CM Report of Recent Decisions – 2015 Volume 3

July 1, 2015 / CM Reports

Articles in this report

*The Minefield Of Appellate Practice Revisited—In Re: Estate Of York, 2015 IL App. (1st) 132830
The authors of this Sidebar have continually recommended to our friends in the insurance and business industry the necessity of always retaining appellate practitioners to handle any appellate matters. The decision by the Illinois Appellate Court, First District in Estate of Yorkreinforces the wisdom of our advice, as shown by the first sentence in the Appellate Court’s Opinion…

CYBER-SECURITY UPDATE: Seventh Circuit Finds Customers Have Standing To Sue In Cyber-Security Case, Remijas v. Neiman Marcus Group, LLC
The Seventh Circuit recently considered whether Neiman Marcus credit card holders who were victims of a cyber-attack on the luxury department store had standing to sue it. The central issue in Remijas v. Neiman Marcus Group, LLC, 2015 U.S.App. LEXIS 12487 (7th Cir. 2015), was whether the credit card holders suffered a “concrete, particularized injury”-requisite for Article III standing-because of the 2013 Neiman Marcus security breach.

California Supreme Court Overrules Henkel: Liability Insurers Barred From Enforcing Consent To Assignment Clauses After Loss Has Occurred
In a unanimous 59-page opinion, the California Supreme Court has overruled Henkel Corp. v. Hartford Accident and Indemnity Company, 29 Cal. 4th 934 (2003)(“Henkel“)’s oft-criticized holding allowing liability insurers to enforce “consent to assignment” clauses to preclude an insured’s post-loss assignment of the right to invoke policy coverage (defense and indemnification) for third-party losses which have not been reduced to a sum of money due or to become due under the policy as contrary to Insurance Code Section 520-a statute neither cited to nor considered by the Court in deciding Henkel. Fluor Corp. v. Superior Court of Orange County, No. S205889, ___Cal. 4th ___ (2015).

Employee On Way To Work Entitled To Employer’s Coverage
Under the so-called “coming and going” rule, employees on their way to or from work typically are said not to be acting within the scope of employment for purposes of any tort that might be committed that might otherwise result in employer liability incurred vicariously.

Indiana School Law: School Corporations Are Not Required To Provide Transportation For Students
The Indiana Supreme Court holds that the Education Clause of the Indiana Constitution does not require school corporations to provide transportation to and from school. Hoagland v. Franklin Twp. Cmty. Sch. Corp., 27 N.E.3d 737.

Indiana Supreme Court Resolves Ambiguity In General Wrongful Death Statute Holding That Attorneys’ Fees Are Not Recoverable By Surviving Spouses And/Or Dependents
In SCI Propane, LLC v. Frederick, 2015 Ind. LEXIS 716 (October 15, 2015), the Supreme Court of Indiana resolved a matter of first impression under the State’s fifty-year old General Wrongful Death Statute (“GWDS”), Indiana Code section 34-23-1-1.

Pennsylvania Supreme Court: Insurer Bound By Insured’s Unauthorized Settlement
The Pennsylvania Supreme Court recently issued a much-watched ruling that undermines liability insurers’ ability to control indemnity payments under their policies. In The Babcock & Wilcox Co. v. American Nuclear Insurers, 2015 Pa. LEXIS 1551 (Pa.), the court held that a policyholder’s $80 million settlement bound its liability insurer, despite the insurer’s refusal to authorize the settlement. In reaching that conclusion, the court held that a policyholder can bind its insurer to “reasonable” settlements when the insurer defends under a reservation of rights, regardless of the basis for the reservation.

Tenth Circuit Refuses To Extend Duty To Initiate Settlement Negotiations To Excess Insurer
Pursuant to Oklahoma law, a primary liability insurer is obligated to initiate settlement negotiations with a third-party claimant if liability is clear and the insured is likely to owe that claimant more than the limits of the primary policy.

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