Justia Contracts Opinion Summaries

In 2005, Applicant Michael Benson made an application to Leader Life for a life insurance policy, naming his wife Shannon, as Beneficiary. The application asked if the applicant had ever been treated for liver disease, had any medical or surgical treatment in the last five years or any departure from good health and whether or not the applicant had ever had an alcohol or drug problem. Applicant answered yes to the departure from good health question and told the insurance company that he had a blood clot in his leg 2003. Applicant answered no to the Liver disease question and no to the alcohol question. Leaders Life accepted his answers and issued the underlying policy in this action. In 2006, Applicant was on foot, pushing a stalled car out of the street when he was struck by another vehicle which eventually resulted in his death. His wife filed for benefits under the policy. Leaders investigated the claim. They received the hospital records pertaining to his death, which also noted his blood alcohol at his time of death, although the owner of the car testified that he smelled no alcohol on the applicant. After reviewing the records, Leaders Life's underwriter concluded that Applicant falsified his answers on his application and rescinded the policy due to Applicant's alcoholism. Certiorari was granted to review the Court of Civil Appeals opinion that reversed and remanding the case following a jury verdict in Applicant's favor. Leaders Life appealed the trial court and won on appellate review. After its review, the Supreme Court found that at trial, Leaders Life made clear that they believed there were material misrepresentations made by Applicant, and that he attempted to deceive them. However, the trier of fact, the jury did not find that such a misrepresentation had been made. They decided in favor of the beneficiary, and awarded her actual and in punitive damages. The Supreme Court declined substitute its judgment for that of the jury under the case law presented by this suit. Accordingly, the Court reinstated the trial court's judgment and vacated the appellate court's opinion. View "Benson v. Leaders Life Insurance Co." on Justia Law

The plaintiff-appellants, Bruce Bermel and Pamela Jurga, as husband and wife, appealed the final judgment of the Superior Court granting the motion for summary judgment of the defendant-appellee, Liberty Mutual Fire Insurance Company. The appellants contended that the Superior Court erred by granting summary judgment in favor of Liberty. Bermel was injured in an automobile accident when his personal motorcycle was struck head-on by another driver. Bermel, then an employee of the Siemens Corporation, contended that the business policy issued to Siemens by Liberty on a company car that was assigned for his business and personal use, provided him with $100,000 in underinsured motorist coverage even when he was operating a non-work vehicle in circumstances unrelated to his employment. Bermel brought this action for underinsured benefits (“UIM”) against Liberty arguing: (1) that the Liberty Policy covering the company car he used was personal to him, even though Siemens was the named insured; (2) that he was entitled to personally access the Liberty Policy because Siemens automatically deducted a nominal fee from his paycheck for his personal use of the vehicle assigned to him that was insured by the Liberty Policy; and (3) that the Liberty Policy was ambiguously drafted and should have been construed in his favor. Upon review, the Supreme Court concluded that the Superior Court correctly found Siemens, and not Bermel, to be the named insured on the Liberty Policy, that the nominal fee charged to Bermel by Siemens for the use of the car did not make Bermel a named insured under the Liberty Policy, and that the Liberty Policy was unambiguous. Therefore, the judgments of the Superior Court were affirmed. View "Bermel v. Liberty Mutual Fire Insurance Co." on Justia Law

Policyholder obtained a title insurance policy from Insurer for a parcel of property it owned. Because an ambiguity in the legal description of the property prevented Policyholder from reselling the property, Policyholder filed an action seeking a declaration of Insurer's obligations under the policy and alleging breach of contract against Insurer. The district court held in favor of Policyholder, concluding that Insurer was liable because the title to the property was unmarketable. The court, however, limited Policyholder's recovery to the face value of the policy. The court of appeals affirmed the finding of liability but held that Policyholder was entitled to recovery in excess of the policy limit. The Supreme Court (1) affirmed the district court's grant of partial summary judgment to Policyholder on the question of Insurer's liability for its failure to defend and indemnify Policyholder; but (2) reversed the court of appeals' award of damages to Policyholder in excess of the policy limit and remanded for reinstatement of the district court's award of damages. View "Mattson Ridge, LLC v. Clear Rock Tile, LLP" on Justia Law

While driving a car owned by her divorced parents, Plaintiff was hit and injured by an uninsured drunk driver. Plaintiff's father's policy specifically covered Plaintiff's car and paid Plaintiff $100,000 in uninsured motorist benefits. This amount did not fully compensate Plaintiff for her injuries, however, and Plaintiff filed a claim under her mother's policy with Farmers Mutual Insurance Company of Nebraska (Insurer). The policy did not specifically cover Plaintiff's car but covered Plaintiff as an insured. Farmers denied Plaintiff's claim for uninsured motorist benefits under an "owned-but-not-insured" exclusion in its policy. Plaintiff subsequently filed an action seeking a declaration that the "owned-but-not-insured" exclusion was void and that she was entitled to uninsured motorist benefits from Farmers. The circuit court granted summary judgment in favor of Farmers, concluding that the exclusion was valid and enforceable in relation to uninsured motorist coverage. The Supreme Court reversed, holding (1) the circuit court incorrectly applied the law when it used the Supreme Court's statements in previous cases to conclude that the exclusion was valid and enforceable under S.D. Codified Laws 58-11-9; and (2) the "owned-but-not-insured" exclusion was void in this case. View "Wheeler v. Farmers Mut. Ins. Co. of Neb." on Justia Law

In October 2003, insurance agency Plaintiff Kennedy, Lewis, Renton & Associates, Inc. ("KLR"), secured a property insurance policy with Louisiana Citizens Property Insurance Corporation ("Citizens") for Plaintiff Kirk Prest on property located in Boothville, Plaquemines Parish. Hurricane Ivan damaged Plaintiffs' buildings in 2004. Plaintiffs subsequently made repairs and undertook new construction on the property insured by Citizens. Because they were penalized for being underinsured for their losses in Hurricane Ivan, Plaintiffs wanted to ensure their property was properly covered by sufficient amounts of insurance in the future. The total amount of insurance coverage on the property was $350,000. As each phase of reconstruction and expansion was completed, Plaintiffs requested increased coverage on their buildings. There was a mistake on the form sent requesting increased coverage, in that the words "renew policy" were typed in rather than "increasing coverage." However, the comments immediately below correctly described the increased amounts of coverage on the buildings requested by the policy holder. Hurricane Katrina hit southeast Louisiana on August 29, 2005, eleven days after an August 2005 policy change request. At that time, Plaintiffs believed they had a total of $540,000 in insurance coverage on their property. The KMR insurance agent assisting Plaintiffs in requesting the coverage increases also believed Plaintiffs had coverage in that amount. In May 2006, Citizens sent a letter to Plaintiffs, advising them the policy had been reviewed and the requested increases in the policy limits would not be honored. According to Citizens, Plaintiffs only had the original $350,000 worth of coverage on their property. Plaintiffs filed suit against Citizens, seeking payment of the full policy amounts, including the amount of the requested coverage increases, attorney fees and penalties. In the alternative, Plaintiffs also sought recovery from KLR. After engaging in pretrial discovery, Plaintiffs and Citizens entered into a settlement agreement in late 2008. Without admitting liability, Citizens settled the claims against it for a total of $540,000 from Citizens. After trial on the merits against KLR, the trial court rendered judgment in favor of Plaintiffs, finding KLR was negligent in its handling of its clients' requests for coverage increases. KLR appealed both the finding of liability and the award of damages. The appellate court agreed with the trial court's finding of negligence in part, holding there was manifest error in the trial court's finding the insurance agency failed to exercise reasonable diligence with regard to a July 2005 request for increased coverage. The Supreme Court granted KLR's writ, primarily to determine the correctness of the trial court's award of general damages. After review, the Supreme Court found that the trial court abused its discretion in awarding general damages and reversed that portion of the damage award. View "Prest v. Louisiana Citizens Property Insurance Corp." on Justia Law

At issue in this appeal was whether an action for negligence and breach of contract lies against an insurance broker for failure to procure adequate insurance coverage where the insured receive the policy without complaint. Plaintiff commenced this action against its broker for negligence and breach of contract in connection with Defendant's procurement of insufficient insurance. Supreme Court denied Defendant's motion for summary judgment, finding that issues of fact existed as to Plaintiff's request for specific coverage. The Appellate Division reversed, concluding that Plaintiff's failure to read and understand the policy precluded recovery in this action. The Court of Appeals reversed, holding (1) because there were issues of fact as to whether Plaintiff requested specific coverage for its employees and whether Defendant failed to secure a policy as requested, summary judgment was inappropriate in this matter; and (2) Plaintiff's failure to read and understand the policy should not be an absolute bar to recovery under the circumstances of this case. View "Am. Bldg. Supply Corp. v. Petrocelli Group, Inc." on Justia Law

Plaintiffs were injured when their vehicle was struck by a vehicle driven by Ida Trayter. Trayter's insurer tendered its liability limits, after which Plaintiffs sought underinsured motorist coverage from their insurer, State Farm. State Farm advised Plaintiffs that its settlement offer would be based on the "net" value of the claim after reduction of the liability limits and medical payments already received by Plaintiffs. Plaintiffs filed suit against State Farm seeking a declaratory judgment that a non-duplication provision and reimbursement provision in State Farm's underinsured motorist policy violated W. Va. Code 33-6-31(b). The circuit court granted partial summary judgment to Plaintiffs, finding both provisions at issue violated the statute. The Supreme Court reversed, holding (1) a non-duplication of benefits provision in an underinsured motorist policy, which permits an insurer to reduce an insured's damages by amounts received under medical payments coverage, does not violate the "no sums payable" language of section 33-6-31(b), and the circuit court erred in holding otherwise; and (2) the circuit court's consideration of and entry of summary judgment on the reimbursement provision was erroneous because the provision was not ripe for adjudication in this matter. View "State Farm Mut. Auto. Ins. Co. v. Schatken" on Justia Law

This case involved a district court's denial of coverage under a fire insurance policy. A husband and wife had an insurance policy on their home. The policy included an intentional loss exclusion, voiding coverage when any insured intentionally causes a loss or damage. The district court denied coverage because the husband attempted suicide by pouring gasoline on himself and his home and lit himself on fire. The Supreme Court affirmed, holding (1) a coinsured who sets fire to the insured dwelling in order to commit suicide has the requisite intent to "cause a loss" under the policy; (2) under the language of the policy, the innocent coinsured spouse, who did not participate in the intentional acts of the other coinsured, cannot recover due to the intentional loss exclusion; and (3) the innocent coinsured cannot recover under the recently amended Iowa standard fire policy in Iowa Code 515.109. View "Postell v. Am. Family Ins. Co." on Justia Law

Plaintiff was injured in an automobile accident with Stephen Stanton. At the time, Plaintiff was operating a vehicle owned by his employer, Bambardier Aerospace Corporation, and Stanton was driving a vehicle owned by his employer, the City of Elkins. Plaintiff and his wife filed an action against the City and Stanton to recover for injuries. Plaintiffs' personal automobile insurer, Westfield Insurance, filed a crossclaim against the City and Stanton and a third party claim against Bombardier and National Union Fire Insurance. The trial court entered an order finding (1) the City, Stanton, and National were immune from liability; (2) Bombardier and Westfield were subject to a payment of damages of not more than $20,000 each; and (3) Plaintiffs were not entitled to auto medical coverage under the policy covering Bombardier and the policy issued by Westfield. The Supreme Court (1) reversed the circuit court's order to the extent it held the uninsured motorist policies for Bombardier and Westfield were not enforceable above the mandatory limits of uninsured motorist coverage required by W. Va. Code 33-6-31; (2) reversed the court's order to the extent it denied Plaintiffs auto medical payment benefits under Bombardier's policy; and (3) affirmed the remainder of the court's judgment. View "Jenkins v. City of Elkins" on Justia Law

Petitioner, New Hampshire Insurance Company, appealed an order of the circuit court granting partial summary judgment in favor of Respondent, RRK, Inc., finding that pursuant to the commercial marine property insurance policy issued by New Hampshire, RRK's barge and the barge's contents were covered property under the policy and that a wear-and-tear exclusion in the policy was invalid. The Supreme Court affirmed in part and reversed in part, holding (1) the circuit court correctly found that there was no question of fact regarding whether a renewal policy was mailed to and received by RRK; but (2) the circuit court erred by granting partial summary judgment in favor of RRK because there was a question of fact as to whether, under the doctrine of reasonable expectations, the wear-and-tear exclusion present in the policy mailed to RRK was part of the insurance contract. Remanded. View "N.H. Ins. v. RRK., Inc." on Justia Law