Justia Nebraska Supreme Court Opinion Summaries

At issue in this case was whether federal law preempts Neb. Rev. Stat. 25-2602.01(f)(4), which generally prohibits mandatory arbitration clauses in insurance contracts. Here, Allied Professionals Insurance Company (APIC), which is registered with the Nebraska Department of Insurance as a foreign risk retention group, issued a professional liability insurance policy to Dr. Brett Speece that included a provision requiring binding arbitration. After Speece filed an action seeking a declaration that APIC was obligated to provide coverage for his defense in a Medicaid proceeding, APIC filed a motion to compel arbitration. The district court overruled the motion, concluding that the arbitration clause in the policy was not valid and enforceable pursuant to section 25-2602.01, and that neither the Federal Arbitration Act (FAA) nor the Liability Risk Retention Act of 1986 (LRRA) preempted the state statute. The Supreme Court reversed the district court’s order overruling APIC’s motion to compel arbitration, holding (1) the FAA does not preempt section 25-2602.01(f)(4), but the LRRA does preempt application of the Nebraska statute to foreign risk retention groups; and (2) therefore, the district court erred when it determined that section 25-2602.01(f)(4) prohibited enforcement of the arbitration clause in the parties’ insurance contract in this case. View "Speece v. Allied Prof’ls Ins. Co." on Justia Law

State farm Fire & Casualty Company issued a rental dwelling policy to Jerry Dantzler. The tenants of Dantzler’s rental property sued Dantzler for personal injuries allegedly sustained by a Dantzler’s tenant as a result of exposure to lead-based paint. Dantzler tendered the claim to State Farm. State Farm subsequently filed an action for declaratory judgment against Dantzler and the tenants asking for a determination of whether its policy precluded coverage for the tenants’ personal injury claim. The district court granted summary judgment for State Farm, concluding as a matter of law that the pollution exclusion barred coverage under State Farm’s policy. The court of appeals reversed, concluding that a genuine issue of material fact existed as to whether the tenant’s injuries were the result of a “discharge, dispersal, spill, release or escape of pollutants” as described in the pollution exclusion. The Supreme Court reversed, holding that all manners of exposure to lead-based paint involve discharge, dispersal, spill, release, or escape, and therefore, the manner of exposure was not a material fact that prevented summary judgment. Remanded. View "State Farm Fire & Cas. Co. v. Dantzler" on Justia Law

Barbara Potter suffered a repetitive trauma injury as a result of her employment as a dental hygienist over a period of more than 30 years. In late 2007 or early 2008, while working in a dental clinic for Dr. Patrick McCulla, Potter began experiencing pain in her neck. Potter received medical treatment for her pain 12 times between October 17, 2008, and January 20, 2009. By this time, McCulla had sold the dental practice to Dr. Tracy Garcia. Potter’s duties and hours remained the same during and after the ownership change. Potter filed a petition in the Nebraska Workers’ Compensation Court seeking benefits. That court found Potter had preexisting conditions in her neck which were aggravated by her duties as a dental hygienist and awarded benefits based on a 40-percent loss of earning capacity. It determined that the date of the injury was February 11, 2009, as that was the date she first missed work to be treated for her injury. Because Garcia was Potter’s employer on the date of the injury, the court held Garcia and FirstComp liable for all of Potter’s medical expenses and compensation benefits. Garcia appealed. The Supreme Court concluded Nebraska Workers’ Compensation Court properly determined that her injury manifested itself on February 11, 2009, during Potter’s employment with Garcia, and that Garcia and Garcia’s workers’ compensation carrier are liable for all of Potter’s medical expenses and compensation benefits. View "Potter v. McCulla" on Justia Law

SFI Ltd. Partnership 8 (SFI) owned an apartment complex containing approximately 200 apartments. Through its agent, SFI leased an apartment to Michelle Carroll. The lease included provisions requiring Carroll to pay for repairs caused by her use of the unit and to maintain renter’s insurance including “a personal liability coverage to a minimum of $100,000.00.” A fire occurred in the apartment rented to Carroll. Both the apartment and the surrounding building were damaged. SFI had $10 million of total insurance coverage on the apartment complex. The policy provided for a deductible of $250,000 per occurrence unless a specific deductible applied. The parties stipulated that SFI sustained damages in excess of $100,000 resulting from the fire, which damages were not covered by its insurance policy. But neither the total amount of damages nor the amount of any insurance recovery by SFI was included in the evidence. Carroll had renter’s insurance in place at that time, and she submitted a claim to her insurer. Carroll’s insurer paid her $1,500, representing only her damages under “Loss of Use Coverage.” In previous cases, the Nebraska Supreme Court applied an antisubrogation rule to prohibit a landlord’s insurer from seeking reimbursement from the tenant of fire losses paid by insurance. In this appeal, the Court declined to extend the antisubrogation rule to a landlord’s uninsured losses allegedly caused by its tenant’s negligence. Therefore the Court reversed the district court’s summary judgment in favor of the tenant. The case was remanded for further proceedings. View "SFI Ltd. Partnership 8 v. Carroll" on Justia Law

A credit union sued former members of the credit union’s board of directors. The former directors submitted the lawsuit to the credit union’s insurer, seeking coverage under the policy. The insurer denied coverage. The former directors sued, seeking a declaratory judgment that the policy covered the credit union’s claims. The district court ruled in favor of the former directors but later reconsidered and granted summary judgment to the insurer. The former directors settled with the credit union while reconsideration was pending. The Supreme Court affirmed the grant of summary judgment for the insurer, holding that the district court did not abuse its discretion in (1) vacating its earlier judgment granting the former directors’ motion for declaratory judgment, as the former directors did not establish that they were entitled to summary or declaratory judgment; and (2) allowing the insurer to amend its answer, as the settlement potentially gave rise to new policy-based defenses that were not barred by equitable estoppel. View "Breci v. St. Paul Mercury Ins. Co." on Justia Law

In December 2008, Appellee was performing his duties as an outdoor parking lot attendant when he developed frostbite. Appellee’s employer and its insurance company (Appellants) voluntarily paid for the medical treatment of Appellee’s frostbite injury and paid temporary total disability benefits through mid-2009. In September 2012, a partial amputation of the fifth metatarsal in Appellee’s right foot was performed. In January 2013, Appellee sought additional benefits for his work-related injury. The Workers’ Compensation Court awarded benefits. On appeal, Appellants argued that the Workers’ Compensation Court erred in finding that Appellee’s claim was not barred by the two-year statute of limitations. The Supreme Court affirmed, holding that the partial amputation of Appellee’s foot was a material change in condition and substantial increase in disability that would permit Appellee to seek benefits more than two years after Appellants’ last voluntary payment. View "Lenz v. Cent. Parking Sys. of Neb., Inc." on Justia Law

Appellants filed a products liability action against Daimler-Chrysler Corporation after they were involved in a rollover collision while driving their Chrysler PT Cruiser. Appellants later filed a complaint for declaratory relief against Allianz Versicherungs-Aktiengesellschaft (“Allianz”), an international insurance company that provided insurance to Chrysler, alleging that Allianz had a duty to defend Chrysler in the underlying action. The district court granted summary judgment for Allianz and dismissed the complaint. Twenty months later, Appellants filed a complaint to vacate the summary judgment. The district court sustained Allianz’s motion to dismiss the complaint. The Supreme Court affirmed, holding (1) the time for exercise of the district court’s inherent power to vacate its judgment had expired; (2) the district court lacked jurisdiction to vacate its judgment because Appellants did not properly serve Allianz; and (3) the district court did not err in invoking its equity jurisdiction to vacate where Appellants had an adequate remedy at law. View "Carlson v. Allianz Versicherungs-Aktiengesellschaft" on Justia Law

Rick Wheeler had two liability insurance policies with American Family Mutual Insurance Company. Both Rick and his son Ryan were insureds under the policies. Both policies provided personal liability coverage and included exclusions for abuse and intentional injury. Both policies also contained a severability clause, which required that the insurance be applied separately to each insured. Joshua and Maren McCrary sued Rick and Ryan for Ryan’s alleged sexual assault of the McCrarys’ minor daughter. American Family filed a complaint for declaratory judgment seeking a judgment that its policies did not provide liability coverage to Rick. The district court granted summary judgment to American Family. At issue on appeal was whether the severability clause changed the effect of, or rendered ambiguous, the exclusions that would otherwise bar coverage for Rick. The Supreme Court affirmed, holding that the severability clause did not affect the unambiguous language of the policies’ exclusions, which barred coverage for Rick. View "Am. Family Mut. Ins. Co. v. Wheeler" on Justia Law

Plaintiff contracted with a shipper agent to move his household goods and personal property from Nebraska to Florida, but the movers who took possession of Plaintiff's property demanded additional payment before the property was delivered, and the property was never delivered to Florida or returned to Plaintiff. Plaintiff sought coverage under his homeowner's policy for loss of personal property due to theft. Insurer denied coverage, claiming that a theft had not occurred. Plaintiff sued Insurer for breach of contract and bad faith in denying the insurance claim. The district court granted summary judgment for Insurer, concluding that Plaintiff lost his property in a contractual dispute and that there was no showing of criminal intent. The Supreme Court reversed, holding that genuine issues of material fact existed as to whether a theft occurred in this case. Remanded. View "Peterson v. Homesite Indem. Co." on Justia Law

In 2007, Appellant purchased the assets of an indoor football team owned by Omaha Beef, LLC. In 2008, Appellant applied for workers' compensation insurance under the Nebraska Workers' Compensation Plan, arguing that it was entitled to a certain experience modifier (XMod), which is used when calculating the premium owed, because it was a new entity with no claims experience. The National Council on Compensation Insurance, Inc. determined that Appellant was a successor entity to Omaha Beef, and thus, the various XMods assigned to Omaha Beef for the relevant time periods must be transferred to Appellant. The director of the Department of Insurance affirmed. The district court affirmed, reasoning that Appellant was a successor to Omaha Beef and that the change in ownership resulted in the transfer of the workers' compensation rating for Omaha Beef to Appellant. The Supreme Court affirmed, holding that the district court did not err in finding (1) Appellant had the burden of proof to show there was no "change in ownership"; and (2) a "change in ownership" existed such that the XMod of Omaha Beef should be transferred to Appellant. View "Gridiron Mgmt. Group, LLC v. Travelers Indem. Co." on Justia Law