Insurance Law

Plaintiff manufacturer filed declaratory judgment action seeking declaration that insurers had a duty to defend it from claims as to environmental contamination. Court properly granted partial summary judgment for insurers. Plaintiff claimed that insurers had duty to defend it in mediation of  claims as to site designated by EPA address additional releases of hazardous substances. Policies provide duty to defend only when there is a “suit,” and this mediation is neither a “suit” nor a continuation of an existing lawsuit; Plaintiff agreed to mediation of claims in hopes of avoiding a suit. (DELORT and HARRIS, concurring.)

(Court opinion corrected 8/22/19.) Plaintiff insured presented underinsured motorist (UIM) claims to insurer for damages he sustained in 2 car accidents. His claims were submitted to arbitration, and arbitrators entered awards in his favor. Insurer disputed the application of setoff provisions in his policy, claiming that policy provisions  permitted setoffs equal to the amounts Plaintiff recovered from the underinsured motorists and his policy to be applied against the arbitration awards. Plaintiff's policy adheres to the principles of public policy behind the UIM statute, and it does not permit a "double set-off".(MASON and HYMAN, concurring.)

Plaintiff insurer filed a declaratory judgment action seeking declaration that there was no uninsured motorist coverage (UM) available to Defendant insured. Court properly entered judgment for insurer, as insured's demand for arbitration was untimely. Insured's submitting of police report and letter from another insurer to Plaintiff did not provide Plaintiff with relevant information it needed to investigate insured's claim, and thus was not a sufficient proof of loss sufficient to toll the limitations period for demanding arbitration. (CONNORS, concurring; and HARRIS, dissenting.)

Plaintiff insurer filed suit, seeking declaratory judgment that it did not owe Defendant coverage under the policy for property damage to airplane that crashed. Defendant insured failed to comply with policy's pilot warranty endorsement. Although co-pilot was approved by Defendant's chief pilot, he failed to go to simulator school annually, which was required by endorsement, and he did not complete company approved training prior to the flight. The fact that the policy gives insurer some discretion does not render the clause illusory.(McBRIDE and REYES, concurring.)

Plaintiff filed declaratory judgment action against insurer seeking order declaring that insurer was contractually required to pay or indemnify it for $18 million in costs incurred while defending itself against personal injury claims arising from welding fumes. Neither party actively pursued this litigation. Thus, court did not abuse its discretion by finding the delay caused by insurer did not constitute a waiver fo the right to arbitrate, as insurer's course of conduct was not inconsistent with its right to dispute resolution. Court properly stayed insurance litigation and compelled parties to comply with Section 7 of their 1999 settlement agreement. In resolving parties' dispute over Plaintiff's defense costs, parties must initially determine scope and applicability of the Agreement to the welding fumes claims.(CARTER and O'BRIEN, concurring.)