Justia Insurance Law Opinion Summaries

In the garnishment action below, Plaintiffs sought to collect the consent judgments they had previously obtained in settlement of their tort actions against Americold Corporation, which was insured by Northwestern Pacific Indemnity Company (NPIC). NPIC, the garnishee in the instant action, appealed the district court's adverse rulings, contending that the underlying judgments against Americold had become dormant and extinguished, thus depriving the district court of subject matter jurisdiction to proceed with this garnishment action. Finding in favor of NPIC on that issue, the Supreme Court reversed, holding (1) when the district court entered its judgment against NPIC in this garnishment proceeding, Plaintiffs' underlying consent judgments against Americold had been extinguished by operation of the dormancy and revivor statutes; (2) because Americold was not legally obligated to pay an unenforceable judgment, NPIC was no longer indebted to Americold under its contract to pay the judgments for which Americold was legally liable; and (3) accordingly, without an indebtedness from NPIC to Americold, the district court lacked subject matter jurisdiction to grant Plaintiffs judgment against NPIC in a garnishment proceeding. Remanded with directions to dismiss these garnishment proceedings.

Employee received workers' compensation benefits for a neck and back injury he suffered in 2002 while working for Employer. After his benefits were discontinued in 2004, Employee sought treatment for a low back condition and petitioned the Department of Labor for workers' compensation benefits. The Department denied the petition, ruling that Employee did not prove his low back condition was related to his original 2002 work injury. The circuit court affirmed. The Supreme Court affirmed, holding that the Department correctly denied workers' compensation benefits where Employee failed to establish by a preponderance of the evidence that the 2002 injury was a major contributing cause of his current low back condition.

Edwin Mitchell, a lobster fisherman, was sued by Victor Ames, who alleged that a group of lobster fishermen had conspired to prevent him from fishing for lobster in the area. The Ames complaint alleged that Mitchell had, among other things, converted Ames's personal property. Mitchell held a homeowners policy with Allstate Insurance Company. By the policy's terms, Allstate agreed to provide a defense if the policyholder was sued for such damages. Allstate, however, declined to provide coverage to Mitchell on the Ames litigation, after which Mitchell sued Allstate for breach of contract. The superior court granted summary judgment in favor of Allstate, concluding that Allstate had no contractual duty to defend Mitchell because a policy exclusion for certain intentional acts applied. The Supreme Court vacated the superior court's judgment, holding that Allstate did have a duty to defend because the liability alleged in the Ames complaint had the potential to result in covered liability.

On April 1, 2005, Employee was injured during the course of his employment. Due to the injury, Employee never returned to work. Employee received workers' compensation benefits from April 2, 2005 through April 14, 2007. When the workers' compensation benefits ceased, Employee applied for unemployment insurance benefits. The Unemployment Insurance Commission based Employee's unemployment benefits on an extended base period comprised of the first three quarters of 2005 and the fourth quarter of 2006. Employee appealed, arguing that the extended base period should be based upon the four calendar quarters of the year 2004 because those were the most recent four quarters which fairly reflected the wages he earned prior to his injury. The circuit court reversed. The court of appeals affirmed. At issue on appeal was the proper interpretation of "extended base period" as defined in section 341.090(2). The Supreme Court reversed the court of appeals and reinstated the decision of the Commission, holding that the Commission properly applied the statute as written by the General Assembly in calculating Employee's unemployment benefits.

The issue before the Supreme Court in this case concerned whether insurer Defendant-Appellant Allstate Insurance Company was liable to Plaintiff Mona Lisa Frazier for personal protection benefits under the state no-fault act. Plaintiff was injured when she slipped and fell on a patch of ice while closing the passenger door of her car. She placed a few items inside, and fell when she closed the door. The Court concluded Plaintiff was not entitled to benefits under the no-fault act because her injury did not arise out of the use of a parked vehicle under MCL 500.3106(1). "Before her injury, plaintiff had been standing with both feet planted firmly on the ground outside of the vehicle; she was entirely in control of her body’s movement, and she was in no way reliant upon the vehicle itself. Therefore, she was not in the process of 'alighting from' the vehicle." Because of these circumstances, Defendant did not owe benefits to Plaintiff, and its refusal to pay them was not unreasonable. The Court reversed the appellate court's decision and remanded the case to the trial court for further proceedings.

In November 1998, Respondent David Moeller’s 1996 Honda Civic CRX was damaged in a collision. Respondent had an insurance policy through Farmers Insurance Company of Washington (Farmers). Farmers chose to repair Respondent's damaged car, and he authorized the repairs. In May 1999, Respondent brought suit on behalf of himself and other similarly situated Farmers policy holders in Washington State asserting a breach of contract claim on the grounds that Farmers failed to restore his vehicle to its "preloss condition through payment of the difference in the value between the vehicle's pre-loss value and its value after it was damaged, properly repaired and returned." The issue on appeal before the Supreme Court was whether the contract between Farmers and Respondent provided for the diminished value of the post-accident, repaired car. Upon review, the Court affirmed the appellate court which held that the policy language at issue here allowed for recovery for the diminution in value.

Blue Cross and Blue Shield of Montana (BCBS) and New West Health Services (collectively TPAs) administered a self-funded employee healthcare benefit plan for the State's employees. Jeannette Diaz and Leah Hoffmann-Bernhardt (Plaintiffs), who were both injured in accidents, filed suit against the state, BCBS, and New West for allegedly violating their made-whole rights by failing to conduct a made-whole analysis before exercising subrogation rights. Plaintiffs moved for class certification seeking to include in the lawsuit individuals who had their benefits reduced under the State plan, as well as individuals who had their benefits reduced under policies independently issued and administered by the TPAs. The district court denied class certification and determined that Montana's made-whole laws did not apply to TPAs. The Supreme Court (1) affirmed the district court's finding that BCBS and New West, in their capacities as TPAs in the present case, were not subject to the made-whole laws under either the subrogation statutes or under a third-party beneficiary theory; and (2) reversed the district court denial of class certification, as Diaz and Hoffmann-Bernhardt demonstrated that the requirements of Mont. R. Civ. P. 23 were met.

Appellant Brenda Jones was involved in an automobile accident with another driver that caused damage to her vehicle. Appellant's insurance policy with Nationwide Property and Casualty Company (Nationwide) included collision coverage for the vehicle involved, subject to a $500 deductible. The policy also provided Nationwide with the right of subrogation. Nationwide paid Appellant for all damage to the vehicle, reduced by the $500 deductible. Nationwide then filed a subrogation claim against the other driver and recovered under the other driver's liability coverage. The recovery, while in excess of Appellant's deductible, was only ninety percent of the amount Nationwide paid Appellant under the collision coverage policy. Nationwide paid Jones a pro rata share of the subrogation award by reimbursing her for ninety percent of her deductible, which amounted to $450. Appellant filed a class action against Nationwide claiming that Nationwide's uniform practice of pro rating reimbursements of deductibles violated the "made whole" doctrine. All claims were based upon Appellant's conclusion that Nationwide should have reimbursed her for her entire $500 deductible, despite the provision in the policy granting Nationwide subrogation rights. Appellant also sought injunctive relief to stop Nationwide's practice of pro rata deductible reimbursement. The Supreme Court concluded that the "made whole" doctrine did not apply to the collision coverage at issue in this case, the Court affirmed the dismissal of Appellant's class action.

Anthony Alsidez died in a single-car accident after a passenger, Gregory Segura, grabbed the steering wheel of the Jeep Anthony was driving. The Jeep was owned by Melissa Alsidez, Anthony's mother, who had a policy with American Family Mutual Insurance Company. Melissa filed a negligence suit against Segura, combined with a coverage action against American Family. After Melissa settled with Segura at an amount that did not compensate her for her claimed loss, Melissa sought to recover underinsured motorist coverage from American Family. The district court granted summary judgment in favor of Melissa, holding, among other things, that the exclusion from the underinsured coverage in Melissa's policy for vehicles "owned by or furnished or available for the regular use of you or a relative" was not void as against public policy. The Supreme Court affirmed, holding that the district court did not err in its judgment where (1) the Jeep was not an "underinsured vehicle" under the policy, and (2) the "regular use" exclusion was consistent with the Uninsured and Underinsured Motorist Insurance Coverage Act and not void as against public policy.

Ransom County appealed a grant of summary judgment that awarded Plaintiffs-Appellees Tracy and Lisa Jund the $250,000 coverage limit of Ransom County's underinsured motorist coverage. The issue in this appeal involved the meaning of language in N.D.C.C. § 26.1-40-15.4(1) that "[a]ny damages payable to or for any insured for . . . underinsured motorist coverage must be reduced by" the amounts payable under any Workforce Safety and Insurance ("WSI") law. The Junds sued Johnnie B's Bar & Grill and Ransom County, alleging Tracy Jund was injured during the course of his employment as a Ransom County Deputy Sheriff when his patrol car was involved in an accident with an underinsured motor vehicle driven by Shane Reinhardt, an individual the Junds alleged had unlawfully consumed alcoholic beverages at Johnnie B's. The Junds alleged Ransom County, as a pool member of the North Dakota Insurance Reserve Fund, provided underinsured motorist coverage for the patrol car and was liable to the Junds for $250,000 in underinsured benefits under the limits of its underinsured motorist coverage. The district court construed that language to authorize a reduction for WSI benefits payable to Tracy Jund from the Junds' total compensatory damages, not from Ransom County's underinsured motorist coverage limit. Upon review, the Supreme Court affirmed the district court for substantially the same reasons outlined in its decision.