A district judge in Indiana held that it did not require an insurance litigation expert’s assistance to interpret contract language considering no party in this case appeared to dispute the actual language of the policy.
Plaintiff Brenda Marie Stephens is a real-estate appraiser and is the President of Plaintiff Accent Consulting Group (collectively, “Ms. Stephens”). Ms. Stephens demanded that Defendant Great American Assurance Company (“Great American”) provide legal representation for her under an insurance policy (the “Policy”) it issued related to a professional disciplinary hearing and Great American refused. After Ms. Stephens successfully defended herself in the hearing, incurring legal costs, she and Accent Consulting initiated this litigation against Great American. With leave of Court, Great American filed a counterclaim against Ms. Stephens and Accent Consulting, alleging that Ms. Stephens’ insurance application contained a misrepresentation — specifically, that she was not subject to any complaint, investigation, or disciplinary hearing even though she was.
The parties filed Cross-Motions for Summary Judgment. In Great American’s Cross-Motion for Summary Judgment, it requested that the Court strike the expert testimony of Ms. Stephens’ expert, Professor William Warfel.
Insurance Expert Witness
William Warfel is a professor of insurance and risk management at Indiana State University where he teaches classes such as Property/Liability Insurance, Health Insurance, Life Insurance, Introduction to Risk and Insurance, Commercial Liability Insurance, and Insurance Seminar.
Discussion by the Court
Great American argued that Warfel’s expert opinion was not a “fact.” Great American further argued that the expert opinion was “not relevant, reliable, appropriate or admissible” under Federal Rule of Evidence 702 and Daubert v. Merrell Dow Pharmaceuticals, Inc., 509 U.S. 579 (1993).
Great American argued that Warfel was not “qualified” to offer expert opinions on real estate appraisal disciplinary actions and “merely attempted to explain the legal effect of” the Policy.
The Court observed that Ms. Stephens did not file any response to Great American’s Cross Motion for Summary Judgment, which contained the motion to strike the expert testimony. Well after the deadline, Ms. Stephens filed an unauthorized “sur-reply.” The sur-reply did not address the motion to strike expert testimony and instead argued that Great American had not demonstrated prejudice from allegedly late notice of her insurance claim.
The Court held that Warfel’s expert opinion is largely a rehashing of Ms. Stephens’ arguments. For example, Warfel opined that “the trigger of coverage issue must be evaluated within the context of the insuring agreement,” that “the underlying claim against [Ms.] Stephens became ripe once The Office of the Indiana Attorney General filed its original Formal Complaint against her,” and that “an expectation that an insured must report to the carrier all Consumer Complaints against the insured is entirely unreasonable.”
The Court did not require Warfel’s opinion since no party in this case appeared to dispute the actual language of the policy, and the interpretation of a contract is a question of law for the Court.
Held
The Court granted Great American’s motion to strike the expert opinion of Professor William Warfel as well as Great American’s cross-motion for summary judgment.
The policy was rescinded and Great American was ordered to return $1,109.00 in premiums to Accent Consulting Group, Inc.
Key Takeaway:
The Court, citing Delta Mining Corp. v. Big Rivers Elec. Corp., 18 F.3d 1398, held that “Absent any need to clarify or define terms of art, science or trade, expert opinion testimony to interpret contract language is inadmissible.” In other words, the Court may not resort to extrinsic evidence unless terms are ambiguous.
Case Details:
| Case Caption: | Accent Consulting Group, Incorporated Et Al V. Great American Assurance Company |
| Docket Number: | 1:22cv1767 |
| Court Name: | United States District Court, Indiana Southern |
| Order Date: | May 20, 2024 |
Leave a Reply