Proposed Pattern Jury Instructions, Comment Requested

The Insurance Law Section Council prepared and approved last spring four proposed Pattern Jury Instructions relating to insurance litigation.  Those proposed instructions, which may be seen on the Section website, cover the following topics:

  1. First-party bad faith;
  2. Expected or intended injury exclusion in CGL policy;
  3. Expected or intended injury exclusion in homeowners’ policy; and
  4. UM/UIM resident of household.

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Mere Disagreement With Claim Valuation Not Enough For Unfair And Deceptive Trade Practice Or Bad Faith Claim Against Insurer

By Daniel J. Knight 

In a recent unpublished decision, the North Carolina Court of Appeals reviewed whether an insurer’s handling of a claim constituted, inter alia, an unfair and deceptive trade practice.  Jackson v. Century Mutual Ins. Co., 2017 WL 3863901 (N.C. App. 2017).  Split 2-to-1, the Court ultimately affirmed summary judgment for the insurer.

Jackson involved a claim under a homeowners’ liability policy after the insureds’ home was severely damaged in a fire.  In submitting their claim to Century, the Jacksons sought relief under their Dwelling, Loss of Use, and Contents coverages.  Unsatisfied with the amounts they were compensated and with Century’s handling of their claim, the Jacksons filed suit against Century, alleging Unfair and Deceptive Trade Practices, Breach of Contract, Bad Faith, and Infliction of Mental or Emotional Distress.  In claiming that Century committed unfair and deceptive trade practices, the Jacksons sought relief under Chapters 58 and 75 of the General Statutes; specifically, the homeowners claimed a violation of N.C. Gen. Stat. § 58-63-15(11) also violated N.C. Gen. Stat. § 75-1.1.  Finding no genuine issue of material fact, the trial court granted summary judgment in favor of Century.

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Late Notice Under Claims-Made Policy Torpedoes Claim

By James W. Bryan

A recent ruling by the federal district court in Raleigh, NC highlights the different treatment the courts give to the late notice defense under a claims-made liability insurance policy versus an occurrence-based policy.  The insurer has a clearer opportunity under claims-made policies to defeat coverage when the insured’s notice of a claim is late. The United States District Court for the Eastern District of North Carolina in the case of John Hiester Chrysler Jeep LLC v. Greenwich Ins. Co., 2017 WL 6210897 (E.D.N.C. December 8, 2017), rejected the policyholder’s argument that prejudice must be shown by the insurer under a claims-made policy before coverage can be avoided due to late notice.

What happened in John Hiester is a lesson for all coverage lawyers. Claims-made policies are different.  They contain traps for the unwary.  One such trap is notice.  In John Hiester, the claims-made policies at issue were two similar employment practices liability (“EPLI”) policies.

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Reservation Of Rights Letter Found Insufficient By South Carolina Supreme Court

By William Lipscomb

The South Carolina Supreme Court issued a decision on July 26, 2017, which provides some good information regarding the purposes and requirements of reservation of rights (ROR) letters.  The Court held in Harleysville Group Insurance Corporation v. Heritage Communities, Inc., 803 S.E.2d 288 (S.C. 2017), that an insurer’s ROR letter in a construction defect case was insufficient to reserve its right to contest coverage.  Harleysville filed a declaratory judgment action seeking a judicial determination that it had no duty to indemnify its insureds (the developers and general contractors of two condominium complexes) regarding judgments entered against them in the underlying lawsuits or, alternatively, if any of the damages awarded in the underlying lawsuits were found to be covered, Harleysville sought an accounting to determine what parts of the underlying jury verdicts constituted covered damages.

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What Your Trial Court Administrator Wants You to Know, Part II: Western Region

By Molly Martinson and Bridget Warren

In our first installment of this three-part series, we discussed advice given by the TCAs in Cumberland, Forsyth and Guilford counties.  Now, we turn to the Western part of the state and highlight what the TCAs of Buncombe and Mecklenburg counties want you to know.

Rule No. 5: Know Your Local Rules (Again)

Ok—we know this was Rule No. 1 in the last installation—but it bears repeating because it is the single-most noted mistake made by attorneys. Indeed, both Marc Shimberg, Trial Court Administrator for the 28th Judicial District (Buncombe County), and Meredith Davis, Caseflow Management Administrator for the 26th Judicial District (Mecklenburg County) stated that not reading the local rules is one of the most common mistakes they see attorneys make in their districts. They both stressed that attorneys’ failure to be familiar with the local rules causes a plethora of caseflow issues. For instance, Ms. Davis stated attorneys routinely do not submit their continuance requests in a timely fashion, do not include the necessary information in continuance motions, and do not ensure that motions are placed on a hearing calendar within three days of filing the motion. It is imperative that attorneys practicing in Buncombe County and Mecklenburg County take the time to read the local rules. Your TCA will thank you.

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Professional Resolutions: Think Beyond the Four Walls of Your Office

By Leslie Pegram

Welcome to 2018! I must admit this post has been a few weeks in the making. Between the dusting of snow right after the new year that cancelled school for a few days to digging out from more snow last week (and more cancelled school), I had trouble finding time to squeeze in everything I wanted to do. But alas, the snow has melted and the sun is shining and I’ll say it again “Welcome to 2018!”  A new year always brings resolutions for improving our personal lives, health, fitness, etc. Has anyone’s resolution to be organized and on top of things already gone by the wayside (see above excuses)? We spend a lot of energy working to keep our resolutions intact (well at least to February) and kudos to those still succeeding! But, if your resolutions are sliding, it can be easy to fall back into our comfort zone and regular routine.  Read more

Two New Published 4th Circuit Opinions

By Joseph S. Murray IV

The 4th Circuit has been active in employment cases during the past couple of weeks, issuing several published and unpublished opinions. The following are the two most recent published opinions: [1]

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Update on EEOC v. Mission Hospital

By Joseph S. Murray IV

In my last post, On Vaccinations, Religion and What Buddha Really Said, I briefly discussed the case of EEOC v. Mission Hospital. In that case, the EEOC alleged Mission violated Title VII when it required employees to request accommodations to the mandatory vaccination policy by Sept. 1, but allowed employees to obtain vaccinations until Dec. 1. The district court denied Mission’s motion for summary judgment, and the case was on the trial docket.

On Jan. 12, 2018, the EEOC announced it had settled the case with Mission. Mission Hospital Agrees to Pay $89,000 To Settle EEOC Religious Discrimination Lawsuit (Jan. 12, 2018). In addition to the $89,000 Mission paid to settle the claim, it also had to agree to “revise its immunization policy to permit employees to request an exemption during the same period in which flu vaccines are to be received.”

‘A Very Happy Accident’: Tom McCormick On His 40-Year Career With the City Of Raleigh

By Ben A. Mount

In September of 2017, Thomas A. McCormick, Jr., announced his plan to retire as the City Attorney for the City of Raleigh after serving in that position for over 40 years.  I’m one of many lawyers who has had the opportunity to work with Tom, and I’m sure there are many more who would be interested in learning about Tom’s career in public service.  For that reason, instead of writing an article about the law, I decided to conduct a brief “career overview” interview with Tom McCormick to share with my colleagues in the NCBA.  Enjoy!

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Tax Reform: Selected Planning Points

By Herman Spence III

Below are selected planning points regarding recent tax changes. This summary does not discuss which provisions are temporary and which are permanent.

A. Bunching Into One Year Charitable Contributions That Would Otherwise Be Made Over Several Years

The new tax law raises the standard deduction to $24,000 for married couples filing jointly. Only $10,000 of state income taxes and property taxes may be deducted. Many expenses that were previously deductible, including investment management expenses and employee expenses, are no longer deductible. Many individuals will now use the $24,000 standard deduction rather than itemizing deductions. Such a taxpayer will, in effect, lose the deductibility of charitable contributions. Some taxpayers may be able to mitigate that by making in a single year charitable contributions they would normally make over several years. Such a taxpayer may have itemized deductions exceeding $24,000 in the year in which charitable contributions are bunched.

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