Justia Insurance Law Opinion Summaries

Plaintiffs sued World Harvest Church (WHC) for claims arising from an incident involving Plaintiffs’ two-year-old son, who attended WHC’s daycare. Plaintiffs alleged that WHC’s employee had beaten their son with a knife. Final judgment was entered in favor of Plaintiffs in the amount of $2.87 million. The court of appeals affirmed. WHC subsequently filed suit against Grange Mutual Casualty Company, which insured WHC under a commercial liability insurance policy and an umbrella policy and had defended the matter but reserved its right to deny coverage. Plaintiffs alleged that Grange improperly refused to indemnify it for any portion of the judgment awarded to Plaintiffs. The trial court entered judgment in favor of WHC, finding that Grange was obligated to indemnify WHC in the amount of $1.47 million but that Grange was not responsible to indemnify WHC for the punitive damages awarded to Plaintiffs. The Supreme Court reversed, holding (1) the abuse or molestation exclusion in the commercial liability insurance policy barred coverage for an award of damages based on WHC’s vicarious liability for intentional infliction of emotional distress arising from WHC’s employee’s abuse of Plaintiff’s son while in WHC’s care and custody; and (2) the policy did not provide coverage for an award of attorney fees and postjudgment interest. View "World Harvest Church v. Grange Mut. Cas. Ins. Co." on Justia Law

Mark Ibsen, Inc., the owner and operator of the Urgent Care Plus medical clinic in Helena, purchased health insurance coverage for its employees from Blue Cross and Blue Shield of Montana (BCBSMT) through a Chamber of Commerce program. Health Care Corporation (Health Care) subsequently acquired BCBSMT’s health insurance business and changed its name to Caring for Montanans, Inc. (Caring). Less than one year later, Ibsen filed a complaint and class action against Caring and Health Care claiming that they had violated the Unfair Trade Practices Act (UTPA). Health Care filed a motion to dismiss and Caring filed a motion for summary judgment. The district court granted the motions, concluding that the legislature did not provide private citizens with the right to bring a cause of action to enforce the UTPA. The Supreme Court affirmed, holding (1) Ibsen may not maintain a private right of action for violation of Mont. Code Ann. 33-18-208 and -212 of the UTPA; and (2) in the alternative, Ibsen’s claims cannot be sustained as common law claims. View "Mark Ibsen, Inc. v. Caring for Montanans, Inc." on Justia Law

Powers drove through a stop sign and caused a four-vehicle accident. The plaintiffs suffered personal injuries. Trotter was the driver of the vehicle; Jackson and Petrie were passengers. Powers was insured under a policy with liability limits of $250,000 per person and $500,000 per accident. The plaintiffs settled with Powers’s insurer for the per-accident limit of $500,000; Trotter received $250,000 and Jackson and Petrie split the remaining $250,000. The plaintiffs believed that the settlement did not make them whole and submitted claims to Harleysville, Trotter’s insurer under a policy that provides that Trotter and any occupant of his vehicle is an “insured” for purposes of underinsured motorist coverage. The policy's declaration page states that underinsured motorist coverage is limited to $500,000 for “each accident.” Because the plaintiffs had together already recovered $500,000 under the Powers policy, Harleysville denied their claims, concluding that Powers was not an “underinsured motorist.” The plaintiffs argued the policy can reasonably be construed to mean that the $500,000 limit applies on a per-person, rather than a per-accident, basis. The court entered summary judgment in favor of Harleysville. The Seventh Circuit affirmed, finding that the policy unambiguously states that coverage is subject to a $500,000 per-accident maximum, regardless of the number of insureds involved. View "Trotter v. Harleysville Ins. Co." on Justia Law

The Glidden Company - now known as Akzo Nobel Paints LLC (ANP) - made, marketed, and sold lead paint. Based on a 1986 purchase agreement, Millennium Holdings LLC, which Appellant insurance companies insured, and its predecessors were required to indemnify ANP and its predecessors from 1986 to 1994. In turn, ANP and its predecessors were required to indemnify Millennium and its predecessors from 1994 onward. Beginning in 1987, a number of lead paint related lawsuits were filed against the predecessors of Millennium and ANP (the lead cases). Appellants satisfied Millennium’s obligations pursuant to monetary settlements reached in the cases. Appellants subsequently commenced this action against ANP seeking to be subrogated to the right of Millennium to indemnification against ANP. Supreme Court determined that the antisubrogation rule prohibited Appellants' right of subrogation. The Appellate Division affirmed. The Court of Appeals reversed, holding that there was no reason to apply to antisubrogation rule under the facts of this case, and therefore, the courts below erred in granting summary judgment for ANP on that basis. View "Millennium Holdings LLC v. Glidden Co." on Justia Law

Craig Smith, who suffered injuries in a motor vehicle accident, submitted an underinsured motorist coverage (UIM) claim to his insurer, Allstate Insurance Company. Allstate denied the claim because Smith’s policy did not provide for UIM coverage. Smith sued Allstate for breach of contract and a declaration of rights as to UIM coverage. The trial court granted summary judgment for Allstate because Smith had not paid a premium for UIM or requested UIM coverage. The court of appeals reversed, finding that Allstate had a duty under the Kentucky Motor Vehicle Reparations Act (MVRA) to advise Smith of possible UIM coverage. The Supreme Court reversed the decision of the court of appeals and reinstated the trial court’s judgment, holding that Allstate had no affirmative duty under the MVRA to notify or counsel Smith on the availability of UIM coverage. View "Allstate Ins. Co. v. Smith" on Justia Law

Roger and Carrie Peters and Daggin’ Y Cattle Company (collectively, Peters) filed a complaint against Junkermier, Clark, Campanella, Stevens, P.C. and Larry Addink (collectively, Junkermeir) alleging multiple counts stemming from tax services Junkermier performed for Peters. New York Marine, which insured Junkermier under a professional liability policy, defended Junkermeir subject to a reservation of rights. Peters and Junkermeir eventually entered into a settlement agreement and stipulation for entry of judgment without New York Marine’s participation, and the district court scheduled a hearing on the stipulated settlement’s reasonableness. The district court allowed New York Marine to intervene. After a hearing, the district court found that the stipulated settlement amount was reasonable, entered judgment in Peters’s favor, and ordered that Junkermier was not liable for the stipulated settlement. New York Marine appealed, asserting for the first time that the district court judge erred by not disclosing an apparent conflict of interest. The Supreme Court dismissed the appeal without prejudice pending referral to a district judge for hearing on New York Martine’s request for disqualification for cause, holding (1) New York Marine did not waive its disqualification claim; and (2) the presiding judge should have disclosed circumstances that could potentially cause the judge’s impartiality reasonably to be questioned. View "Draggin’ Y Cattle Co. v. Addink" on Justia Law

This matter stemmed from a public works project for the construction of a gymnasium in Terrytown. JaRoy Construction Inc. served as the general contractor, and pursuant to statute, furnished a surety bond to Jefferson Parish. Ohio Casualty Insurance Company was the surety. JaRoy entered into a written subcontract with Pierce Foundations, Inc. to provide and install pilings for the project. Once finished, Pierce alleged JaRoy failed to pay certain funds due under the subcontract. Pierce sued both JaRoy and Ohio Casualty Insurance, alleging they were jointly and severally liable to Pierce. JaRoy filed for bankruptcy, leaving only Ohio Casualty Insurance as party to the suit. When the project was substantially completed, the Jefferson Parish government filed a notice of acceptance of work with the Jefferson Parish mortgage records office. This occurred over a year after Pierce amended its lawsuit to add Ohio Casualty as a defendant. Pierce never filed a sworn statement of claim in the mortgage records. Ohio Casualty filed a motion for summary judgment, contending that Pierce was required to comply with statutory notice and recordation, and because it failed to do so within 45 days of Jefferson Parish’s acceptance of the project, Pierce could not recover from Ohio Casualty. Pierce argued that the statute did not affect its right to proceed in contract. After a bench trial, the trial court rendered judgment in favor of Pierce for sums owed under the contract plus judicial interest from the date of the original judgment. Ohio Casualty appealed, arguing that the trial court erred in not dismissing Pierce's claims. The court of appeal reversed and ruled in Ohio Casualty's favor. The Supreme Court, however, disagreed and affirmed the trial court judgment. View "Pierce Foundations, Inc. v. JaRoy Construction, Inc." on Justia Law

At issue in this case was whether two companies (the Insureds) were entitled to coverage under additional excess policies issued to their predecessor by the Excess Insurers and, if so, how indemnity should be allocated across the triggered policy periods. The Delaware Court of Chancery granted summary judgment for the Insureds with respect to the availability of coverage and the allocation of liability under the excess policies, concluding that New York law applied to the dispute, that the Insureds were each entitled to coverage under the excess policies, and that the proper method of allocation was the all sums approach, as compared with the pro rata allocation method propounded by the Excess Insurers. After a trial, the Delaware Superior Court entered judgment largely in the Insureds’ favor. On appeal, the Delaware Supreme Court concluded that resolution of the parties’ disputes over allocation and exhaustion depended on unsettled questions of New York law. The Court of Appeals answered (1) under New York law, the contract language of the applicable insurance policies controlled the questions certified to the Court; (2) all sums allocation was appropriate based on the language of the policies at issue here; and (3) vertical, rather than horizontal, exhaustion was required before the excess policies attached. View "In re Viking Pump, Inc." on Justia Law

Federated Mutual, the insurer, filed an interpleader suit to determine the rights of Moody Station and the Big Store to insurance proceeds. The district court found Moody Station was not entitled to the full amount and awarded attorney fees to Federated. The court concluded that Moody Station is correct that there is no jurisdiction under 28 U.S.C. 1335’s interpleader because the two adverse claimants are both citizens of Missouri. The court determined that diversity jurisdiction exists in this case because there is diversity of citizenship and the amount in controversy is met. Although the district court did not explicitly find a partial loss, the district court implicitly rejected that a total loss occurred. In this case, the district court did not clearly err in determining the actual cash value of the destroyed property. The court concluded, however, that the district court clearly abused its discretion in ordering Moody Station to pay attorney fees to Federated where Federated has consistently opposed Moody Station’s attempts to collect on its policy and is not a disinterested stakeholder deserving attorney fees. Accordingly, the court affirmed in part, reversed in part, and remanded. View "Federated Mutual Ins. Co. v. Moody Station and Grocery" on Justia Law

In 2007, the Sonoma County project’s owner sued Hearn, the general contractor, Second Generation, the roofer, and other subcontractors for design and construction defects. Hearn cross-complained against Second Generation and others. In 2009, Hearn assigned its interests under its subcontracts to two insurers, North American and RSUI. Hearn then settled with the owner and all but two subcontractors, one of which was Second Generation. Hearn filed an amended cross-complaint, purportedly in the name of the insurers, against those subcontractors, adding breach of a contractual obligation to obtain insurance and seeking equitable contribution for Hearn’s defense costs premised on a breach of that duty. In 2013, the court dismissed the cross-complaint against Second Generation on procedural grounds, awarded $30,256.79 in costs and granted prevailing party attorney fees of $179,119. Second Generation moved to amend the orders to name North American as a judgment debtor owing the amounts awarded against Hearn. The trial court denied the motion, stating: Hearn remains the only proper party and that the subcontractor’s exclusive remedy was to pursue a separate action against Hearn’s insurers. The court of appeal reversed, finding that, after the assignment, Hearn was “out of this case.” View "Hearn Pac. Corp. v. Second Generation Roofing, Inc." on Justia Law