Case Briefs
January 05, 2006
Highlights of the latest insurance cases from around the country.
Attorney-Client Privilege as Between the Insured, the Insurer and Their Attorney
January 05, 2006
The attorney-client privilege is a long-standing, well-respected principle. However, given that the privilege acts to limit the scope of discovery, it is frequently as challenged as it is respected. For example, the scope of privilege as between the insured, the insurer and the attorney representing their interests creates a peculiar problem for the courts. In this particular instance, the very basis of the privilege creates the problem.
Asbestos Bankruptcy Cases: The Rise of Objections By Disfavored Plaintiffs' Attorneys
January 05, 2006
There has been an emerging and interesting development in recent asbestos-related bankruptcy cases: the filing of objections by disfavored plaintiffs' attorneys. The filing of asbestos-related bankruptcy cases has increased dramatically with the establishment of Section 524(g) of the Bankruptcy Code. <i>See</i> Stephen J. Carroll, et al., <i>Asbestos Litigation</i>, 151-55 (Rand Inst. for Civ. Just., 2005) (reporting at least 73 asbestos-related bankruptcies since 1982, more than half of which were filed in the past 6 years). Section 524(g) provides asbestos-challenged companies a way to reorganize to shed their asbestos liabilities and channel all future asbestos claims to a trust established through the bankruptcy process. To achieve confirmation of a plan incorporating relief under Section 524(g), a debtor must have the consenting vote of 75% of the present affected asbestos claimants, among other things. This consent requirement has led debtors to enter into negotiations with asbestos claimants in advance of a bankruptcy filing in order to ensure sufficient voter approval for the plan of reorganization.
Repetitive Stress: How New Jersey Courts Handle Common Discovery Disputes Between Policyholders and Insurers
January 05, 2006
Attorneys litigating insurance coverage disputes may find themselves feeling like Bill Murray's character Phil Connors in the 1993 movie <i>Groundhog Day</i>, given the rate at which various types of conflicts repeat themselves, often involving a recurring casts of characters. In particular, discovery disputes between policyholders and insurers often involve the same categories of discovery that policyholders seek from insurers and which insurers frequently refuse to provide. This is no less true in New Jersey, which remains a popular forum for the filing of coverage actions. This article discusses categories of discovery sought by policyholders from insurers that commonly give rise to motion practice and how New Jersey courts have resolved such disputes.
Policyholders Demonstrating Third-Party Beneficiary Rights Granted Direct Access to Reinsurance Proceeds Under Facultative Contracts
January 05, 2006
On July 19, 2005, in a per curiam opinion, the Pennsylvania Supreme Court affirmed the Commonwealth Court's opinion in <i>Koken v. Legion Insurance Company</i>, which had been decided by Judge Mary Hannah Leavitt on June 26, 2003, <i>Koken v. Legion Insurance Company,</i> 831 A.2d 1196 (Pa. Commw. 2003), <i>aff'd,</i> 878 A.2d 51 (Pa. 2005).
West Virginia High Court: No 'Occurrence' in Faulty Workmanship
January 05, 2006
West Virginia's highest court has held that a commercial general liability ('CGL') policy does not provide coverage for faulty workmanship claims because such claims do not constitute an 'occurrence.' <i>Webster County Solid Waste Auth. v. Brackenrich & Assocs., et al.</i>, Nos. 31861 & 31862 (W.Va. June 30, 2005). This case reinforces the core concept — long recognized in insurance law — that general liability coverage protects against liability to others due to third-party property damage or bodily injury and does not serve as a performance bond for the policyholder's own work.
Policy's Wording Is Key to Determining Insured's Coverage in Matters that Do Not Constitute Formal Lawsuits
January 05, 2006
The recent California Supreme Court decisions in <i>Powerine Oil Co. v. Superior Court,</i> Case No. 113295 (Aug. 29, 2005) ('<i>Powerine II</i>') and <i>County of San Diego v. Ace Property & Casualty Ins. Co.</i>, Case No. S114778 (Aug. 29, 2005), illustrate the significance the court ascribes to specific wording of insurance policies and the coverage they afford for liability imposed on an insured other than through a formal court judgment. In particular, <i>Powerine II</i> establishes umbrella and excess carriers' possible duty to indemnify insureds for administrative actions or other matters that do not constitute formal lawsuits.
Revisiting Boilerplate or 'Miscellaneous' Lease Provisions
January 04, 2006
The May 2005 issue of <i>Commercial Leasing Law & Strategy</i> published an article presenting an overview of certain boilerplate provisions often found in the "Miscellaneous" section at the end of a commercial lease. ("Don't Forget the Boilerplate: Not All Standard Miscellaneous Provi-sions Are Standard," co-authored by Christopher A. Jones and Scott A. Weinberg.) The authors noted that after spending significant time drafting and redrafting the more "substantive" provisions of a lease, several seemingly less important provisions are frequently unexamined. The authors also noted, however, that the boilerplate provisions in leases are often not uniform, but instead, can vary dramatically, depending on whether the lease is drafted on behalf of a landlord or a tenant, and therefore, such provisions must also be carefully reviewed to ensure that they capture each party's understanding of the lease terms.
The Availability of Self-Help Evictions to Commercial Landlords
January 04, 2006
A landlord may re-enter leased commercial premises peaceably, without resorting to court process, in those states where it is permitted, if the right to do so is expressly reserved in a commercial lease, either a) upon the tenant's defaulting on the payment of rent or other lease terms, or b) upon termination of the lease or the tenant's abandoning the premises.
