Staying the Course, Texas Supreme Court Rejects Insurer’s Argument for Exception to Eight-Corners Rule in Determining Duty to Defend
April 27, 2020 —
John C. Eichman, Sergio F. Oehninger, Grayson L. Linyard & Leah B. Nommensen - Hunton Insurance Recovery BlogIn responding to a certified question from the Fifth Circuit in Richards v. State Farm Lloyds, the Texas Supreme Court held that the “policy-language exception” to the eight-corners rule articulated by the federal district court is not a permissible exception under Texas law. See Richards v. State Farm Lloyds, 19-0802, 2020 WL 1313782, at *1 (Tex. Mar. 20, 2020). The eight-corners rule generally provides that Texas courts may only consider the four corners of the petition and the four corners of the applicable insurance policy when determining whether a duty to defend exists. State Farm argued that a “policy-language exception” prevents application of the eight-corners rule unless the insurance policy explicitly requires the insurer to defend “all actions against its insured no matter if the allegations of the suit are groundless, false or fraudulent,” relying on B. Hall Contracting Inc. v. Evanston Ins. Co., 447 F. Supp. 2d 634, 645 (N.D. Tex. 2006). The Texas Supreme Court rejected the insurer’s argument, citing Texas’ long history of applying the eight-corners rule without regard for the presence or absence of a “groundless-claims” clause.
The underlying dispute in Richards concerned whether State Farm must defend its insureds, Janet and Melvin Richards, against claims of negligent failure to supervise and instruct after their 10-year old grandson died in an ATV accident. The Richardses asked State Farm to provide a defense to the lawsuit by their grandson’s mother and, if necessary, to indemnify them against any damages. To support its argument that no coverage under the policy existed, and in turn, it had no duty to defend, State Farm relied on: (1) a police report to prove the location of the accident occurred off the insured property; and (2) a court order detailing the custody arrangement of the deceased child to prove the child was an insured under the policy. The federal district court held that the eight-corners rule did not apply, and thus extrinsic evidence could be considered regarding the duty to defend, because the policy did not contain a statement that the insurer would defend “groundless, false, or fraudulent” claims. In light of the extrinsic police report and extrinsic custody order, the district court granted summary judgment to State Farm.
Reprinted courtesy of Hunton Andrews Kurth attorneys
John C. Eichman,
Sergio F. Oehninger,
Grayson L. Linyard and
Leah B. Nommensen
Mr. Oehninger may be contacted at soehninger@HuntonAK.com
Mr. Linyard may be contacted at glinyard@HuntonAK.com
Ms. Nommensen may be contacted at leahnommensen@HuntonAK.com
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Rhode Island Sues 13 Industry Firms Over Flawed Interstate Bridge
September 23, 2024 —
Richard Korman - Engineering News-RecordIn an attempt to recoup any money Rhode Island will owe to others for rerouting traffic on half of a high-volume interstate bridge in Providence after structural flaws had been detected, the state Dept. of Transportation filed a lawsuit Aug. 16 against 13 engineers and contractors that had inspected or performed work on the Washington Bridge in the last decade.
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Richard Korman, Engineering News-Record
Mr. Korman may be contacted at kormanr@enr.com
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Traub Lieberman Partner Colleen Hastie and Associate Jeffrey George Successfully Oppose Plaintiff’s Motion to Vacate Dismissal
September 11, 2023 —
Colleen E. Hastie & Jeffrey George - Traub LiebermanTraub Lieberman Partner Colleen Hastie and Associate Jeffrey George successfully opposed Plaintiff’s motion to vacate a prior dismissal of plaintiff’s medical malpractice action brought before the Supreme Court of the State of New York, Bronx County.
The lawsuit, commenced by Plaintiff in 2015, alleged medical malpractice stemming from treatment Plaintiff received at a New York medical facility after falling out of a window at a rental property owned by Traub Lieberman’s client (“Property Owner”). Property Owner moved to dismiss Plaintiff’s complaint or preclude Plaintiff from offering evidence in support of its claims, or in the alternative, compel plaintiff to produce all outstanding discovery. The Medical Facility cross-moved for the same relief. Defendants agreed to adjourn the motion until after plaintiff’s deposition, but plaintiff made no effort to secure an adjournment with the court and plaintiff filed no opposition to the motion, allowing the motion to be granted on default. Plaintiff waited nearly a year to file a motion to vacate the default judgment, despite receiving notification of the default from defense counsel. Property Owner, in opposing plaintiff’s motion, pointed to plaintiff’s long history of dilatory conduct and failure to comply with discovery orders in support of its position that plaintiff failed to show any good cause for its default on the motion to dismiss.
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Colleen E. Hastie, Traub Lieberman and
Jeffrey George, Traub Lieberman
Ms. Hastie may be contacted at chastie@tlsslaw.com
Mr. George may be contacted at jgeorge@tlsslaw.com
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A New Digital Twin for an Existing Bridge
May 01, 2023 —
Aarni Heiskanen - AEC BusinessThe smartBRIDGE Hamburg project devised a digital twin of a 1970s bridge using open BIM technologies. Allplan and Solibri were instrumental in developing the twin that enables the Hamburg Port Authority, HPA, to maintain the critical infrastructure asset predictively.
Built in 1974, the Köhlbrand Bridge is Germany’s second-longest road bridge and one of its busiest. The cable-stayed bridge serves around 36,000 vehicles daily, thus being crucial to the local economy.
The age of the bridge and the amount of daily traffic it supported meant that continuous real-time monitoring was the best way to identify repairs and minimize disruption to traffic.
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Aarni Heiskanen, AEC BusinessMr. Heiskanen may be contacted at
aec-business@aepartners.fi
Insureds' Summary Judgment Motion on Mold Limitation Denied
November 10, 2016 —
Tred R. Eyerly – Insurance Law HawaiiThe insureds' motion for partial summary judgment on the applicability of the homeowner's mold limitation was denied. R.W.& R. v. Liberty Mutual Fire Ins. Co., 2016 U.S.Dist. LEXIS 131586 (W.D. Wash. Sept. 26, 2016).
The policy imposed a $5,000 limit on losses caused by mold. Plaintiffs discovered that their dishwasher was leaking and reported the loss to Liberty. Liberty's contractor concluded that the bottom of the dishwasher had rusted out, causing water to seep into parts of the kitchen and the laundry/utility room below. The contractor used dehumidifiers to extract moisture from the affected areas and removed damaged cabinetry, drywall and tiling. The contractor discovered mold that it believed predated the dishwasher leak. Although the contractor took steps to remove the mold, its dehumidification efforts exacerbated the problem by dispersing mold spores throughout portions of the house.
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Tred R. Eyerly, Insurance Law HawaiiMr. Eyerly may be contacted at
te@hawaiilawyer.com
New York Bars Developers from Selling Condos due to CD Fraud Case
October 15, 2014 —
Beverley BevenFlorez-CDJ STAFFAccording to GlobeSt, New York “Attorney General Eric T. Schneiderman has announced a settlement agreement that bars developers Joseph Scarpinito and Shiraz Sanjana—and five affiliated entities they own and operate—from offering or selling securities, including condo and coop sales, in or from New York State.”
The settlement is in “result of an investigation by the Attorney General’s real estate finance bureau into allegations of fraud by the developers of the Mirada, an eight-story Harlem condominium.” GlobeSt also stated that the agreement “provides for binding arbitration with the condo purchasers for alleged construction defects, and requires the developers to pay $500,000 in penalties and fines to New York State.”
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Supreme Court Opens Door for Challenges to Older Federal Regulations
August 05, 2024 —
Jane C. Luxton - Lewis BrisboisWashington, D.C. (July 1, 2024) – On July 1, 2024, the U.S. Supreme Court issued another end-of-term major decision limiting the scope of federal agency actions in Corner Post, Inc. v. Board of Governors of the Federal Reserve System. Adding to the tectonic shift in the regulatory landscape created by the Court’s June 27 and 28 rulings constraining the role of administrative law judges and overturning longstanding “Chevron deference” by courts to federal agency expertise, the decision in Corner Post establishes a newly expanded time frame for affected entities to challenge final agency action. Instead of confirming that final agency action is subject to a default six-year statute of limitations, the Court held that under the Administrative Procedure Act (APA), the time limit for appeal begins to run when a plaintiff is injured by the agency's action, not when the action becomes final. This decision has important implications for businesses and others affected by federal regulations.
The case arose when Corner Post, a truck stop and convenience store in North Dakota that opened in 2018, challenged a 2011 Federal Reserve Board regulation (Regulation II) that set maximum interchange fees for debit card transactions. Corner Post filed suit in 2021, arguing that Regulation II allowed higher fees than permitted by statute. The lower courts dismissed the suit as time-barred under 28 U.S.C. § 2401(a), which effectively requires APA claims to be filed "within six years after the right of action first accrues."
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Jane C. Luxton, Lewis BrisboisMs. Luxton may be contacted at
Jane.Luxton@lewisbrisbois.com
OSHA Issues Fines for Fatal Building Collapse in Philadelphia
November 27, 2013 —
CDJ STAFFThe Occupational Safety and Health Administration has issued $400,000 in fines to two contactors who were involved with the collapse of a building in Philadelphia. Six people died and 14 more were injured in an adjacent building. OSHA concluded that the two firms, Campbell Construction and S&R Contracting, violated workplace safety regulations 12 times in their demolition of the building.
According to OSHA, Campbell Construction removed structural supports and portions of the lower floors of the building while upper stories were still being demolished. Both firms failed to provide its workers with fall protection equipment.
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