Justia Insurance Law Opinion SummariesArticles Posted in U.S. 4th Circuit Court of Appeals
American Steamship Owners v. Dann Ocean Towing, Inc.
The Club is a non-profit provider of protection and indemnity insurance. The Club's Rules include a choice-of-law provision selecting New York law and a two-year statute of limitations for claims against the Club. The Club filed a civil action against defendant alleging that it breached the insurance contract by failing to reimburse the Club for a shortfall and by failing to pay the overdue insurance premiums. The court agreed with the district court, and precedent, that an otherwise valid choice-of-law provision in a maritime contract is enforceable and may require application of a jurisdiction's statute of limitations, in lieu of the doctrine of laches, to govern issues regarding the timeliness of claims asserted under that agreement. Accordingly, the court held that the district court correctly applied New York's six-year statute of limitations to the Club's claims arising under its maritime insurance contract with plaintiff. Therefore, the court affirmed the judgment of the district court. View "American Steamship Owners v. Dann Ocean Towing, Inc." on Justia Law
Kenney v. Indep. Order of Foresters
Plaintiff filed suit under the West Virginia Unfair Trade Practices Act (WVUTPA), W. Va. Code 33-11-4(9)(f), based on IOF's allegedly unlawful conduct in connection with its handling of her insurance claim. The court held that plaintiff's WVUTPA claim sounds in tort and not in contract; West Virginia governed the underlying lawsuit pursuant to the lex loci delicti approach and the Restatement choice-of-law approach; and, insofar as the Supreme Court of Appeals of West Virginia has previously entertained questions regarding an action brought under the WVUTPA against an insurer subsequent to settlement, where the cause of action was limited to unfair settlement practices, plaintiff's complaint stated a claim upon which relief could be granted. Accordingly, the court reversed the district court's dismissal of the complaint. View "Kenney v. Indep. Order of Foresters" on Justia Law
Posted in: Injury Law, Insurance Law, U.S. 4th Circuit Court of Appeals
Millennium Inorganic Chemicals v. National Union Fire Ins.
Millennium, processor of titanium dioxide, filed suit contending that the Insurers had wrongfully denied Millennium's claim for coverage under contingent business interruption provisions of commercial liability insurance policies issued by the Insurers. After an explosion occurred at Apache's, a gas producer, Varanus Island facility, it notified Alinta, a retail gas supplier, which in turn sent a notice of "force majeure" to Millennium and other customers. On appeal, National Union and the Insurers challenged the district court's grant of partial summary judgment in favor of Millennium. The court found the term "direct" to be clear as used in the Policies and without ambiguity and, therefore, rejected Millennium's claim to the contrary. The court concluded that, on the plain language of the Policies, Apache could not be considered a direct contributing property to Millennium. The court rejected Millennium's alternative argument that it could also receive coverage under the "for the account of" clause of the Endorsements because coverage was triggered only by damage to or destruction of contributing properties. Accordingly, the court reversed and remanded where Millennium presented no plausible reading of the Policies under which it could receive coverage for its contingent business interruption losses. View "Millennium Inorganic Chemicals v. National Union Fire Ins." on Justia Law
Perini/Tompkins Joint Venture v. ACE American Ins. Co.
PTJV filed suit against ACE claiming coverage under primary and excess insurance policies with regard to a large-scale construction project in Maryland. The court affirmed the district court's grant of summary judgment in favor of ACE, holding that under Maryland and Tennessee law, PTJV violated the terms of both the primary and excess policies by not obtaining ACE's consent before settlement, and as such, could not now claim reimbursement under those policies. View "Perini/Tompkins Joint Venture v. ACE American Ins. Co." on Justia Law
Hartford Fire Ins. Co. v. Harleysville Mutual Ins.
This action arose out of allegedly defective roofing work performed by defendant. At issue was whether defendant, an insured contractor, was a nominal party in a contribution suit between its insurers. The court affirmed the district court's holding that defendant was a nominal party for purposes of the nominal party exception to the rule of unanimity governing removal where defendant did not possess a sufficient stake in the proceeding at issue to rise above the status of a nominal party. View "Hartford Fire Ins. Co. v. Harleysville Mutual Ins." on Justia Law
Cosey v. The Prudential Ins. Co.
Plaintiff filed suit against Prudential, the plan administrator, and BioMerieux, her employer, after Prudential denied her long-term disability and short-term disability benefits. The district court entered summary judgment in favor of Prudential and BioMerieux. Plaintiff appealed. The court concluded that the language at issue in both plans was ambiguous and did not clearly confer discretionary decision-making authority on the plan administrator. Therefore, the administrator's eligibility determinations denying benefits to a covered employee were subject to de novo judicial review, and the district court erred in reaching a contrary conclusion. The court further held that the district court erred in concluding that the employer's group insurance plan required objective proof of disability in order for an employee to qualify for plan benefits. Accordingly, the court vacated and remanded for further proceedings. View "Cosey v. The Prudential Ins. Co." on Justia Law
Johnson v. American United Life Ins.
Plaintiff, the widow of the insured, filed this action under the Employee Retirement Income Security Act (ERISA), 29 U.S.C. 1132(a)(1)(B), after AUL, the insurer, refused to pay accidental death and dismemberment (AD&D) benefits. The district court affirmed the denial of benefits on the grounds that the death was not accidental because the fatal crash was an "anticipated and expected" result of driving while intoxicated. The insurance policies did not define the term "accident" despite its critical importance for determining eligibility for AD&D benefits. Because "accident" was susceptible to more than one reasonable interpretation, the court construed it against AUL, the drafting party, and concluded that a reasonable plan participant under similar circumstances would have understood the insurer's alcohol-related crash to be an "accident" under the policy language. Accordingly, the court reversed and remanded. View "Johnson v. American United Life Ins." on Justia Law
Posted in: Contracts, Insurance Law, U.S. 4th Circuit Court of Appeals
Dooley v. Hartford Accident & Indemnity Co.
Plaintiff, the insured, appealed the district court's holding that his Hartford insurance policy prohibited plaintiff from "stacking," or combining the uninsured/underinsured motorist coverage (UM/UIM) for each insured vehicle, when the policy failed to specify any particular amount of UM/UIM coverage afforded. The court concluded that because Virginia Code 38.2-2206(A) mandated that UM/UIM coverage "shall equal" the general liability coverage, this provision by operation of law provided plaintiff an equal amount of UM/UIM coverage under the Hartford policy. Accordingly, the court held that the anti-stacking provision in plaintiff's policy unambiguously prevented the stacking of UM/UIM coverage, and affirmed the district court's award of summary judgment in favor of Hartford. View "Dooley v. Hartford Accident & Indemnity Co." on Justia Law
Francis v. Allstate Ins. Co.
Plaintiffs brought this action in Maryland state court seeking a declaration as to Allstate's duty under a renters insurance policy to defend and indemnify plaintiffs in a tort suit brought against them, and others. On appeal, defendant challenged the district court's grant of summary judgment to Allstate, concluding that Allstate did not have a duty to defend. The court held that Maryland law applied to the issue of whether Allstate had a duty to defend plaintiffs if Maryland law would apply without the choice-of-law provision in the policy; according to Maryland's lex loci contractus rule for choice-of-law decisions, California law governed the analysis of whether Allstate had a duty to defend plaintiffs in the underlying action; and the court rejected plaintiffs' argument that Allstate nonetheless owed them a duty to defend under the policy. Accordingly, the court affirmed the judgment. View "Francis v. Allstate Ins. Co." on Justia Law
Posted in: Contracts, Insurance Law, U.S. 4th Circuit Court of Appeals
Andochick v. Byrd
Plaintiff brought this declaratory judgment action, asserting that the Employee Retirement Income Security Act of 1974 (ERISA), 29 U.S.C. 1001 et seq., preempted a state court order requiring him to turn over benefits received under ERISA retirement and life insurance plans owned by his deceased ex-wife. At issue was whether ERISA prohibited a state court from ordering plaintiff, who had previously waived his right to those benefits, to relinquish them to the administrators of the ex-wife's estate. The court held that ERISA did not preempt post-distribution suits against ERISA beneficiaries because the court detected no conflict with either ERISA's objectives or relevant Supreme Court precedent. Accordingly, the court affirmed the judgment. View "Andochick v. Byrd" on Justia Law
Posted in: ERISA, Insurance Law, U.S. 4th Circuit Court of Appeals