Justia Insurance Law Opinion Summaries

Appellant was injured while working for Employer, which had an insurance policy issued by Zurich American Insurance Company. The policy included an underinsured motorist (UIM) endorsement. After settling with the tortfeasor, Appellant sought damages from the UIM coverage in the Zurich policy. After Zurich refused Appellant’s claim, Appellant sued Zurich. Ultimately, the trial court granted summary judgment in favor of Zurich on the grounds that the UIM coverage included in the policy was the result of a mutual mistake in the making of the insurance contract. The Supreme Court reversed and remanded for entry of an order granting Appellant’s motion for partial summary judgment on the issue of UIM coverage, holding that reformation of the insurance contract on the grounds of mutual mistake was improper because (1) the facts did not establish that at the time the insurance contract was formed, the minds of the contracting parties met with the common intent to execute a policy that excluded UIM coverage; and (2) Zurich did not assert the mistake or deny the existence of UIM coverage until after Appellant had released the tortfeasor. View "Nichols v. Zurich Am. Ins. Co." on Justia Law

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

Plaintiff was involved in a motor vehicle accident caused by another driver. As a result of the accident, Plaintiff sustained both bodily injury and property damage. Plaintiff carried an automobile insurance policy through United Services Automobile Association General Indemnity Company (USAA). USAA paid vehicle repair and car rental costs, after which it sought subrogation for the property damage expenses from the tortfeasor’s automobile liability insurer. Plaintiff subsequently filed an action on behalf of himself and a putative class of plaintiffs, alleging that USAA violated Montana law by seeking subrogation for property damage loss before its insured had been made whole with respect to related personal injuries. The U.S. district court certified a question to the Montana Supreme Court, which answered by holding that Montana law does not prohibit an insurer from exercising its right of subrogation under the limited, specific circumstances presented in the certified question. View "Orden v. United Servs. Auto. Ass'n" on Justia Law

Mid-Continent Casualty Company provided comprehensive general liability insurance to Scentry Biologicals, the manufacturer of NoMate, a pest control product designed to protect agricultural crops from destructive insects. Applewood Orchards purchased NoMate from Wilbur-Ellis (W-E), a distributor of NoMate, and used the product on its apple crop to protect against moths. After Applewood discovered significant moth damage, it filed a tort action against Scentry and W-E. Scentry and W-E requested that Mid-Continent defend them under Scentry’s policy. Mid-Continent agreed to defend Scentry, reserving its right to determine its coverage obligations later, but refused to defend W-E. Applewood settled with W-E, and a court ruled against Scentry and in favor of Applewood. Meanwhile, Scentry filed a declaratory judgment against against Mid-Continent seeking declaratory relief on coverage issues. W-E and Applewood intervened. The district court granted summary judgment for and awarded damages to Scentry, Applewood, and W-E. The Supreme Court affirmed, holding that the district court did not err in granting the summary judgment motions filed by Scentry, Applewood, and W-E. View "Scentry Biologicals, Inc. v. Mid-Continent Cas. Co." on Justia Law

Plaintiffs brought legal malpractice claims against Jeffrey Daniels, American Guarantee & Liability Insurance Company’s insured. American Guarantee wrongly refused to defend the claims. A default judgment was entered against Daniels, who assigned his rights against American Guarantee to Plaintiffs. Plaintiffs then brought the present action seeking to enforce American Guarantee’s duty to indemnify Daniels for the judgment. Summary judgment was awarded in favor of Plaintiffs. The Appellate Division affirmed. The Court of Appeals affirmed, concluding that American Guarantee’s breach of its duty to defend barred it from relying on policy exclusions as a defense to the present lawsuit. The Court later granted reargument, vacated its prior decision, and reversed the Appellate Division’s order, holding (1) under controlling precedent, American Guarantee was not barred from relying on policy exclusions as a defense; and (2) the applicability of the exclusions American Guarantee relied on presented an issue of fact sufficient to defeat summary judgment. View "K2 Inv. Group, LLC v. Am. Guar. & Liab. Ins. Co." on Justia Law

Filippo Gallina and his wife (Plaintiffs) commenced a personal injury action against Preferred Trucking Services Corp. Preferred Trucking was insured by County-Wide Insurance Company under a policy that required insureds to cooperate with Country-Wide in its investigation of a claim or defense against a lawsuit. The next year, Country-Wide disclaimed its obligation to defend and indemnify Preferred Trucking based upon Preferred Trucking’s refusal to cooperate in the defense. Supreme Court subsequently awarded judgment to Plaintiffs. Thereafter, Country-Wide filed this action against Preferred Trucking and Plaintiffs seeking a declaration that it was not obligated to defend and indemnify Preferred Trucking in the underlying action. Supreme Court concluded that Country-Wide was obligated to defend and indemnify Preferred Trucking. At issue on appeal was whether Country-Wide’s disclaimer was timely as a matter of law. The Appellate Court affirmed, concluding that Country-Wide’s disclaimer was untimely because it came four months after Country-Wide learned of the ground for the disclaimer. The Court of Appeals reversed, holding that Country-Wide was not obligated to defend and indemnify Preferred Trucking, as Country-Wide established as a matter of law that its delay was reasonable. View "Country-Wide Ins. Co. v. Preferred Trucking Servs. Corp. " on Justia Law

In late 2005 or early 2006, Corey Culverhouse began constructing a house for himself on a five-acre lot in Hartford. He obtained a policy from Alfa Mutual Insurance Company to insure the house during the remainder of the construction process and after construction was completed. In 2009, a minor fire damaged the kitchen of the house. Culverhouse submitted a claim to Alfa, which paid for a remediation company to clean and repair the smoke damage caused by the fire. During this process, Culverhouse moved out of the house and into a barn on his property. After about two weeks of living in the barn, Culverhouse moved into a house he was constructing for eventual sale across the road from his house. Later that year, another fire damaged the house. This time, the fire could not be extinguished, and the house, its contents, and an adjacent swimming pool were completely destroyed. Culverhouse promptly informed Alfa. Alfa immediately questioned the Culverhouse's claim because he had not submitted with his claim an inventory of the contents of the house and supporting documentation, and he had not submitted any evidence supporting the large claim he had submitted for loss of use in the two-month period prior to the second fire. Culverhouse ultimately sued Alfa for payment of the claim. A hearing on the summary-judgment motion was held on in 2013, and the trial court granted Alfa's motion and dismissed each of Culverhouse's claims; the trial court also dismissed an Alfa counterclaim as moot. Culverhouse thereafter retained a new attorney and, on moved the trial court to alter, amend, or vacate its order. The trial court granted Culverhouse's motion in part and amended its summary-judgment order so as to exclude Culverhouse's breach-of-contract claim from the judgment, leaving it as the only remaining claim in the case. Alfa's argument on appeal did not relate to the merits of Culverhouse's breach-of-contract claim. Rather, it concerned only whether the trial court acted properly by amending its summary-judgment order to resurrect that claim in response to Culverhouse's motion to alter, amend, or vacate the judgment pursuant to Rule 59(e). Finding no reversible error, the Supreme Court affirmed the trial court's decision. View "ALFA Mutual Insurance Co. v. Culverhouse " on Justia Law

Workforce Safety and Insurance ("WSI") denied Rick Brockel medical benefits and terminated his disability benefits. Upon review of Brockel's arguments on appeal, the Supreme Court concluded WSI's finding that Brockel's condition was not causally related to his work injury was supported by a preponderance of the evidence. Furthermore, the Court concluded Brockel was denied a fair hearing because he was not provided notice that one of the grounds for terminating his disability benefits would be the failure to submit medical verification of his disability. In addition, the Court concluded WSI's finding that Brockel failed to show his wage loss was the result of his compensable injury was not in accordance with the law. Therefore, the Court affirmed in part, reversed in part, and remanded the case for retroactive reinstatement of Brockel's disability benefits and for further proceedings. View "Brockel v. WSI" on Justia Law

Wellness filed a putative class action in state court seeking a declaration that the form language Allstate used in the class members' personal injury protection insurance policies did not clearly and unambiguously indicate that payments would be limited to the levels provided for in Fla. Stat. 627.736(5)(a). The district court subsequently granted Wellness' motion to remand, concluding that the value of the declaratory relief was too speculative for purposes of satisfying the Class Action Fairness Act's (CAFA), 28 U.S.C. 1332(d)(2), amount-in-controversy requirement because Allstate had failed to show that declaratory judgment in this case necessarily triggered a flow of money to plaintiffs. The court concluded, however, that Allstate had carried its burden of establishing an amount in controversy that exceeded $5 million and Wellness did not provide any evidence to rebut Allstate's affidavit or controvert its calculations. Here, the amount that would be put at issue is the amount that the putative class members could be eligible to recover from Allstate in the event that they obtain declaratory relief. Accordingly, the court reversed and remanded. View "South Florida Wellness, Inc. v. Allstate Ins. Co." on Justia Law

Plaintiffs, injured in a truck accident that killed their daughter, filed suit for additional payment under a State Farm policy insuring another vehicle (Hyundai policy) that had identical underinsured motorist (UIM) coverage as the policy insuring their truck (Ford policy). The court concluded that a reasonable person, reading the Hyundai policy in its entirety, would know the stacking of the UIM policies was prohibited. Further, the district court correctly ruled that the Hyundai policy was not illusory. Because the district court found that the Hyundai policy unambiguously precluded policy stacking, it did not address State Farm's alternative argument that the UIM "Exclusions" in the policy barred recovery for any insured other than plaintiffs. Accordingly, the court affirmed the judgment of the district court. View "Daughhetee, et al. v. State Farm Mutual Auto Ins." on Justia Law