Court relies on equitable estoppel determination test

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Examining both state and national caselaw in an appeal involving an Allen County car crash, the Indiana Court of Appeals has used a two-part test in determining whether equitable estoppel is available to those filing a claim.

The Indiana Court of Appeals issued a decision today in Janice L. Davis v. Shelter Insurance Companies, State Farm Insurance Companies, and Jennifer Culver, No. 02A05-1105-CT-256.

Stemming from a case before Allen Superior Judge David Avery, the appeal involves a January 2008 car crash between Janice Davis and Jennifer Culver in which Davis was injured. Shelter insured Davis while State Farm insured Culver, and Davis received treatment paid for by her insurance company. A State Farm representative phoned Davis after the accident and told her that she wasn’t able to call State Farm about the accident until she completed treatment and was ready to settle the claim.

The insurance companies communicated and early the following year, Davis told another State Farm representative she’d provide full medical documentation of her treatment when she was ready to settle. The statute of limitation on Davis’ claim ran out on Jan. 3, 2010, and Davis was still receiving treatment at the time.

She asked State Farm to settle her claim of nearly $4,339 in March 2010, but State Farm informed her the statute of limitations had expired. Davis hired an attorney and filed a complaint in June 2010, and after both parties submitted motions for judgment the trial court granted summary judgment for State Farm and Culver.

On appeal, the judges disagreed with Davis’ claim that equitable estoppel barred the statute of limitations defense by State Farm and Culver. Specifically, the panel relied on rulings from the state’s top appellate courts in 1980, 1990 and 2003 that addressed the doctrine of equitable estoppel and, when applied to this instant case against State Farm and Culver, didn’t amount to any fraud or deceit in stopping the statutory timeline of the case.

The appellate court found that according to the documents in this case, when there’s a promise to settle or perform, any reliance on that promise by a claimant must be reasonable before equitable estoppel is available. The claim by Davis isn’t reasonable in rising to the level of stopping the statute of limitations defense, the judges determined.

Looking at rulings from federal appellate courts and state appellate courts in California, Illinois, Pennsylvania and South Carolina along with federal precedent on this issue, the Indiana Court of Appeals compared that caselaw with this state’s decisions and determined that a two-part test exists for determining whether equitable estoppel should apply. First, a court must determine whether the insurer has engaged in a promise to settle, discouraged the person from filing suit, discouraged the person from hiring an attorney, or other egregious conduct. If one of those factors exists, then the court must engage in the second part of the test and look at the totality of the circumstance surrounding the insurer’s actions.

In this claim by Davis, the appellate panel found that State Farm’s conduct wasn’t sufficient to trigger equitable estoppel because the insurer didn’t engage in any of those initial activities.

“State Farm’s only action at issue in this case was to tell Davis to contact them when she was done with her medical treatment,” Judge Nancy Vaidik wrote. “This conduct can hardly be considered egregious and should not have overridden Davis’s common sense that she needed to actively pursue her claim with State Farm.”

The appellate panel affirmed the lower court’s decision.


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  1. I have an open CHINS case I failed a urine screen I have since got clean completed IOP classes now in after care passed home inspection my x sister in law has my children I still don't even have unsupervised when I have been clean for over 4 months my x sister wants to keep the lids for good n has my case working with her I just discovered n have proof that at one of my hearing dcs case worker stated in court to the judge that a screen was dirty which caused me not to have unsupervised this was at the beginning two weeks after my initial screen I thought the weed could have still been in my system was upset because they were suppose to check levels n see if it was going down since this was only a few weeks after initial instead they said dirty I recently requested all of my screens from redwood because I take prescriptions that will show up n I was having my doctor look at levels to verify that matched what I was prescripted because dcs case worker accused me of abuseing when I got my screens I found out that screen I took that dcs case worker stated in court to judge that caused me to not get granted unsupervised was actually negative what can I do about this this is a serious issue saying a parent failed a screen in court to judge when they didn't please advise

  2. I have a degree at law, recent MS in regulatory studies. Licensed in KS, admitted b4 S& 7th circuit, but not to Indiana bar due to political correctness. Blacklisted, nearly unemployable due to hostile state action. Big Idea: Headwinds can overcome, esp for those not within the contours of the bell curve, the Lego Movie happiness set forth above. That said, even without the blacklisting for holding ideas unacceptable to the Glorious State, I think the idea presented above that a law degree open many vistas other than being a galley slave to elitist lawyers is pretty much laughable. (Did the law professors of Indiana pay for this to be published?)

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  4. Joe, you might want to do some reading on the fate of Hoosier whistleblowers before you get your expectations raised up.

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