Justia Nebraska Supreme Court Opinion Summaries

Articles Posted in Insurance Law

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Rosemary Henn filed a putative class action in a federal court alleging that American Family Mutual Insurance Company wrongfully failed to compensate her and others similarly situated by depreciating labor costs in calculation of “actual cash value” for loss or damage to a building under its homeowner’s insurance policies. The federal court certified a question to the Nebraska Supreme Court asking whether an insurer, in determining the “actual cash value” of a covered loss, may depreciate the cost of labor when the policy does not state explicitly that labor costs will be depreciated and the terms “actual cash value” and “depreciation” are not defined in the policy. The Supreme Court answered in the affirmative, holding that the term “actual cash value” is unambiguous and that labor can be depreciated. View "Henn v. American Family Mutual Insurance Co." on Justia Law

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Farm Bureau Property & Casualty Insurance Company issued a homeowner’s insurance policy to Howard Hunter that prohibited an assignment of “[a]ll rights and duties” without Farm Bureau’s consent. After a storm damaged the roof of Hunter’s home, he assigned his claim to Millard Gutter Company, the company that repaired the roof. Millard Gutter sued Farm Bureau and obtained a county court judgment. The district court affirmed. The Supreme Court affirmed, holding that, under the circumstances of this case, the postloss assignment of a claim under a homeowner’s insurance policy was valid despite the nonassignment cause. View "Millard Gutter Co. v. Farm Bureau Property & Casualty Insurance Co." on Justia Law
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Bruce Evertson was killed in a two-vehicle accident during the course and scope of his employment. Bruce’s estate filed a wrongful death claim against the insurer of the other driver. The county court accepted a settlement in the matter and allocated the proceeds among Bruce’s widow, Darla Evertson, and adult children. Darla received workers’ compensation benefits from Travelers Indemnity Company as a result of Bruce’s death. Travelers filed a subrogation claim to Darla’s settlement proceeds. The county court ordered that Travelers was not entitled to any distribution of Darla’s proceeds and did not provide Travelers any future credit against the workers’ compensation benefits it owed Darla. The court of appeals affirmed. The Supreme Court vacated the decision of the court of appeals and remanded with directions to vacate the order of the county court, holding that the county court lacked subject matter jurisdiction to hear and decide the subrogation matter. View "In re Estate of Evertson" on Justia Law

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At the center of this dispute was defective rebar that was incorporated into the construction of concrete pile caps that would form support for the Pinnacle Bank Arena. Some of the pile caps had to be modified in order to provide the necessary structural support for the Arena. The general contractor paid the costs of the correction and sought reimbursement from Drake-Williams Steel, Inc. (DWS), which fabricated the rebar. DWS reimbursed the general contractor and sought coverage from its insurers. The insurers denied the claim and commenced this action to determine their obligations under the policies of insurance. The district court granted summary judgment in favor of the insurers. The Supreme Court affirmed, holding that there was no coverage under the policies. View "Drake-Williams Steel, Inc. v. Continental Cas. Co." on Justia Law

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Opal Lowman was injured in an automobile accident. State Farm Mutual Automobile Insurance Company provided underinsured motorist coverage to Opal and her husband. The Lowmans sued State Farm, seeking damages. The jury returned a verdict for the Lowmans in the amount of $0. The Lowmans filed a motion for a new trial, which was overruled. The Supreme Court affirmed, holding (1) the district court did not err when it entered judgment on the jury’s verdict where the jury awarded the Lowmans no money damages; and (2) the district court did not err in denying the Lowmans’ motion for new trial. View "Lowman v. State Farm Mut. Auto. Ins. Co." on Justia Law

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Rent-A-Roofer, Inc. (Appellant) settled a lawsuit filed by the National Research Corporation (NRC) without notifying its insurer, Farm Bureau Property & Casualty Insurance Company (the Insurer), of the lawsuit. Appellant later notified the Insurer of its involvement in litigation and made a demand under Appellant’s policy with the Insurer. The Insurer declined coverage on the grounds that Appellant breached the policy’s notice provision and the voluntary payments provision. Appellant subsequently brought this action against the Insurer, alleging breach of contract and bad faith. The district court granted summary judgment for the Insurer. The district court first concluded that for an insurer to deny coverage based on breach of a voluntary settlement condition, the insurer must show prejudice in connection with its claim. The court then ruled that, where Appellant failed to meet both the notice and voluntary payments provisions, prejudice had been established as a matter of law. The Supreme Court affirmed, holding that the district court correctly found that the Insurer was not liable for settlement by NRC against Appellant and not liable for Appellant’s defense costs. View "Rent-A-Roofer v. Farm Bureau Prop. & Cas. Ins. Co." on Justia Law

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An employee at a boiler manufacturing plant sustained permanent hearing loss as a result of his employment. Between the time he was injured and the time he filed his workers’ compensation claim, the plant changed ownership. Twin City Fire Insurance Company insured the plant for the previous owner, and American Insurance Company insured the new owner. Counsel representing American mistakenly believed that American had insured the plant during the time of the injury, and Twin City was not given notice of the claim until after entry of an award. The new owner of the plant filed a declaratory judgment action against the previous owner and both insurers to determine who was liable for payment of the award. The district court determined that Twin City was liable for the employee’s workers’ compensation award. The Supreme Court affirmed, holding that the district court did not err in finding that Twin City was liable for the award, in rejecting Twin City’s equitable defenses, and in dismissing Twin City’s counterclaims. View "Cleaver-Brooks Inc. v. Twin City Fire Ins. Co." on Justia Law

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Improper transfers were made from a title insurance agent’s escrow account. The agent’s principal, United General Title Insurance Company, paid the loss and then sued to recover the loss from multiple entities and persons, including recipients of the transferred funds. United General recovered judgment against some entities and persons, but summary judgment was entered against it on various claims. After a jury trial, several recipients of the transferred funds successfully defended the action on the remaining issues. The Supreme Court affirmed in part and reversed and remanded in part, holding (1) the district court correctly granted summary judgment, with the exception of United General’s claims for conversion and a constructive trust; (2) there was no merit to the alleged errors that United General asserted occurred at trials; and (3) after trial, the district court correctly granted a motion for judgment notwithstanding the verdict. View "United Gen. Title Ins. Co. v. Malone" on Justia Law

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Jennifer Van Kleek was caring for Walter and Janet Chapman’s dog while the Chapmans were out of town when the dog bit her on her lower lip. Van Kleek sent a claim to the Chapmans’ homeowner’s insurer, Farmers Insurance Exchange (Farmers), for her injuries from the bite. Farmers denied the claim, concluding the Van Kleek was “legally responsible” for the dog and therefore, she was also an insured, and the policy excluded coverage for bodily injuries to insureds. The policy defined “insured” to include “any person…legally responsible for covered animals." Van Kleek filed a complaint for declaratory judgment seeking a determination that the policy covered her claim. The district court granted Farmers’ motion for summary judgment, concluding that Van Kleek was “legally responsible” for the dog because she was the only person responsible for feeding, watering, and letting the dog into the backyard while the Chapmans were away. The Supreme Court affirmed, holding that Van Kleek was an insured under the policy because she was “legally responsible” for the Chapmans’ dog, and therefore, the unambiguous terms of the policy excluded coverage of her injury. View "Van Kleek v. Farmers Ins. Exch." on Justia Law
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Appellant, an over-the-road truck driver, filed a claim for workers’ compensation benefits, alleging that he sustained injuries in the form of deep vein thrombosis and pulmonary embolism in an accident that occurred during the course and scope of his employment. The compensation court applied a split test of causation used in heart attack cases, which requires proof of both legal and medical causation. The court then dismissed Appellant’s claim for failure to establish the medical cause prong. The Supreme Court affirmed the dismissal of Appellant’s claim, holding (1) the split test was properly applied to Appellant’s injuries in this case, as deep vein thrombosis and pulmonary embolism present the same difficulties in attributing the cause of a heart attack to a claimant’s work and are similar in origin to a heart attack; and (2) the compensation court’s finding as to causation was not clearly wrong.View "Wingfield v. Hill Bros. Transp., Inc." on Justia Law