Interpreting An Insurance Policy

ERISA And Contributing To Impairment

March 12, 2015 | Mark S. Humphreys

North Richland Hills insurance lawyers who handle ERISA claims need to read the 2015, 5th Circuit Court of Appeals opinion styled, George v. Reliance Standard Life Insurance Company. There are a couple of issues in the case but only the issue in the title above will be discussed here.

George served as an Army helicopter pilot. In 1985 George was injured in a helicopter crash, and doctors were forced to amputate one of his legs at the knee. George retired in 1987. After retiring, George began flying helicopters for PHI, Inc. PHI purchased a long-term disability insurance policy for George from Reliance (“RSL”). George flew for PHI for more than twenty years. But in 2008 he began experiencing severe pain at the site of his amputation, which prevented him from safely wearing his prosthetic limb. As a result, he was no longer able to operate the foot controls of a helicopter, and he was forced to retire from flying. George filed a claim for long-term disability benefits with RSL.

The Policy contains two definitions of “Totally Disabled” and “Total Disability,” which apply during different time periods. The Policy also contains a relevant limitation provision (the “Exclusion Clause”). The Exclusion Clause provides that “Monthly Benefits for Total Disability caused by or contributed to by mental or nervous disorders will not be payable beyond an aggregate lifetime maximum duration of twenty-four (24) months.” The Policy defines “Mental or Nervous Disorders” to include “anxiety disorders” and “mental illness.”

Insurance And Maintaining Vehicle

February 3, 2015 | Mark S. Humphreys

Fort Worth insurance lawyers need to be able to understand when coverage is afforded under a policy and when it is not. A 1994, Dallas Court of Appeals case is a good opinion to know about. It is styled, Nationwide Property & Casualty v. McFarland. Here is the relevant information from that case.

Nationwide and McFarland both filed motions for summary judgment. After a hearing, the trial court granted McFarland’s motion and denied Nationwide’s. In this appeal Nationwide argued the trial court erred in granting summary judgment for McFarland and denying Nationwide’s motion because Mashewske was not a “covered person” under the policy. This Appeals Court disagreed and upheld the trial court ruling.

McFarland was working underneath his Toyota. The car was sitting up on jacks. While McFarland was underneath the car, Mashewske got in the car to see if it would start. When Mashewske shifted the car into neutral, it rolled backward, fell off the jacks, and landed on McFarland. McFarland sustained injuries from the accident.

Insurance Company Duty To

February 1, 2015 | Mark S. Humphreys

Irving insurance lawyers will tell you that an insurance company’s duty to defend one of their insureds in a lawsuit depends on several factors. This is discussed in a 1997, Austin Court of Appeals opinion styled, State Farm v. White.

State Farm filed a suit for declaratory judgment that it owed no duty to defend its insureds.

Sean and Sandra Nash, sued numerous defendants, including White, on behalf of themselves and their minor children, for the sexual abuse of their children which occurred at the day care center operated by Daniel Keller and his wife, Francis Keller. The lawsuit papers allege that Daniel Keller physically and sexually abused the Nash children, as well as other children attending the day care center, while the children were in the center’s care and custody. Such abuse occurred on a regular basis throughout the Nash children’s attendance at the facility. The petition further alleges that the children were taken from the day care center’s premises to other nearby locations where Daniel Keller abused them and sometimes allowed others to witness or participate in the abuse.

Pollution Exclusions

January 31, 2015 | Mark S. Humphreys

Dallas insurance lawyers need to have some familiarity with pollution exclusions in insurance policies. A 1998, Texarkana Court of Appeals case is worth reading. The style of the case is, Allen v. St. Paul Fire & Marine Insurance Company. Here is some information from that case.

This appeal arises from a summary judgment rendered in favor of St. Paul in an insurance coverage dispute. The Allens sued St. Paul based on the judgment in a suit by the Allens against Tawakoni Water Utility Corp. The underlying suit alleged damages arising out of Tawakoni’s failure to provide “potable” water, “good quality” water, water “reasonably fit for family residential use,” or water “approved and/or certified by the appropriate State of Texas and federal authorities.” The Allens also alleged that the water received was of “unpalatable quality,” “unfit for human consumption and/or use,” and that the water was contaminated.

St. Paul, an insurer of Tawakoni, denied coverage and refused to provide a defense for Tawakoni. St. Paul based its denial of coverage on pollution exclusions. Following a bench trial, a judgment of $17,326,174 was rendered in favor of the Allens.

Farm And Ranch Owners Insurance Policy

January 17, 2015 | Mark S. Humphreys

Parker County insurance lawyers will deal with clients who have Farm and Ranch insurance policies. Here is a case that deals with one of those policies. It is a 2014 case styled, Texas Farm Bureau Underwriters v. Terry Graham, and is out of the Texarkana Court of Appeals. Here is some of the relevant information.

Terry Graham shot and killed would-be burglar, Chambers, at Graham’s ranch house. In successfully defending the resulting wrongful death lawsuit by Chambers’ family members, Graham incurred $130,841.43 in defense costs, which Graham sought to recover from Texas Farm Bureau Underwriters (Underwriters), the issuer of Graham’s Texas Farm and Ranch Owner’s Insurance Policy. From competing motions for summary judgment, contesting the question of whether Underwriters had the duty to defend Graham in the Chambers lawsuit, the trial court awarded Graham judgment. Underwriters appealed. Because, under the terms of the policy, there was no duty to defend the Chambers lawsuit, this curt reversed the trial court’s judgment and render a take-nothing judgment in favor of Underwriters.

Underwriters filed a legal denial based on the governing “eight corners rule,” which provides that an insurer is entitled to rely solely on the factual allegations contained in the four corners of the complaint in conjunction with the four corners of the liability policy to determine whether it has a duty to defend. In its answer, Underwriters argued that the eight corners rule precluded recovery because (1) the Chambers family’s petition established that the incident was not a covered occurrence and (2) the policy expressly excluded coverage for bodily injury caused by an intentional act of the insured. Underwriters filed a traditional motion for summary judgment on its legal defense. In response, Graham filed a cross-motion for summary judgment, arguing (1) that Underwriters’ duty to defend was established by the jury’s finding of no wrongdoing on Graham’s part and (2) that the policy’s exclusion for intentional acts did not apply to the Chambers family’s allegations of negligence and gross negligence.

Exclusion For Recreational Vehicle

January 13, 2015 | Mark S. Humphreys

Mineral Wells insurance attorneys handling home owners claim will someday see something similar to the issued dealt with in this 2014, opinion. The opinion was issued by the Houston Court of Appeals [1st Dist.]. The style of the case is, Oleksy v. Farmers Insurance Exchange. Here is the relevant information.

In 2007, Oleksy went snowmobiling in New York with his friend Paul Pochron and several other people. Pochron was seriously injured when his snowmobile collided with Oleksy’s. Pochron and his wife later sued Oleksy.

Oleksy filed a declaratory judgment action against Farmers, his homeowner’s insurance carrier, seeking a declaration that Farmers has a duty to defend and to indemnify him in the lawsuit filed by Pochron. Although his homeowner’s policy includes an exclusion for personal injuries arising from the use of motor vehicles, Oleksy based his claim for coverage on an exception to that exclusion. The relevant policy provisions are:

Who Is An User Of A Vehicle?

January 8, 2015 | Mark S. Humphreys

Fort Worth insurance lawyers can tell you about all kinds of situations they get questions about. A 1997, Dallas Court of Appeals case is a case not seen everyday. The style of the case is American Economy Insurance Co. v. USAA.

This is one insurance company suing another. In the underlying case, Scott Johnson was driving a vehicle belonging to his father. Three friends, including Benjamin Ellis, were passengers. Scott and the passengers were intoxicated. The vehicle collided with a second car and Scott was killed. The passengers injured.

The occupants of the second car brought suit against the father, alleging that the vehicle crossed over the center line while traveling at an excessive speed. The plaintiffs also alleged that the passengers had encouraged, aided, and abetted Scott’s negligent acts and reckless driving, and that the passengers’ occupancy of the vehicle constituted a “use” of the vehicle.

Consent To Settle

December 25, 2014 | Mark S. Humphreys

North Richland Hills insurance attorneys should be aware of the “consent to settle” provision in most insurance policies. This is discussed in a 2006, United States 5th Circuit Court of Appeals opinion. The style of the case is, Motiva Enterprises, LLC v. St. Paul Fire and Marine Insurance Company. Here is what the case tells us.

In July 2001, a sulfuric acid storage tank exploded at Motiva’s Delaware refinery, killing one employee and injuring several others. A number of civil suits ensued, including a lawsuit by John and Pamela Beaver for injuries John sustained in the explosion (the “Beaver” suit).

Motiva had approximately $250 million in liability insurance which Motiva contended covered its liability for injuries and litigation costs related to the explosion. The coverage was divided into two “towers,” referred to as the Continental Tower and the St. Paul Tower, and consisted of seven insurance policies in all. National Union supplied $25 million of umbrella coverage, providing for both the duty to defend and the duty to indemnify once the underlying insurance was exhausted. The policy contained standard “consent-to-settle” and “cooperation” clauses. The consent-to-settle clause required National Union’s advance consent to any settlements that it would be funding, and the cooperation clause required Motiva to cooperate with National Union in the investigation, settlement, and defense of claims.

Exclusions Effecting Coverage In An Insurance Policy

December 23, 2014 | Mark S. Humphreys

Irving insurance lawyers should be able discuss with clients how exclusions in an insurance policy effect coverage. A 1994, Fort Worth Court of Appeals case is worth knowing about on this issue. The style of the case is, Union Pacific Resources Co. v. Aetna Casualty & Surety Co. Here is relevant information from that case.

Over a three year period Union Pacific (UP) disposed of potentially polluting waste in an industrial landfill. Even though dumping of such waste was legal and an accepted form of disposal at the time the EPA subsequently sued UP and others to recover clean up costs at the landfill site. UP entered into a partial consent degree agreeing to participate in limiting pollution hazards at the landfill. UP alleged that it had received third-party claims regarding the landfill and anticipated further claims.

Aetna denied coverage on the basis that the depositing of the waste in the landfill violated the various policies’ pollution exclusion clauses. Some of the policies contained a “sudden and accidental” exclusion which excluded liability for property damage arising out of the discharge, disbursal, release, or escape of waste materials or other irritants, contaminants, or pollutants into or upon the land, the atmosphere, or any water, course, or body of water.

Exclusions In Insurance Policy’s

December 21, 2014 | Mark S. Humphreys

Arlington insurance attorneys will tell their clients they need to be aware of exclusions in insurance policies and how they are interpreted. Just reading the declarations page is not enough. The entire policy needs to be including the exclusions. A 1998, Texarkana Court of Appeals case serves as an example. The style of the case is, Allen V. St. Paul Fire & Marine Insurance Company. Here is some of the relevant information from that case.

This suit alleged damages arising out of Tawakoni Water System’s failure to provide “potable” water, “good quality” water, water “reasonably fit for family residential use,” or water “approved and/or certified by the appropriate State of Texas and federal authorities.” The Allens also alleged that the water received was of “unpalatable quality,” “unfit for human consumption and/or use,” and that the water was contaminated.

St. Paul denied coverage and refused to provide a defense for Tawakoni. St. Paul based its denial of coverage on pollution exclusions allegedly included in the five policies upon which the Allens sued. Following a bench trial, a judgment of $17,326,174 was rendered in favor of the Allens. Tawakoni then assigned to the Allens its claim against St. Paul for wrongful refusal to defend in return for a covenant not to execute.