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COA splits on whether Dreaded decision requires judgment for insurer

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In a dispute over whether an insurer was required to pay pre-notice costs for environmental cleanup, the Indiana Court of Appeals was divided over whether the Indiana Supreme Court ruling Dreaded Inc. v. St. Paul Guardian Insurance was distinguishable from the instant case.

Maplehurst Farms sought to recover from Travelers Insurance Companies and other insurers environmental cleanup costs it incurred after an underground storage tank it installed on property it later sold to Dean Foods Co. leaked petroleum constituents in 2000. Maplehurst settled with Dean’s regarding costs in December 2002, but the company did not give notice to its insurers until March, April, and May 2003. When it learned of the environmental issues, Maplehurst tried to locate its insurance information but had difficulty doing so because so many people who had been with the company when it was still operating were now deceased.  

Travelers denied coverage of the Indiana Department of Environmental Management claim, citing among other things, lack of timely notice of claims and that Maplehurst had paid out money on claims to Dean’s without its consent. The trial court found Travelers breached its duty to defend under its policy and that the case was distinguished from Dreaded, 904 N.E.2d 1267 (Ind, 2009), because Travelers refused to defend Maplehurst once tender was made. In Dreaded, St. Paul Guardian Insurance agreed to defend Dreaded for the time after it received notice, but not prior to that.

The trial court’s ruling also noted that Dreaded determined that delayed tender may be “legally excused” in certain circumstances and that the ruling didn’t discuss or address indemnity costs.

In Travelers Insurance Companies, et al. v. Maplehurst Farms, Inc., et al., No. 49A04-1006-PL-394, Judges John Baker and Cale Bradford reversed, finding the lower court’s order directing Travelers to reimburse Maplehurst for the pre-notice, pre-tender costs is contrary to the fundamental holding in Dreaded that such costs cannot be recovered.

“Granted, when an insured is late in providing notice of a claim and the insurer responds by denying all coverage, prejudice to the insurer caused by the late notice is a potentially relevant consideration as to the insurer’s post-notice obligations. However, regardless of the relevance that prejudice plays in the context of post-notice obligations, an insured is not entitled to recover pre-notice costs. Simply put, an insurer’s duties under the policy do not arise unless and until the insurer has knowledge of the claim,” wrote Judge Baker.

Judge Melissa May dissented, declining to adopt the majority’s “apparent premise” that after Dreaded, reasonableness is no longer a permissible consideration in the analysis of late-notice disputes. This premise is inconsistent with Miller v. Dilts, 463 N.E.2d 257, 265-66 (Ind. 1984), and nothing relied on by the majority in Dreaded suggests that reasonableness must, should, or can be disregarded, she wrote.

The majority reversed and found Travelers’ to only be liable for the costs and expenses under the insurance policy that Maplehurst incurred after it gave notice of the claim. The judges also upheld the denial of Maplehurst’s requests for attorney fees.
 

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  1. So if I am reading it right, only if and when African American college students agree to receive checks labeling them as "Negroes" do they receive aid from the UNCF or the Quaker's Educational Fund? In other words, to borrow from the Indiana Appellate Court, "the [nonprofit] supposed to be [their] advocate, refers to [students] in a racially offensive manner. While there is no evidence that [the nonprofits] intended harm to [African American students], the harm was nonetheless inflicted. [Black students are] presented to [academia and future employers] in a racially offensive manner. For these reasons, [such] performance [is] deficient and also prejudice[ial]." Maybe even DEPLORABLE???

  2. I'm the poor soul who spent over 10 years in prison with many many other prisoners trying to kill me for being charged with a sex offense THAT I DID NOT COMMIT i was in jail for a battery charge for helping a friend leave a boyfriend who beat her I've been saying for over 28 years that i did not and would never hurt a child like that mine or anybody's child but NOBODY wants to believe that i might not be guilty of this horrible crime or think that when i say that ALL the paperwork concerning my conviction has strangely DISAPPEARED or even when the long beach judge re-sentenced me over 14 months on a already filed plea bargain out of another districts court then had it filed under a fake name so i could not find while trying to fight my conviction on appeal in a nut shell people are ALWAYS quick to believe the worst about some one well I DID NOT HURT ANY CHILD EVER IN MY LIFE AND HAVE SAID THIS FOR ALMOST 30 YEARS please if anybody can me get some kind of justice it would be greatly appreciated respectfully written wrongly accused Brian Valenti

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  4. A high ranking bureaucrat with Ind sup court is heading up an organization celebrating the formal N word!!! She must resign and denounce! http://m.indianacompanies.us/friends-educational-fund-for-negroes.364110.company.v2#top_info

  5. ND2019, don't try to confuse the Left with facts. Their ideologies trump facts, trump due process, trump court rules, even trump federal statutes. I hold the proof if interested. Facts matter only to those who are not on an agenda-first mission.

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