstatement, (3) paid a $50 reinstatement fee a few days after the reinstatement order, and (4) benefited when the forfeited $50,000 bail bond was reinstated. Furthermore, the trial court relied on Surety’s consent when it vacated the forfeiture and reinstated the bail bond. The court concluded such circumstances estop Surety from arguing the reinstatement order was invalid. Because the invalidity of the reinstatement order is a necessary condition to Surety’s argument that the summary judgment is voidable. View "P. v. Accredited Surety and Casualty Co." on Justia Law