by sohalang | Apr 25, 2011 | Blog News, Uncategorized
The Insurance Research Counsel (“IRC”), a division of the American Institute for CPCU, which is an independent, nonprofit organization dedicated to providing educational programs, reports that the Washington Insurance Fair Conduct Act (“IFCA”) may have caused an increase in homeowners insurance claims cost in the state by as much as $190 million. The IRC report is available at http://www.ircweb.org/News/IRCWABadFaith_033011.pdf
by sohalang | Apr 22, 2011 | Blog News, Uncategorized
On April 6, 2011, the Oregon Court of Appeals ruled that American Family Mutual Insurance Company (“American Family”) had no duty to defend its insured where the underlying complaint alleged only damage to the insured’s work and did not allege resulting property damage, such as water damage to other building components, that would have been covered by the policy. State Farm Fire and Cas. Co. v. Am. Family Mut. Ins. Co., 2011 WL 1262760, 4 (Or App, 2011). The opinion acknowledged that water damage to other components or contents could have been a natural result of the insured’s alleged negligent performance of the work identified in the complaint. However, the court considered only the policy and the allegations in the complaint in evaluating American Family’s duty to defend:
[T]he allegations in the [underlying] complaint are unambiguous. None of the allegations … allege damage to property other than the EIFS system identified in the particular specification, and none of the identified allegations allege water damage to other components or contents of the residence. Although water damage to other components or contents could have been a natural result from [the insured’s] alleged negligent performance of the work identified in the [underlying] complaint, such damage was not a necessary result of [the insured’s] … alleged negligence. Because that water damage was not a necessary result of [the insured’s] alleged negligence and was collateral in nature, the [underlying plaintiffs] were required to specially plead allegations of such water damage before evidence of it could be properly admitted. It follows that defendant had no duty to defend against the [underlying] negligence claim because the allegations of their complaint did not allege injury to property covered by defendant’s policy. Thus, the trial court erred in granting summary judgment for plaintiff and denying defendant’s motion for summary judgment.
by Soha Lang | Apr 22, 2011 | Blog News, Uncategorized
In Smith v. Truck Ins. Exchange, Inc., No. A142954 (Or App Apr 20, 2011), the Oregon Court of Appeals addressed an alleged third-party beneficiary’s claim for underinsured motorist (“UIM”) coverage. Plaintiff was injured while driving a vehicle owned by MD&D; Construction (“MD&D;”). She made a claim for UIM coverage to the insurer, Truck Insurance Exchange, alleging that it had issued insurance on the vehicle. When the insurer denied the claim, plaintiff sued the insurer, asserting claims for breach of contract and declaratory relief alleging that she was a third-party beneficiary on the policy. In addition she sued the broker, alleging that the broker had negligently failed to obtain the insurance. The trial court dismissed the suit on the pleadings, holding that she was not the real party in interest and that she had failed to state facts sufficient to constitute claims for relief in the complaint.
The Court of Appeals reversed on the claims against the insurer and affirmed on the claim against the broker. It first held that the complaint alleged that plaintiff was a permissive user of the vehicle and therefore adequately alleged that she was a third-party beneficiary for the purpose of the breach of contract theory. Next, the court held that plaintiff had no claim against the broker because nothing indicated that she was an intended beneficiary of the broker’s promise to obtain insurance. Finally, the court held that plaintiff’s declaratory judgment claim was insufficient because she had failed to name the insured, MD&D;, as a party in the suit. Nonetheless, the court declined to affirm the dismissal but instead gave plaintiff the opportunity on remand to add MD&D;.
by sohalang | Mar 4, 2011 | Blog News, Uncategorized
Newmont USA Limited v. All American Home Assurance Co., United States District Court for the Eastern District of Washington, Cause No. CV-09-0033-JLQ, March 3, 2011 Order on PIL Motion for Partial Summary Judgment
The insurer sought a declaration by the court that the scope of the personal injury liability coverage did not encompass Newmont and Dawn’s liability declared in a CERCLA cost recovery action brought by the United States, which only included claims under CERCLA and no common law claims for trespass or nuisance. The court disagreed and ruled, “the claims filed against the Plaintiffs herein by the United States are analogous to trespass, nuisance, and interference with the use of private occupancy and encompassed with the stated Coverage P for claims of “wrongful entry” or “invasion of the right of private occupancy.”
Despite the fact the underlying case was resolved at the trial court level and is on appeal, the court found that there was an issue of fact regarding “whether the Plaintiffs in fact committed covered offenses for which [the insurer] is obligated to provide indemnity.”
by sohalang | Mar 3, 2011 | Blog News, Uncategorized
In Allemand v. State Farm Ins Co., et al, Dkt. no.28954-1 (Div. III, Mar. 03, 2011), Division III of the Washington Court of Appeals ruled that policy provisions in a State Farm Insurance Company homeowners insurance policy unambiguously limited coverage for increased costs of repairs due to changes in the building codes.
by sohalang | Jan 20, 2011 | Blog News, Uncategorized
In State Farm Fire & Casualty Co. v. Arbor Vineyards Homeowners Association, Cause Number CV-10-504-HU (D. Or.), Federal Judge Hubel authored an opinion filed on January 18, 2011 that dismissed the insured’s counterclaims against its insurer for breach of fiduciary duty and bad faith finding that the filing of a declaratory judgment action alone, while the underlying action is still pending, does not support a claim for breach of fiduciary duty or breach of the covenant of good faith and fair dealing against the insurer. The court reasoned, “. . . without some authority, I am unwilling to conclude that the mere fact of filing the coverage action can constitute a breach of fiduciary duty or a breach of the implied covenant of good faith and fair dealing. That is, plaintiff’s filing a complaint seeking clarification of its coverage obligations while the underlying lawsuit is pending is insufficient, as a matter of law, to support the counterclaims.”
