Court reviews whether a child was a resident of a household for the purposes of insurance liability

COTTON STATES MUTUAL INSURANCE COMPANY v. JAMI McNAIR TUCK, ET AL. (Tenn. Ct. App. November 9, 2012)

An insurance company filed a declaratory judgment action seeking a declaration that mother and child were residents of the insured’s household, and therefore, that coverage for the death of the child was excluded by the relevant homeowner’s insurance policy. The chancery court found that mother and child were not residents of the insured’s household at the time of the child’s death, and we affirm.

Opinion available at:
https://www.tba.org/sites/default/files/cottonstates_110912.pdf

Court reviews whether an auto insurance policy covers damages resulting from a car owner's independent acts of negligence in a case involving a car accident

STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY ET AL. v. SOUTHERN TRUST INSURANCE COMPANY (Tenn. Ct. App. October 24, 2012)

This is a dispute between insurance companies over coverage related to a car accident. We conclude that the trial court erred in finding that the driver’s auto policy covered damages resulting from the independent acts of negligence of the car owner.

Opinion available at:
https://www.tba.org/sites/default/files/statefarm_102412.pdf

Court reviews a dispute between an insurance company and a trucking company involving over-the-road drivers

AMERICAN ZURICH INSURANCE COMPANY v. MVT SERVICES, INC., D/B/A MESILLA VALLEY TRANSPORTATION (Tenn. Ct. App. July 30, 2012)

This appeal involves retrospective insurance premiums on a workers’ compensation insurance policy. The defendant trucking company operates in several states, including Texas and Tennessee. Tennessee requires employers to maintain worker’s compensation insurance for certain employees, but Texas does not.

The defendant trucking company purchased workers’ compensation insurance for its Tennessee employees from the plaintiff insurance company. The trucking company employed over-the-road truck drivers who were Tennessee residents. The trucking company decided to classify its Tennessee-resident over- the-road drivers as Texas employees whose on-the-job injuries would not be covered by the Tennessee workers’ compensation insurance policy. Consequently, the trucking company did not pay insurance premiums to cover those employees.

The plaintiff insurance company conducted a retrospective premium audit; in the audit, it determined that the Tennessee- resident over-the-road drivers presented a risk of loss to the insurance company. Consequently, the insurance company notified the trucking company that it owed retrospective premiums based on those drivers. The trucking company refused to pay, so the insurance company canceled the insurance policy and filed this lawsuit for the retrospective premiums. The trial court granted summary judgment in favor of the insurance company, and the trucking company now appeals.

We affirm, finding under the undisputed facts that the Tennessee-resident over-the-road employees presented a risk of loss to the insurer under the workers’ compensation insurance policy during the relevant policy periods.

Opinion available at:
https://www.tba.org/sites/default/files/americanzurich_073012.pdf

Court reviews the limitation of liability in an insurance policy in a case involving a city volunteer

PAUL VINCENT GIANNINI v. AMANDA PROFFITT (Tenn. Ct. App. April 27, 2012)

This appeal involves a limitation of liability in an insurance policy. The plaintiff was working in a volunteer capacity for the city. While doing so, the plaintiff sustained injuries in an accident caused by the negligence of the defendant. The plaintiff’s medical expenses were paid through the city’s on-the-job-injury program. The plaintiff had uninsured motorist coverage under his insurance policy with the appellee insurance company.

The appellee insurance company denied the plaintiff’s claim based on language in the policy reducing the insurance company’s liability by sums paid under laws similar to workers’ compensation laws. The insurance company asserted that the city’s on-the-job-injury program was similar to workers’ compensation.

The plaintiff filed this lawsuit, and the plaintiff and the insurance company filed cross-motions for summary judgment on the issue of coverage. The trial court granted summary judgment in favor of the insurance company, finding that the plaintiff’s benefits under the city’s on-the-job-injury program were similar to workers’ compensation. The plaintiff now appeals. We affirm the grant of summary judgment, for the reason stated by the trial court.

Opinion available at:
https://www.tba.org/sites/default/files/gianninip_042712.pdf

Court Rules for Insured After Agent's Mistake

The Tennessee Supreme Court ruled today that an insurance company must provide vehicle liability insurance coverage to the insured as he requested from his insurance company’s agent but did not receive because of a mistake by the agent. Learn more from the Administrative Office of the Court about Allstate Insurance Company v. Diana Lynn Tarrant and read the dissenting opinion from Justice William Koch and Chief Justice Cornelia Clark.

TN Supreme Court reviews whether an insurer properly changed a policy from a commercial policy to a personal policy

ALLSTATE INSURANCE COMPANY v. DIANA LYNN TARRANT ET AL. (Tenn. March 26, 2012)

After an automobile accident between the insured’s van and a motorcycle, the insurer filed a declaratory judgment action to determine whether the van was covered under a commercial policy with a liability limit of $500,000 or a personal policy with liability limits of $100,000 per person and $300,000 per accident. The insurer alleged that before the accident the insured had instructed his insurance agent to transfer the van from the commercial policy to the personal policy. The insured denied this and alleged that he had instructed the agent to retain the van on the commercial policy.

The trial court ruled that because the insurer had sent the insured a letter and premium bills showing the change in coverage and the insured had paid the bills without objection, he had ratified the transfer and the van was covered under the personal policy. The Court of Appeals reversed.

We hold that the action of the insurance agent in transferring the van to the personal policy was not subject to ratification by the insured because the insurance agent was not acting in the insured’s stead or for his benefit when it made the transfer. We further hold that the insurer is estopped from denying coverage under the commercial policy. We affirm the judgment of the Court of Appeals, although on different grounds.

Opinion available at:
https://www.tba.org/sites/default/files/allstate_032612.pdf

Koch, dissenting opinion:
https://www.tba.org/sites/default/files/allstate_DIS_032612.pdf

Court reviews trial court's denial to enforce a settlement agreement in a wrongful death case.

CATHERINE M. LOVE, as next friend and natural mother of Savannah Love, a minor child and daughter of Rex Bryan Peterson, deceased, ET. AL. v. DORIS LAKINS WOODS (Tenn. Ct. App. November 4, 2010)

This case arises from the trial court's denial of Plaintiff/Appellants' motion to enforce a settlement agreement. Appellants, the surviving children of decedent, filed a wrongful death claim against the Appellee herein, the driver of a car involved in the accident that killed decedent. During negotiations, Appellee/Defendant's attorney proposed a settlement in the amount of Appellee's insurance policy limit, which Appellee's attorney misstated to be $100,000, when, in fact, the policy limit was $50,000.

The trial court denied Appellants' motion to enforce the $100,000 settlement finding that the settlement was not enforceable, as it failed to contain certain material terms of the agreement. We conclude that the trial court failed to determine whether an agency relationship existed between the Appellee's attorney and the insurance company and also whether the insurance company is required to be a party to this litigation. Vacated and remanded.

Opinion may be found at:
http://www.tba2.org/tba_files/TCA/2010/lovec_110410.pdf

Tennessee Supreme Court rules whether liens under the Hospital Lien Act attach to medical payment benefits paid pursuant to an insurance policy.

SHELBY COUNTY HEALTH CARE CORPORATION d/b/a REGIONAL MEDICAL CENTER v. NATIONWIDE MUTUAL INSURANCE COMPANY (Tenn. October 28, 2010)

Kevin L. Holt, injured in an automobile accident in Arkansas, was first taken by ambulance to an Arkansas hospital and then transported to the Regional Medical Center in Memphis, where he incurred $33,823.02 in expenses.

Shelby County Health Care Corporation, the operator of the Regional Medical Center, filed affidavits for a lien as prescribed by statute. Thereafter, Nationwide Mutual Insurance Company, which had medical coverage for Holt with limits of $5,000, paid $1,290 for ambulance services and $3,710 to the Arkansas hospital. Shelby County Health Care Corporation sued Nationwide for impairment of its lien, seeking as recovery the entire amount due for its medical services to Holt.

The trial court awarded $5,000 in damages. The Court of Appeals revised the amount of the judgment to $33,823.02. Because we have determined that liens under the Hospital Lien Act do not attach to medical payment benefits paid pursuant to an insurance policy, the judgment of the Court of Appeals is reversed and the cause is dismissed.

Opinion may be found at:
http://www.tba2.org/tba_files/TSC/2010/shelbycountyhccCORR_102810.pdf

Court reviews a ruling about insurance coverage of a van involved in an accident.

ALLSTATE INSURANCE COMPANY, v. DIANA LYNN TARRANT, et al. (Tenn. Ct. App. October 21, 2010)

Plaintiff insurer brought this declaratory judgment action to determine which of the two policies issued to defendants insured and their corporation, covered a van which had been involved in an accident. Plaintiff named the insureds as defendants, as well as the third party who had filed a tort action against the insureds for personal injuries.

The Trial Court conducted an evidentiary hearing and ruled that the insureds had told the agency plaintiff to keep the van in dispute on the commercial policy, but it had transferred the van to the insureds' personal policy. The Court further ruled that a notice of the transfer was sent to the insureds by plaintiff, and plaintiff sent at least five bills to the insureds that reflected the van was then insured under the personal policy and not the commercial policy. The Court concluded that the insureds ratified the change and ruled that the van was insured under the insureds personal policy. On appeal, we reverse and dismiss the action.

Opinion may be found at:
http://www.tba2.org/tba_files/TCA/2010/allstateins_102110.pdf

Court reviews dismissal of a wrongful death action in an insurance liability case.

MARY F. LAWSON v. BRAD LAWSON (Tenn. Ct. App. September 30, 2010)

Uninsured motorist carrier voluntarily tendered the limits of its liability coverage into the probate proceeding administering the decedent's estate and not in the wrongful death tort action. The trial court dismissed the carrier from this wrongful death tort action since it had tendered its limits of liability. We find the dismissal was in error since any voluntary tender of insurance proceeds for wrongful death should be made into the wrongful death tort case, and tendering the limits elsewhere is not grounds for dismissal.

Opinion available at:
http://www.tba2.org/tba_files/TCA/2010/lawsonm_093010.pdf

Court Reviews Whether Plaintiff Should be Allowed to Reopen Proof in a Motor Vehicle Accident Case

WILLIAM J. REINHART v. GEICO INSURANCE (Tenn. Ct. App. September 30, 2010)

The plaintiff owned a 1988 Porsche that was damaged by a collision with a deer. His insurer offered him $6,000 under his policy, after determining that the cost of repair was greater than the cash value of the car. The plaintiff, acting pro se, sued the insurer, and attempted to prove at trial that the auto was worth more than the insurer offered. After the plaintiff rested his case, the insurer moved for a directed verdict because the plaintiff had not introduced the insurance policy into evidence. The trial court granted the motion.

The plaintiff argues on appeal that he did not intend to rest his case and that in any event the trial court should have allowed him to reopen his proof so he could introduce the insurance policy. Because there is neither a transcript of the proceedings nor a Rule 24 Statement of the Evidence in the appellate record, we must affirm the trial court.

Opinion available at:
http://www.tba2.org/tba_files/TCA/2010/reinhartw_093010.pdf

Court Reviews Insurance Coverage in a Case Involving an Uninsured Motorist

FLOYD L. FLETCHER, ET AL. v. ASHLEY R. WHITE, ET AL. (Tenn. Ct. App. September 22, 2010)

Mr. Fletcher, who was injured in an automobile accident involving an uninsured motorist, sued the insurance company after it denied uninsured motorist benefits under his towing policy. Insurance company filed a motion for summary judgment claiming that the towing policy did not provide uninsured motorist coverage for Mr. Fletcher's accident because it involved a non-covered auto. After a hearing on the motion, the trial court granted summary judgment to the insurance company. Mr. and Mrs. Fletcher appeal. We affirm.

Opinion may be found at:
http://www.tba2.org/tba_files/TCA/2010/fletcherf_092210.pdf

Court Reviews Summary Judgment Ruling in an Insurance Case Involving Misrepresentation

CECILIA OWENSBY, ET AL. v. STATE FARM FIRE AND CASUALTY COMPANY, ET AL. (Tenn. Ct. App. September 15, 2010)

Cecilia and Charles Owensby had a homeowners insurance policy issued by State Farm Fire and Casualty Company ("State Farm"). After their house burned down, the Owensbys filed a claim pursuant to the policy. State Farm eventually denied the claim, asserting that Cecilia Owensby had made four material misrepresentations when applying for the insurance and that each of these misrepresentations increased State Farm's risk of loss. The plaintiffs asserted that any inaccurate information contained on the application was the fault of the insurance agent who filled out the application on Cecilia Owensby's behalf. The plaintiffs sued both State Farm and Darius Miller ("Miller"), the insurance agent. State Farm and Miller filed a motion for summary judgment, which the Trial Court granted. The plaintiffs appeal the grant of summary judgment. We modify the judgment of the Trial Court and, as modified, affirm the grant of summary judgment to the defendants.

Opinion may be found at:
http://www.tba2.org/tba_files/TCA/2010/owensbyc_091510.pdf

Court Reviews an Insurance Policy to Determine Whether it is Liable for Unpaid Medical Expenses Related to Patient’s Pre-Existing Condition

WELLMONT HEALTH SYSTEM v. JOHN QUINTON QUALLS, ET AL. (Tenn. Ct. App. August 20, 2010)

Plaintiff hospital filed a lawsuit against defendant patient for unpaid medical expenses. Defendant patient filed a third party complaint against defendant insurance company alleging that the insurance company was responsible for the unpaid medical expenses pursuant to a health insurance policy. After a bench trial, the trial court concluded that the insurance contract was ambiguous and construed it against the defendant insurance company. Defendant insurance company appeals.

After reviewing the record and the health insurance policy, we conclude that the policy was not ambiguous and the insurance contract specifically excluded coverage of patient's pre-existing condition. Accordingly, we reverse.

Opinion may be found at:
http://www.tba2.org/tba_files/TCA/2010/wellmont_082010.pdf

Court considers an issue of uninsured motorist coverage in an interlocutory appeal

RANDALL D. KISER v. IAN J. WOLFE & CONSUMERS INSURANCE COMPANY (Tenn. Ct. App. May 28, 2010)

This interlocutory appeal considers an issue of uninsured motorist coverage following an automobile accident in which Plaintiff Randall D. Kiser was permanently injured. The plaintiff was working within the scope of his employment, driving for a towing company, when his truck was struck by Defendant Ian J. Wolfe's vehicle. The defendant driver tendered his liability policy limits to the plaintiff and is not a party to this appeal. The employer towing company was insured by Defendant Consumers Insurance Company. In anticipation of arbitration for determination of damages and liability, the insurance company moved for partial summary judgment.

The trial court denied summary judgment but granted the insurance company permission for an interlocutory appeal to determine two issues, on which we hold:
(1) On a policy of vehicle insurance, the statutory requirement of Tenn. Code Ann. section 56-7-1201(a)(2) for a written rejection of uninsured/underinsured motorist benefits or written selection of uninsured/underinsured motorist benefits lower than liability limits is met when the insured signs an application containing a lower selection but neglects to initial a block provided for that purpose; and
(2) the insurer bears the burden of proof to show that the insured signed an insurance contract application containing a stated limit of uninsured/underinsured motorist coverage, but once that burden has been met, the insured must raise any issue that the insurer obtained the insured's signature unlawfully under Tenn. Code Ann. section 56-7-1201(a)(2).

We vacate the trial court's denial of the insurance company's Motion for Partial Summary Judgment and remand for reconsideration in light of this holding.

Opinion may be found at:
http://www.tba2.org/tba_files/TCA/2010/kiserr_052810.pdf

Court reviews breach of contract claim between insurance company and customer

JOHN COOK, JR. v. PERMANENT GENERAL ASSURANCE CORP. (Tenn. Ct. App. April 21, 2010)

This appeal involves the alleged breach of an insurance policy. The plaintiff insured had an automobile insurance policy with the defendant insurance company. The insured paid his insurance premium by check. He subsequently was involved in an automobile accident and notified the insurance company of the accident. The check was later returned for insufficient funds. The insurance company notified the insured that if he did not bring the premium current by a date certain, his insurance policy would be cancelled. The insured gave the insurance company a valid check for the premium, which was negotiated. The insurance company later cancelled the policy, retroactive to a date prior to the insured's automobile accident. The insured sued the insurance company for breach of contract. After a bench trial, the trial court held in favor of the plaintiff insured. The insurance company appeals. We affirm.

Opinion may be found at:
http://www.tba2.org/tba_files/TCA/2010/cookj_042110.pdf