Justia Insurance Law Opinion Summaries

Articles Posted in Mississippi Supreme Court
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After an insolvent employer's insurance company also became insolvent, the Mississippi Workers' Compensation Self-Insurers Guaranty Association (SIGA) made workers' compensation payments to an injured worker. SIGA sued the Mississippi Insurance Guaranty Association (MIGA) for reimbursement of those payments, and the trial court ordered reimbursement. The issue came before the Supreme Court who, after consideration, concluded that SIGA's claim against MIGA did not fall within the statutory definition of a "covered claim," and reversed the trial court’s reimbursement decision.

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In 2002, Dung Thi Hoang Nguyen stopped behind Karen Thompson at a red light. In reaching for her purse, her foot slipped off the brake and her car bumped into Thompson's. Neither car was damaged. The two exchanged insurance information without calling the police. But after Thompson arrived at her parents' home, her father told her to get a police report for her insurance provider, so Thompson called Nguyen, who agreed to meet her at the police station that night. A few days later, Thompson visited her physician complaining of neck pain. An MRI of Thompson’s spine revealed a preexisting degenerative-disc disease associated with disc bulges. And despite ongoing therapy, Thompson continued to complain of headaches, insomnia, depression, and neck pain until, in 2004, she was referred to a neurosurgeon, who performed surgery in 2005, Thompson to treat her abnormal discs. Thompson filed suit against Nguyen, seeking $234,316.49 in compensation. Nguyen admitted liability but contested that the accident had caused Thompson that much damage. A jury awarded Thompson $9,131– the exact amount of her physical therapy bills, but she filed a motion for additur or a new trial on damages alone, which the circuit court denied. Thompson appealed, and the Court of Appeals reversed and remanded for a trial on damages. The jury awarded Thompson less than the amount requested. Thompson appealed the jury’s second award. Because causation was central to Thompson's argument for the new damages award, the Supreme Court found it a question of fact for the jury, and affirmed its award.

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The issue on appeal to the Supreme Court was whether the circuit court erred in granting summary judgment for the Mississippi Insurance Guaranty Association (MIGA), and in denying a cross-motion for summary judgment for nursing homes and nursing-home residents. The circuit court found that MIGA was entitled to a credit, which would reduce the amount MIGA must pay to indemnify nursing-home owners and operators for damage claims of two nursing-home residents that were allegedly caused by a series of negligent acts and omissions over the course of many years. Upon review, the Court found "the factual and legal predicates necessary to formulate an opinion on coverage issues are lacking, which would preclude any court from rendering a valid ruling on coverage." The Court reversed the circuit court's judgment that granted MIGA's motion for summary judgment and that denied the cross-motions for summary judgment.

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In July 2006, Respondent Paul Cook's workers' compensation claim was dismissed for failure to file a properly completed prehearing statement. In December 2006, his "Motion for an Order Re-Instating Claim" was denied for failing to "attach a properly completed prehearing statement . . . ." In August 2008, Respondent's "Amended Motion to Reinstate" was dismissed as barred under a one-year statute of limitations. The full Commission affirmed the dismissal, as did the circuit court and a unanimous Mississippi Court of Appeals. The Supreme Court granted Respondent's petition for certiorari and affirmed: "Cook's claim was properly dismissed. To hold otherwise would eviscerate the Commission's rules and rulings of their statutorily intended effect, since '[a] rule which is not enforced is no rule at all.'"

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As a result of Hurricane Katrina, the Mississippi Windstorm Underwriting Association (MWUA) sustained great losses well in excess of its reinsurance. MWUA assessed its members to cover the loss. Members are required to share in MWUA’s expenses, profits, and losses based on their percentages of wind and hail insurance premiums written in the previous calendar year. After the initial assessments, several member companies complained that they had incorrectly reported the previous year's figures. The Board of Directors gave the members a one-time opportunity to submit corrected data (a true-up). Some members (most of whom did not submit corrected data) appealed the assessment following the true-up. The Board denied their appeals. The members appealed their claims to the Insurance Commissioner, and the Commissioner denied their requested relief. Thereafter, the members appealed the Commissioner’s decision to the chancery court, which granted the members relief on all but one issue. Aggrieved, MWUA appealed the chancery court's judgment, and the members filed a cross-appeal. MWUA presented eight issues on appeal to the Supreme Court. Upon review, the Supreme Court affirmed the chancellor's judgment on two issues: grouping and reinsurance allocation. But the Court reversed and remanded the chancellor's judgment on the remaining issues.

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Following the destruction of their home in Hurricane Katrina, Michael and Mary Robichaux filed suit in October, 2006, in the circuit court against their insurers, Nationwide Mutual Fire Insurance Company (Nationwide) and their agent, Jay Fletcher Insurance (Fletcher Insurance). Plaintiffs sought declaratory and injunctive relief, including indemnity under the insurance contract, compensatory and punitive damages, specific performance of the insurance contract, attorneys' fees, and court costs and expenses for what they alleged were uncompensated, covered losses under their homeowners' policy. Also included in the complaint were claims of fraud and bad faith by the insurer and its agent. The trial court ultimately granted summary judgment in favor of Nationwide and Fletcher Insurance based on the Plaintiffs' failure to establish a genuine issue of material fact that the home was damaged by wind, which was covered by the subject policy, rather than its having been destroyed by flood, which the trial court found was excluded under the policy. Alternatively, the trial court found that Plaintiffs failed to show they had suffered uncompensated losses due to their having received compensation under their flood policy. Upon review of Plaintiffs' appeal, the Supreme Court found that the trial court erred in granting summary judgment on the issue of whether Plaintiffs suffered uncompensated, wind damage to structures other than their dwelling, and to personal property. Accordingly, the Court remanded the case for further proceedings.

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In 2006, a fire consumed an apartment building rented by Plaintiffs Paul Whittington, Jr. and Westbrook Cooper. Mr. Whittington died from injuries he sustained in the fire, while Mr. Cooper was injured but survived. The building was owned by Defendant William Lipscomb, and it was located on the same property as Mr. Lipscomb's residence. Plaintiffs sued Mr. Lipscomb and amended their complaint to seek declaratory judgment against Lipscomb's insurer, the Automobile Insurance Company of Hartford, Connecticut (AIC), on the issue of coverage. AIC filed a motion to sever and a motion for summary judgment, which the trial court denied. AIC filed two separate petitions for interlocutory appeal and requested that the Court consolidate the two issues raised in the separate petitions. After reviewing the complaint, together with the insurance policy and the relevant deposition testimony, the Supreme Court determined there was no genuine issue of material fact as to the issue of coverage, and that AIC’s motion for summary judgment should have been granted. AIC was dismissed from the case with prejudice.

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The Bank of Commerce (Bank) brought an action against SouthGroup Insurance and Financial Services, LLC (SouthGroup) and Norman White, an agent of SouthGroup, for negligent misrepresentations made by White regarding the type of liability insurance coverage they would need to purchase. The trial court granted summary judgment for SouthGroup and White on two grounds: (1) that the Bankâs claims are barred by the statute of limitations; and (2) that the damages sought by the Bank constituted a voluntary payment which may not be recovered under Mississippiâs voluntary payment doctrine. The Bank appealed the trial courtâs decision. Upon review, the Supreme Court concluded that the three-year statute of limitations began to run when the Bank first received notice that it did not have entity coverage on January 18, 2005. When the Bank filed its claim against Defendants on July 17, 2008, the statute of limitations already had run, therefore barring the Bankâs claims against them. The Court affirmed the trial court's grant of summary judgment dismissing the Bank's case.

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This case was an interlocutory appeal. Riverbend Utilities alleged that the trial court erred by: (1) adding Arch Insurance Company as an involuntary counterplaintiff, and (2) ordering Riverbend to make four individuals available for deposition. In August 2006, sewage backed up into a home occupied by Hugh Brennan, Shanda Brennan, Meranda Brennan, Diana Marut, and Sarah Marut1 (âthe Brennansâ) in Saucier. During discovery, Riverbend learned that the Brennansâ home had suffered damage from Hurricane Katrina in August 2005. In August 2009, with leave of the trial court, Riverbend counterclaimed, alleging that the Brennans had submitted the same invoices to Riverbend that they previously had submitted to their homeownerâs insurance provider and that they had been paid by that insurer. Upon review of the trial court record, the Supreme Court found that the trial court erred in ordering that Arch be made a party to the counterclaim. Furthermore, the Court held that the individuals noticed for depositions were not parties, Mississippi residents, or Riverbend employees, and concluded the trial court abused its discretion in ordering Riverbend to make them available for deposition. The Court reversed the trial court and remanded the case for further proceedings.