Justia Contracts Opinion Summaries

Chad Jones sued his insurance company, Farmers Insurance Exchange, for breach of contract, bad faith breach of contract, and intentional infliction of emotional distress after Farmers denied his claim. Farmers defended by arguing that it did not breach its contract because Jones's claim was "fairly debatable." Farmers claimed this defense must be resolved through summary judgment. The district court granted Farmers' motion for summary judgment. The Supreme Court reversed, holding that the fairly-debatable defense should not be resolved through summary judgment if reasonable minds could differ as to whether the defendant's conduct measures up to the standard required for insurance claim investigations. Remanded. View "Jones v. Farmers Ins. Exch." on Justia Law

This case, which involved the summary suspension of the medical privileges of Plaintiff by Defendant, Bradley Memorial Hospital and Health Center, Inc., came to the Supreme Court for the second time. In Plaintiff's appeal, the Court reversed the judgment of the trial court granting Defendant's motion for judgment notwithstanding the verdict and denying Plaintiff's motion for punitive damages. On remand, Plaintiff was awarded punitive damages and offer of judgment interest. Defendant appealed. The Supreme Court reversed the judgment, holding that Defendant was entitled to immunity as a matter of law under the federal health Care Quality Improvement Act from money damages arising from its summary suspension of Plaintiff's privileges. Remanded with direction to render judgment in favor of Defendant. View "Harris v. Bradley Mem'l Hosp. & Health Ctr., Inc." on Justia Law

The United States District Court for the Northern District of Alabama, Eastern Division certified two questions of first impression to the Alabama Supreme Court: whether a coverage exclusion clause in an automobile insurance policy applied to the use of the vehicle used for transporting people or delivering newspapers (as part of the insured's job) was enforceable. A secondary issue was whether that exclusion applied when an accident takes place after the delivery of the last paper, "but while the insured is driving back to his point of origin or some other location." Scott and Lori Touart Thomas were injured as the result of an automobile accident; Lori had been driving. The Thomases recovered a judgment in state court against defendant Kenneth Gooden, Jr., the driver of the other vehicle. The dispute involved whether the Thomases were entitled to recover from Nationwide under the provisions of a Nationwide automobile liability insurance policy naming Gooden as an insured. Upon review, the Supreme Court concluded that the answer to the first certified question is "yes:" a clause in an automobile liability-insurance policy excluding coverage for the "use of any motor vehicle to carry persons or property for a fee" could be enforced as to an insured if the finder of fact concludes that the insured delivers newspapers for a fee and that the insured was using the covered vehicle for that purpose at the time of the accident. With regard to the second question, the Court concluded that the answer to the second certified question is "no:" a clause in an automobile liability-insurance policy excluding coverage for the "use of any motor vehicle to carry persons or property for a fee" cannot be enforced as to an insured after the delivery of the "property," i.e., newspapers in this case, is complete. View "Nationwide Mutual Ins. Co. v. Thomas" on Justia Law

At issue in this appeal was the question of an agent's authority to bind his or her principal to an arbitration agreement presented with other documents upon the principal's admission to a long-term care facility. Agent in this case was the daughter and executrix of the deceased Principal. Agent brought a claim for negligence against the long-term care facility where Principal spent the last years of her life. Invoking an arbitration agreement executed in conjunction with Principal's admission to the nursing home, Defendants moved the trial court to dismiss the complaint. The trial court denied the motion, holding that Agent, who executed the admissions agreement on behalf of Principal, had no authority to agree to arbitration. The court of appeals reversed, holding that the agreement was enforceable. The Supreme Court reversed, holding that the optional arbitration agreement Agent purported to execute on Principal's behalf was beyond the scope of Agent's authority and was therefore unenforceable. View "Ping v. Beverly Enters., Inc." on Justia Law

Jerry and Martha Garrison witnessed their son's injuries after he was struck by a car. The son died afterwards. The Garrisons filed a claim for negligent infliction of emotional distress against the owner and driver of the car. The Garrisons also served a copy of the complaint upon their insurance company, State Farm, pursuant to the uninsured motorist provisions of their policy. The policy covered damages for "bodily injury," and "bodily injury" was defined in the policy as "bodily injury to a person and sickness, disease, or death that results from it." The trial court determined that the "bodily injury" provision of the uninsured motorist statute covered mental injuries, and therefore, the policy provided, by operation of law, coverage for the Garrisons' emotional distress claim. The court of appeals reversed. The Supreme Court affirmed, holding (1) as applied to this case, "bodily injury" did not include damages for emotional harm alone; and (2) the definition of "bodily injury" in the policy did not conflict with the uninsured motorist statute. View "Garrison v. Bickford " on Justia Law

This case involved a claim by a former professional football player (the athlete) for benefits under the Maryland Workers' Compensation Act based on an injury during pre-game warm-up at the employer's stadium in Maryland. The employment agreement contained a forum selection clause providing, inter alia, that claims for workers' compensation benefits should be governed by Virginia law and that the Virginia Workers' Compensation Commission should have exclusive jurisdiction to resolve such claims. The Maryland Workers' Compensation Commission decided that it could properly exercise jurisdiction over the athlete's claim, that the athlete had sustained an accidental injury arising out of the course of his employment, and that the athlete's disability was causally related to his accidental injury. The circuit court upheld the decision. The court of special appeals affirmed. The Court of Appeals affirmed, holding (1) the forum selection clause in the employment contract was ineffective to divest the Commission of the ability to exercise jurisdiction; and (2) injuries occurring while playing and practicing professional football are accidental injuries and thus compensable under the Act. View "Pro-Football, Inc. v. Tupa" on Justia Law

Candice Brilz filed an action in Montana state court purportedly asserting statutory and common law bad-faith claims against Metropolitan General Insurance Company (Metropolitan). Metropolitan removed the action to federal court and filed a motion for summary judgment, which the federal court granted. Thereafter, Brilz commenced this suit district court seeking a determination that she may pursue her common law bad-faith claim against Metropolitan. Because the statute of limitations on that claim had since expired, Brilz requested a ruling that she may pursue the claim pursuant to 27-2-407, MCA, or the Supreme Court's doctrine of equitable tolling. The District Court dismissed the action, and Brilz appealed. The Supreme Court concluded that principles of claim preclusion barred her from filing a second action against Metropolitan arising out of the same underlying facts. Accordingly the Court affirmed the District Court's judgment. View "Brilz v. Metropolitan General Ins." on Justia Law

Ronald Bole appealed a superior court's order that affirmed an arbitration award that denied him recovery of underinsured motorist benefits. The Supreme Court allowed the appeal to determine whether the rescue doctrine allowed a volunteer firefighter responding to a crash to recover despite finding his injuries were the result of a superseding cause. Upon review, the Supreme Court concluded that Bole could not, and did not disturb the arbitrator's determination. View "Bole v. Erie Insurance Exchange" on Justia Law

The original opinion in this case was filed on June 15, 2012. Because this Texas diversity law case involved important and determinative questions of Texas law as to which there is not controlling Texas Supreme Court precedent, the panel withdrew the previous opinion and substituted the following certified questions to the Texas Supreme Court: (1) Does a general contractor that enters into a contract in which it agrees to perform its construction work in a good and workmanlike manner, assume liability for damages arising out of the contractor's defective work so as to trigger a contractual liability exclusion in a CGL insurance policy; and (2) if the exclusion is triggered, do the allegations in the underlying lawsuit alleging that the contractor violated its common law duty to perform the contract in a careful, workmanlike, and non-negligent manner fall within the exception to the contractual liability exclusion for "liability that would exist in the absence of contract." View "Ewing Constr. Co. v. Amerisure Ins. Co." on Justia Law

After its property sustained wind damage during Hurricane Katrina, a real-estate developer sued its insurance provider for coverage, and, in the alternative, its insurance agent for professional negligence. The district court decided that the insurance policy covered wind damage, and a jury decided that there had been no "mutual mistake" between the agent and the provider concerning wind coverage. As a consequence, the district court dismissed with prejudice the developer's negligence claim against its agent. The insurance provider appealed, and the Fifth Circuit Court of Appeals reversed, deciding that the policy did not cover wind damage. On remand, the developer moved under Fed. R. Civ. P. 60(b) to set aside the dismissal of its professional negligence claim against the agent in light of the reversal. The district court granted the motion and resurrected the negligence claim against the agent. The Fifth Circuit affirmed, holding that the district court did not abuse its discretion in granting the developer Rule 60(b) relief. View "Lowry Dev., LLC v. Groves & Assocs. Ins., Inc." on Justia Law