Justia Insurance Law Opinion Summaries

Hyland was a passenger in a car owned by Perkins and driven by Smith, age 16. Smith smashed the car into two parked vehicles, seriously injuring Hyland. Smith was convicted of aggravated reckless driving. Neither Smith nor her parents had auto insurance. Perkins had insurance with Liberty Mutual, covering her family, including her daughter Risby and anyone driving the car with the family’s permission. Smith told Liberty Mutual that Risby gave her the keys during a party; Risby denied doing that and said that she gave the keys to “Rob,” who was never identified. The police reported that Smith told many incompatible stories. Liberty Mutual would not provide a defense or indemnity. Smith defaulted. A state court entered a $4.6 million judgment. Smith assigned to Hyland whatever claim she had against Liberty Mutual. The district court concluded that Liberty Mutual’s failure either to defend or to seek a declaratory judgment of non-coverage violated Illinois law, making it liable for the entire judgment, although the policy provided only $25,000 per person in coverage. The Sixth Circuit vacated and remanded for the entry of a judgment for $25,000 plus interest; damages for a breach of the duty to defend are measured by the consequences proximately caused by the breach. The maximum loss caused by this failure to defend is $25,000 View "Hyland v. Liberty Mutual Fire Insurance Co." on Justia Law

Hyland was a passenger in a car owned by Perkins and driven by Smith, age 16. Smith smashed the car into two parked vehicles, seriously injuring Hyland. Smith was convicted of aggravated reckless driving. Neither Smith nor her parents had auto insurance. Perkins had insurance with Liberty Mutual, covering her family, including her daughter Risby and anyone driving the car with the family’s permission. Smith told Liberty Mutual that Risby gave her the keys during a party; Risby denied doing that and said that she gave the keys to “Rob,” who was never identified. The police reported that Smith told many incompatible stories. Liberty Mutual would not provide a defense or indemnity. Smith defaulted. A state court entered a $4.6 million judgment. Smith assigned to Hyland whatever claim she had against Liberty Mutual. The district court concluded that Liberty Mutual’s failure either to defend or to seek a declaratory judgment of non-coverage violated Illinois law, making it liable for the entire judgment, although the policy provided only $25,000 per person in coverage. The Sixth Circuit vacated and remanded for the entry of a judgment for $25,000 plus interest; damages for a breach of the duty to defend are measured by the consequences proximately caused by the breach. The maximum loss caused by this failure to defend is $25,000 View "Hyland v. Liberty Mutual Fire Insurance Co." on Justia Law

Stacy Triplett filed three lawsuits against her former employer, Southern Hens, all stemming from an incident in which Triplett, while working, witnessed the gruesome death of a coworker. This incident caused Triplett mental anguish leading to an award of workers’ compensation benefits. After Triplett allegedly incurred some trouble in collecting her award of workers’ compensation benefits, she sued Southern Hens and Southern Hens’s carrier, Liberty Mutual. Triplett’s first lawsuit against Southern Hens, for failure to pay, ultimately was dismissed. Triplett then filed a second lawsuit against Southern Hens for failure to report; Triplett failed to serve Southern Hens within 120 days, as required under Mississippi Rule of Civil Procedure 4(h). With no official court action on her second suit, and admittedly knowing that she could not show good cause for failure to serve in the second suit, Triplett filed a third suit against Southern Hens , like the second, was for failure to report. Aware of the second suit, the circuit court dismissed Triplett’s third suit as an impermissible duplicative suit. Triplett appealed. Finding no error, the Mississippi Supreme Court affirmed. View "Triplett v. Southern Hens, Inc." on Justia Law

Stacy Triplett filed three lawsuits against her former employer, Southern Hens, all stemming from an incident in which Triplett, while working, witnessed the gruesome death of a coworker. This incident caused Triplett mental anguish leading to an award of workers’ compensation benefits. After Triplett allegedly incurred some trouble in collecting her award of workers’ compensation benefits, she sued Southern Hens and Southern Hens’s carrier, Liberty Mutual. Triplett’s first lawsuit against Southern Hens, for failure to pay, ultimately was dismissed. Triplett then filed a second lawsuit against Southern Hens for failure to report; Triplett failed to serve Southern Hens within 120 days, as required under Mississippi Rule of Civil Procedure 4(h). With no official court action on her second suit, and admittedly knowing that she could not show good cause for failure to serve in the second suit, Triplett filed a third suit against Southern Hens , like the second, was for failure to report. Aware of the second suit, the circuit court dismissed Triplett’s third suit as an impermissible duplicative suit. Triplett appealed. Finding no error, the Mississippi Supreme Court affirmed. View "Triplett v. Southern Hens, Inc." on Justia Law

Antonicelli, was a passenger in a vehicle traveling on I-88. Three lanes were closed for construction. Browder was operating a semi-tractor and trailer, traveling behind Antonicelli’s vehicle. Rodriguez, under the influence of cocaine, made an improper U-turn through the median and collided with Antonicelli’s vehicle, causing it to rotate. Browder was unable to stop his semi and slammed into Antonicelli’s vehicle. Antonicelli suffered severe permanent injuries. Rodriguez pled guilty to aggravated driving under the influence of drugs and acknowledged fault. Antonicelli sued and entered ­ into a settlement with Rodriguez for $20,000, the limit of his insurance coverage. Rodriguez sought a finding of a good-faith settlement, informing the court that the insurance policy was his only material asset. The nonsettling Browder defendants counterclaimed for contribution against Rodriguez, alleging that Rodriguez’s conduct was intentional rather than negligent under the Contribution Act (740 ILCS 100/2). The court granted Rodriguez a finding of good faith and dismissal, allowing the Browder defendants to credit $20,000 against any future judgment. The Illinois Supreme Court affirmed, finding no basis for the allegation of intentional conduct. The Browder counterclaims alleging intentional conduct are separate and independent causes of action that do not change the nature of Antonicelli’s complaint, which alleged only negligent conduct. Requiring a court to make a determination as to each defendant’s fault before finding that a settlement agreement was in good faith would be impracticable and would defeat the Act's purpose of encouraging settlement in the absence of bad faith, fraud, or collusion. View "Antonicelli v. Rodriguez" on Justia Law

This case arose out of a dispute between insureds, Nancy Vigil and her stepson Martin Vigil, and their insurance company, Progressive Casualty Insurance Company, as to whether the Vigils’ policy was in effect at the time of a November 4, 2002, car accident. The parties’ dispute has been the subject of two jury trials and two appeals to the Court of Appeals. The New Mexico Supreme Court limited its review to the propriety of two evidentiary rulings that the district court made prior to the second trial. The Court of Appeals held that the district court erred by excluding evidence at the second trial of: (1) a previous judge’s summary judgment ruling that the Vigils lacked coverage on the date of the accident, a ruling that had been reversed in “Progressive I;” and (2) Progressive’s payment of $200,000 under the Vigils’ policy to settle third-party claims while this litigation was pending. The Supreme Court reversed the Court of Appeals and held the district court acted within its discretion to exclude the evidence under Rule 11-403 19 NMRA, which permitted the district court to “exclude relevant evidence if its probative value is substantially outweighed by a danger of one or more of the following: unfair prejudice, confusing the issues, misleading the jury, undue delay, wasting time, or needlessly presenting cumulative evidence.” The case was remanded back to the Court of Appeals to address the remaining issues that Progressive raised on appeal. View "Progressive Cas. Co. v. Vigil" on Justia Law

This case arose out of a dispute between insureds, Nancy Vigil and her stepson Martin Vigil, and their insurance company, Progressive Casualty Insurance Company, as to whether the Vigils’ policy was in effect at the time of a November 4, 2002, car accident. The parties’ dispute has been the subject of two jury trials and two appeals to the Court of Appeals. The New Mexico Supreme Court limited its review to the propriety of two evidentiary rulings that the district court made prior to the second trial. The Court of Appeals held that the district court erred by excluding evidence at the second trial of: (1) a previous judge’s summary judgment ruling that the Vigils lacked coverage on the date of the accident, a ruling that had been reversed in “Progressive I;” and (2) Progressive’s payment of $200,000 under the Vigils’ policy to settle third-party claims while this litigation was pending. The Supreme Court reversed the Court of Appeals and held the district court acted within its discretion to exclude the evidence under Rule 11-403 19 NMRA, which permitted the district court to “exclude relevant evidence if its probative value is substantially outweighed by a danger of one or more of the following: unfair prejudice, confusing the issues, misleading the jury, undue delay, wasting time, or needlessly presenting cumulative evidence.” The case was remanded back to the Court of Appeals to address the remaining issues that Progressive raised on appeal. View "Progressive Cas. Co. v. Vigil" on Justia Law

Heimer, one year over the legal drinking age, drank alcohol with friends and then rode motorbikes in a field. Heimer and his friend collided. Heimer suffered extensive injuries, incurring more than $197,333.50 in medical bills. Heimer’s blood alcohol level shortly after the crash was 0.152, nearly twice the limit to legally use an off-road vehicle in Michigan. Heimer was insured. As required by his plan, he submitted a medical claim form shortly after the accident. The plan administrator denied coverage based on an exclusion for “[s]ervices, supplies, care or treatment of any injury or [s]ickness which occurred as a result of a Covered Person’s illegal use of alcohol.” After exhausting administrative appeals, Heimer filed suit. The district court held that the plan exclusion did not encompass Heimer’s injuries, reasoning that there is a difference between the illegal use of alcohol—such as drinking while under 21 or drinking in defiance of a court order—and illegal post-consumption conduct, such as the illegal use of a motor vehicle. The Sixth Circuit affirmed. Reading “illegal use of alcohol” to disclaim coverage only for the illegal consumption of alcohol, and not for illegal post-consumption conduct is consistent with the ordinary meaning of “use” and best gives effect to the contract as a whole. View "Heimer v. Companion Life Insurance Co." on Justia Law

Life Insurance Company of North America’s terminated plaintiff-appellant Carl Van Steen’s long-term disability benefits under Lockheed Martin’s ERISA Plan. Life Insurance Company of North America (LINA) appealed the district court’s finding that its decision to terminate Van Steen’s benefits was arbitrary and capricious. Van Steen, in turn, appealed the district court’s denial of his attorney’s fees request. Van Steen was physically assaulted during an altercation while walking his dog. The assault resulted in a mild traumatic brain injury (mTBI) that impacted Van Steen’s cognitive abilities that prevented him from returning to full time work; Van Steen was eventually allowed to return to part-time work on a daily basis roughly six weeks later. Even on a part-time schedule, Van Steen experienced cognitive fatigue and headaches that required him to frequently rest. Due to his inability to stay organized and keep track of deadlines after the assault, Van Steen received poor feedback on his job performance. Van Steen’s claim for partial long-term disability benefits was approved on March 30, 2012. Roughly a year later, LINA reviewed Van Steen’s file, contacted his doctors, and confirmed that Van Steen’s condition and restrictions were permanent as he was “not likely to improve.” Despite this prognosis, LINA sent Van Steen a letter one week later terminating his long-term disability benefits, explaining that “the medical documentation on file does not continue to support the current restrictions and limitations to preclude you from resuming a full-time work schedule.” Having exhausted his administrative appeals under the Plan, Van Steen next sought relief before the district court. The district court reversed LINA’s decision to terminate Van Steen’s partial long-term disability benefits on the grounds that it was arbitrary and capricious, but denied Van Steen’s request for attorney’s fees. The Tenth Circuit agreed with the district court’s reversal of LINA’s decision to terminate Van Steen’s coverage. The Court also found that Van Steen was not eligible for attorney fees: “Van Steen’s arguments fail to convince us that the district court’s decision was based on a clear error of judgment or exceeded the bounds of permissible choice.” View "Van Steen v. Life Insurance Company N.A." on Justia Law

In 2014, Shaundalyn Elliott, a resident of Montgomery County, was injured in an automobile accident in the City of Hayneville in Lowndes County. On February 23, 2017, Elliott filed this lawsuit at the Lowndes Circuit Court against her automobile insurer, Allstate Insurance Company ("Allstate"), seeking uninsured-motorist benefits related to the accident. Elliot alleged that the accident was caused by a "phantom driver," whose location was unknown. Allstate filed a motion to transfer the action from the Lowndes Circuit Court to the Montgomery Circuit Court. Elliott petitioned the Alabama Supreme Court for a writ of mandamus directing the Lowndes Circuit Court to vacate its order transferring this case to the Montgomery Circuit Court. In this case, the Supreme Court found that Lowndes County and Montgomery County had connections to this action. The accident, injuries, and police investigation occurred in Lowndes County. On the other hand, Elliott resided in Montgomery County, where she sought treatment for her injuries resulting from the accident and where the parties' contractual dealings arose. Under the specific facts of this case, Lowndes County's connection to the accident was not "little" or "weak," and Montgomery County did not have a significantly stronger connection to the case to justify a transfer of this case under the interest-of-justice prong of § 6-3-21.1. Therefore, the Court held the trial court erred in transferring this action to the Montgomery Circuit Court. View "Ex parte Shaundalyn N. Elliott." on Justia Law