Ewing’s Undoing’s Ungluing: Appeals Court Follows Ewing And Holds That Contractual Liability Exclusion Precludes Coverage For Construction Defect Claim

In January, the Supreme Court of Texas, in easily one of the most important coverage cases of 2014, held in Ewing Construction Co. v. Amerisure Insurance Co., [ enhanced version available to lexis.com subscribers ], that the “contractual liability” exclusion, contained in a CGL policy, did...

When an Additional Insured Is the Party Seeking Coverage, Courts Must Resolve Ambiguities in a Manner Consistent With the Objectively Reasonable Expectations of the Additional Insured

Transport Ins. Co. v. Superior Court , 222 Cal. App. 4th 1216 (2014), [ enhanced version available to lexis.com subscribers ]. In Transport Insurance Co. , the California Court of Appeal held that because the additional insured was the party seeking coverage, ambiguities found in the insurance policy...

MUST READ Reservation Of Rights Case (A Top 10 Case Of 2014)

I’m capable of writing a hyperbolic headline in Coverage Opinions now and then. Really, I am. But this isn’t one of them. If you read only one article in this issue of CO , make it this one. In Builders & Exteriors, Inc. v. Mid-Continent Casualty Co., No. WD 76880 (Mo. Ct. App. Sept...

Insurer Cherry Bombs: Court Holds That Pollution Exclusion Does Not Apply To Fireworks [Yes, Fireworks]

One of the things that makes the pollution exclusion such a fan-favorite is that its applicability is sometimes tested against unusual substances, i.e., ones that don’t necessarily shout pollution when come across. For example, just since 2011, courts have addressed whether such things as aroma...

A-L-Hi To Coverage For Pre-Tender Defense Costs: ALI Principles Looking To Shift The Law

If you’ve been reading Coverage Opinions of late you’ve seen me take issue with certain aspects of the American Law Institute’s “Principles of the Law of Liability Insurance” Project. In general, my beef has been with certain proposed Principles that open the door to insureds...

Court Declares Excess Policy Triggered Based On Insured’s Own Funding To Establish Exhaustion Of Primary

I rarely address primary--excess exhaustion cases in CO . They are often too policy language specific to offer any takeaways of substance. But I address Plantation Pipe Line Company v. Highlands Ins. Co., No. 12-29 (Tex. Ct. App. Aug. 29, 2014) here, [ enhanced version available to lexis.com subscribers...

Recent Developments in California Bad Faith Law and Related Trends

By Tyler Gerking On July 29, 2014, I spoke on a panel about recent developments in California bad faith law and related trends. My co-presenter was Robert K. Scott of The Law Offices of Robert K. Scott, and we gave the presentation at ACI’s 28th National Advanced Forum on Bad Faith Claims &...

The Napa Earthquake – The Time To Think About Insurance Coverage Is Now

By David Smith Last month's Napa earthquake served as a wake-up call for everyone living and working in the Greater Bay Area. As with all natural disasters, after the immediate clean-up is over the analysis will begin as to how to make buildings safer and how to prevent and minimize injuries...

Mindful Case Management

By Dennis Cusack We recently litigated and successfully settled an insurance coverage case that offers a model for managing a case thoughtfully. Too often, parties reflexively dive into litigation with its procedural hurdles and delays, unbounded discovery, and often unnecessary motion practice, without...

U.S. High Court Refuses To Review Arbitration Ruling Arising From Crop Damage

WASHINGTON, D.C. — (Mealey's) The U.S. Supreme Court today rejected a nursery insured’s request to review the 11th Circuit U.S. Court of Appeals' refusal to vacate an arbitration award in favor of insurers in a coverage dispute over the insured's crop damage ( Campbell's Foliage...

Wisconsin Court of Appeals Provides a Lesson in Documenting the Settlement

A recent case from the Wisconsin Court of Appeals demonstrates the necessity of properly documenting the details of a settlement after agreement is reached on the amount. In Singler v. Zurich American Insurance Co. , 2014AP391, Robert Singler and Zurich American Insurance Co. agreed to settle Singler’s...

Texas Appeals Court Provides Roadmap For Punitive Damages Coverage

When it comes to the potential availability of coverage for punitive damages there is often more than meets the eye. First, the answer to the oft-asked question, whether punitive damages are insurable in such and such state, is many times provided by one word: yes or no. While one of those two answers...

Mississippi Supreme Court Provides A Clinic In Plain Meaning To Preclude Coverage [Yes, Mississippi]

It is routine for a court, setting out to resolve an insurance coverage dispute, to begin its opinion by laying out the rules that will determine its decision. And it is likely that, somewhere in the court’s recitation, will be a statement that its most important consideration is to be the language...

Dentons on Should Liability Insurance Claim Files Be Split and, If So, When?

By William T. Barker , Partner, Dentons US LLP Every liability insurance claim requires an adjuster to deal with issues relating to the plaintiff's claim against the insured: it must be evaluated and defended or settled. For purposes of this commentary, those issues are called "defense issues...

Principles Have An A.L.Eye On The “Innocent Co-Insured” Rules: Set Sights On Adoption Of The Minority Position

Lately I’ve been using the forum that Coverage Opinions provides me to take issue with certain draft sections of the American Law Institute’s “Principles of the Law of Liability Insurance” Project. In general, my beef has been that some draft Principles in chapter 3 constitute...

Another Ineffective Reservation Of Rights Case

After two years of writing Coverage Opinions I know when a case resonates with readers. A case in the last issue of CO resonated. Really resonated. The case was Advantage Builders & Exteriors v. Mid-Continent Casualty Co., No. WD 76880 (Mo. Ct. App. Sept. 2, 2014), [ enhanced version available to...

Appeals Court Makes New Law: Insurer Must Pay Interest On Settlement After 30th Day Without Payment

Singler v. Zurich American Ins. Co., No. 2014AP391 (Wis. Ct. App. Sept. 16, 2014), [ enhanced version available to lexis.com subscribers ], involves Zurich’s eve-of-trial settlement of an automobile liability claim for $1.9 million. Zurich’s attorney told the plaintiff’s attorney that...

Insurer’s Unwillingness To Sign a Protective Order In an Underlying Case Leads To Discovery Of Its Reserves

The discoverability of an insurer’s reserve information is an issue that does not come with a straightforward, yes or no, answer. The cases can involve unique facts; so their outcomes can be necessarily fact driven. That was certainly the situation in National Union Fire Insurance Co. v. H &...

Broker May Be on the Hook for Insured’s Failure to Provide Timely Notice Of a $5M Claim

When an insured is denied coverage for a claim it is not unusual for someone to suggest that the fault lies with the insured’s broker for its failure to have obtained it. [On one hand, broker liability cases are not true coverage cases. On the other hand, they are nothing short of coverage cases...

Killing Two Is Not an Accident – Three Shots at Head Not an Occurrence

After State Farm intervened in a wrongful death action the trial court granted the insurer summary judgment and found State Farm owed neither defense nor indemnity to a person who was convicted of negligently killing two people by firing three shots at a man’s head. Nathan Leinweber and John Doe...

5th Circuit Addresses Excess Insurer’s Bad Faith Claim Against Primary

Tapas: Small Dishes of Insurance Coverage News & Notes RSUI Indem. Co. v. American States Ins. Co., No. 14–30033 (5th Cir. Sept. 25, 2014), [ enhanced version available to lexis.com subscribers ], (addressing Louisiana law) (“We hold only that under the circumstances of this case...

Policy Needs Void For Fraud Language – Fake Doctor & Innocent Co-Insureds

Medical malpractice insurance is designed to protect doctors who accidentally cause injury to their patients. The insurance policy is issued based upon the truth of facts reported in applications for insurance. In Evanston Ins. Co. v. Watts , Slip Copy, 2014 U.S. Dist. LEXIS 140227 (D.S.C., Oct. 2, 2014...

Regional Steel: The Continuing Effort to Avoid the Cost of Correcting the Insured’s Work

By Eliot R. Hudson , Carl H. Poedtke III , and Stephen W. Schwab Casualty insurers normally do not expect to pay the cost of their insureds simply doing a good job. Insurers typically view their contracts as assuming the risk of delineated consequences – damages – if the insured’s...

Dentons on The Puzzle of Determining Damages in Florida UM/UIM Bad Faith Actions

By William T. Barker, Partner, Dentons US LLP A unusual Florida statute provides that damages for bad faith handling of an uninsured or underinsured motorist claim include "the total amount of the claimant's damages, including the amount in excess of the policy limits." In the context...

Appeal Court Rejects Pollution Exclusion in Oil Overflow

By Jennifer Kalnins Temple In O’Byrne et al. v. Farmers’ Mutual Insurance Company (Lindsay) , 2014 ONCA 543, the Ontario Court of Appeal has forced an insurer to pay for a fuel oil cleanup after a spill, despite a pollution exclusion clause. The case involved an “all risks”...