Justia Insurance Law Opinion Summaries

Petitioner Tulsa Stockyards, Inc. challenged the constitutionality of the CompSource Mutual Insurance Company Act (85 O.S.Supp.2013, secs. 375.1 et seq.). The Act required CompSource Oklahoma be restructured to do business as a domestic mutual insurer without capital stock or shares under the name of CompSource Mutual Insurance Company effective January 1, 2015. Petitioner contended that CompSource was a state agency and its money and other assets, valued at approximately $265,000,000.00, were assets of the people of Oklahoma. Converting CompSource from a department of the State to an independent, licensed mutual insurance company without provision for the State to retain ownership of CompSource's assets, petitioner argued, was contrary to the prohibition against gifts of public money, the prohibition against interference with contracts, and the prohibition against money being paid out of the State Treasury except by appropriation. Upon review of the matter, the Supreme Court concluded that CompSource's money and other assets were held in trust for the benefit of the employers and employees protected by the insurance issued by CompSource, the Court's "Moran" opinion remained sound law, and the Oklahoma Constitution did not prohibit the Legislature from placing CompSource's money and other assets in trust with a domestic mutual insurer. View "Tulsa Stockyards, Inc. v. Clark" on Justia Law

The Supreme Court granted certiorari in this case to address two issues: (1) whether a political-subdivision employer may be required to provide workers' compensation benefits to an off-duty employee injured while providing services to a private entity; and (2) whether, under the facts presented, the claimant's salaries from his full-time employment as a deputy sheriff and his part-time job as a security officer may be combined when determining the amount of benefits to which the employee is entitled. Respondent-claimant John David Waldenville was injured while acting as a security guard for petitioner Cattlemen's Steakhouse, Inc. Initially, Cattlemen's contended that Waldenville was an independent contractor but later conceded that it had workers' compensation coverage for him through their insurer. Nevertheless, the employer continued to assert that Waldenville was an employee of respondent, Oklahoma County Sheriff's Department when injured. The trial court determined that: Cattlemen's was the employing entity when the employment-related injury occurred; Oklahoma County should be dismissed pursuant to 85 O.S. 2001 sec. 2b(G); Cattlemen's was estopped to dispute employee status based on the payment of workers' compensation premiums associated with Waldenville's employment; no evidence existed indicating that the employee was acting in his official capacity as a Deputy Sheriff at the time of the incident; and because the duties that Waldenville was carrying out at the time of his injury were the same or similar to those he executed as a Deputy Sheriff, the claimant's salaries were to be combined for establishment of weekly rates. The Supreme Court held that: (1) the "plain, clear, unmistakable, unambiguous, mandatory, and unequivocal" language of 85 O.S. 2011 sec. 313(G) mandated that private employers, hiring off-duty municipal employees, alone shall be responsible for the payment of workers' compensation benefits arising from incidents occurring during the hours of actual employment by the private employer; and (2) under the facts of this case, claimant was engaged in the same, or substantially similar, employment to that of his profession as a Major with the Oklahoma County Sheriff's Department when he was injured, warranting the combination of salaries for purposes of determining workers' compensation benefits. View "Cattlemen's Steakhouse, Inc. v. Waldenville" on Justia Law

An Oklahoma worker was killed at Employer's jobsite in Texas. The employer's insurer paid the worker's Widow death benefits provided by Texas workers' compensation law. The widow also recovered damages in a wrongful death tort action in Texas. When the Insurer sought subrogation from the widow's wrongful death damages as allowed by Texas law, she filed suit in Oklahoma to prevent subrogation. She sought a declaratory judgment that the rights of Oklahoma workers and their dependents were governed by Oklahoma's Workers' Compensation Act, notwithstanding the worker's injury or death in another state, and any benefits that may be paid under another state's workers' compensation law. In particular, Widow asked the Oklahoma court to enforce the provision in Oklahoma law that forbids subrogation in cases of death benefits. The trial court granted the declaratory relief sought by the widow. On appeal by the Insurer, the Court of Civil Appeals reversed. The Court of Civil Appeals ruled that the widow had to commence a proceeding by filing a claim with Oklahoma's Workers' Compensation Court before Oklahoma could exercise jurisdiction over the benefits due the widow, including enforcement of the anti-subrogation provision in death benefit cases. Because she never filed a claim with Oklahoma's Workers' Compensation Court, the Court of Civil Appeals held subrogation was proper. Upon review, the Supreme Court affirmed the trial court's judgment and vacated the appellate court in this case. View "Holley v. ACE American Ins. Co." on Justia Law

First American Cash Advance, owned by Valued Services, L.L.C. was robbed twice. The first robbery occurred on New Year's Eve 2008, and the second was in the spring of 2009. Respondent-Claimant Leslie Tregenza was the branch manager and the only employee on the premises during both robberies. A man wearing something covering his face and a ball cap committed the first robbery; in the second, two men stole all of the cash on hand in the office. These men did not have guns. However, one of the robbers threw an empty plastic cash drawer at respondent's head. She did not return to work for her employer after the second robbery. Claimant filed her Form 3 in October 2009, alleging an accidental injury arising out of and in the course of her employment. She alleged she sustained an injury to her head with psychological overlay in the form of post-traumatic stress disorder (PTSD) and PTSD headaches. She sought permanent total disability (PTD) as a result of her injuries, claiming she was unable to work or to be out in public. The trial the court concluded respondent was permanently totally disabled and awarded her continuing medical maintenance in the nature of four annual office visits and prescription medication. The employer appealed the trial court's holding and the appellate court reversed. After its review, the Supreme Court concluded the Workers' Compensation Court received competent evidence that Claimant was permanently totally disabled. The Court vacated the appellate court's decision and affirmed the order of the lower court. View "Valued Services, LLC v. Tregenza" on Justia Law

The Oklahoma Supreme Court accepted a certified question of state law from the Tenth Circuit federal appellate court. Two excess insurers for the Grand River Dame Authority (GRDA) had a dispute concerning the application of equitable subrogation. The question centered on whether a second-level excess insurer could invoke equitable subrogation to recover money it became liable to pay because of an agreement GRDA had with its first-level insurer. GRDA and the first-level insurer agreed to include losses under a policy that was outside that policy's year and that triggered the second-level insurer's coverage for that year. Upon review, the Oklahoma Court held that the second-level insurer could invoke equitable subrogation notwithstanding GRDA's release of the first level insurer. View "Steadfast Insurance Co. v. Agricultural Ins. Co" on Justia Law

In 2009, respondent Adrian Melton suffered an on-the-job accident while working for his employer, Joe Brown Company, Inc. He was awarded eleven weeks of temporary total disability, granted permanent partial disability, and a psychological overlay. The employer appealed the award, which vacated some parts and sustained others. In 2011, the employer appealed to the Court of Civil Appeals (COCA) which vacated the permanent partial impairment award because it failed to comply with the AMA Guides (5th Edition), and that an "any competent evidence" standard of review was inconsistent with 85 O.S. 2011 sec. 340, so the court used the "against the clear weight of the evidence" standard which had recently been revised. Respondent petitioned the Supreme Court for review of the COCA decision, arguing that the appellate court should have used the "any competent evidence" standard. Upon review of the matter, the Supreme Court concluded that because respondent's injury happened before the new standard went into effect, the "any competent evidence" standard should have been applied. With regard to respondent's awards of disability, the Court found that psychological overlay was not supported by appropriate expert testimony. Accordingly, the benefits as they related to the overlay were vacated. View "Joe Brown Company, Inc. v. Melton" on Justia Law

W.R. Allison Enterprises, Inc. was a small business operated by a sole owner. Allison hired an employee in early 2009 and secured workers' compensation and employers' liability insurance from CompSource. Allison prepaid the estimated annual premium. The employee only worked for Allison for approximately one month. Allison asked its insurance agent to cancel the workers' compensation insurance policy. CompSource acknowledged the cancellation request and advised that it would issue a ten-day notice of cancellation on a short rate basis in conformance with the insurance policy. CompSource prepared a final audit report, calculating the gross premium, short rate cancellation penalty, and a catastrophe premium. CompSource subtracted the audit amount from the estimated prepaid annual premium and refunded the remainder as the unearned premium calculated on a short rate basis. Allison took the position that the short rate penalty charge conflicted with 85 O.S.2001, section 67.1 which expressly required the insurance company to refund a pro rata share of the prepaid premium if it canceled a policy and that the policy's short rate penalty provision was changed, by operation of law, to comply with section 67.1. Allison filed suit against CompSource on behalf of itself and other similarly situated employers to recover the short rate penalties charged by CompSource, alleging CompSource's refusal to return the short rate penalty charge constituted a breach of the insurance policy as impliedly amended by law. The trial court overruled CompSource's counter motion for summary judgment. The trial court granted partial summary judgment in favor of plaintiff and certified an interlocutory order that decided that when an insured employer requests that a workers' compensation insurance policy be canceled, the insurer must refund the prepaid premium on a pro rata basis pursuant to 85 O.S.2001, 67.1. The insurer filed a petition for certiorari review arguing that the pro rata refund provisions in the statute apply only when the insurer initiates the cancellation. Upon review, the Supreme Court concluded: (1) the statute was ambiguous as to insured-initiated cancellations of workers' compensation insurance policies; (2) the state insurance department has applied the statute only to insurer-initiated cancellations; and (3) plaintiff respondent did not establish any cogent reason why the Court should not defer to the department's longstanding application. Accordingly, the Supreme Court reversed. Section 67.1 did not require CompSource to make a pro rata refund of unearned prepaid premium to Allison. View "W.R. Allison Enterprises, Inc. v. CompSource of Oklahoma" on Justia Law

Petitioner-Claimant Nancy Bertrand injured her right foot when she slipped on a wet floor while employed as a child care worker for Respondent Laura Dester Center (Employer). She sought certiorari review of the opinion of the Court of Civil Appeals (COCA) which sustained the Workers' Compensation Court's (WCC) denial of her request for travel costs to and from a vocational rehabilitation facility. Claimant contended that her allowance for travel expenses was effectively eliminated under the new Workers' Compensation Code, enacted August 26, 2011, which set a minimum for reimbursement of twenty miles round-trip. Claimant's total round-trip mileage was fourteen miles for which she was previously paid prior to the effective date of the Code. The trial court ordered the new law was procedural and could be applied retroactively. But after its review, the Supreme Court concluded that the WCC ordered vocational rehabilitation before August 26, 2011, and the treatment facility was outside the city limits of Claimant's hometown. As such, the Supreme Court reversed. View "Bertrand v. Laura Dester Center" on Justia Law

In a dispute over insurance coverage between the plaintiff-appellee City of Choctaw, and its insurer defendant-appellant Oklahoma Municipal Assurance Group (OMAG), the trial court granted a motion for summary judgment for Choctaw. Both in the trial court and on appeal, the city argued that OMAG should cover an inverse condemnation judgment entered against the city in a suit brought by a landowner, even though the city admitted it obtained coverage from OMAG for liability imposed under the Governmental Tort Claims Act (GTCA). The OMAG appealed summary judgment granted in favor of the Choctaw on a claim which had been denied. Upon review, the Supreme Court concluded that the summary judgment record disclosed neither a legal nor factual basis for applying any theory of estoppel to make OMAG liable for the inverse condemnation judgment. Accordingly, the Court reversed the summary judgment in favor of the city, and remanded the case with directions to enter summary judgment in favor of OMAG. View "City of Choctaw v. Oklahoma Municipal Assurance Group " on Justia Law

In 2005, Applicant Michael Benson made an application to Leader Life for a life insurance policy, naming his wife Shannon, as Beneficiary. The application asked if the applicant had ever been treated for liver disease, had any medical or surgical treatment in the last five years or any departure from good health and whether or not the applicant had ever had an alcohol or drug problem. Applicant answered yes to the departure from good health question and told the insurance company that he had a blood clot in his leg 2003. Applicant answered no to the Liver disease question and no to the alcohol question. Leaders Life accepted his answers and issued the underlying policy in this action. In 2006, Applicant was on foot, pushing a stalled car out of the street when he was struck by another vehicle which eventually resulted in his death. His wife filed for benefits under the policy. Leaders investigated the claim. They received the hospital records pertaining to his death, which also noted his blood alcohol at his time of death, although the owner of the car testified that he smelled no alcohol on the applicant. After reviewing the records, Leaders Life's underwriter concluded that Applicant falsified his answers on his application and rescinded the policy due to Applicant's alcoholism. Certiorari was granted to review the Court of Civil Appeals opinion that reversed and remanding the case following a jury verdict in Applicant's favor. Leaders Life appealed the trial court and won on appellate review. After its review, the Supreme Court found that at trial, Leaders Life made clear that they believed there were material misrepresentations made by Applicant, and that he attempted to deceive them. However, the trier of fact, the jury did not find that such a misrepresentation had been made. They decided in favor of the beneficiary, and awarded her actual and in punitive damages. The Supreme Court declined substitute its judgment for that of the jury under the case law presented by this suit. Accordingly, the Court reinstated the trial court's judgment and vacated the appellate court's opinion. View "Benson v. Leaders Life Insurance Co." on Justia Law