Montana Supreme Court: Insurer Not Bound by Insured's Settlement
December 02, 2019 —
K. Alexandra Byrd - Saxe Doernberger & Vita, P.C.In Draggin’ Y Cattle Co., Inc. v. Junkermier, et al.1 the Montana Supreme Court held that where an insurer defends its insured and the insured subsequently settles the claims without an insurer’s participation, a court may approve the settlement as between the underlying plaintiff and underlying defendant, but the settlement will not be presumed reasonable as to the insurer. Therefore, an insurer who defends its insured cannot be bound by a stipulated settlement that the insurer did not expressly consent to.
The case involved Draggin’ Y Cattle Company (the “Cattle Company”), a ranching and cattle business that utilized the services of an accounting firm, Junkermier, Clark, Campanella, Stevens, P.C. (“Junkermier”), to structure the sale of real property to take advantage of favorable tax treatment. It was discovered that Junkermier’s employee misinformed the Cattle Company’s owners of the tax consequences of the sale. The Cattle Company’s owners subsequently filed suit against Junkermier and its employee and alleged nearly $12,000,000 in damages due to the error. Junkermier’s insurer, New York Marine, provided a defense for Junkermier and its employee.
The Cattle Company’s owners offered to settle the claims against Junkermier and its employee for $2,000,000, the policy limit of the New York Marine policy. New York Marine refused to give its consent or tender the policy’s limit. Subsequently, Junkermier, its employee, and the Cattle Company entered into their own settlement agreement for $10,000,000. The settlement was contingent upon a reasonableness hearing to approve the stipulated agreement.
Read the court decisionRead the full story...Reprinted courtesy of
K. Alexandra Byrd, Saxe Doernberger & Vita, P.C.Ms. Byrd may be contacted by
kab@sdvlaw.com
Traub Lieberman Attorneys Jessica Burtnett and Jessica Kull Obtain Dismissal of Claim Against Insurance Producer Based Upon Statute of Limitations
August 20, 2019 —
Jessica Burtnett & Jessica N. Kull - Traub LiebermanTraub Lieberman Straus & Shrewsberry attorneys Jessica Burtnett and Jessica Kull successfully obtained a dismissal with prejudice on behalf of their client after oral argument for a lawsuit filed in the Circuit Court of Cook County. Mrs. Burtnett and Ms. Kull represented an insurance broker who was sued by one of its customers, a property management company, for failure to procure a correct policy of insurance that would have provided coverage for an underlying class action lawsuit asserting statutory violations.
In their motion, Mrs. Burtnett and Ms. Kull argued that the Plaintiff failed to file the lawsuit within the applicable two year statute of limitations outlined in the Illinois Insurance Producers Act 735 ILCS 5/13-214.4. Based on a recent ruling by the Illinois Supreme Court in the case of Am. Family Mut. Ins. Co. v. Krop, 2018 IL 122556, ¶ 13, reh’g denied (Nov. 26, 2018), Mrs. Burtnett and Ms. Kull argued that the statute of limitations began to accrue at the moment the allegedly non-conforming policy was delivered to the customer Plaintiff. In this case, Mrs. Burtnett and Ms. Kull argued that the subject policy was purchased and received before it became effective on November 25, 2015. Thus, at the absolute latest, the statute of limitations expired two years later on November 25, 2017. Since the lawsuit was not filed until October 4, 2018, the Plaintiff was approximately 10 months too late to assert a valid claim.
In response, the Plaintiff tried to factually distinguish the Krop case by arguing it involved a claim against a captive agent rather than a broker. Plaintiff further argued that a broker maintains a fiduciary duty to its clients and, therefore, the two year statute of limitations applied in Krop did not apply to a broker. Plaintiff also argued the Illinois Insurance Placement Liability Act was unconstitutional.
Reprinted courtesy of
Jessica Burtnett, Traub Lieberman and
Jessica N. Kull, Traub Lieberman
Ms. Burtnett may be contacted at jburtnett@tlsslaw.com
Ms. Kull may be contacted at jkull@tlsslaw.com
Read the court decisionRead the full story...Reprinted courtesy of
A Court-Side Seat: A Poultry Defense, a Houston Highway and a CERCLA Consent Decree that Won’t Budge
March 22, 2021 —
Anthony B. Cavender - Gravel2GavelFebruary saw the usual array of significant environmental decisions and federal regulatory notices.
THE FEDERAL COURTS
U.S. Court of Appeals for the District of Columbia
Luminant Generation v. EPA
The court will be grappling with a difficult venue case governed by the Clean Air Act (42 USC Section 7607(b)). In 2013, the U.S. Court of Appeals for the Fifth Circuit decided the case of Luminant Generation v. EPA (714 F. 3d 841), in which the court upheld the affirmative defenses that were made part of the Texas State Implementation Plan (SIP) and which applied to certain unpermitted emissions from regulated sources during periods of startup, shutdown or malfunction. These defenses were challenged in the Fifth Circuit and were rejected. On the national stage, EPA has been involved in litigation over these affirmative defenses and recently excluded from a “SIP Call” the Texas program, which was carved out. This EPA decision is being challenged in the DC Circuit (see Case number 20-1115),with the State of Texas arguing as an intervenor that any issues involving Texas belong in the Fifth Circuit, and not in the DC Circuit because the Act allows regional issues to be decided in the regional federal courts.
Read the court decisionRead the full story...Reprinted courtesy of
Anthony B. Cavender, PillsburyMr. Cavender may be contacted at
anthony.cavender@pillsburylaw.com
Recording “Un-Neighborly” Documents
April 03, 2019 —
Bob Henry - Snell & Wilmer Real Estate Litigation BlogIn September 2018, in Baumgartner v. Timmins, 245 Ariz. 334, 429 P.3d 567, the Arizona Court of Appeals provided further clarification on what constitutes an “encumbrance” on a property for purposes of Arizona’s statutory scheme prohibiting the recording of “false documents.” The statute, A.R.S. § 33-420, prohibits the recording of documents that a person knows to be forged, are groundless, or that contain material misstatements (or false claims). A person who claims an “interest in, or a lien or encumbrance against” real property who records such documents can be held liable for $5,000 or treble the actual damages caused by the recording (whichever is greater), A.R.S. § 33-420(A), and perhaps even be found guilty of a class 1 misdemeanor, A.R.S. § 33-420(E).
At issue in Baumgartner were neighbors fighting about CC&Rs—a typical neighborhood fight. In 2015, some of the neighbors filed suit against the Timminses for violating the CC&Rs. The Timminses did not contest the lawsuit, resulting in a default judgment. In what the Court of Appeals characterized as a lawsuit filed by the Timminses “in apparent response to the [first] lawsuit and resulting default judgment,” the Timminses created, signed, and recorded affidavits contending that the Plaintiffs in the original lawsuit were themselves “in violation of several provisions of the CC&Rs.” The Plaintiffs then filed suit again against the Timminses, this time contending that the Timminses had violated A.R.S. § 33-420 by recording the affidavits because the affidavits, the Plaintiffs contended, created encumbrances on their properties. The Apache County Superior Court agreed, and issued a final judgment nullifying the recorded documents and awarding the Timminses damages, along with their attorneys’ fees and costs.
Read the court decisionRead the full story...Reprinted courtesy of
Bob Henry, Snell & WilmerMr. Henry may be contacted at
bhenry@swlaw.com
Managing Once-in-a-Generation Construction Problems – Part II
April 03, 2023 —
Jeffrey S. Wertman - Construction ExecutivePart I of this series discussed the benefits of construction participants using alternative project delivery methods and properly addressing change order issues, rising costs and payment structure issues to manage construction during these uncertain times. Part II below explores the possibility that higher prices and steady consumer demand could lead to an increase in unscrupulous contractor practices—and how owners can mitigate that risk, managing the challenges posed by the unforeseen labor shortage and turnover in the industry and evolving your construction team for short-term and long-term success.
Higher Prices and Steady Demand
With the demand for construction projects relatively stable, contractors remaining in high demand and a surge in prices for construction materials and components, owners are under great pressure to accept less favorable construction terms. This has presented unscrupulous contractors with perceived leverage over owners and new opportunities to engage in questionable business practices and fraud. Although some contractors may seek to stretch the boundaries of a construction contract, other contractors are more deliberate. Falsifying payment applications and invoices to inflate labor or materials costs, billing for work not yet performed or materials not yet delivered to the project site and manipulating change orders are examples of illicit and fraudulent practices by contractors.
Reprinted courtesy of
Jeffrey S. Wertman, Construction Executive, a publication of Associated Builders and Contractors. All rights reserved.
Read the court decisionRead the full story...Reprinted courtesy of
Insurance Telematics and Usage Based Insurance Products
October 29, 2014 —
Robert Ansehl – White and Williams LLPThe New York State Department of Financial Services (the "DFS") issued Insurance Circular Letter No. 4 on May 27, 2014 (the “Circular Letter”). The purpose of the Circular Letter was to alert stakeholders of the DFS’ interest in obtaining information about products that use embedded telematic devices, including usage-based insurance products (“UBI”) that provide benefits to insurers and policyholders.
As data capture and transmission technology become more advanced, and as user interfaces become increasingly sophisticated, many insurers are considering UBI and other programs that rely upon telematic devices to monitor the behavioral patterns, tendencies and habits of insureds. For example, when these devices are installed in an insured's vehicle, a telematic device can gather driving data, including miles driven, the time of day the driver used the vehicle, and his/her speed, acceleration and braking patterns. This data can be captured and transmitted on a real-time basis that allows insurers to make more effective underwriting determinations and to better align pricing with an insured’s driving tendencies and the resulting attendant risks. Other insurers have applied UBI to homeowner’s insurance where, for example, smoke and other alarms and monitoring devices can monitor and transmit details regarding the resident's risk-based activities (for example, whether and how often and how long the insured uses ovens and stoves on an attended and unattended basis). This data can be used to facilitate an insurer’s ability to correlate insurance coverage decisions with the insured’s actual behavior (as opposed to self-reported behavior) as measured by sophisticated home-based telematic devices. In addition, UBI and other programs provide the data on a real-time basis, as opposed to collecting information via traditional means, principally based upon post-claim reporting. Tempering increased UBI usage are countervailing privacy and data protection concerns and risks. Regulators, insurers and consumers have significant stakes in the availability, access and applications of this information.
Read the court decisionRead the full story...Reprinted courtesy of
Robert Ansehl, White and Williams LLPMr. Ansehl may be contacted at
ansehlr@whiteandwilliams.com
Updated Covid-19 Standards In The Workplace
August 23, 2021 —
Mustafa Karim - Wilke FleuryWith California reopening, many Californians will be heading back to the workplace soon and are wondering if employers may require their employees to get vaccinated. According to the Fair Employment and Housing Act (“FEHA”), an employer may require employees to receive an FDA-approved vaccination against COVID-19 infection so long as the employer (a) does not discriminate against nor harass employees on the basis of a protected characteristic, (b) provides reasonable accommodations related to disability or sincerely-held religious beliefs, and (c) does not retaliate against anyone for engaging in protected activity.[1]
On June 15, 2021, California lifted its mask mandate across the state. The California Department of Public Health (“CDPH”) updated its guidance for the use of face coverings stating that masks are no longer required for fully vaccinated individuals.[2] However, masks are still required on public transit, indoors in k-12 schools, childcare, other youth settings, healthcare settings, long-term care facilities, correctional and detention facilities, and homeless shelters.[3]
Read the court decisionRead the full story...Reprinted courtesy of
Wilke Fleury LLP
Subcontractors Have a Duty to Clarify Ambiguities in Bid Documents
August 19, 2015 —
Craig Martin – Construction Contractor AdvisorSeveral months ago, I wrote about an escalator subcontractor that sued a general contractor, demanding payment for work completed based on approved shop drawings. The trial court agreed with the subcontractor, but the general contractor appealed. Ten months later, the Court of Appeals reversed, finding that the subcontractor had a duty to bring to the general contractor’s attention major discrepancies or errors they detect in the bid documents.
“The subcontractor failed to disclose ambiguities in the plans and must suffer the peril.”
Construction Difficulties
The subcontractor installed 32 inch escalators throughout the project, but the plans called for 40 inch escalators. The general contractor and subcontractor could not reach agreement on how the dispute should be resolved. The subcontractor sued the general to get paid for replacing the escalators and the general sued to subcontractor for concessions it had to pay to the owner.
Read the court decisionRead the full story...Reprinted courtesy of
Craig Martin, Lamson, Dugan and Murray, LLPMr. Martin may be contacted at
cmartin@ldmlaw.com
