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Chapter 27 - Insurance Law
V. ANSWERS TO PROBLEM CASES:
1. World Trade Center Properties, LLC v. Hartford Fire Insurance Co., 345 F.3d 154 (2nd Cir.
2003). The Second Circuit Court of Appeals holds that under the definition of occurrence set
Points for Discussion: Focus on the issue of how occurrence should be interpreted,
without getting mired in the details of the parties' motions. Ask the students what the
stakes are here. (If it's one occurrence, the insurer pays out the policy limits only once.
2. No. Noting that the lower court’s decision had rested on a determination that no partnership
interest existed and that Harber and USA Properties therefore had no insurable interest, the
U.S. Court of Appeals for the Second Circuit Court concluded that the insurable interest issue
should not have been disposed of on a summary judgment motion. The Second Circuit
3. No. The District Court for the Northern District of Indiana held that Cope had a right to
present evidence establishing that the snowmobiling trip was sufficiently related to business
4. No. The U.S. Court of Appeals for the Third Circuit concluded that the unfair competition
term in the provision covered not only common law claims but also appropriate statutory
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© 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any
manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part.
Chapter 27 - Insurance Law
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© 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any
manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part.
Chapter 27 - Insurance Law
5. Yes. The determination of the case was not a matter of law [as the policy was ambiguous];
rather, it was a factual question: whether the frozen pipe or the mold was the dominant and
6. Yes. The Indiana Supreme Court took the transfer due to an interlocutory appeal by the
plaintiffs regarding the granting of summary judgment at the appellate level. The Indiana
7. No. Holding that the insured was unilaterally mistaken about whether a certain event would
be covered under his property insurance policy and that the insured therefore was not entitled
to reformation of the written policy, the Supreme Court of Nebraska reversed the decree of
reformation issued by the trial court. Ridenour demonstrated neither mutual mistake on the
part of himself and Farm Bureau nor fraud or inequitable conduct on the part of Farm Bureau.
8. Vining won the case and received both compensatory and punitive damages. The Tenth
Circuit affirmed an $800,000 jury verdict ($400,000 in compensatory damages and $400,000
in punitive damages) against Enterprise. In so doing, the Tenth Circuit held that even if an
9. Yes. Lane's acts of exiting the restaurant and fighting with Taylor were not performed as part
of his duties or in the service of his employer, Memtek. Lane's reason for these actions was
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© 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any
manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part.
Chapter 27 - Insurance Law
10. Yes. The Minnesota Court of Appeals held that the Crowells' right of first refusal, granted to
them by state law, constituted an insurable interest entitling them to recovery under their
VI. ANSWER TO ONLINE RESEARCH PROBLEM:
Given the nature of the assignment, there is no set answer. The content of the students’ brief
reports will vary according to the states chosen.
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© 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any
manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part.
