Justia Iowa Supreme Court Opinion Summaries

The Supreme Court affirmed the decision of the court of appeals affirming the district court's grant of summary judgment in favor of Cincinnati Insurance Company in this insurance dispute, holding that, for the reasons set forth in 33 Carpenters Construction, Inc. v. State Farm Life & Casualty Co., __ N.W.2d __ (Iowa 2020), an assignment contract entered into by a residential contractor acting as an unlicensed public adjuster is void under Iowa Code 103A.71(5).After a hailstorm and windstorm damaged Gregg Whigham's residence, Whigham and 33 Carpenters Construction, Inc. entered into an agreement under which 33 Carpenters would repair the damage in exchange for Wigham's insurance proceeds. A 33 Carpenters representative and Whigham then signed an assignment of claim and benefits. Later, 33 Carpenters sued Whigham's insurer, Cincinnati, claiming that Cincinnati breached the insurance policy by failing to by 33 Carpenters all benefits due and owing under the policy that had been assigned to it. The district court granted summary judgment to Cincinnati, concluding that the purported assignment of Whigham's insurance claim was invalid. The Supreme Court affirmed, holding that because 33 Carpenters was operating as an unlicensed public adjuster, the assignment contract was unenforceable. View "33 Carpenters Construction, Inc. v. Cincinnati Insurance Co." on Justia Law

The Supreme Court affirmed the judgment of the district court entering judgment against a commercial general liability (CGL) insurer on a homeowners’ insurer’s lawsuit seeking reimbursement for the amount it paid to settle a death claim, holding that the district court correctly interpreted the CGL insurance contract, and substantial evidence supported the court’s factual findings on potential liability and the reasonableness of the settlement.A dentist and his wife formed a limited liability company (LLC) that held title to investment properties, including a farmhouse. An accidental shooting at the farmhouse resulted in a death, and a death claim followed. The dentist had purchased homeowners liability insurance and CGL insurance from separate insurers. The CGL insurer denied coverage. The homeowners’ insurer settled the death claim for $900,000. Thereafter, the homeowners’ insurer filed this action seeking subrogation from the CGL insurer. The district court entered judgment against the CGL insurer for $450,000. The Supreme Court affirmed, holding that the LLC, as owner of the farmhouse, had potential liability under a premises liability theory for a dangerous condition and that the CGL insurer, as coinsurer of the farmhouse property, was obligated to indemnify the homeowners’ insurer for half of the $900,000 settlement. View "Metropolitan Property & Casualty Insurance Co. v. Auto-Owners Mutual Insurance Co." on Justia Law

The Supreme Court affirmed the decision of the district court granting summary judgment to the insurer in this coverage dispute, holding that an electrical-currents exclusion in the policy applied to the loss in this case.A squirrel climbed onto an outdoor electrical transformer at the City of West Liberty’s power plant, eventually triggering an electrical arc that caused substantial damage to the City’s property. The City sought coverage from Employer’s Mutual Casualty Company (EMC) under its all-risks insurance policy. EMC denied coverage based on the electrical-currents exclusion in the policy, which excluded “loss caused by arcing or by electrical currents other than lightning.” The City sought a declaratory judgment of coverage and damages, arguing that the squirrel was an efficient proximate cause of the loss, and therefore, two independent causes, one covered and one excluded, contributed to the loss. The district court disagreed and granted summary judgment to EMC. The Supreme Court affirmed, holding that the loss here was “caused by arcing” and therefore was excluded even though the squirrel triggered the arcing. View "City of West Liberty v. Employers Mutual Casualty Co." on Justia Law

Appraisers may determine the factual cause of damage to insured property to ascertain the amount of the loss, but coverage questions are to be resolved by the court.In the instant case, the district court rejected an insurance appraisal award for hail damage to roofing shingles. The property insurer denied coverage for hail caused damage to the asphalt shingles based on a preexisting manufacturing defect. The insured townhome association sued the insurer for breach of contract and invoked the appraisal provision of the property insurance policy to ascertain the amount of the loss from the hailstorm. The appraisal panel valued the hail damage loss at $1.4 million. The district court found no shingle damage from hail, applied an exclusion for defective materials, and rejected the appraisal award. The Supreme Court remanded the case, holding (1) the district court erred by disregarding the appraisal award’s determination of the amount of the loss for shingles damaged by the hailstorm; and (2) the issue of the extent of preexisting shingle damage excluded from coverage must be decided by the court on remand. View "Walnut Creek Townhome Ass’n v. Depositors Insurance Co." on Justia Law

Several Iowa chiropractors brought this class-action lawsuit against Wellmark, Inc., Iowa’s largest health insurer, alleging that it conspired with competitors to fix prices, allocate markets, and engage in other anticompetitive conduct in violation of the Iowa Competition Law. The district court stayed the case pending further proceedings in federal multidistrict litigation (MDL) in Alabama brought under federal antitrust laws. The Supreme Court vacated the order staying this action, holding that the district court abused its discretion in staying the Iowa litigation pending further proceedings in the Alabama MDL because (1) resolution of the Alabama MDL could take years, and (2) there are considerable differences in the issues the two cases present. Remanded. View "Chicoine v. Wellmark, Inc." on Justia Law

In 1986, the Iowa legislature enacted House File 2219 to provide for payment by healthcare service corporations for services performed by chiropractors. Following the Supreme Court’s decision in Mueller v. Wellmark, several Iowa-licensed chiropractors (collectively, Appellants) brought this action alleging that Wellmark, Inc. wrongfully imposes restrictions and pays lower rates for chiropractic services than for equivalent services offered by medical and osteopathic doctors in violation of Iowa Code 514F.2. The Insurance Commissioner concluded that section 514F.2 does not require health insurers to compensate the chiropractors equally with medical and osteopathic doctors in network. The district court affirmed the Commissioner’s decision. The Supreme Court affirmed, holding (1) the interpretation of section 514F.2 has not been clearly vested by a provision of law in the discretion of the Commissioner; (2) the statute regulates payments to providers; (3) Wellmark’s fees for chiropractic care are not based solely on licensure; and (4) ERISA preempts the application of section 514F.2 to self-funded health plans. View "Abbas v. Iowa Insurance Division" on Justia Law

Insured filed a complaint challenging Insurer’s termination of workers’ compensation issuance. The insurance commissioner declined to consider the merits of the complaint on the ground that the complaint raised factual issues that could not be resolved by the agency. Insurer filed a petition for judicial review seeking a declaration that the insurance commissioner should have exercised jurisdiction over the dispute. The district court granted the commissioner’s motion to dismiss, concluding that Insurer lacked standing to litigate the issues. The Supreme Court dismissed Insurer’s appeal, holding that, under the circumstances presented and applying established caselaw, the appeal was moot. View "Auto-Owners Insurance Co. v. Iowa Insurance Division" on Justia Law

Developers and a general contractor of an apartment complex purchased a primary commercial general liability (CGL) insurance policy from Arch Insurance Group and an excess CGL insurance policy from National Surety Corporation (NSC). Westlake Investments, LLC, which purchased the complex, sued the insureds for construction defects. Arch defended the suit on behalf of the insureds, and the parties eventually settled. Pursuant to the settlement agreement, the insureds assigned their claims against NSC on the excess CGL policy to Westlake. Thereafter, NSC initiated this declaratory judgment action seeking a declaration that it had no obligation to pay any portion of the judgment awarded to Westlake. Westlake counterclaimed for breach of contract. The district court granted partial summary judgment in favor of Westlake, concluding that property damage resulting from defective work performed by an insured’s subcontractor may constitute an accident that qualifies as an occurrence covered by the Arch policy, and therefore, the NSC policy. After a trial, the jury returned a verdict in favor of Westlake. The Supreme Court affirmed in part and reversed in part, holding that defective workmanship by an insured’s subcontractor may constitute an occurrence under the terms of the Arch policy incorporated by reference into the NSC policy. View "Nat’l Surety Corp. v. Westlake Invs., LLC" on Justia Law

An SUV was being driven in the wrong direction on a highway when it collided with a semi-tractor-trailer. The SUV was totaled, and the SUV’s driver was killed. Second later, a motorcyclist ran into the SUV that was still in the middle of the highway. The drivers of both the semi and the motorcycle suffered injuries. The drivers jointly filed a petition for declaratory judgment against the insurer of the SUV asking the district court to declare that there had been two accidents for purposes of the insurance policy’s per-accident limit on bodily injury liability. The district court granted summary judgment for the insurer, concluding that the injuries suffered by the plaintiffs arose from one accident. The Supreme Court affirmed, holding that, under the terms of the SUV driver’s insurance policy, there was only one accident. View "Hughes v. Farmers Auto. Ins. Ass’n" on Justia Law

An SUV was being driven in the wrong direction on a highway when it collided with a semi-tractor-trailer. The SUV was totaled, and the SUV’s driver was killed. Second later, a motorcyclist ran into the SUV that was still in the middle of the highway. The drivers of both the semi and the motorcycle suffered injuries. The drivers jointly filed a petition for declaratory judgment against the insurer of the SUV asking the district court to declare that there had been two accidents for purposes of the insurance policy’s per-accident limit on bodily injury liability. The district court granted summary judgment for the insurer, concluding that the injuries suffered by the plaintiffs arose from one accident. The Supreme Court affirmed, holding that, under the terms of the SUV driver’s insurance policy, there was only one accident. View "Hughes v. Farmers Auto. Ins. Ass’n" on Justia Law