Liar, Liar…No Minimum Coverage?
Safeway Insurance Company v. Dukes et al
If policy holder makes a false or material misrepresentation on application, entire policy may be void and the statutory minimum does not have to be covered.
In this case, Safeway Insurance issued the plaintiff an automobile insurance policy for her car. The plaintiff’s boyfriend was driving the covered car when he was involved in an accident that injured someone. Safeway disputed coverage, claiming the policy was void due to plaintiff’s failure to list her boyfriend as a regular, frequent driver on her application for insurance.
Safeway argued that the policy was void due to the false warranty and material misrepresentation. Also, Safeway claims that if she had listed her boyfriend there would have been a much higher premium. The trial court granted Safeway partial summary judgment because plaintiff and her boyfriend refused to cooperate with Safeway’s investigation and there was a false warranty and/or material misrepresentation; however, the trial court also found that Safeway was responsible to provide $25,000 of liability coverage due to the decision in Lyons v. Direct General. Following the trial court’s denial of a motion for reconsideration, Safeway appealed, via petition for interlocutory appeal, to the Mississippi Supreme Court. Finding that the trial court erred in its holding, the Mississippi Supreme Court reversed and rendered summary judgment in Safeway’s favor.
In Lyons, the Mississippi Supreme Court held that “every vehicle operated within this State must have the statutorily required minimum-coverage requirements … [and a] liability policy that purports to exclude that coverage for certain drivers fails to comply with the statutory mandate.” Therefore, Lyons held that named-driver exclusions are void up to the minimum coverage requirements of $25,000. Safeway distinguished this case from Lyons, because Safeway is not seeking to enforce an exclusion to deny coverage, rather it is requesting that the policy be held void ab initio, “which would invalidate the policy as if it never existed in the first place because it was obtained through materially false and misleading information and there was never any meeting of the minds.”
The Court first notes that Lyons has been overruled by statute. Next, the Court acknowledges that its analysis in Lyons, which assumed a valid insurance policy had been issued, prohibited the insurance company from excluding statutorily-required coverage, but it created no duty to issue a policy. Lyons, the Court stated, did no more than address an invalid exclusion within a valid insurance policy. By contrast, the question in this case is not whether the terms of the plaintiff’s policy with Safeway covered the accident, but whether the policy, itself, was voidable
For a copy of the decision, see:
Ask for Permission First
Mary Meeks v. Hologic, Inc.
Plaintiff amended the complaint for the second time without permission and did not properly serve the first amended complaint, thus, plaintiff’s claims were time barred by the applicable statute of limitations.
Plaintiff filed a medical malpractice suit. After all defendants responded to the original complaint, plaintiff obtained leave from the court to file a first amended complaint, joining the defendant manufacturer of a medical device used by the doctor who performed her procedure. Plaintiff did not serve the first amended complaint on the manufacturer, but instead filed a second amended complaint without leave of the court or permission from all the defendants. The manufacturer filed a motion to dismiss, claiming that the plaintiff’s claims were preempted by federal law and were barred by the statute of limitations. The Mississippi Supreme Court found that the trial court properly granted the manufacturer’s motion to dismiss. The Court held that since plaintiff failed to obtain leave from the court or permission from all the defendants to file the second amended complaint after responsive pleadings, and the first was never served on the manufacturer, the three year statute of limitations had expired against the manufacturer.
For a copy of the decision, see: