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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. What a fine article, thank you! I can testify firsthand and by detailed legal reports (at end of this note) as to the dire consequences of rejecting this truth from the fine article above: "The inclusion and expansion of this right [to jury] in Indiana’s Constitution is a clear reflection of our state’s intention to emphasize the importance of every Hoosier’s right to make their case in front of a jury of their peers." Over $20? Every Hoosier? Well then how about when your very vocation is on the line? How about instead of a jury of peers, one faces a bevy of political appointees, mini-czars, who care less about due process of the law than the real czars did? Instead of trial by jury, trial by ideological ordeal run by Orwellian agents? Well that is built into more than a few administrative law committees of the Ind S.Ct., and it is now being weaponized, as is revealed in articles posted at this ezine, to root out post moderns heresies like refusal to stand and pledge allegiance to all things politically correct. My career was burned at the stake for not so saluting, but I think I was just one of the early logs. Due, at least in part, to the removal of the jury from bar admission and bar discipline cases, many more fires will soon be lit. Perhaps one awaits you, dear heretic? Oh, at that Ind. article 12 plank about a remedy at law for every damage done ... ah, well, the founders evidently meant only for those damages done not by the government itself, rabid statists that they were. (Yes, that was sarcasm.) My written reports available here: Denied petition for cert (this time around): http://tinyurl.com/zdmawmw Denied petition for cert (from the 2009 denial and five year banishment): http://tinyurl.com/zcypybh Related, not written by me: Amicus brief: http://tinyurl.com/hvh7qgp

  2. Justice has finally been served. So glad that Dr. Ley can finally sleep peacefully at night knowing the truth has finally come to the surface.

  3. While this right is guaranteed by our Constitution, it has in recent years been hampered by insurance companies, i.e.; the practice of the plaintiff's own insurance company intervening in an action and filing a lien against any proceeds paid to their insured. In essence, causing an additional financial hurdle for a plaintiff to overcome at trial in terms of overall award. In a very real sense an injured party in exercise of their right to trial by jury may be the only party in a cause that would end up with zero compensation.

  4. Why in the world would someone need a person to correct a transcript when a realtime court reporter could provide them with a transcript (rough draft) immediately?

  5. This article proved very enlightening. Right ahead of sitting the LSAT for the first time, I felt a sense of relief that a score of 141 was admitted to an Indiana Law School and did well under unique circumstances. While my GPA is currently 3.91 I fear standardized testing and hope that I too will get a good enough grade for acceptance here at home. Thanks so much for this informative post.

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