Justia Insurance Law Opinion Summaries

The Supreme Court reversed the opinion of the court of appeals reversing the decision of the circuit court granting summary judgment in favor of Defendant pursuant to Kentucky's Unfair Claims Settlement Practices Act (UCSPA) and dismissing Plaintiff's bad faith claim as barred by the statute of limitations, holding that the complaint was untimely.Plaintiff was injured in a motor vehicle accident and settled his dram shop liability claim against Pure Country, LLC, an establishment insured by United States Liability Insurance Company (USLI). Several years after settling, Plaintiff brought a bad faith claim against USLI under the UCSPA. The circuit court concluded that the action was untimely and granted summary judgment for Defendant. The court of appeals reversed. The Supreme Court reversed, holding (1) the trial court correctly determined that the bad faith claim against USLI was barred by the statute of limitations; and (2) the USCPA claim was not saved by relation back to an earlier filed or proposed pleading. View "United States Liability Insurance Co. v. Watson" on Justia Law

The Supreme Court affirmed the judgment of the court of appeals affirming the trial court's dismissal of this third-party bad-faith case against Arch Specialty Insurance Company and National Union Fire Insurance Company, holding that there was no error.At issue was whether the two insurance companies acted in bad faith while mediating negligence and wrongful death claims asserted by Plaintiff against the insureds of Arch and National Union after her husband died in a coal mining accident. The Supreme Court affirmed, holding that the trial court did not err in dismissing the third-party bad-faith claims and that there was no other error in the proceedings below. View "Mosley v. Arch Specialty Insurance Co." on Justia Law

In these appeals arising from adverse jury verdicts rendered in separate trials following an automobile accident involving Joseph Jenkins and Tessa Jordan, the Supreme Court affirmed in part and reversed in part, holding that the circuit court erred in part.The first trial resulted in the jury's calculation of damages sustained by Jenkins and his wife as a result of the accident, which the parties stipulated was caused through the fault of Jordan. The Jenkins also sued Safeco Insurance Company of America and liberty Mutual Insurance Company (collectively, Safeco) for conversion. After a second trial on the Jenkins' claims for compensatory and punitive damages Safeco appealed the jury's determination that the Jenkins were entitled to punitive damages. The Supreme Court (1) reversed the circuit court's order denying the Jordans' motion to set aside the verdict and for a new trial and remanded that case for a new trial, holding that the jury should have been instructed on Jenkins' duty to mitigate the loss of his vehicle; and (2) reversed the court's order denying Safeco's motion to reduce the punitive damages award, holding that remand was necessary to review the punitive damages award for excessiveness. View "Jordan v. Jenkins" on Justia Law

The Eighth Circuit affirmed the district court's grant of summary judgment to Integrity in an action brought by plaintiff for negligent performance of an undertaking. Plaintiff filed suit after he was injured in a cab driven by a drunk driver, alleging that Integrity should have done a better background check on the cab driver.The court concluded that Integrity did not owe any duty to plaintiff under Iowa law. The court explained that, even assuming Integrity could have discovered the cab driver's Minnesota DWI, its review of his records did not put plaintiff in a worse situation because the cab company put the driver behind the wheel. Therefore, plaintiff failed to state a duty as a matter of law under the Restatement (Second) of Torts, Sec. 324A. The court also concluded that there was no liability under Sec. 324A(c) of the Restatement because the cab company did not rely on the insurer's background check and conducted its own review of the driver's record. View "Foster v. Integrity Mutual Insurance Co." on Justia Law

Keith Bronner sued the City of Detroit seeking no-fault benefits. Bronner was a passenger on a city-operated bus when the bus was involved in an accident with a garbage truck operated by GFL Environmental USA Inc. The city self-insured its buses under the no-fault act, MCL 500.3101 et seq. Under the city’s contract with GFL, GFL agreed to indemnify the city against any liabilities or other expenses incurred by or asserted against the city because of a negligent or tortious act or omission attributable to GFL. The city paid Bronner about $58,000 in benefits before the relationship broke down and Bronner sued the city. Shortly after Bronner sued the city, the city filed a third-party complaint against GFL pursuant to the indemnification agreement in their contract. GFL moved for summary judgment, arguing that the city was attempting to improperly shift its burden under the no-fault act to GFL contrary to public policy. The circuit court denied GFL’s motion and granted summary judgment for the city. GFL appealed as of right, arguing that the indemnification agreement was void because it circumvented the no- fault act. The Court of Appeals agreed with GFL and reversed in an unpublished opinion, citing the comprehensive nature of the no-fault act and concluding that the act outlined the only mechanisms by which a no-fault insurer could recover the cost of benefits paid to beneficiaries. The Michigan Supreme Court reversed, finding that regardless of the differing opportunities for an insurer to reach an indemnification agreement with a vendor, such agreements were enforceable. View "Bronner v. City of Detroit" on Justia Law

The United States Court of Appeals for the Tenth Circuit certified two questions of law to the Oklahoma Supreme Court. Plaintiff-appellant George Morgan was driving drunk and hit Jesse Atkins with his truck at more than 40 miles per hour. Atkins was severely injured, and his resulting medical bills totaled more than $2 million. Defendant-appellee State Farm Mutual Automobile Insurance Company provided liability insurance to Morgan at the time of the accident under a policy with a $100,000 limit. State Farm negotiated and executed a settlement with Atkins whereby State Farm paid its policy limit to Atkins and Atkins released his claims against Morgan. During the same timeframe, Atkins pursued a workers' compensation claim because he had been traveling for work when he was injured. The workers' compensation court issued a preliminary order for compensation, and the workers' compensation insurer began making payments to Atkins. The workers' compensation insurer's subrogee, New York Marine and General Insurance Company (NYM), sued Morgan in Oklahoma state court in June 2011 for reimbursement of the amounts paid to Atkins. Morgan retained personal counsel to represent him in the action. State Farm also provided counsel to Morgan and mounted a vigorous defense. A jury would later return a verdict in favor of NYM in the amount of $844,865.89, finding that State Farm knew about NYM's potential claim but failed to apprise NYM of its pending settlement with Atkins. The Oklahoma Court of Civil Appeals affirmed the judgment, and the Oklahoma Supreme Court denied certiorari. Morgan then filed suit against State Farm alleging State Farm's failure to secure NYM's release as part of its settlement with Atkins amounted to: (1) breach of the implied duty of good faith and fair dealing; and (2) breach of contract. The United States District Court for the Western District of Oklahoma found that Morgan's claims accrued in 2010, when State Farm negotiated the original settlement with Atkins and, therefore, concluded the applicable two and five year statutes of limitations for the tort and contract claims, respectively, barred Morgan's suit. Morgan appealed to the Tenth Circuit Court of Appeals. The Tenth Circuit asked: (1) where a plaintiff is injured by entry of an adverse judgment that remains unstayed, is the injury sufficiently certain to support accrual of a tort cause of action based on that injury under 12 O.S. 95 before all appeals of the adverse judgment are exhausted?; and (2) does an action for breach of an insurance contract accrue at the moment of breach where a plaintiff is not injured until a later date? The Oklahoma Court answered the first question with a "no:" the claim accrues when the appeal is finally determined in the underlying case. The Court answered the second question with a "yes:" an action for breach of contract accrues when the contract is breached, not when damages result; the limitations period may be tolled if the defendant fraudulently concealed the cause of action. View "Morgan v. State Farm mutual Automobile Insur. Co." on Justia Law

The Supreme Court reversed the judgment of the trial court granting the state's motion to dismiss this tort action, holding that a state's waiver of sovereign immunity in Conn. Gen. Stat. 52-556 for claims arising from a state employee's negligent operation of a state-owned and -insured motor vehicle extends to litigants who are state employees.Plaintiff, a state employee, was a passenger in a motor vehicle owned and insured by the state and operated by another state employee, William Texidor, when another vehicle operated by Tyreke Brooks struck their vehicle. Brooks' vehicle was uninsured. Plaintiff, who applied for and received workers' compensation benefits, brought this action agains the state and Metropolitan Casualty Insurance Company alleging that Texidor's operation of the vehicle was negligent. The state filed a motion to dismiss for lack of subject matter jurisdiction on the ground of sovereign immunity. The trial court granted the motion to dismiss. The Supreme Court reversed, holding (1) the trial court had jurisdiction pursuant to the waiver of sovereign immunity in section 52-556; (2) Plaintiff's action against the state was barred by Conn. Gen. Stat. 31-284(a); and (3) therefore, the form of judgment was improper, and the case is remanded with direction to render judgment for the state. View "Feliciano v. State" on Justia Law

Plaintiff filed suit against two defendants: a property owner and her alleged liability insurer. The insurer was served with the petition, but plaintiff withheld service on the property owner. The insurer filed an answer on its own behalf within three years of suit being filed, but no action was taken in the suit by any party relative to the property owner within that three years. The Louisiana Supreme Court granted this writ application to determine whether plaintiff’s action against the property owner was abandoned pursuant to La. C.C.P. art. 561(A)(1). The court of appeal found the filing of an answer by the insurer within the three-year abandonment period was effective to interrupt the abandonment period as to the property owner. The Supreme Court held the filing of the insurer’s answer did not serve to interrupt the abandonment period as to the property owner; therefore the appellate court was reversed because plaintiff’s original action against the property owner was abandoned by operation of law. However, the Court found plaintiff’s underlying claims against the property owner, that were subsequently reasserted by amended petition, were not necessarily prescribed due to the potential interruption of prescription resulting from the pending suit against an alleged solidary obligor. Because a determination regarding prescription could not be made based on the existing record, the court of appeal’s ruling on the property owner’s exception of prescription was affirmed, and the matter remanded to the district court for an evidentiary hearing on that exception. View "Williams v. Foremost Ins. Co. et al." on Justia Law

In this insurance dispute, the Supreme Court denied a writ of mandamus compelling the trial court to render judgment in favor of Insurer on the jury's verdict, holding that the trial court did not abuse its discretion in declining to render judgment on the verdict.Insured sought underinsured motorist (UIM) benefits from Insurer. Insurer in this case declined to participate in a jury trial to establish the at-fault motorist's liability and demanded a separate trial on its liability under the UIM policy. Before trial on the UIM claim, the court commenced a jury trial on Insured's negligence claim against the at-fault motorist. The parties settled and the claim was dismissed without rendition of judgment on the jury's verdict. Insurer then argued that a separate trial on the UIM claim was no longer necessary because of the jury's findings and the settlement payment. The trial court denied Insurer's motion for judgment based on the jury verdict from the negligence trial. Insurer sought mandamus relief. The Supreme Court denied relief, holding (1) collateral estoppel did not bind Insured to a verdict that was not reduced to judgment; and (2) Insurer's post-dismissal consent to be bound by the negligence suit's outcome did not make the negligence verdict enforceable against Insured in the contract suit. View "In re USAA General Indemnity Co." on Justia Law

The Supreme Court conditionally granted a petition for a writ of mandamus directing the trial court to vacate its order granting a motion to strike a counteraffidavit served under Tex. Civ. Prac. & Rem. Code 18.001 and precluding the offering party from contesting the reasonableness of the subject medical expenses at trial, holding that the trial court abused its discretion.In granting the motion to strike, the trial court concluded that the counteraffidavit failed to comply with the requirements of section 18.001. The court then prohibited the offering party from testifying regarding the reasonableness and necessity of the medical bills. Petitioner petitioned the Supreme Court for a writ of mandamus. The Supreme Court conditionally granted relief, holding that the trial court erred by striking the counteraffidavit and by granting relief that found no legal basis in section 18.001 for the purported failure to comply with the statute. View "In re Allstate Indemnity Co." on Justia Law