Justia Insurance Law Opinion Summaries

This litigation arose from a suit filed by plaintiff Beverly Smith against Darlene Shelmire and her insurer, GoAuto Insurance Company (“GoAuto”), as a result of an automobile accident in 2010. In 2015, following a trial on the merits, the district court entered judgment in favor of plaintiff against Shelmire and GoAuto in an amount in excess of the insurance policy limits. GoAuto appealed that judgment, but Shelmire did not. The court of appeal ultimately affirmed the district court’s judgment in March 2016. Thereafter, Shelmire assigned her rights to pursue a bad faith action against GoAuto to Smith. Through that assignment of rights, Smith filed the underlying suit against GoAuto on March 10, 2017, and amended her petition on September 27, 2017, asserting a bad faith claim based on GoAuto’s violation of its duties under La. R.S. 22:1973(A) as well as the recognized duty of good faith pre-existing the statute. GoAuto answered the petitions, asserting the prescriptive period for a bad faith claim against an insurer was a delictual action, and subject to a one-year prescriptive period. Plaintiff opposed the exception arguing a bad faith claim against an insurer was a contractual action and subject to a ten-year prescriptive period. The Louisiana Supreme Court granted this writ application to determine whether a first-party bad faith claim against an insurer was indeed a delictual action subject to a one-year prescriptive period, or whether it was a contractual claim subject to a ten-year prescriptive period. Finding the bad faith claim arose as a result of the insured’s contractual relationship with the insurer, the Court held it was subject to a 10-year prescriptive period. View "Smith vs. Citadel Insurance Company" on Justia Law

In this declaratory judgment action, the Supreme Court reversed the judgment of the court of appeals reversing the judgment of the trial court denying a claimant's motion to set aside a default judgment in favor of an insurance company and allow the claimant to intervene as a necessary party, holding that, under the circumstances of this case, the claimant was not a necessary party and the trial court could decide the coverage dispute between the insurance company and its insured without the claimant's participation in the action.The claimant sued the insured for damages arising from an automobile accident. The insurance company sought a declaratory judgment that the company was not required to provide liability coverage to the insured. The trial court awarded the insurance company a default judgment. The claimant moved to set aside the default judgment and allow her to intervene on the basis that she was a necessary party. The trial court denied the motion. The court of appeals reversed. The Supreme Court reversed, holding (1) the claimant had no interest affected by the dispute between the insurance company and its insured; and (2) therefore, the trial court had authority to grant declaratory relief because all necessary parties were before the court. View "Tennessee Farmers Mutual Insurance Co. v. Debruce" on Justia Law

The Supreme Judicial Court affirmed the orders denying a motor vehicle insurer's motions to stay trial in a wrongful death action until the question of coverage had been determined in a declaratory judgment action but and denying the insurer's Mass. R. Civ. P. 67 motion and vacated the wrongful death judgment, holding that the matter must be remanded for a reasonableness hearing.The Supreme Judicial Court addressed issues that arose where Insurer recognized its duty to defend Insureds in a wrongful death action but did so under a reservation of rights and then brought a separate action seeking a declaratory judgment that it owed no duty to indemnify Insureds for damages arising from the wrongful death action. The parties subsequently settled the wrongful death action. The plaintiff agreed to release the defendants from liability and seek damages only from Insurer. Insurer moved to deposit with the court the policy limit and postjudgment interest under Rule 67. The Supreme Judicial Court held (1) the judge properly denied Insurer's motions to stay; (2) the judge properly denied Insurer's motion to deposit the funds; and (3) where the settlements were executed with no determination of reasonable, the case must be remanded for a hearing on the reasonableness of the settlement/assignment agreements. View "Commerce Insurance Co. v. Szafarowicz" on Justia Law

Benjamin Robinson drove his employer’s vehicle into the rear end of a stopped Holmes County garbage truck. The garbage truck was stopped picking up garbage on the side of the highway in dense fog. Robinson sued Holmes County and his uninsured motorist carrier, Brierfield Insurance Company. Robinson claimed Holmes County was negligent in its operation of the garbage truck. Robinson also asserted a breach of contract claim, stating that Brierfield Insurance Company breached the insurance contract by denying him uninsured motorist benefits. The trial court granted summary judgment and found not only that Holmes County was not negligent but also that it was immune under the Mississippi Tort Claims Act. The trial court further found that, since Holmes County was not negligent, Brierfield also was not liable as the uninsured motorist insurance provider. Robinson appealed, but finding no reversible error, the Mississippi Supreme Court affirmed granting summary judgment to Holmes County and Brierfield Insurance Company. View "Robinson v. Holmes County, Mississippi" on Justia Law

The United States Court of Appeals for the Third Circuit certified a question of law to the Pennsylvania Supreme Court regarding whether an increase to the limits of underinsured motorist (“UIM”) coverage for multiple vehicles that are insured under an existing policy constitutes a “purchase” for purposes of Subsection 1738(c) of the Pennsylvania Motor Vehicle Financial Responsibility Law (“MVFRL”). Michelle Barnard purchased a personal automobile policy from Travelers Home and Marine Insurance Company (“Travelers”) to insure her two vehicles. As part of this policy, Barnard purchased UIM coverage in the amount of $50,000 per vehicle. Barnard waived stacking of her UIM coverage limits. Two years later, Barnard increased the UIM coverage limit on each of her vehicles to $100,000. Barnard did not execute a new stacking waiver at that time. Then several more years later, Barnard was involved in a motor vehicle accident with an underinsured motorist. When Barnard sought UIM benefits from Travelers, Travelers offered her $100,000 based upon the UIM coverage limit on one of her vehicles. Barnard filed a complaint for declaratory judgment, seeking $200,000 in stacked UIM benefits. Travelers removed the case to the United States District Court for the Eastern District of Pennsylvania, where the parties filed cross-motions for summary judgment. Based upon the plain language of Subsection 1738(c), the Pennsylvania Supreme Court answered the Third Circuit's question in the affirmative: therefore, an increase of UIM coverage under circumstances as was presented here triggered an insurance company’s statutory obligation to offer an insured the opportunity to waive stacking of the new, aggregate amount of UIM coverage. View "Barnard v. Travelers Home, et al" on Justia Law

In this insurance dispute the Supreme Court reversed in part the district court's determination that Carla King was not entitled to her taxable costs and her claimed nontaxable costs after a jury found in favor of King, holding that the district court erred in concluding that King was not entitled to her claimed nontaxable costs.King was injured when her vehicle was hit by a drunk driver. King sought underinsured motorist coverage from State Farm, but King and State Farm did not agree on the value of King's claim. State Farm had offered to settle the claim for $20,000. The jury found that King had suffered damages in the amount of $410,000. The district court entered judgment against State Farm in the amount of the policy limit of $50,000. The district court awarded King $20,000 in attorney fees and denied King's claimed litigation expenses and costs. The Supreme Court held (1) the district court correctly held that King was not entitled to her taxable costs as provided by Mont. Code Ann. 25-10-201 because they were not timely filed; and (2) the district court erred in concluding that King was not entitled to her claimed nontaxable costs because those litigation costs were part of the insurance exception to the American Rule. View "King v. State Farm Mutual Automobile Insurance Co." on Justia Law

A hotel housekeeper injured her back while lifting a pile of linens. Her employer challenged her application for benefits based on an examining doctor’s opinion that she was medically stable and that the job injury was no longer the substantial cause of any disability or need for medical treatment. After a hearing, the Alaska Workers’ Compensation Board decided that the woman was medically stable as of the date of the doctor’s opinion and therefore not entitled to further disability payments or to benefits for permanent partial impairment. The Board also denied further medical care after the date of medical stability. The Alaska Workers’ Compensation Appeals Commission affirmed the Board’s decision, and the woman appealed. Because the Board’s selected date of medical stability was not supported by substantial evidence in the record, the Alaska Supreme Court vacated the Commission’s decision and remanded the case to the Commission with instructions to remand the case to the Board for further proceedings. View "Tobar v. Remington Holdings LP" on Justia Law

One summer night in 2015, at a Louisville nightclub, someone discharged a firearm, shooting eight people. Six of those people sued the nightclub’s owner, Cole’s Place, in state court, arguing that Cole’s Place failed to protect them from foreseeable harm. United Specialty Insurance (USIC) obtained a federal declaratory judgment that it is not obligated to defend or indemnify Cole’s Place in the state court litigation. The Sixth Circuit affirmed. The district court did not abuse its discretion in exercising Declaratory Judgment Act jurisdiction over USIC’s lawsuit and did not err in finding that an assault-and-battery exclusion in Cole’s Place’s insurance policy with USIC applies to the state court litigation. There are no factual issues remaining in the state-court litigation or complex state-law issues that are “important to an informed resolution” of this case. View "United Specialty Ins. Co. v. Cole's Place, Inc." on Justia Law

Due to an unsafe condition on the premises, Osborne suffered a broken arm at the Center, which is owned and operated by Metro Nashville. Osborne obtained a state court judgment against Metro under the Tennessee Governmental Tort Liability Act; the damages included specific medical expenses related to the incident and found Osborne’s comparative fault to be 20 percent. Before the state court suit, Osborne incurred medical expenses for which Metro did not pay at the time. Medicare made conditional payments to Osborne totaling at least $9,453.09. Osborne claims he incurred—in addition to the costs of his state court litigation—the cost of his co-pays, deductibles, and co-insurance for treatments not covered through Medicare. Osborne alleged Metro is a primary payer who failed to pay under the Medicare Secondary Payer Act (MSPA), 42 U.S.C. 1395y(b), and was therefore liable for reimbursement of Medicare’s conditional payments and a double damages penalty under section 1395y(b)(3)(A). Metro claimed it paid the judgment in full, including discretionary costs. The Sixth Circuit affirmed that Osborne lacked statutory standing to sue for his individual losses and the conditional payments made by Medicare because the MSPA does not permit a private cause of action against tortfeasors. Because the MSPA is not a qui tam statute and financial injury suffered by Medicare is not attributed to Osborne, he also lacked Article III standing to sue for Medicare’s conditional payments. View "Osborne v. Metropolitan Government of Nashville and Davidson County" on Justia Law

In 2013, Rachel Dixon was driving a car owned by her boyfriend, Rene Oriental-Guillermo (“Policyholder”), when she was involved in an accident with a vehicle in which Priscila Jimenez was a passenger, and which was owned by Iris Velazquez, and operated by Alli Licona-Avila. At the time of the accident, Dixon resided with Policyholder, who had purchased a personal automobile insurance policy (“Policy”) for his vehicle through Safe Auto Insurance Company (“Safe Auto”). The Policy contained an unlisted resident driver exclusion (“URDE”), which excluded from coverage any individuals who lived with, but were not related to, the policyholder, and whom the policyholder did not specifically list as an additional driver on the insurance policy. Jimenez and her husband Luis (collectively, “Appellants”) filed a personal injury lawsuit against Dixon, Policyholder, and Licona-Avila. On May 13, 2015, Safe Auto filed a complaint against Dixon, Policyholder, and Appellants, seeking a declaratory judgment regarding the enforceability of the URDE with respect to Dixon. The trial court granted summary judgment in favor of Safe Auto, finding the URDE unambiguous, valid, and enforceable, and concluding that Safe Auto had no duty under the Policy to defend or indemnify Dixon in the underlying personal injury lawsuit. Appellants timely appealed to the Superior Court, arguing: (1) the trial court erred in holding the URDE was valid and enforceable; (2) that the URDE violated the provisions of the Pennsylvania Motor Vehicle Financial Responsibility Law (“MVFRL”); and (3) that the URDE violated public policy. The Superior Court affirmed the order of the trial court in a divided, published opinion. The Pennsylvania Supreme Court concurred the URDE at issue in this case was enforceable, and affirmed the Superior Court. View "Safe Auto v. Oriental-Guillermo" on Justia Law