Justia Insurance Law Opinion Summaries

Plaintiffs Jimmy Larry Beddingfield ("Larry"), his wife, Rebecca, and their adult son, James Cody Beddingfield ("Cody") appealed the grant of summary judgment in favor of the defendants Mullins Insurance Company, Mullins & Company Insurance, Rand Mullins, and David Mullins (referred to collectively as "Mullins"), on the Beddingfields' claims stemming from Mullins's alleged failure to properly procure insurance coverage. In 1997, Larry and Rebecca purchased a homeowners' liability-insurance policy from Rand Mullins that protected Larry and Rebecca's primary residence. In 2001, Larry and Rebecca purchased a second liability-insurance policy that provided coverage for a rental house located in Florence; they later constructed another house in Guntersville and, in 2003, purchased an additional liability-insurance policy for that property. In July 2003, Mullins canceled the insurance policy on the Florence house allegedly based on a belief that "the policy was issued in duplicate." Allegedly unbeknownst to Larry and Rebecca, however, the requested cancellation left the Florence house uninsured. One month later, pursuant to a mortgage refinance on the Beddingfields' residence, Larry and Rebecca paid one year's insurance premium on that residence; the check was endorsed and deposited into Mullins's account. In March 2004, the policy on the Beddingfields' residence was canceled because of nonpayment of the premium; neither Larry nor Rebecca, however, was able to recall receiving notice of the cancellation. After those two events, Larry and Rebecca were without insurance on their residence and the Florence house, leaving them with liability insurance only on their Guntersville house. In July 2004, a minor guest at the Beddingfields' Guntersville house, Trace Linam, suffered a serious eye injury in a fireworks-related incident. In 2008, Linam and his father, Linam, sued the Beddingfields, alleging that they, and particularly Cody (who was a minor at the time), were responsible for the injury. Because the underwriter of the Beddingfields' policy had been placed into receivership in Texas in 2006, the Alabama Insurance Guaranty Association ("AIGA") covered the Beddingfields' legal-defense costs in the Linam litigation; however, the maximum amount of liability coverage available was limited to $100,000 –- the amount of the liability- insurance policy Larry and Rebecca had obtained from Mullins to insure that property -- and not $500,000, the amount they say would have been available had the other two policies not been canceled. In February 2011, a judgment was entered on a $600,000 jury verdict against the Beddingfields in the Linam litigation. The Beddingfields appealed that decision. Because, however, AIGA did not post the requisite supersedeas bond, and the Beddingfields were allegedly unable to obtain a bond, execution of the judgment was not stayed during the pendency of the appeal. In July 2011, while their appeal was pending, the Beddingfields sued Mullins, alleging numerous counts of negligence and wantonness with relation to Mullins's handling of the various insurance policies. After review of the trial court record, the Alabama Supreme Court affirmed summary judgment as to the negligence claims, reversed as to the wantonness claims, and remanded the case for further proceedings. View "Beddingfield et al. v. Mullins Insurance Company et al." on Justia Law

A policy exclusion for personal liability “under any contract or agreement” does not apply to relieve an insurer of its duty to defend its insured, an alleged builder-vendor, against a claim for negligent excavation brought by the home buyer because the negligence claim arose from the common law duty to construct the home as a reasonable builder would.After rockslides damaged his property, the home buyer sued the alleged builder-vendor, asserting breach of contract, negligence, and fraud-based claims and alleging that the rockslides were the result of improper excavation during construction. The builder-vendor’s insurer declined the tender of defense on grounds that there was no coverage under the relevant insurance policies. The builder-vendor sought damages and declaratory relief. The superior court granted summary judgment in favor of the insurer. The court of appeals reversed, concluding that the policy’s “contractual liability” exclusion did not apply. The Supreme Court affirmed, holding that the contractual liability exclusion did not relieve the insurer of its duty to defend the builder-vendor against the home buyer’s negligence claim. View "Teufel v. American Family Mutual Insurance Co." on Justia Law

The circuit court did not err when it ruled that Plaintiff, a retired firefighter, was not a disabled person entitled to receive health insurance benefits under the Virginia Line of Duty Death and Disability Act, Va. Code 9.1-400 et seq.Plaintiff was diagnosed with throat cancer after he retired from the fire department but did not experience any health problems while he worked as a firefighter. The circuit court concluded (1) under the plain reading of the Act, Plaintiff’s duties as a firefighter ceased as of his retirement; and (2) because Plaintiff became disabled after he retired, his claim for insurance coverage under the Act was not viable. The Supreme Court affirmed, holding that Plaintiff was not a “disabled person” under the Act because his incapacity did not prevent the “further performance” of his duties as a firefighter. Therefore, Plaintiff was not entitled to continued health insurance coverage under the Act. View "Jones v. Von Moll" on Justia Law

While sitting on his motorcycle at a stop light, Chad Hahn was thrown backwards when Franklin Townsend’s car failed to stop in time and struck the motorcycle. During settlement negotiations in the suit that followed, Hahn sought payment under Townsend’s underinsured motorist(UIM) insurance policy. Hahn argued that he was an insured occupant of Townsend’s car because he landed on the car after the impact and that Townsend’s liability insurance would not cover the full extent of his damages, rendering Townsend underinsured. Townsend’s insurer, GEICO Choice Insurance Company (GEICO), sued for a declaratory judgment that no UIM coverage was available. Hahn answered, raising a number of affirmative defenses including that GEICO’s declaratory judgment action was not ripe and that the court therefore lacked subject matter jurisdiction. Hahn also filed a counterclaim for a declaratory judgment that UIM coverage was available to him, and asserted third-party claims against Townsend, seeking to join him as a necessary party and a real party in interest. The superior court concluded that it had subject matter jurisdiction, granted summary judgment and a declaratory judgment in GEICO’s favor, and dismissed the third-party claims against Townsend. Hahn appealed; finding no reversible error, the Alaska Supreme Court affirmed. View "Hahn v. GEICO Choice Insurance Company" on Justia Law

The business-owners liability insurance policy in this case did not provide coverage for a negligent supervision claim arising out of an alleged employee’s intentional act of physically punching a customer in the face.The circuit court granted summary judgment in favor of the Insurer, concluding that there was no coverage under the policy for either the employee’s intentional act or the negligent supervision claim against the employer arising out of the employee’s intentional act. The court of appeals reversed. The Supreme Court reversed, holding that where the negligent supervision claim pled rested solely on the employee’s intentional and unlawful act without any separate bais for a negligence claim against the employer, no coverage existed. View "Talley v. Mustafa" on Justia Law

An insured plaintiff who has chosen to be treated with doctors and medical facility providers outside his insurance plan shall be considered uninsured, as opposed to insured, for the purpose of determining economic damages. The Court of Appeal held that the trial court properly allowed the plaintiff in this case, as a plaintiff who is treating outside his insurance plan, to introduce evidence of his medical bills. The trial court also permitted defendants to present expert testimony that the reasonable and customary value of the services provided by the various medical facilities was substantially less than the amounts actually billed. The jury rejected the expert evidence and awarded plaintiff the billed amounts. The court held that defendants have not demonstrated error except with respect to two charges regarding the amounts billed by Ventura County Medical Center and American Medical Response. Accordingly, the court reduced the damage award and affirmed the judgment as modified. View "Pebley v. Santa Clara Organics" on Justia Law

Plaintiffs Candice Reis and Melvin Williams appealed the grant of summary judgment to defendant OOIDA Risk Retention Group, Inc. (“OOIDA”) in a direct action against OOIDA and others arising from a vehicular collision involving Plaintiffs and a motor carrier insured by OOIDA. At issue was whether provisions in the federal Liability Risk Retention Act of 1986 (“the LRRA”), 15 USC 3901, et seq., preempted Georgia’s motor carrier and insurance carrier direct action statutes, OCGA sections 40-1-112 (c),1 40-2-140 (d) (4), in regard to risk retention groups, thereby precluding this direct action against OOIDA. After review of the statutes at issue here, the Georgia Supreme Court concluded there was indeed federal preemption of this action against OOIDA, and consequently, affirmed summary judgment. View "Reis et al. v. OOIDA Risk Retention Group, Inc. et al." on Justia Law

The three-year statute of limitations set forth in N.Y. C.P.L.R. 214(2) applies to no-fault claims against a self-insurer.Girtha Butler sustained personal injuries in a motor vehicle accident involving a New York City Transit Authority (Defendant) bus in which she was a passenger. Plaintiff provided health services to Butler for her injuries, and Butler assigned to Plaintiff her right to recover first-party benefits from Defendant, who was self-insured. Plaintiff then brought this action seeking reimbursement for allegedly outstanding invoices it had submitted to Defendant. Defendant moved to dismiss the complaint based on Plaintiff’s failure to bring the action within the three-year statute of limitations under N.Y. C.P.L.R. 214(2). Civil Court denied the motion, ruling that the six-year statute of limitations set forth in N.Y. C.P.L.R. 213(2) controlled this case. The Court of Appeals reversed, holding that the three-year period of limitations in N.Y. C.P.L.R. 214(2) should control this case. View "Contact Chiropractic, P.C. v. New York City Transit Authority" on Justia Law

The Court of Appeal reversed the trial court's entry of judgment for Gursey in an action alleging that plaintiffs had been damaged because they could not collect the additional money they would have been entitled to had Gursey purchased an insurance policy with the limits they had requested. The court held that plaintiffs did not incur actual damages until they became entitled to the benefits of the underinsured motorist policy. Consequently, plaintiffs' causes of action against Gursey accrued less than two years before they filed this action, and the trial court erred in holding that plaintiffs' claims were time-barred. View "Lederer v. Schneider" on Justia Law

Plaintiff Robert Ferrante was involved in an automobile accident in 2006 where the other motorist caused the collision. Without informing his auto insurance carrier, defendant New Jersey Manufacturers Insurance Group (“NJM”), Ferrante initiated a negligence lawsuit against the tortfeasor, who had a liability limit of $100,000 on his insurance policy. The parties participated in mandatory arbitration, which set Ferrante’s damages at $90,000. Again, without informing NJM and allowing it to exercise its subrogation rights, Ferrante rejected the award, and sought a trial de novo. He also refused a $50,000 settlement offer without notifying NJM. Prior to the trial, Ferrante entered into a high-low agreement with the tortfeasor, which set the range of damages between $25,000 and $100,000, notwithstanding a jury verdict. Ferrante did not communicate this agreement or the trial itself to NJM, either. Following the trial, a jury awarded plaintiff $200,000 in damages, but the Law Division entered a judgment of $100,000 based on the high-low agreement. For the first time in 2011, Ferrante sent NJM a letter required by Longworth v. Van Houten, 223 N.J. Super. 174 (App. Div. 1988), stating that he was seeking UIM benefits. In the letter, Ferrante wrote that the other motorist was willing to settle for $100,000. However, Ferrante failed to mention the arbitration, high-low agreement, completed trial, or jury verdict. Based on this information, NJM told Ferrante to accept the offer. NJM and Ferrante proceeded to litigation over UIM coverage; only during a pretrial discovery exchange did Ferrante finally disclose his past dealings. NJM moved to dismiss the complaint, and the Law Division granted the motion, finding that Ferrante violated Longworth by not notifying NJM of any of the proceedings with the other motorist. On appeal, a split panel of the Appellate Division reversed. The majority held that because the trial court did not consider if NJM was actually prejudiced by the lack of notice, a remand was needed to determine if NJM sustained any prejudice. The New Jersey Supreme Court reversed: due to the complete absence of notice by Ferrante to NJM at any point over years of litigation, including the lack of notice about the high-low agreement or completed jury trial during the UIM process, NJM could refuse to pay the UIM benefits. View "Ferrante v. New Jersey Manufacturers Insurance Group" on Justia Law