Insurance Law Update
April 2014
Brown & James 
Records Most Reported Defense Verdicts For 
Sixth Year In A Row 
The firm was recognized for its accomplishments at the 2014 Missouri Lawyers Awards. 
In This Issue
Case Law Updates
Court Upholds Owned Vehicle Exclusion And Refuses To Allow Stacking of Liability Policies
In Farmers Ins. Co., Inc. v. Wilson, No. SD32632 (Mo. App. S.D., March 20, 2014), the Missouri Court of Appeals rejected the claimants' efforts to stack four liability insurance policies. In addition to the policy insuring the insureds' vehicle involved in the accident, the insureds owned three other vehicles, each insured under a separate policy. One vehicle was a motorcycle. In refusing to stack the motorcycle policy, the court enforced the policy's provision limiting coverage to two-wheel land motor vehicles. In refusing to stack the other two vehicles, the court enforced the policies' "owned vehicle" exclusion, which eliminated coverage for bodily injury "arising out of the ownership, maintenance or use of any vehicle other than your insured car, which is owned by or furnished or available for regular use by you or a family member." Thus, since the three policies afforded no coverage for the insured driver's use of the vehicle involved in the accident, the court held there were no other applicable policies that could be stacked.
Broker Not Liable To Third Party For Failure To Procure Insurance
An insurance broker is not liable to third parties who are not parties to the initial broker/client relationship unless the third parties had some type of expectancy at the time of the policy's procurement. In Blevins v. American Family Mut. Ins. Co., ED99852 (Mo. App. E.D., March 4, 2014), the Missouri Court of Appeals affirmed the trial court's dismissal of the third parties' claim that the broker had not agreed to purchase insurance for the third parties, and that the third parties' action failed because their claim rested solely on the broker's failure to procure insurance for the broker's client, which failure left both the client and the third parties with no insurance coverage for the third parties' damages.
Anti-Stacking Language In Underinsured Motorist Coverage Form Upheld Because There Was Only One "Accident" Although Three Vehicles Had Collided With The Insured's Tractor-Trailer
The United States Court of Appeals for the Eighth Circuit in Munroe v. Continental Western Ins. Co., No. 13-1290 (8th Cir., Nov. 7, 2013), upheld the single limit language in a commercial auto policy providing UIM coverage and held that this language unambiguously barred the stacking of UIM coverage. The court also rejected the insured's claim that he was entitled to stack UIM coverage because his accident involved collisions with three different autos. The court, in ruling for the insurer, explained that Missouri follows the "cause approach;" therefore, since the accident could be considered to be the continuous or repeated exposure to the same conditions, the insured's collision with three other vehicles constituted only a single accident and not three separate accidents for stacking purposes.
Proper Offers Of Judgment Require The Assessment Of Court Costs Against The Plaintiff
When a defendant files a proper Offer of Judgment under Mo. R. Civ. P. 77.04, a trial court must assess court costs against the plaintiff if the plaintiff has rejected the offer and the plaintiff recovers less than the offer made by the defendant. In Gabriel v. St. Joseph License, LLC, No. WD75959 (Mo. App. W.D., Dec. 31, 2013), the court made plain that the award of costs for the defendant following the filing of a successful Offer of Judgment is mandatory, and that the trial court is without discretion to tax costs otherwise.
Post-Judgment Interest Runs From Date Of Original Judgment
Even though a judgment may be adjusted upward or downward from the original verdict at some later date, whether on appeal or in the trial court, the operative date for calculating the running of post-judgment interest is the date on which the original judgment was entered. Kelly v. Bass Pro Outdoor World, LLC, No. ED99911 (Mo. App. E.D., Dec. 17, 2013).
Court Again Reaffirms Church Immunity To Negligent Hiring And Supervision Claims
In Doe v. Catholic Diocese of Kansas City-St. Joseph, No. WD76155 (Mo. App. W.D., March 11, 2014), the second appellate decision in less than six months addressing the Missouri Supreme Court's decision in Gibson v. Brewer, 952 S.W. 2d 239 (Mo. banc 1997), the Missouri Court of Appeals once again reaffirmed that the religious freedom guarantees of the First Amendment prohibit negligence claims against religious institutions based on their conduct in hiring, retaining, and supervising their clergy. The Doe decision follows the decision in D.T. v. Catholic Diocese of Kansas City-St. Joseph, No. WD70025 (Mo. App. W.D., Dec. 24, 2013), which also rejected a challenge to the First Amendment immunity afforded religious institutions under Gibson, and which we reported in a prior newsletter.
Court Construes Three-Year Statute Of Limitations For Wrongful Death Claims
In State ex rel. Beisly v. Perigo, No. SD32800 (Mo. App. S.D., Jan, 23, 2014), the Missouri Court of Appeals held that the plaintiff's allegations that the defendant had concealed his involvement in a killing did not toll the three-year statute of limitations for wrongful death claims. The Court held the plaintiff's filing of her wrongful death lawsuit almost four years after the death barred her lawsuit from going forward because there are no recognized exceptions to the statutory limitation period for wrongful death claims based on fraud or concealment. The appellate court's decision in Beisly may not be the last word on this question, however. On March 25, 2014, the Missouri Supreme Court took transfer of the case. As soon as the Missouri Supreme Court rules, we will report the court's decision in this newsletter.
Forum Selection Clauses Are Valid
The Missouri Court of Appeals in Raydiant Technology, LLC v. Fly-N-Hog Media Group, Inc., No. SD32478 (Mo. App. S.D., March 17, 2014), has reinforced Missouri law governing the enforcement of forum selection clauses in contracts. The court held in Raydiant Technology that clearly written and bargained for forum selection clauses should be enforced unless their enforcement would be patently unfair or unreasonable.
Agreement To Arbitrate Must Be Clearly Stated In Contract
In Bellemere v. Cable-Dahmer Chevrolet, Inc., No. WD76238 (Mo. App. W.D., Dec. 31, 2013), the Missouri Court of Appeals upheld the trial court's denial of the defendant's motion to compel arbitration because the arbitration agreement lacked mutuality. The court found significant the fact that, although the plaintiff had signed the document that contained an arbitration provision, the defendants did not. In so ruling, the court also held that the courts, and not the arbitrator, may decide, in the first instance, the threshold question whether the parties have entered into a fully executed and binding arbitration agreement, and even whether there was a contract formed that contained an arbitration agreement.
Recent Trial Results
In a large win, Brad Hansmann, Russ Watters, and Erica Blume brought in a defense verdict for their boat manufacturer client in a double wrongful death case filed in the United States District Court for the Eastern District of Missouri. The plaintiffs sought $16 million in damages and, after a two-week trial in January 2014, the jury returned a unanimous defense verdict for the manufacturer.
Joe Swift and Scott Morgan obtained a defense verdict in St. Louis County in a premises liability claim brought against a national restaurant chain in a case involving a slippery substance on the floor. Although liability was probable, the plaintiff had made other personal injury claims and the jury did not believe that the incident at the restaurant was responsible for the plaintiff's total disability.
Russ Watters and David McCourt obtained summary judgment in the United States District Court for the Eastern District of Missouri for over 30 municipalities in a class action lawsuit filed against their clients which had been sued for collecting illegal fees.
The court granted summary judgment for an insurer in a first-party lawsuit based on the vacancy exclusion. David Bub and Ed Reilly convinced the court that the undisputed facts established as a matter of law that the insured premises were vacant at the time of the loss.
John Cunningham and Dan Hasenstab obtained summary judgment in St. Clair County, Illinois, for their tavern client in an Illinois Dram Shop Act claim in which the plaintiff claimed she had purchased alcohol from John's client and then shared that alcohol with her friend who was driving the car. The friend later ran off the road, and the plaintiff, her passenger, was seriously injured. The court concluded the bartender had no reason to know that the plaintiff would share alcohol with her friend and that the plaintiff was guilty of complicity for providing the alcohol to the driver.
Tim Wolf and Cynthia Juedemann obtained a summary judgment for their insurer client on a UIM stacking claim. The court ruled as a matter of law that the insurer's UIM provisions prohibited stacking.
Denise Baker-Seal obtained summary judgment in the United States District Court for the Southern District of Illinois for her employer client. The plaintiff, a physician, claimed race discrimination and retaliation under Title VII arising out of the employer's decision to offer the physician a non-management position.
Corey Kraushaar won a bench trial in Clay County, Missouri, in a first-party property claim where the insured had set fire to his garage in an unsuccessful suicide attempt. The court concluded that the insured had intentionally set his garage on fire and refused to submit to an examination under oath, despite the insured's claim that he lacked the mental capacity to commit an intentional act.
In March 2014, Joe Swift and Jennifer Kawicki obtained a defense verdict in St. Louis County for their common-carrier client in a sideswipe accident in which the plaintiff claimed severe injuries and total disability. The plaintiff contended the tractor-trailer entered her lane; the tractor-trailer driver contended the plaintiff entered his lane. The defense presented expert testimony that allowed the jury to break the "He said/she said" dilemma and return a unanimous defense verdict.
Justin Chapell and Beth Silker obtained summary judgment for their insurer client in a UIM coverage case in which the insured sought to stack five policies for $500,000 in coverage. The court found the plaintiff was not entitled to UIM coverage because he could not meet the policy's "underinsured motor vehicle" definition and because the policies' anti-stacking provisions were unambiguous and enforceable.  
Erica Blume convinced the trial court in Sangamon County, Illinois, to grant summary judgment for her asbestos contractor client in a contribution action brought by other defendants. The court held the defendants had no right as a matter of law to bring a contribution action because the plaintiff's claims against the parties seeking contribution were based on fraud and breach of contract.
Justin Chapell and Brad Zaffiri obtained summary judgment in Platte Country, Missouri, for their insurer client in a declaratory judgment and constructive fraud action brought after the insurer had refused to provide its insured with a complete copy of the insurer's claim file. The court held the insurer's later production of the file rendered the declaratory judgment action moot and that the constructive fraud action failed because the insured could identify no harm from the insurer's actions.
John Cooney received a defense verdict in a jury trial for his farmer client in a case in which client had pulled his tractor into a road where it was struck by an oncoming tractor-trailer. John persuaded the jury that the accident was caused by the tractor-trailer's high speed at the time of the collision.
In Other News
Board Appointment
Phil Willman has been elected to serve a three-year term on the Board of Directors of the National Foundation for Judicial Excellence (NFJE). The NFJE was established in 2004 to work closely with bar associations, law schools, think tanks, and other non-profit organizations to ensure the preservation of a strong, independent, and responsive judiciary.
CLM Annual Conference
Tim Wolf will be speaking at the spring 2014 CLM Annual Conference in Boca Raton, Florida, April 9, 2014, to April 11, 2014. His presentation is entitled "Litigation Management - Dealing with TPA's in 2014 - Reporting, Medicare and Beyond."
ALFA Transportation
Joe Swift will be speaking at the ALFA International Transportation Seminar, April 23, 2014, to April 25, 2014, as the moderator of "Do You Need to Stack the Deck for a Winning Hand?: Consideration for Selecting the "Correct" Trial Team," a panel discussion addressing the merits of diversifying your trial team. Kurt Schmid is also leading a panel discussion at the same conference, entitled, "The Antivenom: Defending Against Reptile Themes in Depositions, Voir Dire, Opening Statements, and Closing Arguments."
ALFA Women's Initiative
Elaine Moss recently moderated a panel discussion for ALFA International entitled, "Diversity & Inclusion: The Changing Face of Outside Counsel." The panel, which featured senior members of the general counsel offices of Microsoft Corporation, Prudential Financial, and Wells Fargo & Co., addressed diversity considerations in the selection of outside counsel and discussed the actions taken by corporate law departments to achieve their corporations' diversity goals and expectations.
Recent Medical Malpractice Presentations
On January 21, 2014, Pete Spataro spoke at Washington University School of Medicine on medical negligence litigation. He also gave a grand rounds presentation on November 20, 2013, to the ENT Department at Washington University School of Medicine regarding the litigation process.
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Brown & James, P.C. is a Midwest regional law firm with more than 100 attorneys representing companies in litigation, appeals and insurance coverage matters.



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