Justia Insurance Law Opinion Summaries

While working on a fall clean-up job for defendant All Star Specialists Plus, Inc., defendant Joseph Derry was loading leaves into a truck using a leaf vacuum machine when the machine tipped over, injuring him. At the time, All Star had three insurance policies issued by Auto-Owners Insurance Company: (1) a commercial general liability policy, (2) a commercial automobile insurance (no-fault) policy, and (3) a commercial workers’ compensation policy. The general liability policy excludes from coverage “[a]ny obligation of the insured under a workers[’] compensation . . . law,” and the no-fault policy excludes coverage for “any expenses that would be payable under any workers[’] compensation law . . . .” Derry brought a negligence suit against All Star and one of its owners, Jeffery Harrison, for his injuries and sued Auto-Owners for no-fault benefits. Plaintiff Auto-Owners later filed this declaratory judgment action, seeking a determination that Derry was an employee of All Star and, thus, that the only insurance coverage available was under the workers’ compensation policy. The trial court concluded that because it was uncontroverted that Derry held himself out to the public to perform the same services as the work he performed for All Star, Derry was an independent contractor at the time of his injury and not an employee, and that Derry was therefore entitled to coverage under Auto-Owners’ general liability and no-fault policies. The court denied Auto-Owners’ motion for summary judgment and granted summary judgment in favor of Derry. Auto-Owners appealed to the Court of Appeals, and the panel affirmed in part and reversed in part. The panel affirmed the trial court’s conclusion that Derry was an independent contractor for purposes of the Worker's Disability Compensation Act (WDCA). However, the panel only reached this conclusion because it was bound under MCR 7.215(J)(1) to follow the Court of Appeals’ prior decision in "Amerisure." A special panel was convened, and in a published 4-3 decision, the majority reversed the trial court’s order granting summary judgment in favor of Derry and, thus, its determination that Derry was an independent contractor. Because the Supreme Court believed the term “employee” as defined in the WDCA was properly interpreted in "Amerisure," the Court reversed the Court of Appeals. View "Auto-Owners Insurance Co. v. All Star Lawn Specialists Plus, Inc." on Justia Law

“In Texas, the general rule…is that an injured party cannot sue the tortfeasor’s insurer directly until the tortfeasor’s liability has been finally determined by agreement or judgment.” Plaintiff sued San Diego Tortilla (SDT) for personal injuries after he lost his hand operating a tortilla machine. Plaintiff then added a declaratory judgment claim against SDT’s liability insurer, Essex Insurance Company, seeking a declaration that Essex must indemnify SDT for its liability to Plaintiff. Essex filed motions to dismiss Plaintiff’s claims, arguing that the “no direct action” rule barred Plaintiff from suing Essex until SDT’s liability to Plaintiff was determined. The trial court denied the motions, and the court of appeals denied Essex’s petition for writ of mandamus. The Supreme Court conditionally granted mandamus and directed the trial court to grant Essex’s motions to dismiss, holding that no exception to the “no direct action” rule applied in this case. View "In re Essex Ins. Co." on Justia Law

Petitioners Susan and Peter White appealed a superior court order denying their petition for a declaratory judgment that respondent Charles Matthews was covered under a homeowner's insurance policy issues to his mother by respondent Vermont Mutual Insurance Company. Matthews' dog bit Mrs. White while Matthews was staying with friends at the mother's home in Moultonborough. The policy defined an "insured" to include "residents of your household who are… your relatives." Matthews’s mother also owns a home in Naples, Florida, where she lives for approximately half of the year, and where Matthews usually visits only at Christmas. The petitioners and Matthews claim that the Florida residence is Matthews’s mother’s primary residence, but they do not claim that Matthews is a resident of the Florida home. Matthews testified that he lived in Massachusetts for 80% or more of the year. However, he had not changed his voting registration since he first registered to vote when he was eighteen, and he was still registered to vote in Moultonborough (he voted in Moultonborough in the 2012 election, a month before the hearing in this case). Matthews also held a New Hampshire driver’s license and his vehicle was registered in New Hampshire (his decision to register his car in New Hampshire was motivated by his desire to avoid buying automobile insurance, which is required in Massachusetts). Matthews typically notifies his mother in advance of using the Moultonborough house for permission to stay there. Following the 2011 incident involving Matthews' dog, petitioners sought a declaratory judgment that Vermont Mutual was responsible for any damages that might recover from Matthews. After a bench trial, the court denied the petition and the subsequent motion for reconsideration, finding that the policy did not contemplate Matthews as a resident of the Moultonborough house. Finding no reversible error, the Supreme Court affirmed the superior court's judgment. View "White v. Vermont Mutual Insurance Company" on Justia Law

Plaintiff, who was injured while working in Genesee County, filed a workers’ compensation claim. While his claim was pending, defendants, in their capacity as administrators of the workers’ compensation hearing system, advised plaintiff that the Genesee County hearing site where plaintiff’s case was assigned would be closed and that all pending cases from the county, including plaintiff’s, would be transferred to the State Secondary Complex in Dimondale, which is about 70 miles away in Eaton County. Plaintiff brought a mandamus action to compel defendants to maintain the Genesee County hearing site. The trial court granted mandamus relief, and in a divided and published opinion, the Court of Appeals affirmed. The issue before the Supreme Court was whether the trial court abused its discretion by issuing a writ of mandamus compelling defendants to ensure that hearings in workers’ compensation cases were held in the county in which the alleged injury occurred. The Court disagreed with the Court of Appeals, finding that plaintiff did not have a clear legal right to a hearing in Genesee County. Defendants, accordingly, did not have a clear legal obligation to hold the hearing there either. The trial court was reversed, and direct to enter judgment denying plaintiff's complaint for mandamus. View "Younkin v. Zimmer" on Justia Law

Christina Elliott appealed the dismissal of her lawsuit against Geico Indemnity Company (Geico). Elliott’s husband was killed when his motorcycle was struck by a truck driven by a drunk driver, Lesa Shaffer, who was returning to her job at Peterson’s Corner, a restaurant and bar in Nevada City. The trial court concluded Geico was not required to pay underinsured motorist benefits under a motorcycle insurance policy issued to Elliott and her husband because Elliott recovered more than the $100,000 underinsured motorist coverage limits in settlement of a wrongful death action brought against Shaffer and the owners of the restaurant (Shaffer’s insurer paid $15,000 and the owners’ general liability insurer paid $250,000). The Court of Appeal agreed with the trial court: the Geico policy at issue here unambiguously allowed Geico to deduct from the underinsured motorist coverage limits “the amount paid to the insured by or for any person or organization that may be held legally liable for the injury.” Because $265,000 was paid to Elliott in settlement of her claims that both Shaffer and the owners may be held legally liable for the injury, Geico properly deducted this amount from the underinsured motorist coverage limits. View "Elliott v. Geico" on Justia Law

In 2007, neighbors reported a fire that had erupted at the home of the Terrence and Judith Tincher in Downingtown. The residence was the central unit of a two-story triplex purchased by the Tinchers in 2005. The fire was eventually extinguished and no one was harmed. Investigators concluded that a lightning strike near the home caused a small puncture in the corrugated stainless steel tubing (“CSST”) transporting natural gas to a fireplace located on the first floor of the residence. The CSST installed in the Tinchers’ home was manufactured and sold by Omega Flex as part of a gas transportations system marketed as the TracPipe System. The melting of the CSST caused by the lightning strike ignited the natural gas and fueled the fire estimated to have burned for over an hour. The fire caused significant damage to the Tinchers’ home and belongings. After the fire, the Tinchers reported the incident to their insurer, United Services Automobile Association (“USAA”). USAA compensated the Tinchers for their loss up to the limit of their policy and received an assignment of liability claims. The Tinchers suffered an additional out-of-pocket loss because a portion of their claimed loss exceeded the limits of the USAA policy. In January 2008, the Tinchers filed a complaint against Omega Flex; USAA prosecuted the claims in the name of the Tinchers to obtain reimbursement of the insurance proceeds payout, but the Tinchers retained an interest in the litigation to recover the losses exceeding their insurance coverage. The Tinchers asserted claims premised upon theories of strict liability, negligence, and breach of warranty, alleging that Omega Flex was liable for damages to their home caused by the placement on the market and sale of the TracPipe System. Omega Flex, Inc., appealed the Superior Court's decision to affirm the judgment on the verdict entered in favor of the Tinchers. After review, the Supreme Court reversed in part, and remanded the case with instructions: (1) "Azzarello v. Black Brothers Company," (391 A.2d 1020 (Pa. 1978)) was overruled; (2) a plaintiff pursuing a cause upon a theory of strict liability in tort must prove that the product is in a “defective condition”; (3) whether a product is in a defective condition is a question of fact ordinarily submitted for determination to the finder of fact; (4) to the extent relevant here, the Court declined to adopt the Restatement (Third) of Torts: Products Liability despite acknowledging that "certain principles contained in that Restatement has certainly informed [its] consideration of the proper approach to strict liability in Pennsylvania in the post-Azzarello paradigm." View "Tincher v. Omega Flex, Inc." on Justia Law

Michele Dupree sued Auto-Owners Insurance Company, seeking to recover, under her homeowners’ insurance policy, the full cost of repair or replacement for the personal property that was destroyed in a fire at her home. Because the parties did not agree on the extent of the personal property loss, the parties submitted separate appraisals to an umpire under the process set forth in the insurance policy. The umpire issued an appraisal award that set forth the full replacement cost, the applicable depreciation, and the actual cash value loss of the property. Defendant paid plaintiff the actual cash value of the property but refused to pay the full replacement cost on the ground that plaintiff had failed to submit proof, in accordance with the replacement-cost provision of her insurance policy, that she had actually replaced the damaged property. The court denied defendant’s motion for summary judgment and granted summary judgment to plaintiff. Defendant appealed. The Court of Appeals, affirmed in an unpublished opinion per curiam. On appeal, the issue before the Supreme Court was whether plaintiff’s appraisal award entitled her to only the actual cash value of her damaged personal property or whether defendant was liable for the full replacement cost of that property, i.e., actual cash value plus the applicable depreciation amount. The Supreme Court reversed, finding that plaintiff was not entitled to the full replacement cost of her property because she did not submit proof of actual loss in accordance with her policy. Defendant was liable for only the actual cash value of plaintiff’s damaged personal property. View "Dupree v. Auto-Owners Insurance Company" on Justia Law

Plaintiff was seriously injured in a collision while he was a passenger in a motor vehicle owned by the insureds of Defendant. Defendant obtained a judgment for money damages but subsequently settled with the insureds in exchange for an assignment of claims the insureds had against Defendant. Plaintiff then filed this action seeking a declaratory judgment requiring Defendant to pay the entire judgment from the underlying tort action (count one) and a declaration that Defendant was liable for prejudgment interest on the judgment in the underlying tort action (count two). A superior court justice granted summary judgment for Plaintiff on counts one and two. The Supreme Court vacated the judgment in count one and remanded for a new trial and affirmed the judgment in count two. On remand, Plaintiff sought a calculation of prejudgment interest. The superior court granted the motion, determining that Defendant’s argument with respect to the judgment satisfied order had been waived in regards to count two. The court subsequently ordered Defendant to make payment to Plaintiff. Defendant appealed from that order. The Supreme Court affirmed, holding that Defendant waived its arguments with respect to the judgment satisfied order and that the superior court had subject matter jurisdiction over the dispute throughout the litigation. View "DeMarco v. Travelers Ins. Co." on Justia Law

Wayne Farms owned and operated a chicken processing plant in Oakwood. A fire broke out at the plant in 2003. Roughly three years later, Wayne Farms and its insurers filed suit against Crane Composites, Inc., which manufactured interior panels used in the plant, alleging Crane’s negligence caused the fire to spread extensively. In the meantime, the legislature enacted OCGA 9-11-68 (b) (1). The question for decision in this case is whether OCGA 9-11-68 (a tort reform, fee-shifting statute) could be applied to a negligence action in which the injury occurred prior to the effective date of the statute, but in which the action was filed after that date. The Supreme Court concluded that it could, and in so doing, overruled the case law set forth in "L. P. Gas Industrial Equipment Co. v. Burch," (701 SE2d 602) (2010)). View "Crane Company v. Wayne Farms, LLC" on Justia Law

Jose Campos was injured while working for Daisy Construction Company. While Campos was receiving total disability payments from Daisy, Daisy performed an investigation of his social security number at the request of its workers' compensation insurance carrier and discovered that Campos was an undocumented worker. When Campos could not provide a valid number, Daisy terminated his employment. Around the same time, Daisy hired a doctor to re-evaluate Campos' medical condition. The doctor concluded that although Campos remained partially disabled, he could perform "light duty" work with restrictions. Daisy then filed a petition with the Industrial Accident Board to terminate Campos' total disability benefit payments. The Board granted Daisy's petition because Campos was physically capable of working and therefore was not totally disabled. The Board also found that Campos was not eligible for partial disability benefits, reasoning that Daisy had met its burden of showing that Campos had no decrease in earning capacity by testifying that Campos would be eligible for light duty jobs at Daisy at his pre-injury wage rate if he could provide a valid social security number. The Superior Court affirmed the Board's decision. After its review, the Delaware Supreme Court concluded the Board erred when it found that Campos was not eligible for partial disability benefits: "If we were to hold that Daisy's testimony constituted sufficient proof of job availability, an employer could always hire an undocumented worker, have him suffer a workplace injury, and then avoid partial disability benefit payments by 'discovering' his immigration status, offering to re-employ him if he could fix it, and claiming that a job is available to him at no loss in wages. This outcome would be contrary to the Workers' Compensation Act and our case law interpreting it, [...] which prevents employers from depriving undocumented workers of employment benefits. [...]Accordingly, Daisy must continue to pay partial disability payments until it can demonstrate that Campos has no decrease in earning power from his workplace injury, or until the statutory period for partial disability benefit eligibility expires. Federal restrictions that prevent employers from hiring undocumented workers may make it more difficult for Daisy to prove job availability, but any difficulty is appropriately borne by it as the employer, who must take the employee, Campos, as it hired him." View "Campos v. Daisy Construction Co." on Justia Law