Justia Insurance Law Opinion Summaries

Quest Diagnostics, LLC was an independent contractor for Brown University under an agreement that obligated both parties to name the other party as an additional insured under their general liability policies. In 2006, Pauline Hall, a student at Brown University, sought treatment at the university’s health services clinic. A rapid strep test, to be performed by Quest, was ordered. The test, however, was not performed promptly, and the results were not returned to the health clinic. Hall was subsequently diagnosed with toxic shock syndrome, which resulted in permanent injuries. Hall filed suit against Brown and Quest, and Brown filed a cross-claim against Quest. Hall settled her claims with Brown and its insurers, Pinnacle Consortium of Higher Education and Genesis Insurance Company, but the cross-claim was not resolved. Quest subsequently sought a declaratory judgment that it was entitled to a defense from Pinnacle and indemnification from Pinnacle and Genesis. The superior court granted summary judgment in favor of Pinnacle and Genesis. The Supreme Court affirmed, holding that, under the facts of this case, Quest was not entitled to defense and indemnification from either insurer.View "Quest Diagnostics, LLC v. Pinnacle Consortium of Higher Educ." on Justia Law

Charles Blackmon and Dexter Booth sued Malaco, Inc.; N.J. Pockets, Inc.; and Callop Hampton (owner of Hamp’s Place Night Club) on a premises-liability claim. Plaintiffs settled with Malaco. At trial, the jury returned a verdict in favor of Hampton. Hampton filed a post-trial motion, requesting the trial court to impose sanctions against Blackmon, Booth, and their attorney for filing a frivolous lawsuit and to award attorney fees. The motion was denied, and Hampton appealed that judgment to the Supreme Court. Finding no abuse of discretion, the Supreme Court affirmed. View "Hampton v. Blackmon" on Justia Law

This appeal involved Empire Fire and Marine Insurance Company's obligations under an "Insurance for Non-Trucking Use" policy issued to Drielick Trucking. The policy contained a business-use exclusion, which included two clauses that Empire argued precluded coverage in this case. The Court of Appeals agreed that the first clause precluded coverage when the covered vehicle was not carrying property at the time of the accident, was in this case. Thus, the Court of Appeals expressly declined to address the second clause relating to leased covered vehicles. The Supreme Court held that the Court of Appeals erred in its interpretation of the first clause. The case to the trial court for further fact-finding to determine whether Drielick Trucking and Great Lakes Carriers Corporation (GLC) entered into a leasing agreement for the use of Drielick Trucking’s semi-tractors as was contemplated under the policy's clause related to a leased covered vehicle. View "Estate of Eugene Hunt v. Drielick" on Justia Law

Physicians Liability Insurance Company (PLICO) insured Defendant Mark Valentine pursuant to a claims made policy with a policy period from July 1, 2004, to December 31, 2006. On November 1, 2004, Valentine operated on David Wurtz. As a result of Valentine's negligence during the operation, Wurtz died. On March 10, 2005, the Oklahoma Board of Medical Licensure held a hearing to determine whether Valentine should be disciplined. At the hearing, the Board revoked Valentine's license. On March 22, 2005, PLICO notified Valentine by letter that the policy had been cancelled effective March 10, 2005, with "Company's Decision" stated as the reason for cancellation and offered to sell him tail coverage. That letter was followed by another that addressed the premium refund issues and stated that the policy had been cancelled at Valentine's request. On June 2, 2005, Wurtz' personal representative, Tracey Chandler, filed suit against Valentine and others for the wrongful death of Wurtz. Valentine forwarded the petition and summons served on him to PLICO; PLICO sent Valentine a letter denying coverage because the claim was not made until after the policy was cancelled and asserting the policy exclusion for acts performed while under the influence of intoxicating substances. Valentine's debts were discharged in bankruptcy in early 2006. Chandler filed a motion for summary judgment against Valentine; Valentine entered into a Consent Judgment with Chandler in the amount of $2,250,000.00. The trial court granted summary judgment in favor of Chandler and ruled that Valentine was entitled to a set off by virtue of settlements with other parties in the amount of $1,275,000.00. Chandler filed garnishment proceedings against PLICO in May of 2008. Chandler asserted that Valentine was indebted to Chandler. PLICO denied any indebtedness asserting a lack of coverage under any insurance policy. Both Chandler and PLICO filed motions for summary judgment in the garnishment action. The trial court entered summary judgment in favor of Chandler, holding that cancellation of the policy violated section 3625 of title 36 and was therefore void. The issue in this matter was whether an insurer may agree to cancel a "claims made" policy with the knowledge that a potential claim is pending without violating the statutory prohibition on retroactive annulment of an insurance policy following the injury, death, or damage for which the insured may be liable. Upon review, the Supreme Court held that it may not and affirmed the trial court. View "Chandler v. Valentine" on Justia Law

Jimmy Carty died in an accident during his employment for the state. The workers’ compensation carrier for state employees (carrier) began paying death benefits to Christy, Jimmy’s wife, and the couple’s three minor children. Christy, individually, as representative of her deceased husband’s estate, and as next friend of the couple’s children, brought suit against two defendants. The Cartys settled with the defendants. The district court subsequently calculated the carrier's reimbursement and apportioned the remainder of the settlement funds among Christy and the children “in the same ratio as they received death benefits.” The carrier appealed, challenging the apportionment. The court of appeals certified to the Supreme Court the question of “how a net recovery in excess of the amount of benefits paid by the workers’ compensation carrier should be apportioned among beneficiaries when multiple beneficiaries recover from a third-party tortfeasor.” The Supreme Court answered that when multiple beneficiaries recover compensation benefits through the same covered employee, the workers’ compensation carrier’s right to a third-party settlement is determined by treating the recovery as a single, collective recovery rather than separate recoveries by each beneficiary.View "State Office of Risk Mgmt. v. Carty" on Justia Law

Janet Howe and Rajesh Mandekar (together, Howe) owed a condominium in the River Knoll Farms Condominium. The condominium association (Association) sued Howe for negligence, nuisance, and keeping a dangerous dog. MMG Insurance Company, which had issued a homeowner’s policy to Howe, declined to defend Howe in the litigation. The trial court subsequently declared that MMG had no duty to defend in the suit, concluding that the policy issued to Howe did not provide coverage because the Association’s suit sought only equitable relief. The Supreme Court vacated the judgment of the superior court, holding that MMG had a duty to defend Howe in the suit because the complaint alleged facts that would support claims potentially falling within the coverage of the policy. View "Howe v. MMG Ins. Co." on Justia Law

Plaintiff Thomas P. Whelan, Jr.'s decedent father, Thomas P. Whelan, Sr., was in Plaintiff's parked truck when it was hit by a moving vehicle. The collision allegedly resulted in severe injuries and medical costs in excess of $100,000 and ultimately in the decedent's death a few years later. At the time of the accident, occupants of Plaintiff's truck were insureds under the terms of a $50,000 liability policy issued by State Farm, facially providing no UM/UIM coverage. In the Supreme Court's decision in "Jordan v. Allstate Ins. Co.," the effective rejection of an insured's statutory rights to UM/UIM coverage equal to liability limits had to be made in writing and as part of the insurance policy delivered to the insured. Because the result in "Jordan" was foreshadowed by other precedents, the Supreme Court declined to make Jordan applicable only to cases arising in the future, and held that policies that failed to comply with Jordan's rejection requirements would be judicially reformed to provide full statutory coverage. In 2011, following the 2010 issuance of Jordan, Plaintiff made a demand on his insurer State Farm for reformation of his policy that was in effect at the time of the accident. Relying on a clause in the policy that purported to bar UM/UIM claims made more than six years after the date of the underlying accident, State Farm rejected the claim. Plaintiff then instituted a declaratory judgment action against State Farm for reformation of the policy. Upon review of this matter, the Supreme Court held that a limitations clause based solely on the date of the accident without consideration of the actual accrual of the right to make a UM/UIM claim was unreasonable and unenforceable as a matter of law. But addressing the merits of Plaintiff's action, the Court also held that judicial reformation under Jordan did not extend to historical insurance contracts formed before another precedential opinion was issued in 2004. Because the policy in this case was issued before that date, it was not subject to retroactive reformation of its facial lack of UM/UIM coverage. View "Whelan v. State Farm Mutual Auto Ins. Co." on Justia Law

A highly paid worker suffered a debilitating stroke while traveling for his employer. The employer did not think the stroke was work related, but it later accepted the claim and paid workers' compensation benefits. The statutory maximum compensation rate at the time of the injury was $700 a week. A little more than five months after the employee's stroke, an amended version of the Alaska Workers' Compensation Act took effect. Instead of an absolute maximum compensation rate, the amended statute set a variable rate indexed to the statewide average weekly wage. The employee asked for an increased rate of compensation, arguing that the law in effect at the time he was recognized as being permanently and totally disabled should govern his benefit amount. The Alaska Workers' Compensation Board, with one panel member dissenting, decided that the version of the statute in effect at the time of the injury was the applicable statute and consequently capped the employee's benefits at $700 a week for life. The dissenting panel member would have construed the statute as permitting increased benefits. The Alaska Workers' Compensation Appeals Commission affirmed the Board's decision. The employee appealed, arguing that the amount of his benefits did not fairly compensate him for lost wages during the period of his disability so that the date of his disability, rather than the date of his injury, should have been used to determine the version of the statute governing his claim. Finding no reversible error, the Supreme Court affirmed the Commission's decision.View "Louie v. BP Exploration (Alaska), Inc." on Justia Law

Hartford Casualty Insurance Company issued a commercial general liability policy to Ultimate Support Systems, a company that sold the Ulti-Cart. The policy covered “personal and advertising injury,” which included claims arising out of publication of material that "disparages a person’s or organization’s goods, products or services.” Gary-Michael Dahl, the manufacturer of the Multi-Cart, sued Ultimate for patent and trademark infringement, false designation of origin, and damage to business, reputation, and goodwill. Hartford denied coverage on the ground that the suit did not allege that Ultimate had disparaged the Multi-Cart or Dahl. The Supreme Court affirmed, holding (1) a claim of disparagement requires a plaintiff to show a false or misleading statement that specifically refers to the plaintiff’s product or business and clearly derogates that product or business; and (2) because Dahl’s suit did not allege that Ultimate clearly derogated the Multi-Cart, there was no claim of disparagement triggering Harford’s duty to defend.View "Hartford Cas. Ins. v. Swift Distrib., Inc." on Justia Law

While working for Vista Care (Employer), appellant Sherrie Fowler suffered a back injury. Appellant began receiving TTD and subsequently underwent back surgery. Several years later, a physician determined that appellant reached maximum medical improvement (MMI). This case began when appellant filed a complaint with the Workers' Compensation Act (WCA) in 2010, for reinstatement of her TTD benefits and for an increase in her PPD rating. The Court of Appeals held that the Act limited appellant's eligibility for TTD benefits to 700 weeks of benefits and reversed a contrary decision of the Workers’ Compensation Administration judge. Upon review of the matter, the Supreme Court concluded that the Act imposed no such limitation; TTD benefits are payable during any period of total disability for the remainder of a worker’s life. View "Fowler v. Vista Care" on Justia Law