Harvey Kruse P.C.

MIKE SCHMIDT PREVAILS IN FIRST PARTY INSURANCE COVERAGE DISPUTE AMONG CARRIERS OVER A FIRE ON PROPERTY OWNED BY GM GRAND

Northland Insurance Co. as Subrogee of GM Grand v Century Surety Company and Adel Abbas Hashim, Wayne County Circuit Court, claim for $148,000 in property damage from a fire to property owned by GM Grand and insured by Northland Insurance Co. Northland filed suit as subrogee of GM Grand against Century Surety Company and Adel Abbas Hashim seeking coverage for the loss under the policy of insurance issued by Century Surety Company to the tenant Hashim and seeking recovery against Hashim for the damages pursuant to the lease. We were successful in obtaining summary disposition from Judge Wendy Baxter for both Century Surety and Hashim, on the basis that the Century Surety policy did not provide first party property coverage to GM Grand and that although GM Grand was an additional insured on the Century Surety policy, the policy did not provide any property coverage for GM Grand’s loss and also did not provide any liability coverage to Adel Abbas Hashim for the claims made by Northland. The court further ruled that Adel Abbas Hashim had no liability to GM Grand under the lease, because although the lease stated that the tenant assumed the entire risk of loss for damage to all or any part of the property, a separate lease provision required the landlord to insure the property. There had been a case evaluation award in favor of the plaintiff in the amount of $25,000.

MICHAEL SCHMIDT WINS COLLAPSING WALL INSURANCE COVERAGE LITIGATION

Northstar Petroleum, Inc. v L & M Masonry Enterprises and Allied Insurance, Oakland County Circuit Court. The plaintiffs, Northstar Petroleum, Inc., Atlantis Development Corporation and Atlantis Management Co., brought suit against L & M Masonry Enterprises, Inc. and Allied Insurance seeking to recover approximately $300,000 in damages for the collapse of a wall which was part of a construction project for a shopping center. The wall collapsed due to high winds and as a result adjacent walls also had to be torn down and replaced. The plaintiffs were the owners and general contractor for the project and brought suit against L & M, the masonry subcontractor, and Allied Insurance. The claims against Allied were based on the contract documents which required L & M to obtain a policy of insurance naming the plaintiffs as insureds and also to obtain insurance providing liability coverage for L & M. We filed a motion for summary disposition on behalf of Allied arguing that the plaintiffs were not insureds under the policy issued by Allied to L & M, and even if they were insureds, the policy was a commercial general liability policy which did not provide any first party coverage. We also argued that there was no coverage available to L & M for any of the claims made by the plaintiffs because all of the damage was to L & M’s own work or was incurred in repair and replacement of L & M’s work, and thus there was no "occurrence", no "property damage" and coverage was also excluded by the business risk exclusions. The plaintiffs entered a default against L & M in the amount of $288,000 and we obtained an order of dismissal as to any and all claims against Allied determining that Allied provided no coverage to the plaintiffs, and also had no duty to provide any coverage or defense to L & M for any of the claims made by the plaintiffs.

MEL KARFIS AND BARRY SUTTON OBTAIN 25 MINUTE DEFENSE JURY VERDICT IN MARYLAND TREESTAND PRODUCT LIABILITY TRIAL

In Frank v. Summit Treestands, LLC., Frederick County, Maryland, Mel Karfis and Barry Sutton recently obtained a lightning fast defense verdict on behalf of their treestand manufacturing client. Plaintiff sought over $750,000.00 for serious spinal, chest and lung injury suffered when he fell 20 to 25 feet from his treestand. He maintained that the cause was the result of a failure of the metal frame of the treestand and that his failure to use his harness in the matter intended was a foreseeable misuse of the product. In a case which stressed the importance of warnings and safety videos, Barry and Mel, together with engineer-designer and safety pioneer Ron Woller, their experts, George Saunders (mechanical engineering) and L.J. Smith (renowned hunting safety expert), established that the metal deformation was the result of and not the cause of the fall, and that the plaintiff’s injuries were solely caused by his own decision to disregard repeated warnings to always wear his full body safety harness. Deliberating only 25 minutes, the jury found that the product was not defective and was reasonably safe for its intended uses. The case is important for the entire treestand industry because it pioneered the importance of safety videos (now co-packaged with every treestand) in the courtroom. Mel and Barry, and another partner, John Prew, have developed a national practice defending treestand manufacturers throughout the United States.

FRANK PORRETTA WINS INSURANCE CANCELLATION CASE BEFORE JUDGE COLOMBO IN WAYNE COUNTY CIRCUIT COURT

In E & O Taxi v Insurance Services of Detroit, a taxicab company, which had financed the $150,000 annual premium on its commercial insurance policy, alleged that it had made all installment payments to its agent, which had failed to convey the payments to the premium finance company or to our client, the insurance carrier. The premium finance company sent out a “Notice of Intent to Cancel” and then sent out a “Notice of Cancellation” as required by statute, and requested that the carrier cancel the policy. The taxicab company claimed the carrier had breached duties to notify it that the premium had not been received and to notify it of the cancellation. The Court disagreed and granted Frank Porretta’s motion for summary disposition, finding that the cancellation and notices complied with MCL §500.1511, and the carrier owed no additional duties to the insured, relying on Doshi v Michigan Basic Property Ins Ass'n, 229 Mich App 595, 603, 582 NW2d 542, 546 (1998).

MICHIGAN COURT OF APPEALS OVERTURNS TRIAL COURT AND RULES FOR MICHAEL SCHMIDT IN CONTRACTUAL INDEMNITY CASE

In Empire Fire & Marine Insurance Co. v Minuteman International, Empire Fire filed suit as subrogee of General RV Center, Inc. to recover in excess of $5.5 million in damages as a result of a fire at the General RV Center, Inc. facility in Wixom, Michigan. Empire Fire alleged that a floor scrubber manufactured by Minuteman International, Inc. caused the fire. We represented Minuteman and filed a third party complaint against Lester Electrical, the manufacturer of a battery charger which was a component part of the floor scrubber, on the basis that the defect which the plaintiff alleged in the floor scrubber was in the battery charger. The plaintiff’s complaint was eventually dismissed for a $12,000 settlement, and we then sought contractual indemnity for all of the defense costs and attorney fees incurred in defending the claim from Lester Electrical pursuant to an indemnity contract. The trial court denied our motion for summary disposition and granted summary disposition to Lester Electrical. In Empire Fire & Marine Insurance Co. as Subrogee of General RV Center, Inc. v Minuteman International, Inc., unpublished per curiam decision of the Michigan Court of Appeals docket number 274660 (2008), the Court of Appeals reversed the trial court and ordered summary disposition in favor of Minuteman for full contractual indemnity from Lester Electrical. The court held that the plaintiff did not have to make allegations against Lester Electrical in order for Minuteman to obtain contractual indemnity, because the evidence established factual support to enforce the contractual indemnity agreement.

David W. Allard, As Trustee of The Bankruptcy Estate of Laura J. Wilamowski v Joseph A. Sova, State Farm Mutual Automobile Insurance Company, Clarkston Steel, Inc., Conrad C. Wilamowski and Mirash Bojaj, Oakland Court Circuit Court, Judge Fred M. Mester, plaintiff brought suit against multiple defendants alleging injuries incurred in a multi-vehicle accident. The plaintiff claimed that she had a lumbar laminectomy and total and permanent disability from prior cervical fusions as a result of the accident. We argued that the defendants, Sova and Clarkston Steel, had no liability and that Sova’s truck was knocked into the median by another vehicle, where it stopped. The trial court agreed and granted summary disposition holding that there was no evidence of anything other than an “accident” and no negligence on the part of the defendants.

Jaclyn Allen v Nationwide Mutual Fire Insurance Company and Auto-Owners Insurance Company, Washtenaw County Circuit Court, involved a claim for no fault benefits for catastrophic injuries to the plaintiff. The issue was whether the plaintiff was a resident of her parents’ household and thus entitled to no fault benefits under the Nationwide policy issued to her parents or was a resident of her grandmother’s household and thus entitled to no fault benefits from her grandmother’s insurer Auto-Owners. Auto-Owners argued that the plaintiff had indicated on her vehicle registration and driver’s license that she was a resident of her parents’ household. We argued that pursuant to the affidavits of the witnesses, including the plaintiff, her parents, her grandmother and other family members and neighbors, that the plaintiff was a resident of her grandmother’s household. We argued further that Auto-Owners’ argument regarding the driver’s license and vehicle registration did not raise any genuine issue of material fact. The court, Judge Archie C. Brown, agreed and ordered summary disposition in favor of the plaintiff and against Auto-Owners, and dismissed all claims against Nationwide.

MIKE SCHMIDT PERSUADES A FEDERAL COURT TO GRANT SUMMARY JUDGMENT IN HOMEOWNER MISREPRESENTATION CASE

In Lacresia Nolan v Nationwide Mutual Fire Insurance Company, plaintiff filed suit seeking recovery for fire damage to her home insured by Nationwide for $161,000. After completing discovery we moved for summary judgment on the basis that the policy of insurance was rescinded from its inception due to the plaintiff/insured’s misrepresentations in the application for insurance. The plaintiff argued that Nationwide had to prove an intentional misrepresentation, that Nationwide undertook to inspect the premises and should have ascertained that they were vacant, and that the plaintiff advised the agent that she was not residing in the premises and only intended to move in the future contrary to the written application, thus estopping Nationwide from raising a misrepresentation in the application and that Nationwide knew the premises would be vacant because they were being remodeled or under construction. The court rejected all of these arguments holding that the misrepresentation did not have to be intentional, that Nationwide had no duty to investigate to determine if the representations in the application were correct, that the plaintiff/insured did not provide oral information to the agent contrary to all of the misrepresentations in the application and thus Nationwide was not estopped from raising the defense of the application and the fact that the home was allegedly being remodeled or under construction was irrelevant to the misrepresentations. The court granted summary judgment to Nationwide dismissing all of the claims.

IN A PUBLISHED DECISION THE MICHIGAN COURT OF APPPEALS AFFIRMS SUMMARY DISPOSTION FOR DALE BURMEISTER IN A CASE RAISING CONSTITUTIONAL AND REAL PROPERTY ISSUES IN A DISPUTE BETWEEN A CABLE OPERATOR AND A LARGE LANDOWNER

In Heydon v MediaOne, the Michigan Court of Appeals has affirmed in a published decision a variety of dispositive rulings involving a dispute between a large landowner and a cable television operator. The four major questions before the Court where 1) whether the Cable Communications Policy Act of 1984 violates the takings clause in the United States Constitution; 2) whether the Cable Communications Policy Act of 1984 prohibits "piggy-backing" on private easements; 3) whether prescriptive easements may be assigned; and 4) whether a public utility that apportions a prescriptive easement for use by a cable operator to string its wire imposes a new burden on the existing easement. On all four issues, the Court of Appeals ruled in favor of Dale's client. Click here to view the opinion of the Court.