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Judges disagree on estoppel claim

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An Indiana Court of Appeals panel disagreed today as to whether an insurance company is entitled to summary judgment in an action filed by clients regarding coverage.

In Everett Cash Mutual Insurance Co. v. Rick and Katrina Taylor, No. 02A03-0808-CV-386, the issue is whether the Taylors were negligent in failing to make sure an independent contractor had worker's compensation insurance because the Taylors believed their farm personal liability policy from Everett would cover all risks occurring on their property.

The Taylors told their insurance agent Jake Owens they wanted "all risk" coverage, but the policy contained exclusions that included no coverage if an injury would be covered by a worker's compensation claim.

Shortly after obtaining the policy, a worker for Sherlock, an independent contractor hired by the Taylors, was injured while painting the grain bin. The Taylors didn't verify if the company had worker's compensation insurance before hiring them and assumed any risk was covered by their policy. When the employee Christopher Collis filed a complaint against the company, he added the Taylors as a party for failing to verify whether Sherlock had worker's compensation coverage. After the injury, Owens told the Taylors their policy would cover Collis' injuries, but Everett denied coverage.

The Taylors filed suit against Everett, Owens and two other insurance agencies seeking recovery against Everett for breach of contract and estoppel. The trial court denied Everett's summary judgment motion.

The judges examined a "somewhat obscure" worker's compensation provision, Indiana Code Section 22-3-2-14, which says a third party that contracts with an injured worker's employer is subject to liability for worker's compensation benefits to the same extent as the employer if the third party didn't comply with the Worker's Compensation Act. This statute is applicable in the instant case, so the Taylors are potentially liable for payment of worker's compensation benefits to Collis just as if they directly employed him, wrote Judge Michael Barnes for the majority. The Taylors should have ensured Sherlock had the coverage because their policy from Everett doesn't provide coverage for a claim made under the statute.

The majority also found Everett wasn't estopped from denying coverage for Collis' claim because there wasn't any designated evidence to show the Taylors thought they were receiving coverage for the precise situation that happened in this case, and in the absence of evidence they were led to believe at the time they originally bought the policy that it would provide coverage for this specific situation, there can't be estoppel, wrote Judge Barnes. The majority reversed the denial of Everett's motion for summary judgment.

Judge L. Mark Bailey dissented believing there was genuine issue of material fact regarding the estoppel claim. There is a question of fact whether the policy was represented to be the "all risk" coverage that included the Taylors' negligent omission for which they believed they are insured, the judge wrote. Judge Bailey believed the Taylors are entitled to their day in court and would affirm the denial of Everett's motion for summary judgment.

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  1. Well, maybe it's because they are unelected, and, they have a tendency to strike down laws by elected officials from all over the country. When you have been taught that "Democracy" is something almost sacred, then, you will have a tendency to frown on such imperious conduct. Lawyers get acculturated in law school into thinking that this is the very essence of high minded government, but to people who are more heavily than King George ever did, they may not like it. Thanks for the information.

  2. I pd for a bankruptcy years ago with Mr Stiles and just this week received a garnishment from my pay! He never filed it even though he told me he would! Don't let this guy practice law ever again!!!

  3. Excellent initiative on the part of the AG. Thankfully someone takes action against predators taking advantage of people who have already been through the wringer. Well done!

  4. Conour will never turn these funds over to his defrauded clients. He tearfully told the court, and his daughters dutifully pledged in interviews, that his first priority is to repay every dime of the money he stole from his clients. Judge Young bought it, much to the chagrin of Conour’s victims. Why would Conour need the $2,262 anyway? Taxpayers are now supporting him, paying for his housing, utilities, food, healthcare, and clothing. If Conour puts the money anywhere but in the restitution fund, he’s proved, once again, what a con artist he continues to be and that he has never had any intention of repaying his clients. Judge Young will be proven wrong... again; Conour has no remorse and the Judge is one of the many conned.

  5. Pass Legislation to require guilty defendants to pay for the costs of lab work, etc as part of court costs...

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