Justia Insurance Law Opinion Summaries

Child Doe brought a civil action against Mark Tully, alleging that Tully negligently sexually assaulted Doe while he was intoxicated. State Farm Fire and Casualty Company previously issued a homeowners insurance policy to Tully providing that State Farm would defend Tully from claims resulting from an “occurrence” but not from claims resulting from Tully’s intentional actions. State Farm brought this action seeking a declaratory judgment that it owed no duty to defend Tully under the policy. The trial court granted summary judgment for State Farm, concluding that Tully’s actions fell outside the scope of the policy and, therefore, State Farm had no duty to defend him under the presumption of intent established in United Servs. Auto. Ass’n v. Marburg. Tully and Doe appealed, arguing that the evidence that Tully was intoxicated at the time of the incident created a genuine issue of material fact as to whether his actions were intentional. The Supreme Court affirmed, holding that evidence of voluntary intoxication may not negate intent in duty to defend cases such as the case here. View "State Farm Fire & Cas. Co. v. Tully" on Justia Law

Plaintiffs filed suit against Mercury for breach of contract and breach of the implied covenant of good faith and fair dealing. Judgment was entered in favor of plaintiffs for $3 million plus interest from the date of judgment in the underlying personal injury action. The court concluded that substantial evidence supports the finding that Mercury unreasonably refused to accept the modified release where the offering of the policy limits was not sufficient in and of itself to defeat a bad faith claim as a matter of law, and substantial evidence supports the referee’s finding that Mercury unreasonably rejected the policy limits settlement proposed by counsel for plaintiffs. Accordingly, the court affirmed the judgment. View "Barickman v. Mercury Cas. Co." on Justia Law

Floyd Cornelison injured his back at work in 1996 while shoveling dirt. He had back surgery later that year, but it did little to improve his condition. The Board found he was permanently and totally disabled (PTD) in 2001 under the "odd-lot doctrine." TIG Insurance, the workers’ compensation insurer for Floyd’s employer, did not contest that he was PTD; it reclassified his workers’ compensation benefits as PTD in 2000. Floyd also received Social Security disability payments, and the employer received an offset for those payments. The employer and TIG challenged Cornelison's continuing eligibility for workers’ compensation, relying on surreptitious video surveillance and a doctor’s report issued after the doctor viewed an edited surveillance video. Cornelison and his wife sued TIG and a number of others involved in the attempt to terminate benefits; they alleged several causes of action, contending that the video had been purposely edited to provide a false picture of the employee’s physical abilities and that the defendants had participated to varying degrees in a scheme to defraud the Alaska Workers’ Compensation Board. The trial court granted summary judgment or dismissal as to all of the defendants on all counts. After review of the matter, the Supreme Court affirmed in part, and reversed in part. The Court concluded the Cornelisons provided enough evidence to show that a material factual dispute existed about the accuracy of the edited videos and the manner in which the videos were created. They also presented more than generalized claims of emotional distress. Because the superior court failed to address the issues in dispute in the IIED claim against certain persons involved with the making of the videos, we reverse the grant of summary judgment on this claim and remand to the superior court. The case was remanded for further proceedings. View "Cornelison v. TIG Insurance" on Justia Law

Rizvi and his company, Prime Builders, performed repair work for Alikhan, whose house was damaged in a fire. When the work was completed in 2009, Alikhan paid Rizvi only part of what he owed. Rizvi sued for breach of contract in federal court, invoking diversity jurisdiction under 28 U.S.C. 1332. (Rizvi and Prime are Illinois citizens. Alikhan is a citizen of Texas.) When Alikhan failed to appear, plaintiffs obtained a default judgment, then served a citation to discover assets on Allstate under an Illinois statute that governs supplementary proceedings to assist in collecting on a judgment. Allstate responded that Alikhan had no accounts of any sort with Allstate, had no claims pending with Allstate, and was not owed any insurance payments by Allstate. Plaintiffs then asked the court to order Allstate to remit “outstanding insurance proceeds of $110,926.58” and to impose sanctions, arguing that Allstate had participated in negotiating the repair contract and had made a partial payment to Alikhan in 2008. The court ultimately dismissed the supplemental action. The Seventh Circuit affirmed. Allstate is a citizen of Illinois, the supplemental proceeding against Allstate was sufficiently independent of the underlying case as to require its own basis for subject matter jurisdiction. View "Rizvi v. Allstate Corp." on Justia Law

An employee of NTC Transportation, Inc. (“NTC”) filed petitions with the Mississippi Workers’ Compensation Commission (“the Commission”), claiming he had suffered compensable work-related injuries on two occasions. AmFed National Insurance Co. (“Amfed”), believing NTC’s workers’ compensation coverage to have lapsed due to NTC’s failure to timely pay the premium, responded and denied both liability and coverage as to the latter injury. AmFed’s denial of coverage was litigated and culminated in a judgment rendered in NTC’s favor. Based on the applicable law and particular facts of this case, the Supreme Court found that NTC had no insurance coverage with AmFed in effect at the time of the relevant injury. Accordingly, the Court reversed and remanded. View "Amfed National Insurance Co. v. NTC Transportation, Inc." on Justia Law

In 2012, Williams visited the Van de Venters in Monroe County, Indiana. They told Williams that their labrador retriever, Emma, would ring a bell by the door if she needed to go out and he should let her out. Williams chose to walk Emma on a leash. When a neighborhood dog barked, Emma lurched toward the sound, pulling Williams to the ground and seriously injuring his shoulder. Williams sued the Van de Venters. Their AmFam home-insurance policy included personal liability coverage indemnifying them for damages for bodily injury and guaranteeing a defense against such suits. The policy contained a provision stating: “Intra-Insured Suits. We will not cover bodily injury to any ‘insured’,” defined as “any person ... legally responsible for a[n] ... animal owned by [a named insured or resident relative of a named insured] to which [the policy’s personal-liability coverages] apply.” The district court rejected AmFam’s position that these provisions relieved it of the duty to defend or indemnify. The Seventh Circuit affirmed. It would make no sense to treat Williams as if he were “legally responsible” for his own injuries resulting from the dog’s actions; he was not an insured for purposes of this incident. View "Am. Family Mut. Ins. v. Williams" 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

After a film industry worker was seriously injured on a film set, he filed suit. His employer had two primary insurance policies with Fireman’s Fund, and an excess insurance policy with Ace American. Ace American subsequently filed suit against Fireman's Fund for equitable subrogation, alleging the injured worker initially offered to settle his case within the limits of the Fireman’s Fund policies, and that Fireman’s Fund unreasonably rejected those settlement offers. Ace American alleged that as a result, it was required to contribute to the eventual settlement, which exceeded the limits of the Fireman’s Fund policies. The court found that because Ace American, the excess insurer, alleged it was required to contribute to the settlement of the underlying case due to the primary insurer’s failure to reasonably settle the case within policy limits, the lack of an excess judgment against the insured in the underlying case does not bar an action for equitable subrogation and breach of the duty of good faith and fair dealing. Accordingly, the court reversed the judgment sustaining Fireman’s Fund’s demurrer and remanded for further proceedings. View "Ace American Ins. Co. v. Fireman's Fund Ins. Co." on Justia Law

At the center of this dispute was defective rebar that was incorporated into the construction of concrete pile caps that would form support for the Pinnacle Bank Arena. Some of the pile caps had to be modified in order to provide the necessary structural support for the Arena. The general contractor paid the costs of the correction and sought reimbursement from Drake-Williams Steel, Inc. (DWS), which fabricated the rebar. DWS reimbursed the general contractor and sought coverage from its insurers. The insurers denied the claim and commenced this action to determine their obligations under the policies of insurance. The district court granted summary judgment in favor of the insurers. The Supreme Court affirmed, holding that there was no coverage under the policies. View "Drake-Williams Steel, Inc. v. Continental Cas. Co." on Justia Law