Justia Insurance Law Opinion SummariesArticles Posted in Massachusetts Supreme Court
N.E. Physical Therapy Plus, Inc. v. Liberty Mut. Ins. Co.
After being billed by NEPT for medically necessary chiropractic services provided to the passenger of its insured, Liberty Mutual, claimed that the cost was unreasonably high and thus refused to pay the full amount invoiced. At trial, Liberty Mutual sought to introduce statistical evidence from a commercial database to show that NEPT's charges exceeded the 80th percentile of reported charges for the same procedures, pursuant to G.L. c. 233, 79B, which creates a limited exception to the hearsay rule for factual statements contained in commercial publications. The trial judge denied the motion, finding that the database was unreliable, based on a prior decision from the appellate court with respect to the database. The Massachusetts Supreme Court affirmed. Based on the explicit language of section 79B, and the gatekeeper role of a trial judge, it is within a judge's discretion to consider the reliability of evidence offered pursuant to section 79B. View "N.E. Physical Therapy Plus, Inc. v. Liberty Mut. Ins. Co." on Justia Law
Posted in: Injury Law, Insurance Law, Massachusetts Supreme Court
Caron v. Horace Mann Ins. Co.
Insureds purchased a homeowner's insurance policy from Insurer with a personal liability limit of $500,000. The policy contained an animal liability endorsement (endorsement) which limited coverage to $25,000 for claims arising from animal bites. Both Insurer's agent and Insureds mistakenly believed the policy did not contain the limitation of liability but neither conveyed their mistaken belief to the other. After Plaintiff was bitten by Insured's dog, he and his wife successfully brought an action against Insureds. Insurer paid only $25,000 of this judgment. Plaintiffs and Insureds reached a settlement regarding the balance of the judgment and Plaintiffs became assignees of Insureds' claims against Insurer. Plaintiffs sued Insurer, alleging that Insureds and Insurer were mutually mistaken as to the application of the endorsement, and therefore, the policy should be reformed by striking the endorsement. The superior court concluded Plaintiffs were entitled to summary judgment on the reformation claim. The Supreme Court vacated the judgment, holding that, absent full, clear, and decisive proof of some prior agreement between the parties as to coverage for animal bites different than that contained in the policy, there was no mutual mistake warranting reformation of the policy. View "Caron v. Horace Mann Ins. Co." on Justia Law
Posted in: Contracts, Injury Law, Insurance Law, Massachusetts Supreme Court
Golchin v. Liberty Mut. Ins. Co.
Claimant sustained injuries in a car accident. The car was insured under a standard Massachusetts automobile insurance policy (auto policy) issued by Liberty Mutual that included optional "medical payments" coverage (MedPay). Claimant was also insured under a separate policy of health insurance issued by Blue Cross Blue Shield (Blue Cross). Liberty Mutual paid personal injury protection benefits to Claimant and Claimant's additional medical expenses. After Liberty Mutual declined to pay Claimant any MedPay benefits because Blue Cross had already submitted the expenses, Claimant commenced this action against Liberty Mutual on behalf of herself and a putative class of similarly situated individuals. On remand, the superior court granted Liberty Mutual's motion for judgment on the pleadings. The Supreme Court reversed, holding that Claimant was entitled to the MedPay benefits provided by her auto insurance policy, notwithstanding that her medical expenses were covered by and paid under a separate policy of health insurance. Remanded. View "Golchin v. Liberty Mut. Ins. Co." on Justia Law
Deutsche Bank Nat’l Ass’n v. First Am. Title Ins. Co.
Karla Brown brought a lawsuit against Deutsche Bank and others seeking rescission of a note and first mortgage securing that note, alleging that she was the victim of a predatory lending scheme. The mortgage was originated by Deutsche Bank's predecessor in interest in connection with the purchase of Brown's home. Deutsche Bank requested that First American Title Insurance Company defend Deutsche Bank's mortgage interest pursuant to the terms of its title insurance policy. First American refused coverage, claiming the lawsuit did not trigger its duty to defend because Brown was claiming she was misinformed as to the terms of the note rather than challenging that she granted the mortgage. Deutsche Bank subsequently brought this action seeking a judgment declaring First American had a duty to defend it in Brown's lawsuit. The superior court granted summary judgment in favor of First American. The Supreme Court affirmed, holding that the allegations in Brown's complaint did not trigger First American's duty to defend because the complaint's claims were not specifically envisioned by the terms of the title insurance policy. View "Deutsche Bank Nat'l Ass'n v. First Am. Title Ins. Co." on Justia Law
GMAC Mortgage, LLC v. First Am. Title Ins. Co.
This case involved multiple litigations among three parties - Insurer, insured Mortgagee, and Homeowner - arising out of a defect in the title to Homeowner's home. Insurer brought suit in the land court on behalf of Mortgagee seeking to reform the deed to the property or to equitably subrogate Homeowner's interest in the property behind Mortgagee's mortgage. Homeowner initiated suit in the superior court against Mortgagee. Eventually, all claims in both actions became part of a federal court case, which settled. Thereafter, Mortgagee filed a complaint against Insurer in the U.S. district court seeking to recover from Insurer for the costs Mortgagee incurred in defending against Homeowner's claims. The judge determined Insurer had no obligation under its title insurance policy to pay Mortgagee's defense costs but certified two questions to the Massachusetts Supreme Court. The Court answered by holding that, under Massachusetts law (1) a title insurer does not have a duty to defend the insured in the entire lawsuit where one claim is within the scope of the title insurance coverage and other claims are not; and (2) a title insurer that initiates litigation similarly does not have a duty to defend the insured against all reasonably foreseeable counterclaims. View "GMAC Mortgage, LLC v. First Am. Title Ins. Co." on Justia Law
Metro. Life Ins. Co. v. Cotter
Defendant purchased an "own occupation" disability insurance policy from an affiliate of Plaintiff, Metropolitan Life Insurance Company (MetLife). After Defendant was diagnosed with cancer, Defendant's employment was terminated. Defendant filed a clam for disability benefits and began receiving disability payments. Defendant later began working at a lower stress job. MetLife concluded that Defendant was no longer eligible to receive disability benefits. Metlife reached this conclusion by interpreting a clause in Defendant's policy requiring Defendant to receive care by a physician that "is appropriate for the condition causing the disability" to mean that Defendant was required to pursue treatment aimed at returning him to his prior occupation. MetLife filed an action seeking a judgment declaring it had no continuing obligation to pay benefits to Defendant and reimbursement of benefits it had paid. The superior court declared MetLife was not required to continue paying Defendant benefits but that MetLife was not entitled to restitution of any benefits paid. The Supreme Court affirmed, holding (1) Defendant was not entitled to benefits under the policy since he was not receiving care designed to enable him to return to him prior occupation; and (2) MetLife was not entitled to reimbursement for benefits paid to Defendant. View "Metro. Life Ins. Co. v. Cotter" on Justia Law
Costa v. Brait Builders Corp.
In 2004-2005, Costa & Son Construction performed site work for the general contractor (Braitt) on such a project in Bridgewater. After Braitt terminated the relationship Costa sued, alleging breach of contract and violations of G.L. c. 93A. Costa sought to recover damages under a payment bond obtained by Brait from Arch Insurance, G.L. c. 149, 29. Brait asserted similar counterclaims against Costa. Arch argued that Costa had relinquished any right to claim against the bond pursuant to a provision of his subcontract with Brait. The trial court granted Brait and Arch directed verdict with respect to claims under the bond. A jury returned a verdict for Costa, against Brait. The Massachusetts Supreme Court vacated the directed verdict. A subcontractor on a public construction project for which a payment bond has been obtained by the general contractor pursuant to G.L. c. 149, 29, may not by private agreement forgo its right to pursue payment under the bond. The court also vacated the portion of the amended judgment granting consequential damages to Costa; consequential damages were precluded by the contract. View "Costa v. Brait Builders Corp." on Justia Law
Surabian Realty Co., Inc. v. NGM Ins. Co.
After a storm began, water stopped flowing down the parking lot drain on the property, which had become clogged with debris. Water seeped under the door of the building, flooding its lower level and damaging carpeting, baseboards, and walls. The owner had an "all risk" insurance policy, covering damage from any peril that was not specifically excluded. One of the exclusions was for water damage. After investigating, the insurer denied the claim, finding that the damage resulted at least in part from surface water, which was excluded by the policy. The owner alleged breach of contract, breach of the implied covenant of good faith and fair dealing, unfair or deceptive insurance practices in violation of G.L. c. 176D, and unfair or deceptive acts or practices in violation of G.L. c. 93A. The Superior Court granted the insurer summary judgment, finding that the damage was caused at least in part by "surface water." Although the damage was also partially caused by water that had backed up from a drain, the "anticoncurrent cause" provision of the policy excluded coverage for surface water "regardless of any other cause or event that contributes concurrently or in any sequence to the loss." The Massachusetts Supreme Court affirmed. View "Surabian Realty Co., Inc. v. NGM Ins. Co." on Justia Law
Boazova v. Safety Ins. Co.
Plaintiff appealed the dismissal of her complaint against Safety, which alleged that Safety improperly denied coverage under her homeowner's insurance policy for damage to her house. The court concluded that plaintiff satisfied her initial burden of proving that her claimed loss fell within the coverage of her homeowner's insurance policy. Safety then satisfied its burden of showing that the exclusion for damage caused directly or indirectly by surface water was applicable to plaintiff's claim. In light of the anticoncurrent cause provision in the exclusions section of plaintiff's policy, where the excluded peril was a direct or indirect cause of the damage to plaintiff's home, Safety was not obligated to provide insurance coverage "regardless of any other cause or event contributing concurrently or in any sequence to the loss." Accordingly, the court affirmed the grant of Safety's motion for summary judgment.
Scott Wadsworth’s Case
An insurer appealed from a decision related to an employee's injury in a metal rolling machine accident. The court concluded that the board was not arbitrary or capricious in deciding that there was insufficient evidence to find that the employee was entitled under G.L.c. 152, section 51 to compensation based on an amount greater than his average weekly wage. But the court concluded that the board erred in finding that the employee's compensation should be based on the average weekly wage he earned when injured in 1980 rather than the out-of-state average weekly wage he earned when that injury recurred in 2003. The court also affirmed the board's decision to vacate the denial of recoupment for the insurer's overpayment of temporary total disability benefits between 1985 and 1988, but noted that, should the insurer decide to renew its claim for recoupment in a separate complaint filed with the department, its claim could prevail only if recoupment was equitable in the circumstances.