In Santacroce v. Sametz, a plaintiff brought suit against both the alleged tortfeasor for negligence, and the tortfeasor’s insurer for bad faith in violation of Mass. Gen. Laws chs. 176D and 93A. The insurer, as is often the case, moved to sever and stay the Chapter 176D and 93A claims. This motion was denied by the trial judge, who noted that “privileges [work product and attorney client] can be protected by less drastic methods than severance and staying these claims.”
Massachusetts Developments
District of Massachusetts Finds Coverage Under A Professional Liability Policy In Underlying Case Centered On Unfair Competition
On October 28, the United States District Court for the District of Massachusetts denied an insurer’s motion for summary judgment in a coverage action it had brought against its insured on a professional liability policy, an insurance broker who specialized in the placement of professional liability coverage for professionals including real estate agents and brokers.…
Massachusetts Federal Court Rules That Insurer’s Decision To Commence Rescission Action Does Not Waive Attorney-Client Privilege
Insurers can take comfort that their decision to bring a rescission action against a Massachusetts insured will not itself effect a waiver of the attorney-client privilege, at least in cases where the carrier’s process for deciding whether to sue is not relevant to the rescission claim itself. The federal district court in Massachusetts recently considered that precise question in Preferred Mutual Insurance Company v. Lodigiani, No. 13-cv-30138-MGM (D.Mass. Aug. 12, 2014).…
Massachusetts Federal Court Declares Insured’s Construction Of General Liability Policy “Irrational”
The federal district court in Massachusetts recently declared that a general liability policyholder’s construction of a policy exclusion was irrational, with the result that the carrier owed no coverage for an underlying personal injury suit. In the course of its discussion, the court also highlighted First Circuit precedent for the proposition that the construction of an insurance policy should comport with “common sense.”…
U.S. Treasury Department Maintains Stance on Boston Marathon Bombings With Respect to Certification Under TRIA
A spokesperson for the U.S. Treasury Department recently reaffirmed that the “[t]he Secretary has not determined that there has been an ‘act of terrorism’ under the Terrorism Risk Insurance Act” with respect to the April 15, 2013, Boston Marathon bombings.…
Massachusetts Federal Court Rules Limits Equitable Contribution Between Insurers
Recently, a Massachusetts federal court issued an opinion limiting the ability of one insurer to seek reimbursement from another insurer under the doctrine of equitable contribution. In the insurance context, equitable contribution allows an insurer to seek contribution from a co-insurer after the insurer pays more than its proportionate share of a loss on a claim that both insurers are obligated to indemnify or defend. …
Massachusetts Appeals Court Declares That Failure To Follow Contract Conditions Is Not An “Occurrence” Under Landscaper’s General Liability Insurance Policy
On July 24, 2014, the Massachusetts Appeals Court issued an opinion arising out of a subcontractor’s clear-cutting of environmentally-sensitive property in Western Massachusetts. The decision in Pacific Indemnity Company v. Lampro, et al., 86 Mass. App. Ct. 60 (2014), is notable because the court declared, as a matter of law, that the subcontractor’s erroneous actions were not a fortuitous event for which liability insurance was designed but, rather, a normal, foreseeable, and expected incident of doing business. …
Massachusetts Superior Court Determines That New York Notice Law Does Not Apply Despite New York Choice Of Law Provision In Policy
In Catlin Specialty Ins. Co. v. Am. Superconductor Corp., 12-2314-BLS1 (Mass. Super. Ct. Jan. 29, 2014), Catlin sought a declaration of no coverage based on late notice, among other reasons. …
Massachusetts to Replace Health Exchange Website Provider
Massachusetts health officials announced last week that it will replace its health insurance exchange website. According to media reports, the current website has had difficulty implementing the federal health laws (i.e., Obamacare), because it was designed to comply with state health laws (i.e., Romneycare). …
Massachusetts House Committee Revises Proposed Reinsurance Credit Legislation
We have been closely following the progress of a Massachusetts bill that would realign the Commonwealth’s reinsurance regulations to make them more consistent with the increasingly global nature of insurance and reinsurance markets. …