Justia Insurance Law Opinion Summaries

The Supreme Court held that under California's Motor Carriers of Property Permit Act, Cal. Veh. Code 34600 et seq., a commercial automobile insurance policy does not continue in full force and effect until the insurer cancels a corresponding certificate of insurance on file with the Department of Motor Vehicles (DMV).Insured was driving a truck covered by his policy with Insurer when he collided with a car, killing its driver. The driver's parents sued Insured for wrongful death, and Insured tendered his defense to Insurer. Insurer settled the claim for its policy limits and then sued Insured's former insurer (Defendant) for declaratory relief, equitable contribution, and equitable subrogation. The trial court held that Defendant's policy remained in effect on the date of the collision because one of Defendant's cancellation notices was rejected by the DMV as incomplete. The Court of Appeals for the Ninth Circuit certified a question of law to the Supreme Court, which answered that the Act does not require a commercial auto insurance policy to remain in effective indefinitely until the insurer cancels the certificate of insurance on file with the DMV. View "Allied Premier Insurance v. United Financial Casualty Co." on Justia Law

Plaintiff sued Reliance Standard Life Insurance Company under 29 U.S.C. Section 1132(a)(1)(B), seeking to recover long-term disability benefits. The district court granted Plaintiff’s motion for summary judgment and denied Reliance’s cross-motion. Reliance appealed, and the Eighth Circuit reversed.   The court explained that the cases cited do not demonstrate that Reliance has a history of biased claims administration. Nor do they show some other systemic flaw in its claims review process that affected Reliance’s review of Plaintiff’s claim. On the other hand, Reliance does not argue that it maintained structural separations to minimize its conflict of interest. Therefore, the conflict of interest, in this case, deserves “some weight,” but the court concluded that it does not indicate that Reliance abused its discretion. The court wrote that substantial evidence supports Reliance’s decision, and neither the decisional delay in this case nor the purported conflict of interest leads us to conclude that Reliance abused its discretion. View "Melissa McIntyre v. Reliance Standard Life" on Justia Law

Defendant Union Mutual Fire Insurance Company appealed a superior court grant of summary judgment to plaintiff CC 145 Main, LLC, in a declaratory judgment action regarding the interpretation of an insurance policy exclusion. CC 145 Main owned an apartment building and purchased a “Businessowners Coverage” insurance policy that included “all risk” property insurance, which provided that Union Mutual would “pay for direct physical loss of or damage to” the covered property, unless coverage was specifically limited or excluded by the policy. The insured property sustained damage when a tenant poured cat litter down a toilet, clogging an interior pipe and causing water to overflow from a shower and toilet. The property required significant cleaning and repair, and tenants were required to temporarily relocate. CC 145 Main filed a claim with Union Mutual for water damage, which Union Mutual denied pursuant to a provision in the insurance policy excluding coverage for damage caused by “[w]ater that backs up or overflows or is otherwise discharged from a sewer, drain, sump, sump pump or related equipment.” CC 145 Main filed a complaint seeking a declaration that the water exclusion does not apply to its claim. Union Mutual filed a motion for summary judgment, arguing that the damage at issue was caused by water that overflowed from “drains” within the meaning of the exclusion. The trial court concluded it was unclear whether the word “drain” in the water exclusion applied to shower and toilet drains and, therefore, the water exclusion was ambiguous and had to be construed in favor of CC 145 Main. Defendant challenged the trial court’s ruling that the policy’s water damage exclusion was ambiguous and its decision to construe the policy, therefore, in favor of CC 145 Main. But finding no reversible error, the New Hampshire Supreme Court affirmed the trial court. View "CC 145 Main, LLC v. Union Mutual Fire Insurance Company" on Justia Law

Ramaco Resources suffered a coal silo collapse and submitted a claim for losses to Federal Insurance Company. When Federal denied the claim, Ramaco sued. After a twelve-day trial, a jury awarded Ramaco $7.6 million in contract damages and prejudgment interest. The jury also awarded $25 million under West Virginia’s Hayseeds doctrine, which permits an insured party to claim consequential damages when it prevails after suing to collect on its insurance policy. But post-trial, the district court reduced Ramaco’s contract damages and interest to $1.8 million and entirely rejected the Hayseeds damages as a matter of state law. The district court also conditionally granted a new trial on the Hayseeds award, reasoning that—even if Hayseeds damages were theoretically permissible—the jury’s $25 million award was punitive and thus invalid. Ramaco appealed.   The Fourth Circuit reversed in part and affirmed in part. The court reversed the district court’s reduction of contract damages and prejudgment interest because the insurance policy’s plain language and the trial evidence support the jury’s original $7.6 million award. And the court reversed the district court’s wholesale rejection of Hayseeds damages. But the court affirmed its conditional grant of a new Hayseeds damages trial. The court explained that West Virginia law requires courts to give insurance policies their plain, ordinary meaning whenever possible. Here, the policy’s plain language extended the period of restoration until Ramaco’s operations were restored to the level of generating the net profits that would have existed but for the collapse. To determine that level, a court must consider both throughput and expenses. The district court did not. View "Ramaco Resources, LLC v. Federal Insurance Company" on Justia Law

Boulevard RE Holdings, LLC (Boulevard) sued Mixon Insurance Agency, Inc. (Mixon), alleging breach of contract and negligent procurement of insurance. Mixon moved for summary judgment. The district court granted Mixon’s motion. Boulevard appealed that order. On appeal, Boulevard challenged the district court’s conclusions that Mixon had no duty to know or discover whether Boulevard was a mortgagee under Missouri law and that Mixon’s actions did not cause Boulevard’s alleged damages.   The Eighth Circuit affirmed. The court reasoned that even assuming that the district court erred in concluding that Mixon did not have a duty to know or discover whether Boulevard was a mortgagee, summary judgment in favor of Mixon was proper because Boulevard cannot show Mixon caused its alleged damages. Noncompliance with the policy, not Mixon’s failure to notify, barred recovery. Therefore, Bell is inapplicable. The district court did not err in granting Mixon’s motion for summary judgment. View "Boulevard RE Holdings, LLC v. Mixon Insurance Agency, Inc." on Justia Law

The Bert Company, dba Northwest Insurance Services (“Northwest”), was an insurance brokerage firm with clientele in northwestern Pennsylvania and western New York. From 2005 to 2017, Matthew Turk (“Turk”) was employed as an insurance broker with Northwest. First National Insurance Agency, LLC (“FNIA” or "First National") was an insurance brokerage firm. To grow its business in that region, First National developed a plan to takeover Northwest, initially by convincing key Northwest employees to leave Northwest for FNIA and to bring their clients with them. Through the fall and winter of 2016, Turk repeatedly met with First National about the plan with the hope that First National could gut Northwest by hiring the bulk of its highest producers, acquiring their clients, and ultimately forcing that company to sell its remaining book of clients. Pursuant to the plan, Turk remained at Northwest to convince the company to sell its remaining business to First National. Northwest refused, choosing instead to fire Turk and initiate legal action. In this appeal by permission, the Pennsylvania Supreme Court opined on the jurisprudence of the United State Supreme Court addressing the constitutionality of an award of punitive damages by a civil jury in the Commonwealth. The Pennsylvania Court's grant of allowance addressed the narrow issue of the appropriate ratio calculation measuring the relationship between the amount of punitive damages awarded against multiple defendants who are joint tortfeasors and the compensatory damages awarded. The superior court calculated the punitive to compensatory damages ratio using a per-defendant approach, rather than a per-judgment approach. The Pennsylvania Supreme Court generally endorsed the per-defendant approach as consistent with federal constitutional principles that require consideration of a defendant’s due process rights. Further, the Court concluded that under the facts and circumstances of this case, it was appropriate to consider the potential harm that was likely to occur from the concerted conduct of the defendants in determining whether the measure of punishment was both reasonable and proportionate. View "The Bert Company v. Turk, et al." on Justia Law

Lance Hagen filed a public records request related to a condemnation case he was a party to involving the City of Lincoln and North Dakota Insurance Reserve Fund (“NDIRF”). Hagen sought to determine how the City of Lincoln and NDIRF spent approximately $1.1 million dollars on litigation costs defending the action. NDIRF did not produce all requested records, and the parties sought relief from the district court. Hagen appealed the district court’s judgment that concluded certain documents belonging to NDIRF were exempt from release under the potential liability exception outlined in N.D.C.C. § 44-04-19.1(8). Hagen argued the court abused its discretion by finding NDIRF itself faced potential liability because its members could face potential liability, and because the court discussed the fiscal effect of a disclosure on NDIRF, which Hagen argued exceeded the scope of the North Dakota Supreme Court’s remand order in Hagen v. North Dakota Insurance Reserve Fund, 971 N.W.2d 833. Because the Supreme Court concluded the potential liability exception under N.D.C.C. § 44-04-19.1(8) did not apply to any of the documents determined by the district court to be exempt, the Court reversed. View "Hagen v. N.D. Insurance Reserve Fund" on Justia Law

The Supreme Court affirmed the order of the district court granting a summary judgment motion filed by Petitioners and two insurers, Farmers Insurance Exchange and Truck Insurance Exchange (collectively, Insurers), and denying Respondent's cross-motion for summary judgment, holding that the district court did not err by finding that Insurers had no duty to defend Respondent under the terms of the relevant insurance policies.After a complaint in the underlying lawsuit alleging slander, malicious prosecution, and bodily injury was amended to add Respondent as a defendant Respondent tendered the complaint to Farmers seeking defense and indemnity under a series of homeowners insurance policies and commercial general liability policies. Later, the Insurers filed a declaratory judgment action seeking a judicial determination that they were not obligated to defend and indemnity Respondent. The district court found that Insurers had no duty to defend Respondent under any of the policies. The Supreme Court affirmed, holding that Respondent failed to meet his burden of demonstrating that the claims fell within the scope of coverage of any of the policies at issue. View "Farmers Insurance Exchange v. Minemyer" on Justia Law

The Supreme Court affirmed the judgment of the district court denying a writ of prohibition of administrative proceedings initiated by the Montana Commissioner of Securities and Insurance, holding that the district court did not err in denying the writ of prohibition.The Commissioner issued a notice of proposed agency action and opportunity for hearing, alleging that Victory Insurance Company violated various provisions of the Insurance Code, including the requirements to provide the Commissioner access to certain managing general act (MGA) records "in a form usable to the commissioner." Victory responded by filing for a writ of prohibition seeking to halt the proceedings. The district court denied the writ. The Supreme Court affirmed, holding (1) the Commissioner's proceedings were within the agency's jurisdiction; (2) Victory had a legal remedy by way of appeal of the Commissioner's decision; and (3) Victory's federal litigation addressing a different legal issue did not have preclusive effect. View "Victory Insurance Co. v. Downing" on Justia Law

Sathiyaselvam Thangavel and Sasikala Muthusamy were tenants who leased an apartment from Seaford Apartment Ventures, LLC. The complaint filed by Seaford Apartment’s insurer, Donegal Mutual Insurance Company, alleged that the tenants hit a sprinkler head while they flew a drone inside the apartment. Water sprayed from the damaged sprinkler head and caused damage to the apartment building. Seaford Apartment filed an insurance claim with Donegal, who paid $77,704.06 to repair the water damage. Donegal then brought this action against the tenants through subrogation and alleged that the tenants were negligent and breached the property’s rules and regulations. Donegal sought to recover the repair costs from the tenants. Under the "Sutton" rule, landlords and tenants are co-insureds under the landlord’s fire insurance policy unless a tenant’s lease clearly expresses an intent to the contrary. If the Sutton rule applies, the landlord’s insurer cannot pursue the tenant for the landlord’s damages by way of subrogation. In this case, a Delaware superior court ruled in the tenants’ favor at summary judgment that the Sutton rule applied because the lease did not clearly express an intent to hold the tenants liable for the landlord’s damages. To this the Delaware Supreme Court agreed and affirmed. View "Donegal Mutual Insurance Company v. Thangavel" on Justia Law