Justia Insurance Law Opinion Summaries

An employee at a boiler manufacturing plant sustained permanent hearing loss as a result of his employment. Between the time he was injured and the time he filed his workers’ compensation claim, the plant changed ownership. Twin City Fire Insurance Company insured the plant for the previous owner, and American Insurance Company insured the new owner. Counsel representing American mistakenly believed that American had insured the plant during the time of the injury, and Twin City was not given notice of the claim until after entry of an award. The new owner of the plant filed a declaratory judgment action against the previous owner and both insurers to determine who was liable for payment of the award. The district court determined that Twin City was liable for the employee’s workers’ compensation award. The Supreme Court affirmed, holding that the district court did not err in finding that Twin City was liable for the award, in rejecting Twin City’s equitable defenses, and in dismissing Twin City’s counterclaims. View "Cleaver-Brooks Inc. v. Twin City Fire Ins. Co." on Justia Law

F.H. Stoltze Land & Lumber Company and Maxum Specialty Insurance Group (collectively, “Stoltze”) and Les Schlegel Enterprises (“Schlegel”) contracted for Schlegel to log Stoltze’s property. Schlegel obtained liability insurance from American States Insurance Company (ASI). Whitney Shanks, a worker for Schlegel, injured himself during logging operations on Stoltze’s property. Shanks filed a personal injury lawsuit against both Schlegel and Stoltze. Stoltze tendered defense and indemnity of Shanks’s suit to ASI. After ASI accepted the tender, the district court dismissed the case against Schlegel on the grounds that Schlegel was immune to suit under the Workers’ Compensation Act’s exclusive remedy provision. ASI subsequently withdrew its defense of Stoltze, asserting that the policy covered Stoltze only to the extent that Schlegel was liable. Stoltze then filed a complaint against ASI, seeking declaratory judgment that ASI was required to defend and indemnify Stoltze against Shanks’s suit. The district court entered summary judgment for ASI, concluding that because the court in the underlying action determined that Schlegel was immune and not liable, ASI had no duty to defend or indemnify Stoltze. The Supreme Court affirmed, holding that ASI’s insurance policy with Schlegel did not require ASI to defend and indemnify Stoltze in an action in which Schlegel could not be held liable. View "F.H. Stoltze Land & Lumber Co. v. Am. States Ins. Co." on Justia Law

Candelario Lopez, who was hired by Interstate Treating to work on the installation of a gas processing plant, was transporting two other Interstate Treating employees to the job site when he died in an automobile accident. Lopez’s wife, Maximina Lopez, sought death benefits from Interstate Treating’s workers’ compensation insurance carrier, SeaBright Insurance Co. SeaBright denied coverage, concluding that Lopez was not acting in the course and scope of his employment at the time of the accident. A hearing officer, however, determined that Lopez was acting in the course and scope of his employment and ordered SeaBright to pay death benefits. The trial court affirmed the administrative decision. The court of appeals affirmed the trial court’s judgment. The Supreme Court affirmed, holding that Lopez was acting in the course and scope of his employment when he died, and Maximina was entitled to benefits. View "Seabright Ins. Co. v. Lopez" on Justia Law

In 2010, two miners died in a mining accident while employed by Webster County Coal, LLC. That same year, another miner died in a mining accident while employed by River View Coal, LLC. Both River View and Webster County were wholly owned subsidiaries of Alliance Coal LLC, the parent company. Alliance, which had obtained a self-insurance contract, guaranteed payment of benefits under the Workers’ Compensation Act in the event its subsidiaries failed to pay benefits. Webster County and River View accepted the workers’ compensation claims made on behalf of the surviving widows and children of the deceased miners, and Alliance paid the benefits. Appellants filed lawsuits against Alliance alleging that it had liability for the miners’ deaths. The trial court granted summary judgment for Alliance, concluding that it had immunity under the Act. The court of appeals affirmed. The Supreme Court affirmed, holding that a parent company that completely self-insures the liability of its subsidiary is a carrier and immune from tort liability. View "Falk v. Alliance Coal, LLC" on Justia Law

Employee was injured when he ran from a co-worker on the job site after tricking that co-worker. Employee sought workers’ compensation benefits. Employer and Insurer denied workers’ compensation benefits, asserting that Employee’s injury did not “arise out of” or “in the course of” his employment because Employer specifically prohibited horseplay by its employees. Employee petitioned for a hearing. The Department of Labor concluded that Employee’s injury arose “out of” his employment because, but for his work with Employer” he would not have been at the job site where he was injured, but that the injury did not occur “in the course of” the employment. The circuit court affirmed. The Supreme Court reversed in part, affirmed in part, and remanded for an award of benefits, holding that the Department (1) correctly concluded that Employee’s injury arose “out of” the employment; and (2) erred when it did not consider the effect of the mandatory lull in Employee’s work when it determined that the injury did not occur “in the course of” his employment. Because Employee’s act of horseplay was not a substantial deviation from his employment, it occurred “in the course of the employment.” View "Petrik v. JJ Concrete, Inc." on Justia Law

At the time that Claimant suffered a compensable work-related injury to his left knee, Liberty Mutual Insurance Group (Liberty Mutual) was the workers’ compensation insurance carrier for Claimant’s employer (Employer). Claimant subsequently suffered a compensable work-related injury to his right knee. At the time, Chubb & Son (Chubb) was the workers’ compensation insurance carrier for Employer. Claimant was scheduled to have bilateral knee replacement surgery, but the two insurance carriers disagreed about who would pay for Claimant’s temporary total disability benefits. After a hearing, the Workers’ Compensation Commissioner required Liberty Mutual to reimburse Chubb for one half of Claimant’s temporary total disability benefits. The Workers’ Compensation Review Board and the Appellate Court affirmed. Liberty Mutual appealed, claiming that the Commissioner lacked the statutory authority to order the reimbursement to Chubb. The Supreme Court affirmed, holding that, given the unique factual circumstances of this case, the Commissioner had the authority to order the reimbursement pursuant to the relapse statute, Conn. Gen. Stat. 31-307b. View "Gill v. Brescome Barton, Inc." on Justia Law

A man working at a concrete-pouring job was assaulted by another worker at the job site. The injured man filed a lawsuit against the assailant and both the concrete-pouring company and its owner. Although the company’s commercial general liability insurer initially provided a defense attorney in the negligence action, the insurer later brought a declaratory judgment action alleging that the incident fell within the policy’s employee-exclusion clause. The superior court granted summary judgment to the insurance company. The Supreme Court affirmed. "[B]ecause courts look to workers’ compensation law to give meaning to the phrase 'arising out of and in the course of employment' in workers’ compensation/employers’ liability policies, and because commercial general liability policies are designed to avoid the existence of an overlap or a gap between workers’ compensation/employers’ liability and commercial general liability policies, sister jurisdictions interpret the same phrase in employee-exclusion clauses in commercial general liability policies in light of the identical language in workers’ compensation statutes. We have found no case law holding that the contractual phrase 'arising out of and in the course of employment' in commercial general liability exclusions should be interpreted differently from the identical phrase in workers’ compensation statutes. For purposes of this appeal, we will use workers’ compensation case law to interpret the meaning of the commercial general liability policy’s exclusion of coverage for bodily injury "arising out of and in the course of employment.'" The employer did not purchase workers' compensation coverage. And in reading the general liability policy in question, the Supreme Court concluded the superior court did not err in determining that the incident here fell within the employee-exclusion claim. View "Devine v. Great Divide Insurance Company" on Justia Law

Randy Ellington owned and operated R&J Cabinets as a sole proprietorship. When Ellington received a work-related injury, R&J had no employees. Kentucky Employers’ Mutual Insurance (KEMI) had previously issued a workers’ compensation policy to Ellington and R&J as “insureds.” At the same time, the policy included a specific exclusion from coverage of Ellington as the sole proprietor. KEMI denied Ellington’s claim for benefits, arguing that it was not covered because of the sole-proprietor exclusion endorsement. An administrative law judge concluded that Ellington was not covered by the policy. The Court of Appeals reversed, finding the policy was ambiguous and construing it in Ellington’s favor to provide coverage for his injuries. The Supreme Court reversed, holding that the policy, as issued, is not a personal policy but rather a business policy purchased by a sole proprietor, and Ellington, as the sole proprietor, was not entitled to benefits under the policy. View "Ky. Employers Mut. Ins. v. Ellington" on Justia Law

In 2005, Plaintiff suffered a compensable, work-related injury to his neck and back while employed by Ridco, Inc. Twin City Fire Insurance Company, which insured Ridco for purposes of workers’ compensation, paid temporary disability benefits. Plaintiff subsequently sought additional workers’ compensation benefits, which the administrative law judge granted. In 2010, Plaintiff filed suit against Twin City and Ridco, alleging bad faith handling of his workers’ compensation claim. During the discovery stage, Plaintiff filed a motion to compel Twin City to produce wholly unredacted claim files, personnel files, and privilege logs. The circuit court ordered Twin City to produce the disputed documents in in unredacted form, concluding that Twin City impliedly waived the attorney-client privilege. The Supreme Court reversed, holding that the circuit court erred in concluding that Twin City implied the attorney-client privilege without conducting an in camera inspection of the documents. Remanded for findings as to whether Twin City injected its reliance upon the advice of counsel into the bad faith litigations, thereby making the disputed communications relevant to the case such that would constitute an implied waiver of the attorney-client privilege. View "Andrews v. Ridco, Inc." on Justia Law

In 2009, George Lawrence, while employed by Schneider National Inc., suffered a work-related injury when he slipped and fell in a parking lot leased by Domtar Paper Company, and allegedly owned and maintained by Commercial Net Lease Realty Services, Inc., Commercial Net Lease Realty Trust, Commercial Net Lease Realty, Inc., National Retail Properties, Inc., and National Retail Properties Trust. As a result of this injury, Schneider's workers' compensation carrier, Liberty Mutual Insurance Company, paid Lawrence $33,929.23 in workers' compensation benefits. The issue this case presented for the Supreme Court's review centered on whether section 319 of the Pennsylvania Workers' Compensation Act (WCA) conferred on employers or their workers' compensation insurers a right to pursue a subrogation claim directly against a third-party tortfeasor when the injured employee took no action against the tortfeasor. Based on established precedent, the Superior Court held that Section 319 did not permit employers/insurers to commence an action directly against the third-party tortfeasor, and affirmed the trial court's grant of preliminary objections in favor of the tortfeasors. Agreeing with that reasoning, the Supreme Court affirmed. View "Liberty Mutual Ins. Co. v. Domtar Paper Co." on Justia Law