Justia Insurance Law Opinion Summaries

During the course of his employment as a police officer for the Town of Abingdon, Kevin Christy suffered injuries from an automobile accident. Christy was insured under an automobile liability insurance policy issued by Mercury Casualty Company (Mercury). Christy submitted a claim to Mercury for payment of the portion of his medical expenses not paid by the Town's workers' compensation carrier. Mercury denied the claim, asserting that an exclusion in the policy barred Christy from receiving any payment for medical expenses because a portion of those expenses had been paid by workers' compensation benefits. Christy filed a warrant in debt against Mercury seeking contract damages. The district court entered judgment in favor of Christy. The circuit court reversed, concluding that, based on the unambiguous language of the exclusion, payment of workers' compensation triggered the exclusion and precluded payment by Mercury. The Supreme Court affirmed, holding that the language of the exclusion was clear and that the exclusion permitted Mercury to deny coverage for any expenses that would have been subject to workers' compensation coverage without regard to whether all of those expenses were actually paid by the workers' compensation carrier.

On June 28, 2010, Appellant Maria Gomez filed a Worker’s Compensation Complaint with the Industrial Commission (Commission) claiming benefits for an accident that occurred in 2009, when she injured her lower back lifting sixty-pound boxes. The injury occurred at Blackfoot Brass (Dura Mark). Appellant had previously suffered two work-related accidents while working with Dura Mark, one in 2002, the other in 2006, but had returned to work without restrictions after participating in physical therapy for both injuries. The issue before the Supreme Court centered on a Commission order denying reconsideration of Appellant's motion to reopen the record to allow for additional evidence on the issue of causation. The Industrial Commission previously ordered that Appellant had failed to prove the medical treatment she received for a back injury was related to an industrial accident and injury. At the emergency hearing pursuant to the Judicial Rules of Practice and Procedure adopted by the Commission, Appellant introduced evidence regarding her entitlement to reasonable and necessary medical care pursuant to I.C. 72-432, but the referee denied Appellant's claim on the grounds of causation. Upon review, the Supreme Court affirmed the Commission's judgment. In doing so, the Court wanted to provide a "clear message that without a specific stipulation that causation will be a contested issue at the hearing pursuant to I.C. 72-713, and especially if there is a difference of opinion as to causation by opposing parties and their experts, claimant’s attorneys should no longer be lulled by anything other than a stipulation to all legal prerequisites and elements for recovery and be prepared to present evidence of a causal connection between the industrial injury or sickness and the required treatment."

Plaintiffs-Respondents father and daughter Jose and Nayeli Carrillo, father and daughter, sued Boise Tire Co. (Boise Tire), alleging that Boise Tire improperly performed a tire rotation on their vehicle and that as a result, the Carrillos and Marisela Lycan, Jose’s wife and Nayeli's mother, were in a motor vehicle accident. Marisela was killed, Jose was injured, and eighteen-month old Nayeli underwent testing that revealed no physical injury. A jury found that Boise Tire's conduct was reckless. Boise Tire moved for new trial on the grounds that: (1) the Carrillos' pleadings merely alleged negligence and therefore the court committed legal error by permitting the Carrillos to argue that Boise Tire's conduct was reckless; (2) the jury verdict was excessive and the result of passion or prejudice; and (3) the jury verdict was not supported by sufficient evidence. The district court issued a remittitur as to Nayeli's noneconomic damage award but otherwise denied the motion. Boise Tire appealed that denial and the court's holding that I.C. 6-1606 did not require the Carrillos' damage awards to be reduced by the subrogation interest transferred from the Carrillos' insurer to their attorney, nor by social security benefits obtained by the Carrillos. Upon review, the Supreme Court affirmed the district court's denial of Boise Tire's motion for a new trial, vacated the judgment and remanded the case for the district court to reduce Jose's personal injury reward by the value of his social security benefits when judgment was originally entered.

Plaintiff, a Rhode Island resident and employee of Safety, a Massachusetts corporation, was driving one of Safety's vehicles in Massachusetts as part of her job and was seriously injured in an accident caused by the other driver. She filed a claim against the tortfeasor, whose insurer paid the full policy limit of $20,000.00. She also received workers' compensation through the Rhode Island system and settled a Underinsured Motorist claim against her personal automobile insurance company for the policy limit of $25,000.00. She sought to recover under the UIM provision of Safety's policy, provided by defendant. The First Circuit determined that Massachusetts law applied, under which an employee cannot recover under both WC and her employer's UIM policy, except where the employer has "explicitly purchased" the UIM coverage for employees injured in the course of their employment. On remand, the district court granted summary judgment to defendant. The First Circuit affirmed. Plaintiff had no evidence that the company explicitly purchased the coverage for employees injured in the course of employment that would permit a reasonable jury to resolve this case in her favor.

The issue in this case was whether a healthcare provider could be held liable for damages when the provider's negligence permitted the theft of its patients' personal information, though the information was never used or viewed by the thief or any other person. Plaintiffs Laurie Paul and Russell Gibson (individually and on behalf of all similarly-situated individuals) claimed economic and noneconomic damages for financial injury and emotional distress that they allegedly suffered when, through Defendant Providence Health System-Oregon's alleged negligence, computer disks and tapes containing personal information from an estimated 365,000 patients (including Plaintiffs') were stolen from the car of one of Defendant’s employees. The trial court and Court of Appeals held that Plaintiffs had failed to state claims for negligence or for violation of the Unlawful Trade Practices Act (UTPA). Upon review, the Supreme Court concluded that, in the absence of allegations that the stolen information was used in any way or even was viewed by a third party, Plaintiffs did not suffer an injury that would provide a basis for a negligence claim or an action under the UTPA.

In this appeal the Supreme Court was asked to determine whether the parties' indemnity agreement clearly and unequivocally indemnified the Snohomish County Public Transportation Benefit Area Corporation (doing business as Community Transit) for losses resulting from its own negligence. Upon review, the Court concluded that the language of the agreement, and in particular language providing that indemnity would not be triggered if losses resulted from the sole negligence of Community Transit, clearly and unequivocally evidenced the parties' intent that the indemnitor, FirstGroup America, Inc. (doing business as First Transit) indemnify Community Transit for losses that resulted from Community Transit's own negligence. The Court reversed the Court of Appeals' decision to the contrary and remanded the case to the trial court for further proceedings.

An 11-year-old child suffered long-term horrific abuse and, in 2005, was beaten nearly to death by her adoptive mother and stepfather. The child's legal guardian, brought suit against Carson Center and one of its employees, a licensed social worker, alleging that they failed to detect or report signs of ongoing physical abuse. The state court suit led to insurance coverage litigation in federal court. Insurers sought a declaratory judgment that the allegations fell within exclusions to coverage. The First Circuit affirmed entry of declaratory judgment for the insurers. The language of the policy exclusions precludes coverage for abuse that occurs to anyone in the insureds' "care, custody or control." At the time of the abuse the victim was not in the physical custody of the insureds, but had been receiving bi-weekly outpatient therapeutic services from them for 14 months covered by the policies in question. The exclusions are unambiguous.

Defendant performed occasional maintenance and repairs for a fleet of plaintiff's delivery trucks. Defendant usually provided service onsite at plaintiff's plant, but sometimes would take trucks to its shop. In 2007, defendant's employee caused a fatal traffic accident while driving plaintiff's tractor-trailer to defendant's shop for service. The district court concluded that under Illinois law only plaintiff's insurance policy provided coverage for the accident. The Seventh Circuit affirmed. Both insurers provide coverage: defendant's policy by its plain language and plaintiff's policy operation of Illinois public policy. Plaintiff and its insurer are, however, ultimately responsible for the settlement amount. Under Illinois law the vehicle owner's policy is primary over the operator's policy unless a statute provides otherwise. The Illinois tow-truck insurance statute does not apply to provide an exception.

This case raised the question of whether an uninsured driver who was injured in a motor vehicle accident with an insured driver, may sue the insured driver in tort for economic damages. "The question highlight[ed] a tension" in the Motor Vehicle Financial Responsibility Law, (MVFRL), 75 Pa.C.S. 1701-1799, and Pennsylvania decisional precedent, as noted by the United States Court of Appeals for the Third Circuit. On the one hand, Section 1714 of the MVFRL prohibits uninsured drivers from recovering first-party benefits, which include medical and income loss benefits. On the other, Section 1705 of the MVFRL deems uninsured drivers to have chosen the limited tort alternative, which permits recovery of damages for economic loss sustained in a motor vehicle accident as the consequence of the fault of another person. Loss is commonly understood as being comprised of damages for medical expenses and wage loss. "Thus, it may appear as though the MVFRL both prohibits and permits insurance recovery to uninsured drivers for this category of damages or loss." The Supreme Court answered the question posed by the Third Circuit in the negative: Section 1714 of the MVFRL does not preclude an uninsured motorist from recovering tort damages for economic loss from an alleged third-party tortfeasor under the torfeasor’s liability coverage.

Lawrence Trudell was injured when he fell while trying to descend a ladder from the roof of a structure on which he was working. At the time he was employed by Phillips Construction Co. (Phillips), a construction contracting company principally owned by Clayton Phillips and Trish Dorman. Phillips did not have workers' compensation insurance, even though it was licensed by the State. The structure Trudell was working on was owned by John Brent and Debra Hibbert. Trydell filed suit for workers' compensation benefits against Phillips and the Hibberts, alleging that the owners were "project owners" as defined in the Alaska Workers’ Compensation Act and thus liable for securing workers' compensation. Phillips then filed for bankruptcy. The Hibberts denied liability on the basis that they were not "project owners." After a bench trial solely about whether the building owners were "project owners" or Trudell's employers, the superior court decided that they were neither and that they were not liable to pay worker's compensation, and awarded attorney’s fees against the Trudell. Upon review, the Supreme Court concluded it was error to interpret "project owners" as excluding the building owners, and reversed the superior court's decision.