Justia Insurance Law Opinion Summaries

A driver lost control of his truck and crashed into a cabin, causing property damage and personal injuries to the cabin owner. The cabin owner brought suit against both the driver and the driver’s insurance company, alleging in part that the insurance company subsequently took charge of and negligently handled the fuel spill cleanup on the cabin owner’s property. The superior court granted the insurer summary judgment, concluding as a matter of law that the insurer could not owe the cabin owner an actionable duty. The cabin owner appealed, arguing that Alaska case law did not preclude a duty in this context. The Supreme Court agreed with the cabin owner and therefore reversed the superior court’s grant of summary judgment. View "Burnett v. Government Employee Ins. Co." on Justia Law

Philadelphia Indemnity Insurance Company (“Philadelphia”) and Lexington Insurance Company (“Lexington”) insured the same school building that suffered fire damage. In a declaratory judgment action, they disputed their relative responsibilities to pay for the loss. The district court ordered Philadelphia to pay 54 percent and Lexington to pay 46 percent of the approximately $6 million loss. Lexington appealed, arguing it should have no obligation to pay. Philadelphia cross-appealed, arguing Lexington should have paid more. Finding no reversible error, the Tenth Circuit affirmed the district court's allocation between the insurers. View "Philadelphia Indemnity v. Lexington Insurance" on Justia Law

The Riverwalk at Arrowhead Country Club and Magnolia North Horizontal Property Regime developments were constructed between 1997 and 2000. After construction was complete and the units were sold, the purchasers became aware of significant construction problems, including building code violations, structural deficiencies, and significant water-intrusion problems. In 2003, the purchasers filed suit to recover damages for necessary repairs to their homes. Lawsuits were filed by the respective property owners' associations (POAs), which sought actual and punitive damages for the extensive construction defects under theories of negligent construction, breach of fiduciary duty, and breach of warranty. As to the Riverwalk development, individual homeowners also filed a class action to recover damages for the loss of use of their property during the repair period. The defendants in the underlying suits were the related corporate entities that developed and constructed the condominium complexes: Heritage Communities, Inc. (the parent development company), Heritage Magnolia North, Inc. and Heritage Riverwalk, Inc. (the project-specific subsidiary companies for each separate development), and Buildstar Corporation (the general contracting subsidiary that oversaw construction of all Heritage development projects), referred to collectively as "Heritage." The issues presented to the Supreme Court by these cases came from cross-appeals of declaratory judgment actions to determine coverage under Commercial General Liability (CGL) insurance policies issued by Harleysville Group Insurance. The cases arose from separate actions, but were addressed in a single opinion because they involved virtually identical issues regarding insurance coverage for damages. The Special Referee found coverage under the policies was triggered and calculated Harleysville's pro rata portion of the progressive damages based on its time on the risk. After review of the arguments on appeal, the Supreme Court affirmed the findings of the Special Referee in the Magnolia North matter, and affirmed as modified in the Riverwalk matter. View "Harleysville Group Ins. v. Heritage Communities, Inc." on Justia Law

This appeal arose out of a property damage claim filed by the Hayes Family Trust with its insurer, State Farm Fire & Casualty. When the parties could not agree on the amount of loss, Hayes invoked an appraisal process provided by the policy to calculate the loss incurred. After Hayes sought the district court's assistance with the appointment of an umpire, the parties participated in the appraisal process, which resulted in a unanimous award. State Farm paid the balance of that award, and Hayes accepted payment. But despite State Farm's payment, at Hayes's request, the district court confirmed the award and entered judgment in favor of Hayes. Hayes promptly moved for an award of prejudgment interest, attorney's fees, and costs under a prevailing party statute. In response, State Farm moved to vacate or amend the judgment. Finding that the parties settled any dispute over the amount of loss, the court agreed with State Farm and vacated its order confirming the appraisal award and the judgment. Hayes appealed the order vacating judgment in an attempt to recover prejudgment interest, fees, and costs. Finding no reversible error, the Tenth Circuit affirmed. View "In re: Hayes Family Trust" on Justia Law

American Family Mutual Insurance Company (AFM) sought review of a Court of Appeals decision upholding the trial court's judgment in a garnishment proceeding requiring AFM to pay a judgment that plaintiffs FountainCourt Homeowners’ Association and FountainCourt Condominium Owners’ Association (FountainCourt) had obtained against AFM’s insured, Sideco, Inc. (Sideco). The underlying dispute centered on a housing development that was constructed between 2002 and 2004 in Beaverton. FountainCourt sued the developers and contractors seeking damages for defects in the construction of the buildings in the development. Sideco, a subcontractor, was brought in as a third-party defendant, and a jury eventually determined that Sideco’s negligence caused property damage to FountainCourt’s buildings. Based on that jury verdict, the trial court entered judgment against Sideco in the amount of $485,877.84. FountainCourt then served a writ of garnishment on AFM in the amount owed by Sideco, and, in response, AFM denied that the loss was covered by its policies. The trial court ultimately entered judgment against AFM, after deducting the amounts that had been paid by other garnishees. After review, the Supreme Court found no reversible error in the court of Appeals' judgment and affirmed the courts below. View "FountainCourt Homeowners v. FountainCourt Develop." on Justia Law

Donna Simono attended a meeting hosted by Treasure Valley Area of Narcotics Anonymous (“TVNA”) at the Turner House in Mountain Home. When leaving the meeting, she fell down the stairs and injured her ankles. Simono brought a negligence action against Turner House, Larry Rodgers, and Cheryl Baker (collectively “Turner House”). Turner House filed a third-party complaint against TVNA, alleging that TVNA was responsible for maintaining the area where Simono fell. Turner House also sought indemnification for Simono’s claims. The jury returned a verdict finding neither Turner House nor TVNA negligent, and the district court entered judgment dismissing Simono’s complaint and Turner House’s third-party complaint. TVNA filed a motion seeking attorney fees against Turner House under Idaho Code section 12-120(3). The district court denied the motion for fees, concluding that the lawsuit was not based on a commercial transaction. TVNA appealed the district court’s denial of its motion for fees. Both TVNA and Turner House sought attorney fees on appeal. Finding that the district court erred in concluding that TVNA was not entitled to attorney fees, the Supreme Court reversed. Fees and costs on appeal were awarded to TVNA. View "Turner House v. Treasure Valley Area of Narcotics Anonymous" on Justia Law

In 2006, plaintiffs procured a mortgage from Regions to purchase a home near the Cumberland River. The National Flood Insurance Act (NFIA) requires mortgagors to obtain flood insurance for properties in flood zones, 42 U.S.C. 4012a(b)(1). CoreLogic provided Regions with flood-zone certification. The National Flood Insurance Program Flood Insurance Rate Map (FIRM) showed that the property was in a Special Flood Hazard Area (SFHA), but CoreLogic informed plaintiffs that their property was in a non-SFHA zone. FEMA issued a revised FIRM for the area months later. Regions informed plaintiffs that their home was in a flood zone and that they must procure flood insurance within 45 days. Plaintiffs hired Vandenbergh, who procured for them a Nationwide Standard Flood Insurance Policy for a home constructed before the effective FIRM. Plaintiffs’ home, built in 1984, after the 1981 FIRM, required a post-FIRM policy, under which they could receive full coverage only after obtaining an elevation certificate showing sufficient elevation above the base flood zone. A 2010 flood submerged plaintiffs’ home in 16” of water. Nationwide informed plaintiffs of pre-/post-FIRM discrepancy and required an elevation certificate, which showed that the home’s lower level was below the base flood-zone elevation. Because plaintiffs’ home was post-FIRM and situated below the base flood-zone elevation, their SFIP did not cover all losses “below the lowest elevated floor.” FEMA upheld Nationwide’s coverage determination. The Sixth Circuit affirmed partial summary judgment for Vandenbergh, but vacated dismissal of claims against Regions, CoreLogic, and Nationwide. The NFIA did not preempt state-law claims arising from procurement of the SFIP: that plaintiffs would not have purchased their home absent defendants’ negligence and breach of fiduciary duty. View "Harris v. Nationwide Mut. Fire Ins." on Justia Law

This dispute arose from the construction of Cypress Point, a luxury condominium complex in Hoboken. Co-defendants Adria Towers, LLC, Metro Homes, LLC, and Commerce Construction Management, LLC (collectively, the developer) served as the project's developer and general contractor, and subcontractors carried out most of the work. During construction, the developer obtained four CGL policies from Evanston Insurance Company, covering a four-year period, and three from Crum & Forster Specialty Insurance Company, covering a subsequent three-year period (collectively, the policies). In this appeal, issue before the Supreme Court was whether rain water damage caused by a subcontractor's faulty workmanship constituted property damage and an occurrence under the developer's commercial general liability (CGL) insurance policy. In a published decision, the Appellate Division reversed, holding that, under the plain language of the CGL policies, the unintended and unexpected consequential damages caused by the subcontractors faulty workmanship constituted property damage and an occurrence. The Supreme Court agreed and affirmed, finding that the consequential damages caused by the subcontractors faulty workmanship constituted property damage, and the event resulting in that damage water from rain flowing into the interior of the property due to the subcontractors faulty workmanship was an occurrence under the plain language of the CGL policies at issue here. View "CypressPoint Condominium Association, Inc. v. Adria Towers, L.L.C., et al." on Justia Law

A wildfire destroyed David and Kristina Parks’ house, which was insured by Safeco Insurance Company (“Safeco”). The Parks purchased an existing house, and Safeco paid the Parks a total of $255,000, the cost of the replacement house less the value of the land. The Parks filed a complaint against Safeco alleging: (1) they were entitled to $440,195.55 under the policy; and (2) Safeco committed bad faith in handling the claim. Safeco filed a Motion for Summary Judgment asserting that the policy was not breached and its conduct did not constitute bad faith. The Parks filed a Cross-Motion for Summary Judgment asserting that Safeco misrepresented the policy. Additionally, the Parks moved to amend their complaint to include a claim for punitive damages. The district court held that: (1) there was no breach of contract because the policy was unambiguous and the Parks received the amount due under the clear language of the policy; (2) Safeco did not commit bad faith in handling the claim because it complied with the terms of the policy and paid the Parks the amount owed; and (3) the Parks had not established a reasonable likelihood of proving facts at trial sufficient to support an award of punitive damages. The Parks appealed, but finding no reversible error, the Idaho Supreme Court affirmed. View "Parks v. Safeco Ins Co of Illinois" on Justia Law

At issue in this case were two provisions of a title insurance policy underwritten by Fidelity National Title Insurance Company. One provision insured against unmarketability of title, and the other insured against a lack of access to property. The owner of the policy, Woody Creek Ventures, LLC, contended that both provisions covered losses it sustained when it learned, after purchasing two parcels of land, that one parcel lacked permanent access. And although Fidelity obtained a 30-year right-of-way grant to that parcel, Woody Creek argued Fidelity failed to cure the lack of access and the title remained unmarketable. After review, the Tenth Circuit agreed with the district court’s conclusions that: (1) the policy did not insure a permanent right of access; (2) the right-of-way cured the lack of access to the parcel; and (3) the lack of permanent access did not render Woody Creek’s title unmarketable. View "Fidelity National Title v. Woody Creek Ventures" on Justia Law