ILNews

COA: insurer owed duty to defend

Jennifer Nelson
January 1, 2008
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After nearly 10 years of litigation, the Indiana Court of Appeals has reversed a grant of summary judgment in favor of an insurance company because the company couldn't show it was prejudiced by a late notice from its insured as a matter of law.

In the unanimous 27-page opinion, Tri-Etch Inc., et al v. Cincinnati Insurance Co., No. 49A02-0709-CV-827, the appellate court ruled in favor of the appellants-plaintiffs in this appeal - Tri-Etch, which provides security services; the estate of Michael Young; and Scottsdale Insurance Co., which provided insurance to Tri-Etch with a $1 million limit of liability.

The back-and-forth litigation between Tri-Etch, the estate, and Scottsdale and Cincinnati Insurance Co., which also provided a commercial general liability (CGL) and umbrella policy to Tri-Etch, began in 1999 after the estate filed a complaint against Tri-Etch.

Tri-Etch provided security for Muncie Liquors and would call a store's general manager if the store's night alarm wasn't set within 30 minutes of closing. Michael Young, an employee at the liquor store, was found beaten outside of the store after Tri-Etch called the store's owner at 3:15 a.m. The store closed at midnight and the alarm wasn't set, but Tri-Etch didn't call the general manager to make sure everything was OK at the store until 3:15 a.m. Young subsequently died of his injuries, and the complaint alleged he would have lived had Tri-Etch called at 12:30 a.m. once it realized the alarm wasn't set.

At issue in this case are two orders granted by Marion County trial courts. In 2006, the first order granted partial summary judgment in favor of Tri-Etch and the appellants on the bad faith counterclaim brought by Cincinnati. It granted partial summary judgment to the appellants finding that Young's death is covered under Cincinnati's CGL and umbrella policies and denied Scottsdale and Cincinnati's motions for summary judgment regarding Scottsdale's claim to recover 50 percent of the legal fees and costs Scottsdale paid to defend Tri-Etch.

Cincinnati claimed it didn't learn of the litigation until 2004, just before the claim was to go to trial. The insurance company informed Tri-Etch that the estate's claim wasn't covered by either of its policies with Cincinnati, so it wouldn't be responsible to pay a portion of the $2.5 million in damages the estate won against Tri-Etch.

The second order issued in 2007 granted summary judgment in favor of Cincinnati and ordered that Tri-Etch's late notice to Cincinnati was unreasonably late as a matter of law, and due to the prejudice arising from the untimely notice, the company owes no coverage or indemnity to Tri-Etch.

The Indiana Court of Appeals determined that Cincinnati wasn't prejudiced by Tri-Etch's allegedly late notice because the insurance company consistently maintained Tri-Etch wasn't entitled to coverage for the claim, wrote Chief Judge John Baker. As a result, the appellate court reversed the grant of summary judgment in favor of Cincinnati in the second order and remanded with instructions to enter summary judgment in favor of the appellants.

Regarding the first order, the judges concluded Tri-Etch is entitled to coverage pursuant to both Cincinnati's CGL and umbrella policies, requiring Cincinnati to be responsible for $1.5 million in damages the estate won.

The court also remanded the issue of Cincinnati's liability for defense costs to Scottsdale because Scottsdale defended Tri-Etch from the start of the claim.

"Because we have concluded that coverage existed under Cincinnati's policies, each of which contained duty-to-defend provisions, it logically follows that Cincinnati must pay a portion of the costs Scottsdale incurred while defending Tri-Etch during the liability litigation," the chief judge wrote.

The appellate court remanded the issue to the trial court to determine when Cincinnati received notice of the claim to determine the amount of reasonable defense costs Cincinnati should pay.
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  1. All the lawyers involved in this don't add up to a hill of beans; mostly yes-men punching their tickets for future advancement. REMF types. Window dressing. Who in this mess was a real hero? the whistleblower that let the public know about the torture, whom the US sent to Jail. John Kyriakou. http://www.nytimes.com/2013/01/26/us/ex-officer-for-cia-is-sentenced-in-leak-case.html?_r=0 Now, considering that Torture is Illegal, considering that during Vietnam a soldier was court-martialed and imprisoned for waterboarding, why has the whistleblower gone to jail but none of the torturers have been held to account? It's amazing that Uncle Sam's sunk lower than Vietnam. But that's where we're at. An even more unjust and pointless war conducted in an even more bogus manner. this from npr: "On Jan. 21, 1968, The Washington Post ran a front-page photo of a U.S. soldier supervising the waterboarding of a captured North Vietnamese soldier. The caption said the technique induced "a flooding sense of suffocation and drowning, meant to make him talk." The picture led to an Army investigation and, two months later, the court martial of the soldier." Today, the US itself has become lawless.

  2. "Brain Damage" alright.... The lunatic is on the grass/ The lunatic is on the grass/ Remembering games and daisy chains and laughs/ Got to keep the loonies on the path.... The lunatic is in the hall/ The lunatics are in my hall/ The paper holds their folded faces to the floor/ And every day the paper boy brings more/ And if the dam breaks open many years too soon/ And if there is no room upon the hill/ And if your head explodes with dark forbodings too/ I'll see you on the dark side of the moon!!!

  3. It is amazing how selectively courts can read cases and how two very similar factpatterns can result in quite different renderings. I cited this very same argument in Brown v. Bowman, lost. I guess it is panel, panel, panel when one is on appeal. Sad thing is, I had Sykes. Same argument, she went the opposite. Her Rooker-Feldman jurisprudence is now decidedly unintelligible.

  4. November, 2014, I was charged with OWI/Endangering a person. I was not given a Breathalyzer test and the arresting officer did not believe that alcohol was in any way involved. I was self-overmedicated with prescription medications. I was taken to local hospital for blood draw to be sent to State Tox Lab. My attorney gave me a cookie-cutter plea which amounts to an ALCOHOL-related charge. Totally unacceptable!! HOW can I get my TOX report from the state lab???

  5. My mother got temporary guardianship of my children in 2012. my husband and I got divorced 2015 the judge ordered me to have full custody of all my children. Does this mean the temporary guardianship is over? I'm confused because my divorce papers say I have custody and he gets visits and i get to claim the kids every year on my taxes. So just wondered since I have in black and white that I have custody if I can go get my kids from my moms and not go to jail?

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