Justia Civil Procedure Opinion Summaries

Plaintiff Carmen Zubillaga was injured in an automobile accident. The other driver was at fault. Her insurer, defendant Allstate Indemnity Company (Allstate), rejected her demand for $35,000, the full amount of her remaining underinsured motorist (UIM) coverage, although it made her a series of offers increasing to $15,584 instead. After an arbitrator awarded plaintiff $35,000, the amount of her demand, she sued Allstate for breach of the implied covenant of good faith and fair dealing. While an insurance company has no obligation under the implied covenant of good faith to pay every claim its insured makes, the insurer cannot deny the claim, without fully investigating the grounds for its denial. To protect its insured’s contractual interest in security and peace of mind, it is essential that an insurer fully inquire into possible bases that might support the insured’s claim before denying it. The Court of Appeal found the problem in this case was that the undisputed facts showed the insurer’s opinions were rendered in October and November 2012, but insurer continued to rely on them through the arbitration in September 2013, without ever consulting with its expert again or conducting any further investigation. Summary judgment in favor of the insurer was reversed and the matter remanded for further proceedings. View "Zubillaga v. Allstate Indemnity Company" on Justia Law

Homeowners sued Builder for failing to construct their home in a good and workmanlike manner. Builder’s commercial general liability insurer (Insurer) refused to defend Builder in the suit. Judgment was granted in favor of Homeowners after a trial, and Builder assigned the majority of its claims against Insurer to Homeowners. Homeowners subsequently sought to recover the judgment from Insurer under the applicable policy. The trial court entered judgment in favor of Homeowners. The court of appeals affirmed. The Supreme Court reversed and, in the interests of justice, remanded the case to the trial court for a new trial, holding (1) the judgment against Builder was not binding on Insurer in this suit because it was not the product of a fully adversarial proceeding; but (2) this insurance litigation may serve to determine Insurer’s liability, although the parties in the case focused on other issues during the trial. View "Great American Insurance Co. v. Hamel" on Justia Law

Daniel Kemp sued his no-fault insurer, Farm Bureau General Insurance Company of Michigan, seeking personal protection insurance (PIP) benefits under the parked motor vehicle exception in MCL 500.3106(1)(b) for an injury he sustained while unloading personal items from his parked motor vehicle. Farm Bureau moved for summary disposition under MCL 2.116(C)(10) on the basis that Kemp had not established any genuine issue of material fact regarding whether he satisfied MCL 500.3106. Kemp responded by asking the trial court to deny Farm Bureau’s motion and, instead, to grant judgment to Kemp under MCR 2.116(I)(2). The trial court granted Farm Bureau's motion for summary judgment. The Michigan Supreme Court reversed, finding that Kemp satisfied the transportational function required as a matter of law, and created a genuine issue of material fact concerning whether he satisfied the parked vehicle exception in MCL 500.3106(1)(b) and the corresponding causation requirement. Therefore, the trial court erred in granting summary judgment, and the Court of Appeals erred in affirming the trial court. The matter was remanded for further proceedings. View "Kemp v. Farm Bureau Gen. Ins. Co. of Michigan" on Justia Law

A party’s attorney-billing information is normally not discoverable when the party challenges an opposing party’s attorney-fee request as unreasonable or unnecessary but neither uses its own attorney fees as a comparator nor seeks to recover any portion of its own attorney fees.Several lawsuits brought by insured homeowners against various insurers and claims adjustors alleging underpayment of insured property-damage claims were consolidated into a single multidistrict litigation (MDL) for pretrial proceedings, including discovery. In this discovery dispute, individual homeowners sought attorney fees incurred in prosecuting their claims. The homeowners sought discovery regarding the insurer’s attorney-billing information. The insurer argued that the requested discovery was overly broad and sought information that was both irrelevant and protected by the attorney-client and work-product privileges. The MDL pretrial court ordered the insurer to respond to the discovery requests. The court of appeals denied the insurer’s petition for mandamus relief. The Supreme Court conditionally granted mandamus relief and directed the trial court to vacate its discovery order, holding that, absent unusual circumstances, information about an opposing party’s attorney fees and expenses is privileged or irrelevant and, thus, not discoverable. View "In re National Lloyds Insurance Co." on Justia Law

Pacific Bay treated an individual who was a subscriber to a Blue Shield health plan. It submitted invoices to Blue Shield for payment for the services rendered to the subscriber. Pacific Bay contends it was underpaid and brought suit against Blue Shield to recover the additional amount it claimed to be owed. The court sustained Blue Shield's demurrer to the first amended complaint (FAC) without leave to amend, finding that Pacific Bay had not shown that it was entitled to any payment from Blue Shield. As an out-of-network, nonemergency service provider, Pacific Bay was entitled to payment for treating Blue Shield's subscriber under the terms of the applicable evidence of coverage (EOC). Pacific Bay did not allege Blue Shield paid it improperly under the EOC, nor did it argue that it could allege additional facts to support such a claim. Pacific Bay claimed it was underpaid. Against this backdrop, Pacific Bay's other allegations did not give rise to any valid cause of action. View "Pacific Bay Recovery v. Cal. Physicians' Services" on Justia Law

A provision of the mandatory form settlement document promulgated by the Director of the Division of Workers’ Compensation (“Director”) did not waive an injured employee’s statutory right under section 8-43-204(1), C.R.S. (2016), to reopen a settlement based on a mutual mistake of material fact. Petitioner Victor England was a truck driver for Amerigas Propane. He filed a workers’ compensation claim after sustaining a serious injury to his shoulder in December 2012 while making a delivery for Amerigas. England’s claim was governed by the Colorado Workers’ Compensation Act, which required that settlements between employer and employee must be written, signed by both sides, and approved by the Director or an administrative law judge (“ALJ”). Pursuant to section 8-43-204, the Director promulgated a form settlement agreement (“Form”), which the parties are required to use to settle all claims. In this case, the parties’ settlement agreement was consistent with the Form. England’s pain continued after the settlement agreement was signed and approved. In October 2013, he sought further medical evaluation, which revealed a previously undiagnosed stress fracture in the scapula (shoulder blade) of England’s injured shoulder. Up to this point, no one was aware that this fracture existed. England claims that if he had been aware of this fracture, he would not have settled his claim. England filed a motion to reopen the settlement on the ground that the newly discovered fracture justified reopening his workers’ compensation claim. An ALJ agreed, and the Industrial Claim Appeals Office (ICAO) affirmed. The court of appeals reversed, concluding that the Form waived England’s right to reopen. The Colorado Supreme Court held that because provisions of the form document must yield to statutory rights, the court of appeals erred in its conclusion. View "England v. Amerigas Propane" on Justia Law

Only two sections of the Michigan no-fault act mention healthcare providers, MCL 500.3157 and MCL 500.3158, and neither of those sections confers on a healthcare provider a right to sue for reimbursement of the costs of providing medical care to an injured person. Although MCL 500.3112 allows no-fault insurers to directly pay PIP benefits to a healthcare provider for expenses incurred by an insured, MCL 500.3112 does not entitle a healthcare provider to bring a direct action against an insurer for payment of PIP benefits. Covenant Medical Center, Inc., brought suit against State Farm Mutual Automobile Insurance Company to recover payment under the no-fault act for medical services provided to State Farm’s insured, Jack Stockford, following an automobile accident in which Stockford was injured. State Farm denied payment. In the meantime, Stockford had filed suit against State Farm for no-fault benefits, including personal protection insurance (PIP) benefits. Without Covenant’s knowledge, Stockford and State Farm settled Stockford’s claim for $59,000 shortly before Covenant initiated its action against State Farm. As part of the settlement, Stockford released State Farm from liability for all allowable no-fault expenses and any claims accrued through January 10, 2013. State Farm moved for summary judgment under MCR 2.116(C)(7) (dismissal due to release) and MCR 2.116(C)(8) (failure to state a claim). The trial court granted State Farm’s motion under MCR 2.116(C)(7), explaining that Covenant’s claim was dependent on State Farm’s obligation to pay no-fault benefits to Stockford, an obligation that was extinguished by the settlement between Stockford and State Farm. View "Covenant Medical Center, Inc. v. State Farm Mutual Automobile Ins. Co." on Justia Law

Lamar Ragland appeals the dismissal of his bad-faith claim against State Farm Mutual Automobile Insurance Company. Ragland sought punitive damages from State Farm based on State Farm's alleged bad-faith failure to pay and related failure to subject his claim for underinsured-motorist ("UIM") benefits to a cognitive review. State Farm moved to dismiss Ragland's claims, because Ragland had filed a separate civil action in 2014 that had not yet been resolved. After review, the Alabama Supreme Court dismissed Ragland's claim as being from a nonfinal judgment. View "Ragland v. State Farm Mutual Automobile Ins. Co." on Justia Law

The Act makes the builder who sells homes liable for violations without proof of negligence, while general contractors and subcontractors not involved in home sales are liable only if the plaintiff proves they negligently caused the violation in whole or part. The jury found the grading subcontractor, defendant Gerbo Excavating, was not negligent in any respect. The trial court, not the jury, found the builder/seller, Knotty Bear Development, Inc. and Knotty Bear Construction, Inc. (collectively Knotty Bear), liable after Knotty Bear failed to appear for trial. Plaintiffs sought redress from Gerbo under common law negligence theories for the tree damage, because they argued tree damage was not covered by the Act. The Court of Appeal found that plaintiffs failed to show tree damage was not covered by the Act: the jury found Gerbo was not negligent in any respect, even when the jury found building standards were violated. Finding no other basis for reversal, the Court affirmed the trial court’s judgment and post-trial orders. View "Gillotti v. Stewart" on Justia Law

The Louisiana Supreme Court granted review to determine the applicability of La. R.S. 9:2795.3, the Equine Immunity Statute. The trial court granted a motion for summary judgment filed by Equest Farm, LLC, finding that the immunity statute applied because plaintiff Danielle Larson was a participant engaged in equine activity at the time an Equest Farm pony bit her. The court of appeal reversed, holding that Larson was not a “participant” under the immunity statute, and that summary judgment was inappropriate because there were genuine issues of material fact as to whether another provision in the immunity statute might apply. The Supreme Court held that there were indeed genuine issues of material fact on the issue of whether the immunity statute applied. Accordingly, the Court affirmed the court of appeal and remanded to the trial court. View "Larson v. XYZ Ins. Co." on Justia Law