Articles Posted in Massachusetts Supreme Judicial Court

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Here the Supreme Court answered a certified question from the United States District Court for the District of Massachusetts concerning the priority of coverage of two automobile insurance policies that both covered a single motor vehicle accident. A portion of the loss was covered by a primary insurance policy from an insurance company not a party to this case. The two policies at issue were triggered, according to the language in each policy, after the exhaustion of the primary policy. Each policy stated that it provided “excess” coverage and also contained an “other insurance” clause. In this opinion, the Supreme Court ultimately concluded that both excess policies covered the accident equally, after exhaustion of the underlying primary policy, to the extent of their respective policy limits. View "Great Divide Insurance Co. v. Lexington Insurance Co." on Justia Law

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Where an insurance policy provides that the insurer has the “duty to defend any claim” initiated against the insured, the insurer’s duty to defend does not require it to prosecute affirmative counterclaims on behalf of its insured. In this case, a policy imposed two duties on Insurer with respect to any wrongful termination claim brought against Insured. When a wrongful termination claim was commenced against Insured, Insurer filed a complaint for declaratory judgment seeking a ruling that its duty to Insured did not require that it prosecute or pay for the prosecution of a counterclaim for misappropriation of funds. A federal district court issued a judgment in favor of Insurer. On appeal, the United States Court of Appeals for the First Circuit certified three questions to the Massachusetts Supreme Judicial Court. The court answered the first two certified questions and did not reach the third. View "Mount Vernon Fire Insurance Co. v. Visionaid, Inc." on Justia Law

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Plaintiff filed a complaint alleging that Zurich American Insurance Co. committed unfair claim settlement practices in violation of Mass. Gen. Laws ch. 176D, 3(9)(f) and Mass. Gen. Laws ch. 93A, 2. Specifically, Plaintiff claimed that Zurich violated these statutory provisions when it conditioned the payment of its primary insurance policy limit on a release of all claims against its insureds, notwithstanding the availability of excess insurance. The superior court judge concluded that Zurich was entitled to judgment as a matter of law because it did not engage in unfair claim settlement practices. The Supreme Judicial Court affirmed, holding that Zurich did not engage in unfair claim settlement practices in violation of Mass. Gen. Laws ch. 176D, 3(9)(f) and Mass. Gen. Laws ch. 93A, 2. View "Caira v. Zurich American Insurance Co." on Justia Law

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The Massachusetts Insurers Insolvency Fund (Fund) is statutorily authorized to recover from “high net worth insureds” certain amounts paid by the Fund “on behalf of” such insureds. There was no dispute that defendant Berkshire Bank met the definition of “high net worth insured.” The Fund brought this action seeking to recover from Berkshire workers’ compensation benefits the Fund had paid to a Berkshire employee. The superior court allowed Berkshire’s motion for summary judgment, concluding that any amounts paid by the Fund would not be “on behalf of” the insured employer, and therefore, recoupment was not available. The Supreme Court reversed, holding that the Fund was authorized to recoup the sums in question because they were paid by the Fund “on behalf of” Berkshire within the meaning of Mass. Gen. Laws ch. 175D, 17(3). View "Massachusetts Insurers Insolvency Fund v. Berkshire Bank" on Justia Law

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Employee was severely injured while traveling abroad on a business trip. Employer had purchased two workers’ compensation policies from two different insurers, the Insurance Company of the State of Pennsylvania (ISOP) and Great Northern Insurance Company (Great Northern). Both policies provided primary coverage. Employee pursued a workers’ compensation claim. Employer gave notice of the claim only to ISOP. ISOP began making payments pursuant to the policy and defended the claim. When ISOP learned that Employer also had workers’ compensation coverage under its Great Northern policy, ISOP filed a complaint against Great Northern seeking a judgment declaring that the doctrine of equitable contribution required Great Northern to pay one-half of the past and future defense costs and indemnity payments related to Employer’s claim. A federal district court granted summary judgment for Great Northern. ISOP appealed, and the United States Court of Appeals for the First Circuit certified a question to the Supreme Court. The Court answered that, where two primary workers’ compensation insurance policies provide coverage for the same loss arising from an injury to an employee, the insurance company that pays that loss has a right of equitable contribution from the coinsurer, regardless of whether the insured gives notice of the injury only to one insurer. View "Ins. Co. of State of Penn. v. Great N. Ins. Co." on Justia Law

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Two employees were injured in the course of their employment, collected workers’ compensation benefits and then reached settlement agreements with third parties including damages for their pain and suffering. The same insurer insured by employers and sought reimbursement from the employees’ recoveries. In one employee’s case, the superior court judge rejected a settlement agreement providing that the insurer would not have a lien on the damages for pain and suffering. In the second employee’s case, a superior court judge approved a settlement agreement similar to the agreement rejected by the judge in the first employee’s case. The Appeals Court determined that the employees’ awards for pain and suffering were exempt from the insurer’s liens. The Supreme Judicial Court combined the two cases for argument and held that an insurer’s lien does not extend to damages allocated to an employee’s pain and suffering. View "DiCarlo v. Suffolk Constr. Co., Inc. v. Angelini Plastering, Inc." on Justia Law