Justia Insurance Law Opinion Summaries

The issue central to this appeal centered on a “covenant judgment” arrangement: an insured defendant, facing suit by a plaintiff, settles claims without the insurer’s consent in exchange for a release from liability and assignment of potential bad faith claims against the insurer to the plaintiff. If the trial court deems the settlement reasonable, that settlement amount becomes the presumptive measure of damages in the later bad faith action brought by the plaintiff against the insurer. Insurer Cincinnati Specialty Underwriters (Cincinnati), challenged the trial court’s order approving as reasonable a $1.7 million settlement between plaintiffs, Anna and Jeffrey Wood (Woods), and Cincinnati’s insureds, Milionis Construction Inc. (MCI) and Stephen Milionis. A divided Court of Appeals held the trial court abused its discretion because the reasonableness finding credited a defense expert’s evaluation of contract damages at $1.2 million despite other evidence in the record suggesting the defense’s evaluation of damages never rose above $399,000. The Washington Supreme Court reversed and reinstated the trial court’s order. The Supreme Court found the trial court properly conducted the reasonableness hearing and evaluated the varied and conflicting evidence of contract damages. In addition, the court appropriately considered damages for plaintiffs’ extracontractual claims as well as allowable attorney fees. "In finding an abuse of discretion, the Court of Appeals majority misapprehended parts of the record and substituted its assessment of the competing damages evaluations for the trial court’s assessment." View "Wood v. Milionis Constr., Inc." on Justia Law

Allstate Insurance Company et al. (Allstate) filed a complaint on behalf of itself and the People of California (qui tam) against Dr. Sonny Rubin and related medical providers (Rubin). Allstate generally alleged Rubin prepared fraudulent patient medical reports and billing statements in support of insurance claims. Rubin filed an anti-SLAPP motion, arguing the preparation and submission of its medical reports and bills were protected litigation activities. The trial court denied Rubin’s motion. "Litigation is not 'under [serious] consideration' - and thereby protected activity under the anti-SLAPP statute - if the ligation is merely a 'possibility.'" The Court of Appeal found that Rubin failed to show its medical reports and bills were prepared outside of its usual course of business in anticipation of litigation that was “under [serious] consideration.” Thus, the Court affirmed the trial court’s order denying Rubin’s anti-SLAPP motion. View "California ex rel. Allstate Ins. Co. v. Rubin" on Justia Law

This dispute over uninsured motorist ("UM") coverage arose from a motor vehicle accident on Louisiana Highway 6 near Natchitoches. Martin Baack, an employee of Pilgrim’s Pride Corporation, was driving his work vehicle when he was struck by a vehicle driven by Michael McIntosh. The vehicle Baack was driving belonged to PPC Transportation Company. Both Pilgrim’s Pride and PPC Transportation were subsidiaries of JBS USA Holdings, Inc. (“JBS”). McIntosh was determined to be solely at fault for the accident and pled guilty to improper lane usage. Baack and his wife filed suit individually and on behalf of their minor daughter naming as defendants McIntosh, his insurer, and Zurich American Insurance Company (“Zurich”) in its capacity as the UM provider for PPC Transportation’s vehicle. In JBS’s policy with Zurich, PPC Transportation was listed as a Broad Named Insured. The Baacks sought damages under Zurich’s UM coverage as well as penalties and attorney fees based on Zurich’s failure to timely settle the claim. The Louisiana Supreme Court granted consolidated writs to determine whether an insured’s initial UM coverage waiver remains valid where, upon consecutive renewals, the insured submitted new signed and dated UM forms without initialing the blanks provided to reject UM coverage. Based on the Court's interpretation of the UM statute, it found such a subsequently submitted form changes the prior rejection and operated to provide UM coverage. Additionally, finding no error in the quantum of damages and denial of penalties and attorney fees by the court of appeal, the Court affirmed. View "Baack v. McIntosh et al." on Justia Law

Because the Louisiana Supreme Court found in its original opinion that plaintiffs had a right of action under La. C.C. arts. 2315.1 and 2315.2, their constitutional challenge was pretermitted and “that part of the district court judgment declaring [these code articles and La. C.C. art. 199 to be] unconstitutional as applied to children given in adoption” was vacated. Having found on rehearing that the codal analysis of La. C.C. arts. 2315.1, 2315.2 and 199 foreclosed a right of action to the plaintiff children, who were given in adoption, for the death of their biological parent and half-siblings, the Supreme Court was called on to address the propriety of the district court’s declaration that La. C.C. arts. 2315.1, 2315.2, and 199 are “unconstitutional as applied to children given in adoption.” The Court found a rational basis existed for limiting the categories of eligible claimants in La. C.C. arts. 2315.1 and 2315.2 to those who “are likely to be most affected by the death of the deceased.” Children given in adoption “have moved into a new parental relationship, becoming children ‘by adoption,’ who are eligible claimants in the unfortunate occurrence of the tortious death of their adoptive parents. Likewise, the transfer of children into a new parental unit as children ‘by adoption’ terminates, for purposes of wrongful death and survival actions, any connection between the ‘children given in adoption’ and any biological siblings who were not ‘given in adoption.’” For these reasons, the district court legally erred in finding that the fact that Daniel Goins and David Watts were adopted did not prevent them from bringing survival and wrongful death claims for the deaths of their biological father and biological half-siblings and in overruling the defendant’s exception raising the objection of no right of action. The Supreme Court's original decree was vacated and the district court's judgment was reversed. Judgment was entered sustaining the defendant insurance company's peremptory exception raising the objection of no right of action, and dismissing the claims that were the subject of this exception. View "Rismiller et al. v. Gemini Ins. Co." on Justia Law

Plaintiffs Cathedral of Faith Baptist Church, Inc., and Lee Riggins appealed the dismissal of their complaint asserting various claims against, among others, Donald Moulton, Sr., Broken Vessel United Church ("Broken Vessel"), Lucien Blankenship, Blankenship & Associates, Antoinette M. Plump, Felicia Harris-Daniels, Tara Walker, and Tavares Roberts ("defendants"). Cathedral Church conducted worship at its property until membership dwindled and discontinued meeting. A mortgage existed on the property with Regions Bank which was outstanding and failed to be paid by Riggins. Riggins and Willie Bell Hall were the sole survivors and interest holders of Cathedral Church; their interest conveyed legally to Riggins. Moulton, on behalf of Broken Vessel Church, sought to rent the Cathedral Church property from Riggins. Riggins agreed to rent the property; Moulton and Broken Vessel Church were to seek financing. Moulton and Broken Vessel Church were to pay the commercial liability insurance Cathedral Church maintained with Planter's Insurance. However Moulton and Broken Vessel unilaterally changed the insurance carrier in July 2015 to Nationwide Mutual Insurance Company without Cathedral Church and Riggins's knowledge or consent. Moulton and Broken Vessel never obtained financing to purchase the property and never paid any money to Riggins or Cathedral Church. Riggins paid for all Cathedral Church repairs and renovations required. Then in late 2016, Cathedral Church burned and was a total loss. Moulton made a claim to Nationwide for the lost premises and contents. No money was paid to Riggins. Riggins discovered the property settlement with Nationwide in or around August 2017. Riggins also discovered two recordings of a general warranty deed at the local Tax Assessor's office purporting to be the sale of the property by Riggins to Broken Vessel. Riggins filed suit, raising a number of causes of action sounding in fraud and conspiracy, and denying he conveyed the church property to Moulton or Broken Vessel, and denied the validity of the deeds on file at the Assessor's office. The Alabama Supreme Court determined the trial court judgment on appeal here did not adjudicate all claims before the court. It was therefore a nonfinal judgement that could not support this appeal. The appeal was thus dismissed. View "Cathedral of Faith Baptist Church, Inc. et al. v. Moulton, et al." on Justia Law

Nucor Steel Tuscaloosa, Inc. ("Nucor"), appealed the grant of summary judgment entered in favor of Zurich American Insurance Company ("Zurich") and Onin Staffing, LLC ("Onin"), on claims asserted by Nucor arising from an alleged breach of an indemnification agreement. Nucor operated a steel-manufacturing facility in Tuscaloosa. Nucor had an internship program that offered part-time work to technical-school students, who, as part of the internship program, earned both academic credit and work experience relevant to their vocational training. In 2010, Nucor entered into a "Temporary Services Agency Agreement" ("the TSA Agreement") with Onin, a personnel-staffing agency, whereby Onin was to manage the employment of the technical-school students selected by Nucor for its internship program. Korey Ryan was a student at Shelton State Community College who applied for Nucor's internship program through Shelton State. In October 2014, Ryan was killed while working in the course of his duties at the Nucor facility. Ricky Edwards, a Nucor employee, directed Ryan to stand in a certain area in front of a water filter so that he would be clear of a moving crane. Edwards stated that he then turned his attention back to the load and began moving the crane. Ryan's right boot was struck by and became caught underneath the gearbox as the crane was moving. Ryan was dragged by the crane along the concrete floor through the narrow passageway between the crane and the warehouse wall, where he was crushed to death against a building support beam. Ryan's estate brought a wrongful-death action against Nucor; OSHA cited Nucor for a "serious" safety violation and fined it. Zurich issued a letter to Nucor and Onin in which it questioned whether the general-liability policy afforded coverage for the claims asserted in the wrongful-death action. Zurich noted that neither the indemnification provision in the TSA Agreement nor the additional-insured endorsement contained in the policy applied to in instances when the alleged "bodily injury" and/or "property damage" was caused by Nucor’s sole wrongful conduct. The Alabama Supreme Court determined the particular facts and circumstances underlying the wrongful- death action did not trigger the indemnification provision and the payment of an insurance benefit; rather, the facts and circumstances voided the indemnification provision altogether. Accordingly, the Supreme Court affirmed the trial court's grant of summary judgment in favor of the insurance company. View "Nucor Steel Tuscaloosa, Inc. v. Zurich American Insurance Company et al." on Justia Law

Various parties petitioned the Oregon Supreme Court for reconsideration of its decision in Allianz Global Risks v. ACE Property & Casualty Ins. Co., 483 P3d 1124 (2021). Petitioner on review Allianz Global Risks US Insurance Company and Allianz Underwriters Insurance Company (“Allianz”), together with respondent on review Certain Underwriters at Lloyd’s, London and Certain London Market Insurance Companies (“London”), petitioned on two grounds: (1) that the court in one place in the opinion incorrectly characterized its earlier cases regarding the duties of an insurer to defend or indemnify its insured; and (2) that the court in several places incorrectly identified a particular entity as the “indemnitor” in several agreements discussed in the opinion. Respondent on review Con-Way filed a petition for reconsideration asserting that the court erred in holding that certain “side” agreements between Con-Way and three of its insurers were to be considered separately from the insurance policies that those companies issued to Con-Way’s subsidiary, Freightliner. The Supreme Court considered the arguments in Con-Way’s petition, and denied it: "The purpose of a rehearing is not to raise new questions or rehash old arguments, but to allow the court to correct mistakes and consider misapprehensions." As to the Allianz/London petition: the Court allowed that petition to make changes as noted. View "Allianz Global Risks v. ACE Property & Casualty Ins. Co." on Justia Law

The Georgia Supreme Court granted certiorari to consider whether the Court of Appeals properly identified the accrual date of the legal malpractice claim in this case. The court determined that the accrual date for the malpractice action based on failure to protect an underinsured motorist (“UM”) claim was the date on which the plaintiff’s attorney first became aware that the plaintiff potentially had a UM claim with available coverage. Under the facts of this case, the Supreme Court disagreed, holding that the accrual date was the last day counsel could protect the client’s UM claim by lawfully effecting service on the UM carrier. View "Armstrong et al. v. Cuffie et al." on Justia Law

Nicholas Jay appealed the grant of summary judgment entered in favor of United Services Automobile Association ("USAA") on his claim against USAA seeking uninsured-motorist ("UM") benefits. Nicholas was injured in an automobile accident when riding as a passenger in Ryen Gorman's automobile. Gorman did not have automobile insurance. Nicholas received $50,000 in UM benefits through a policy he had with Nationwide Insurance Company. Thereafter, Nicholas commenced an action against USAA, seeking UM benefits pursuant to a USAA policy owned by his father-in-law, George Brewer, and under which Nicholas's wife, Michelle Jay, had automobile-insurance coverage. Because Nicholas was not a "covered person" under the USAA policy, the Alabama Supreme Court affirmed the judgment. View "Jay v. United Services Automobile Association" on Justia Law

Jean Hardin filed a claim with Farm Bureau, her homeowner’s insurance carrier, following an alleged sudden collapse in the floor of her home. After Farm Bureau denied the claim, Hardin sued Farm Bureau for specific performance, breach of contract, fraud, misrepresentation, damages, emotional harm and upset, depression, attorneys’ fees, costs of litigation, and punitive damages related to Farm Bureau’s denial of coverage for damage to Hardin’s home. Farm Bureau filed a motion for summary judgment, which the trial court denied. Farm Bureau sought, and the Mississippi Supreme Court granted, interlocutory appeal. The Court reversed, finding the trial court erred in denying Farm Bureau’s motion for summary judgment because Hardin demonstrated proof that the water damage to her home was caused by the failure of the Town of Leakesville to maintain the ditch beside her home. Thus, because Hardin’s damages were not covered under the policy, Farm Bureau was entitled to summary judgment. View "Mississippi Farm Bureau Casualty Insurance Company v. Hardin" on Justia Law