Justia Oklahoma Supreme Court Opinion Summaries

Tokiko Johnson's real property was damaged in a storm and she filed a claim with her insurance company. Johnson also executed an assignment of her insurance claim for the purpose of repairing the property with the execution in favor of Triple Diamond Construction LLC (the construction company). An appraiser retained by the construction company determined storm damage to the property in the amount of $36,346.06. The insurer determined the amount of damage due to the storm was $21,725.36. When sued, the insurer argued the insured property owner was required to obtain written consent from the insurer prior to making the assignment. The Oklahoma Supreme Court determined an insured's post-loss assignment of a property insurance claim was an assignment of a chose in action and not an assignment of the insured's policy. Therefore, the insured's assignment was not prohibited by either the insurance policy or 36 O.S. section 3624. Judgment was reversed and the matter remanded for further proceedings. The insurer's motion to dismiss the appeal was thus denied. View "Johnson v. CSAA General Insurance Co." on Justia Law

In January 2020, summary judgment was entered in favor of defendant State Farm Mutual Automobile Insurance Co. (State Farm) against its insured, plaintiff Eric Thurston. In 2012, Thurston first obtained automobile liability insurance through State Farm. On June 9, 2016, Thurston was injured in an automobile accident. At that time, Thurston had three separate, six-month term, insurance policies with State Farm, with separate UM coverage on each, for which Thurston paid three separate premiums. The accident vehicle had $25,000 in UM coverage and the other two vehicles each had $50,000 in UM coverage. After determining that Thurston's medical expenses from the accident exceeded the at-fault driver's policy limits, State Farm initially paid Thurston $25,000 in UM benefits under the policy for the vehicle involved in the accident. State Farm eventually paid Thurston another $25,000 under a second policy, for a total of $50,000 in paid UM benefits. While Thurston's injuries exceeded that amount, State Farm refused further payment. Thurston brought claims against State Farm, Janis Yearout (Agent), and Yearout Insurance Agency (Agency) for fraud, breach of contract, bad faith, and failure to procure appropriate coverage. In April 2019, Thurston filed his third amended petition arguing, in part, that State Farm expressly provided for stacking when it continued to charge and accept full premiums on multiple policies without advising that the policies no longer stacked. In support, Thurston submitted his deposition testimony that he did not recall receiving notice of changes in policy language after the 2014 statutory amendment. Thurston alleged that his claims were also supported by State Farm's internal claim documents, which described the policy for the accident vehicle as "stacking" with another. The question before the Oklahoma Supreme Court was whether State Farm expressly provided for stacking of uninsured motorist policies, pursuant to 36 O.S. Supp. 2014, section 3636(B), by charging and accepting separate premiums for uninsured motorist coverage on separate policies. The Supreme Court found State Farm's charging separate UM premiums for vehicles on separate policies did not fall within section 3636's exception of expressly providing for stacking of UM coverage. Because State Farm did not take action to expressly provide for stacking of UM coverage, they were entitled to judgment as a matter of law. The district court's order granting summary judgment was affirmed. View "Thurston v. State Farm Mutual Automobile Ins. Co." on Justia Law

The Oklahoma Supreme Court granted certiorari to address first impression questions of: (1) whether a home warranty plan met the definition of an insurance contract; (2) and if it was insurance, whether a forced arbitration clause in such a contract was unenforceable under the Oklahoma Uniform Arbitration Act; (3) whether 12 O.S. 2011 section 1855 of the Oklahoma Uniform Arbitration Act was a state law enacted for the purpose of regulating insurance under the McCarran-Ferguson Act; and (4) whether pursuant to the McCarran-Ferguson Act, did section 1855 preempted the application of the Federal Arbitration Act. The Supreme Court answered all questions in the affirmative. View "Sparks v. Old Republic Home Protection Co., Inc." on Justia Law

The Tenth Circuit Court of Appeals certified two questions of law to the Oklahoma Supreme Court. Billy Hamilton, a small-business owner in Council Hill, Oklahoma, filed a claim in December 2015 with his insurer, Northfield Insurance Company, seeking coverage for his building's leaking roof. Northfield twice denied his claim: once in February 2016, and again in April 2016. Hamilton filed suit against Northfield in November of that year, alleging bad-faith denial of his insurance claim and breach by Northfield of the insurance contract. Hamilton rejected a proposed settlement, and the matter went to trial. A jury awarded him $10,652, the maximum amount of damages the judge instructed the jury it could award. Hamilton then sought attorney fees and statutory interest under 36 O.S. section 3629(B). Northfield responded that Hamilton was not the prevailing party under the statute, given that he had recovered less than its settlement offer to him. The federal district court agreed with Northfield, and Hamilton appealed to the Tenth Circuit Court of Appeals. Initially, a panel of that court affirmed the district court's determination that Hamilton was not the prevailing party for purposes of awarding attorney fees under section 3629(B). Following a petition for en banc rehearing by Hamilton and additional briefing by amicus curiae, the Tenth Circuit Court of Appeals granted panel rehearing sua sponte, vacated its opinion as to the issues raised in Hamilton's appeal, and certified the two questions to the Oklahoma Court. The questions were: (1) in determining which is the prevailing party under 36 O.S. 3629(B), should a court consider settlement offers made by the insurer outside the sixty- (formerly, ninety-) day window for making such offers pursuant to the statute?; and (2) should a court add to the verdict costs and attorney fees incurred up until the offer of settlement for comparison with a settlement offer that contemplated costs and fees? The Oklahoma Court answered both questions "no:" (1) a court may consider only those timely offers of settlement of the underlying insurance claim--and not offers to resolve an ensuing lawsuit that results from the insurer's denial of the same; and (2) this is strictly limited to the specific context of determining prevailing-party status under section 3629(B) alone. The Oklahoma Court expressed no opinion on a trial court's evaluation of the form of settlement offer described in the certifying court's second question when made outside the section 3629(B) setting. View "Hamilton v. Northfield Ins. Co." on Justia Law

Plaintiff Oklahoma Schools Risk Management Trust (OSRMT) brought a declaratory judgment action seeking a declaration it was not liable for losses sustained by McAlester Public Schools resulting from a ruptured water pipe in one of its schools. McAlester Public Schools answered, alleged breach of contract by plaintiff, and sought indemnification for its losses. A trial court granted summary judgment for Oklahoma Schools Risk Management Trust on its request for declaratory relief and against McAlester Public Schools on its indemnity claim. McAlester Public Schools appealed the judgment. The Oklahoma Supreme Court agreed with McAlester Schools that OSMRT failed to show a policy-based exclusion to coverage, reversed summary judgment and remanded for further proceedings. View "Okla. Schools Risk Management Trust v. McAlester Pub. Schools" on Justia Law

Plaintiff-appellant State Farm Automobile Insurance Company, as subrogee of its insured, sued for damages arising out of an automobile accident between the insured and Defendant-appellee Nicholas Payne. The insured, Tori Ukpaka, originally brought this action, but voluntarily dismissed it after the statute of limitations had run. Whether State Farm could revive that claim depended on whether it could take advantage of the Oklahoma savings statute at 12 O.S. sec. 100, which gives "the plaintiff" up to one year from the date of a non-merits-based termination in which to refile an otherwise time-barred claim. In light of the Oklahoma Supreme Court’s “historic” interpretation of that statute, it concluded that because State Farm was "substantially the same, suing in the same right" as its insured for purposes of a subrogation claim, it should be entitled to the same treatment as its insured for purposes of the savings statute. Accordingly, the Court held State Farm’s, filed within one year after its insured voluntarily dismissed the same, was timely. View "State Farm Mutual Automobile Ins. Co. v. Payne" on Justia Law

This case arose from a motor vehicle accident in 2012. William Taylor was driving a vehicle owned and insured by Guy's Seed Company (Guy's Seed); Appellant Mark Raymond was a passenger in the vehicle driven by Taylor. Both Raymond and Taylor were employees of Guy's Seed. Appellee American Mercury Insurance Company (Mercury) issued a commercial automobile insurance policy to Guy's Seed which provided uninsured/under-insured motorist (UM) coverage of $1,000,000 per accident. Larry Bedell was an employee of BlueKnight Energy Partners (BlueKnight); BlueKnight carried a $1,000,000 primary automobile liability policy and a $40,000,000 excess liability policy. Bedell was driving an oil tanker truck, owned by BlueKnight, and attempted to turn in front of the Guy's Seed vehicle causing a collision. The collision caused an immediate explosion, which resulted in Taylor's death and Raymond suffering significant permanent injuries. Raymond qualified as insured under Mercury's UM coverage. Raymond filed suit against Defendants, Bedell and BlueKnight. Mercury investigated and offered the UM policy limits to Raymond's and Taylor's representatives, paying $500,000 to each. Mercury then intervened in Raymond’s court case seeking subrogation from Defendants for the $500,000 payment made to Raymond under the UM policy. Raymond disputed Mercury's right to subrogation, but Defendants refused to settle unless the settlement amount was inclusive of Mercury's disputed subrogation claim. An agreement was reached where Raymond settled with Defendants for a confidential amount greater than the primary insurance liability limits but less than the excess policy; Defendants paid Raymond the amount of the settlement minus the $500,000 claimed by Mercury. The disputed $500,000 was to be held until there was an agreement or court order as to who was entitled to the funds. The question presented for the Oklahoma Supreme Court’s review centered on whether Mercury was entitled to subrogation for the $500,000 paid. The Supreme Court determined that contrary to Mercury's claims, Raymond was not receiving a windfall here. “Mercury was paid a premium for UM protection and Raymond recovered an amount not covering all of his damages within the limits of the primary liability policy and the UM policy. Raymond has also recovered an amount from the tort-feasor's other assets that, combined with the liability and UM funds, covered his damages. It would be unjust to permit Mercury to avoid its liability with its claim that the tort-feasor's other assets, that happened to be an excess liability policy, removed Mercury's liability thus denying Raymond from receiving that for which Mercury was paid a premium.” View "Raymond v. Taylor" on Justia Law

Bob Hensley (Buyer) purchased real estate by contract for deed. He sued the insurer of the property's previous owner, State Farm Fire & Casualty, alleging breach of the implied-in-law duty of good faith. Insurer filed a motion for summary judgment and argued buyer was a stranger to the insurance contract and could not bring an action against insurer. The trial court granted the insurer's motion for summary judgment. The judgment was appealed and affirmed by the Court of Civil Appeals. After review, the Oklahoma Supreme Court held the buyer's action in this case for breach of the implied-in-law duty of good faith by an insurer was based upon his status as an insured or third party beneficiary; and buyer's equitable title to property arising from a contract for deed is insufficient by itself to confer upon him the status of an insured. The Court also held the buyer presented facts on the issue whether he was an intended third party beneficiary, and these facts and their inferences were disputed by insurer. Whether buyer was a third party beneficiary and an insured under the policy based upon disputed facts and inferences was a matter for the trier of fact, and summary judgment for insurer was improvidently granted. View "Hensley v. State Farm Fire & Casualty Co." on Justia Law

Plaintiff-appellee Elizabeth Cates filed on her behalf and a putative class asserting claims against the defendant-appellee INTEGRIS Health, Inc. for breach of contract, violation of the Oklahoma Consumer Protection Act, deceit, specific performance, and punitive damages. INTEGRIS successfully moved to dismiss the claims based on the ground that they are all preempted by the Employee Retirement Income Security Act. Cates appealed. Because the trial court in this matter did not take into consideration the federal Tenth Circuit Court of Appeals’ decision in Salzer v. SSM Health Care of Oklahoma Inc., 762 F.3d 1130 (10th Cir. 2014), which was factually similar to the facts of this case and found that the plaintiff’s claims were not preempted, the Oklahoma Supreme Court reversed and remanded the trial court in this matter for reconsideration in light of Salzer. View "Cates v. Integris Health, Inc." on Justia Law

Employee-appellant Tracy Meeks sued an insurer for bad faith refusal to timely comply with several orders of the Workers' Compensation Court awarding employee temporary total disability benefits after the insurer, without good cause, withheld employee's benefits on twenty-six separate occasions. Insurer moved for dismissal, asserting employee failed to obtain a certification order from the Workers' Compensation Court (a jurisdictional prerequisite for commencing a bad-faith action in district court). The District Court granted insurer's motion, but the Supreme Court reversed. Because the certification requirements were met here, employee was free to proceed in district court on his bad-faith claim against insurer for insurer's alleged bad faith refusal to provide temporary total disability benefits as ordered by the WCC. View "Meeks v. Guarantee Insurance Co." on Justia Law