Justia Oklahoma Supreme Court Opinion Summaries

In November 2005, petitioner Barbara Shepard was working for the Oklahoma Department of Corrections when she was injured. The Workers' Compensation Court found that Shepard had sustained a permanent partial disability. The court ordered the respondent Department of Corrections and/or its insurance carrier "to provide the claimant with reasonable and necessary continuing medical maintenance limited to prescription medications and four (4) visits per year to monitor same with Dr. M." There was no limit imposed on the doctor's exercise of a medical judgment as to which prescriptions were needed by Shepard, except those that were medically reasonable and necessary. The court also directed payment of reasonable and necessary medical expenses incurred by Shepard as a result of her injury. In 2010, Shepard moved to reopen her claim based upon a change of condition for the worse. In 2011, the Workers' Compensation Court reopened the claim and determined that Shepard had a change of condition for the worse and allowed additional compensation for the worsening of her left shoulder. The order of the Workers' Compensation Court en banc stated that respondent/insurance carrier "shall pay all reasonable and necessary medical expenses incurred by claimant as a result of said injury through the date of this order." The previous award of continuing medical maintenance was not disturbed by the order that reopened her claim. The order on reopening was appealed to the Court en banc which affirmed in part and modified in part the previous order. In 2011, the Court en banc modified a provision relating to temporary total disability, and two provisions of attorney's fees. The award of reasonable and necessary medical expenses was not modified. The previous award of continuing medical maintenance was not disturbed. In 2012, Respondents sought a hearing to "discuss prescriptions." They objected one of Dr. M.'s medical reports. The court ordered Shepard to submit to a medical examination by Dr. Y., and directed this doctor to determine whether Shepard needed pain management and the nature and extent of necessary continuing medical maintenance. The order also directed Dr. Y. to determine if Shepard's current continuing medical maintenance by Dr. M. was within the Oklahoma Treatment Guidelines. The court also directed Dr. Y. to determine whether Shepard's continuing medical maintenance was within the Oklahoma Treatment Guidelines; and if not, to advise whether her continuing medical maintenance in her best interest. Respondents then sought an order that would have the effect of terminating Shepard's medical prescriptions. In June 2014, the Workers' Compensation Court of Existing Claims ordered that Dr. M. could provide continuing medical maintenance to the Shepard. In July 2014, Shepard sought review of this decision by by the Supreme Court, arguing that respondents made an impermissible retroactive application of a new workers' compensation law. Respondents argued that application of the new law to medical benefits currently being provided was not a retroactive application, and that even if the application was a retroactive application, such application was permissible. The Supreme Court held that 85 O.S.2011 section 326(G) and the statutorily incorporated Guidelines were unconstitutionally applied retroactively to employee's previous award for medical treatment that predated section 326. View "Shepard v. Dept. of Corrections" on Justia Law

This appeal stemmed from an action for auto negligence arising out of injuries sustained by Plaintiffs Rachael Montgomery and her three year old son, Noah Orcutt. Montgomery was rear-ended by Defendant Morgan Potter, who claims that her car brakes failed. As a result of Defendant's negligence, Montgomery claimed she sustained a severe back injury that required surgery. Among other damages sought Montgomery sought damages for her pain and suffering. Montgomery was an uninsured driver at the time of the accident. Citing 47 O.S. Supp. 2011, section 7-116, which prevents uninsured motorists from recovering certain non-economic damages such as pain and suffering, Defendant denied that Montgomery was entitled to damages for pain and suffering. Plaintiffs argued on appeal that section 7-116 was a special law in violation of art. 5, section 46 of the Oklahoma Constitution and filed a motion for declaratory relief declaring the statute unconstitutional. The trial court ruled in Plaintiffs' favor. The Supreme Court agreed: because 47 O.S.2011, section 7-116 impacted less than an entire class of similarly situated claimants it was under-inclusive and, therefore, the Court found it to be an unconstitutional special law prohibited by the Oklahoma Constitution. View "Montgomery v. Potter" on Justia Law

A church filed a claim with its insurer for damage to its sanctuary after a severe winter storm. The insurer hired an independent insurance adjuster to adjust the claim. The church eventually filed suit against both its insurer and the independent adjuster alleging breach of contract, bad faith, and gross negligence. The church settled with its insurer, and the trial court granted summary judgment for the independent adjuster. The issues this case presented for the Supreme Court's review on appeal were: (1) whether a special relationship existed between an insured entity and an independent adjuster hired by the insurer, sufficient to subject the independent adjuster to the implied covenant of good faith and fair dealing arising under the insurance contract; and (2) whether an independent insurance adjuster owed a legal duty to the insured such that it may be liable to the insured for negligence in its adjustment of the claim. The Oklahoma Supreme Court determined the answer to both questions was no, and affirmed the trial court's judgment. View "Trinity Baptist Church v. Brotherhood Mutual Insurance Services, LLC" on Justia Law

After settling a federal lawsuit brought by plaintiffs for $13,500,000.00, the sheriff of Delaware County and the County Commissioners demanded that the Association of County Commissioners of Oklahoma Self Insurance Group indemnify Delaware County for that amount. The insurance group agreed to contribute $1,000,000.00, less the defense costs already incurred, which amount was the per occurrence limit. Delaware County filed a lawsuit for breach of contract, and subsequently moved to amend its petition to add a bad faith claim, after the lawsuit had been transferred to Rogers County. The trial court granted the motion and subsequently denied the insurance group's motion to dismiss the bad faith claim. The trial court certified for immediate interlocutory appeal the order denying that motion to dismiss to the Supreme Court. The questions that appeal presented for the Supreme Court's review were: (1) whether the Association of County Commissioners of Oklahoma Self-Insurance Group was an insurer pursuant to 36 O.S.2011, sec. 607.1; and (2) whether, pursuant to the Governmental Tort Claims Act, that organization was immune from tort liability for a breach of the duty of good faith and fair dealing. After its review, the Supreme Court held that under the statutes the organization was an insurance company for some purposes, but was a governmental entity immune from a tort claim for the breach of the duty of good faith and fair dealing. View "BD. OF CTY. COMMISSIONERS v. ASSOC. OF CTY. COMMISSIONERS OF OKLA. SELF-INSUR. GROUP" on Justia Law

Claimant Andres Carbajal alleged he was injured when scaffolding he was on was blown over and he fell while working on a construction project in Okmulgee. He filed a claim in the Workers' Compensation Court and alleged that he was an employee of Precision Builders, Inc., and/or Mark Dickerson (Precision) when he fell. The tribunal denied the claim upon determining that claimant was an independent contractor and not an employee. The three-judge panel affirmed the trial tribunal and the panel's order was affirmed by the Court of Civil Appeals. The issue this case presented to the Oklahoma Supreme Court on certiorari was whether petitioner was an employee or independent contractor. "Considering each of the factors on which the evidence was presented leads us to the conclusion that claimant met his burden to show that he was an employee of Precision." The Court of Appeals' decision was vacated and the case remanded for further proceedings. View "Carbajal v. Precision Builders, Inc." on Justia Law

Physicians Liability Insurance Company (PLICO) insured Defendant Mark Valentine pursuant to a claims made policy with a policy period from July 1, 2004, to December 31, 2006. On November 1, 2004, Valentine operated on David Wurtz. As a result of Valentine's negligence during the operation, Wurtz died. On March 10, 2005, the Oklahoma Board of Medical Licensure held a hearing to determine whether Valentine should be disciplined. At the hearing, the Board revoked Valentine's license. On March 22, 2005, PLICO notified Valentine by letter that the policy had been cancelled effective March 10, 2005, with "Company's Decision" stated as the reason for cancellation and offered to sell him tail coverage. That letter was followed by another that addressed the premium refund issues and stated that the policy had been cancelled at Valentine's request. On June 2, 2005, Wurtz' personal representative, Tracey Chandler, filed suit against Valentine and others for the wrongful death of Wurtz. Valentine forwarded the petition and summons served on him to PLICO; PLICO sent Valentine a letter denying coverage because the claim was not made until after the policy was cancelled and asserting the policy exclusion for acts performed while under the influence of intoxicating substances. Valentine's debts were discharged in bankruptcy in early 2006. Chandler filed a motion for summary judgment against Valentine; Valentine entered into a Consent Judgment with Chandler in the amount of $2,250,000.00. The trial court granted summary judgment in favor of Chandler and ruled that Valentine was entitled to a set off by virtue of settlements with other parties in the amount of $1,275,000.00. Chandler filed garnishment proceedings against PLICO in May of 2008. Chandler asserted that Valentine was indebted to Chandler. PLICO denied any indebtedness asserting a lack of coverage under any insurance policy. Both Chandler and PLICO filed motions for summary judgment in the garnishment action. The trial court entered summary judgment in favor of Chandler, holding that cancellation of the policy violated section 3625 of title 36 and was therefore void. The issue in this matter was whether an insurer may agree to cancel a "claims made" policy with the knowledge that a potential claim is pending without violating the statutory prohibition on retroactive annulment of an insurance policy following the injury, death, or damage for which the insured may be liable. Upon review, the Supreme Court held that it may not and affirmed the trial court. View "Chandler v. Valentine" on Justia Law

On November 14, 2009, sewage entered into and damaged the home of plaintiffs Justin and Brandy Porter. At the time, Plaintiffs' home was insured by defendant Oklahoma Farm Bureau Mutual Insurance Company under a "Homeowners Special Coverage Policy." Plaintiffs filed a claim for their loss, which defendant denied. Subsequently, plaintiffs filed a petition in the district court for breach of contract and breach of the duty of good faith and fair dealing. Plaintiffs argued that the district court should follow "Andres v. Oklahoma Farm Bureau Mutual Insurance Co.," (227 P.3d 1102, cert. denied, (Nov. 23, 2009)) to find that the policy was ambiguous because it contained conflicting provisions on loss caused by water damage and that the doctrine of reasonable expectations required the ambiguity to be construed in favor of coverage. Plaintiffs also argued that defendant committed bad faith when defendant wrote a policy that both includes and excludes a named peril and then denied plaintiffs coverage under the policy. Plaintiffs amended their petition to bring classwide claims on behalf of others similarly situated. Plaintiffs amended their petition a second time to allege "breach of the implied covenant of good faith and fair dealing and/or fraud," individually and classwide. Plaintiffs' motion for leave to file a second amended petition did not address an individual or class-action fraud claim. Defendant moved to dismiss the class-action claims and the fraud claim for failure to state a claim upon which relief can be granted. Defendant subsequently stated that the motion to dismiss "[did] not address any other claims" and that "a dispositive motion challenging the merits of Plaintiffs' individual breach of contract and bad faith claims [would] likely be filed in the future." The district court, however, dismissed all claims. The issue before the Supreme Court on appeal was whether the district court erred in granting defendant's motion to dismiss. The resolution of this issue turned on two questions: (1) whether plaintiffs' homeowners policy was ambiguous when the policy covers loss to personal property "caused by . . . accidental discharge or overflow of water from within a plumbing . . . system" (the accidental-discharge-coverage provision) and excluded coverage for loss to real and personal property "resulting directly or indirectly from . . . water which backs up through sewers or drains" (the sewer-or-drain-backup exclusion); (2) if the policy was ambiguous, whether the doctrine of reasonable expectations required the ambiguity to be construed in favor of coverage. The Supreme Court found the district court erred in dismissing the petition in its entirety when the allegations taken as true stated a claim for breach of contract. View "Porter v. Oklahoma Farm Bureau Mutual Ins. Co." on Justia Law

Respondent-claimant, Ben Snell was employed by petitioner-employer Kentucky Fried Chicken of McAlester. He alleged that while at work he slipped and fell while carrying a tray of chicken weighing approximately 40 to 50 pounds. The trial court awarded claimant temporary total disability (TTD) and reasonable and necessary medical treatment for injuries to his neck, the second finger of his right hand, and aggravation of pre-existing conditions to his left knee and low back. All other issues were reserved. On appeal, the Court of Civil Appeals (COCA) sustained the award. In its opinion, COCA ruled the standard of review in this case was the "any competent evidence" standard because of a holding in a previous opinion by the same division, "Westoak Industries, Inc. v. DeLeon," which held 85 O.S. 2011 sec. 340(D)(4), setting out "against the clear weight of the evidence" as the appellate standard of review in workers' compensation cases, constituted a violation of the separation of powers provision of the Oklahoma Constitution. Westoak was completely at odds with another COCA opinion, "Harvey v. Auto Plus of Woodward." "Harvey" held section 340(D)(4) was not unconstitutional as a separation of powers violation. The Supreme Court granted certiorari to consider the issue as one of first impression since certiorari was not sought in either of the previous cases. The Court concluded that there was no constitutional separation of powers prohibition in in the Okla.Const., art IV, section 1 against the Legislature's adoption of the "against the clear weight of the evidence" standard of review in 85 O.S. 2011 sec. 340(D)(4). COCA's opinion was therefore vacated. Because "Westoak" and "Harvey" were totally inconsistent with the views expressed in this opinion, they were both specifically overruled. View "Kentucky Fried Chicken of McAlester v. Snell" on Justia Law

Claimant was injured at work as she walked out a door used by employees to exit Employer's school building. A rug outside the door slipped out from under her, causing her to fall. At the time of this accident, claimant was leaving work early due to a family medical emergency. The Workers' Compensation Court found this injury to be compensable, but the Court of Civil Appeals ruled it was not. The Court of Civil Appeals held that claimant was on a personal mission at the time of the injury and vacated the award of benefits. The dispositive question for the Supreme Court's review was whether Claimant's injury while leaving work in response to a family medical emergency arose out of her employment. The Workers' Compensation Court answered this question in the affirmative. Upon review, the Supreme Court agreed, and reversed the Court of Appeals. View "Graham Public Schools v. Priddy" on Justia Law

Petitioner Tulsa Stockyards, Inc. challenged the constitutionality of the CompSource Mutual Insurance Company Act (85 O.S.Supp.2013, secs. 375.1 et seq.). The Act required CompSource Oklahoma be restructured to do business as a domestic mutual insurer without capital stock or shares under the name of CompSource Mutual Insurance Company effective January 1, 2015. Petitioner contended that CompSource was a state agency and its money and other assets, valued at approximately $265,000,000.00, were assets of the people of Oklahoma. Converting CompSource from a department of the State to an independent, licensed mutual insurance company without provision for the State to retain ownership of CompSource's assets, petitioner argued, was contrary to the prohibition against gifts of public money, the prohibition against interference with contracts, and the prohibition against money being paid out of the State Treasury except by appropriation. Upon review of the matter, the Supreme Court concluded that CompSource's money and other assets were held in trust for the benefit of the employers and employees protected by the insurance issued by CompSource, the Court's "Moran" opinion remained sound law, and the Oklahoma Constitution did not prohibit the Legislature from placing CompSource's money and other assets in trust with a domestic mutual insurer. View "Tulsa Stockyards, Inc. v. Clark" on Justia Law