Landmark American Ins. Co. v. Hilger

Dist. Ct. erred in entering judgment on pleadings in favor of defendant in plaintiff-insurance company’s action seeking declaration that it owed no duty to defend defendant in underlying action alleging that defendant and others persuaded credit union to fund loans by overstating value of certain life insurance policies that would serve as collateral for said loans. Dispute between instant parties was whether defendant was independent contractor to insured, and Ct. agreed with plaintiff that Dist. Ct. could not enter judgment on pleadings for defendant, because plaintiff was entitled to conduct discovery and offer evidence regarding true "non-independent contractor" nature of defendant’s relationship to insured prior to any judgment being entered in case. Ct. rejected defendant’s claim that in all duty-to-defend disputes Dist. Ct. was limited to review of allegations in underlying complaint, and Ct. further noted that defendant’s argument would be correct if plaintiff had attempted to deny coverage without having sought instant declaratory judgment or having defended defendant in underlying action under reservation of rights.