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Justices rule in favor of insurer in dispute over canceled policy

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The Indiana Supreme Court affirmed summary judgment for American Family Insurance in a lawsuit filed by a couple after the insurer denied coverage for a 2003 fire at their home and voided the insurance policy from its beginning.

In Michael Dodd and Katherine Dodd v. American Family Mutual Insurance Company, 12S02-1203-CT-170, Michael and Katherine Dodd filed a claim with American Family after their garage was destroyed by a fire in 2003. Michael Dodd did not disclose in his application with American Family in 1998 that his then-fiancée Katherine’s home, where he lived, was destroyed in a fire earlier that year. Michael and Katherine Dodd didn’t marry until 2000, but they lived together when he applied for the policy.

In investigating the 2003 fire, Michael Dodd told American Family about the 1998 fire. The company treated it as a misrepresentation, voided the insurance policy ab initio and denied the Dodds' claim for the 2003 fire.

The couple sued for breach of contract and intentional infliction of emotional distress. The trial court ruled in favor of American Family. The Indiana Court of Appeals reversed in part and ordered more proceedings on the breach of contract claim.

The justices upheld the trial court’s grant of summary judgment to American Family, rejecting the Dodds’ argument that American Family couldn’t void or rescind the policy because it hadn’t first returned all paid premium amounts to them. They didn’t make that argument in response to the insurer’s motion for summary judgment and the issue wasn’t before the trial court, Chief Justice Brent Dickson wrote.

But even if the Dodds had made the argument before the lower court, an exception to this requirement has been met where an insurer doesn’t have to tender a return of premiums to rescind a contract when the insurer has paid a claim which is greater in amount than the premiums paid.

The Dodds received $5,500 from American family for hail damage, more than twice the amount of the premiums they paid.

The justices ordered the trial court to release and return the tender of premiums to American Family, which the trial court was holding until the conclusion of the Dodds’ appeal.

 

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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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