Court: Alleged negligence didn't cause injury

Jennifer Nelson
January 1, 2008
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The Indiana Court of Appeals affirmed a trial court grant of summary judgment in favor of an insurance agent because it found her alleged negligence was not a cause of injury to the plaintiffs.

At issue in Jerry and Becky French v. State Farm Fire & Casualty Company and Jane Hodson, No. 18A02-0612-CV-1161, is whether the trial court erred in granting summary judgment in favor of Hodson on the Frenches' claim of negligent advice and procurement of insurance.

The Frenches decided to purchase a manufactured home for their Delaware County plot of land, and Jerry French visited his insurance agent, Hodson, to determine the new homeowner's insurance policy. The value of the home was just less than $80,000.

Hodson asked Jerry questions about the home and entered his answers into the Insurance-to-Value calculator, which estimated the cost of replacement to be approximately $173,000. Jerry signed off on this figure. Hodson never asked if Jerry's home was manufactured or stick-built, nor the purchase price, and Jerry never specified the type of policy he wanted. State Farm had different policies for manufactured and stick-built homes.

Under Coverage A of their policy, the Frenches were covered for up to $173,000 to repair or replace with similar construction. Under Coverage B, their personal property was insured, and in the event of a loss they would be awarded 75 percent of the Coverage A amount.

A fire struck the home several months after the Frenches moved in, and a claim representative inspected the loss and told the Frenches they could use up to the total amount of coverage to rebuild their home. The Frenches decided to construct a stick-built home instead of a manufactured home because they believed an electrical issue in the manufactured home caused the fire. The cost to build the new home was more than their policy limit.

The claim representative informed the Frenches the policy would only cover the purchase of a similar or exact unit to the manufactured home. State Farm offered to pay the Frenches $80,000 under the policy to purchase a replacement manufactured home; they accepted the amount and continued to build a new home. They also were paid approximately $130,000 under their Coverage B policy.

The Frenches filed suit against State Farm and Hodson, alleging State Farm breached the terms of the policy by only offering $80,000 and that Hodson negligently failed to procure insurance for the Frenches as requested. Both parties filed for summary judgment, in which the trial court granted summary judgment in favor of Hodson, ruling that the insurance policy did cover the risk and that the Frenches actually received $70,000 more in contents payments than what they would have received with the lower dwelling limits, so Hodson cannot be held liable for negligence with respect to the policy limits.

The Court of Appeals upheld the grant of summary judgment, although it had "serious misgivings" as to whether Hodson actually exercised reasonable skill and diligence in obtaining more than $200,000 worth of coverage on a $76,000 manufactured home.

The Frenches did not suffer an injury proximately caused by Hodson's alleged negligence, and in fact received a benefit of more than $70,000 from the error. The Frenches decided to construct a stick-built home that cost more than the value of their manufactured home, so they did not rely on Hodson's conducts knowing there was a coverage dispute when they continued with the construction.

Judge Edward Najam wrote the court expressed no opinion about the ultimate resolution of the Frenches' claim for breach of contract but held that the trial court didn't error in granting summary judgment in favor of Hodson.

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  1. If a class action suit or other manner of retribution is possible, count me in. I have email and voicemail from the man. He colluded with opposing counsel, I am certain. My case was damaged so severely it nearly lost me everything and I am still paying dearly.

  2. There's probably a lot of blame that can be cast around for Indiana Tech's abysmal bar passage rate this last February. The folks who decided that Indiana, a state with roughly 16,000 to 18,000 attorneys, needs a fifth law school need to question the motives that drove their support of this project. Others, who have been "strong supporters" of the law school, should likewise ask themselves why they believe this institution should be supported. Is it because it fills some real need in the state? Or is it, instead, nothing more than a resume builder for those who teach there part-time? And others who make excuses for the students' poor performance, especially those who offer nothing more than conspiracy theories to back up their claims--who are they helping? What evidence do they have to support their posturing? Ultimately, though, like most everything in life, whether one succeeds or fails is entirely within one's own hands. At least one student from Indiana Tech proved this when he/she took and passed the February bar. A second Indiana Tech student proved this when they took the bar in another state and passed. As for the remaining 9 who took the bar and didn't pass (apparently, one of the students successfully appealed his/her original score), it's now up to them (and nobody else) to ensure that they pass on their second attempt. These folks should feel no shame; many currently successful practicing attorneys failed the bar exam on their first try. These same attorneys picked themselves up, dusted themselves off, and got back to the rigorous study needed to ensure they would pass on their second go 'round. This is what the Indiana Tech students who didn't pass the first time need to do. Of course, none of this answers such questions as whether Indiana Tech should be accredited by the ABA, whether the school should keep its doors open, or, most importantly, whether it should have even opened its doors in the first place. Those who promoted the idea of a fifth law school in Indiana need to do a lot of soul-searching regarding their decisions. These same people should never be allowed, again, to have a say about the future of legal education in this state or anywhere else. Indiana already has four law schools. That's probably one more than it really needs. But it's more than enough.

  3. This man Steve Hubbard goes on any online post or forum he can find and tries to push his company. He said court reporters would be obsolete a few years ago, yet here we are. How does he have time to search out every single post about court reporters and even spy in private court reporting forums if his company is so successful???? Dude, get a life. And back to what this post was about, I agree that some national firms cause a huge problem.

  4. rensselaer imdiana is doing same thing to children from the judge to attorney and dfs staff they need to be investigated as well

  5. Sex offenders are victims twice, once when they are molested as kids, and again when they repeat the behavior, you never see money spent on helping them do you. That's why this circle continues