Statutory Interpretation

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WI Court of Appeals – District I

Case Name: Bryan Casper, et al v. American International South Insurance Company

Case No.: 2015AP2412

Officials: Brennan, P.J., Brash and Dugan, JJ.

Focus: Statutory Interpretation

American International South Insurance Company (AISIC) appeals an order granting plaintiffs’ summary judgment motion and ordering AISIC to pay $684,499.14 in interest on its delayed payment on the underlying claim in this case. WISCONSIN STAT. § 628.46(1) (2015-16)1 requires an insurer given proper notice to pay such interest when it does not timely pay claims unless “the insurer has reasonable proof to establish that the insurer is not responsible for the payment[.]” The requirement applies to claims by insureds and claims by third parties who satisfy certain conditions as set forth in Kontowicz v. American Standard Insurance Co. of Wisconsin.  The trial court concluded that plaintiffs, who are third-party claimants, were entitled to such interest because in 2007 they satisfied the Kontowicz conditions as to the underlying claim and because AISIC was unable to provide “reasonable proof to establish” that it was not responsible for the payment. AISIC argues that both these conclusions are incorrect. AISIC also argues that WIS. STAT. § 628.46 does not apply where an insurer has contractual duties to multiple insureds, as AISIC does here, because those legal obligations make it impossible for AISIC to satisfy the statute. Plaintiffs cross-appeal, arguing that in 2005 they satisfied § 628.46’s requirements as interpreted in Kontowicz and accordingly they are entitled to more interest than the trial court awarded them. We reject those arguments and affirm the order.

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Attorney Derek A. Hawkins is the managing partner at Hawkins Law Offices LLC, where he heads up the firm’s startup law practice. He specializes in business formation, corporate governance, intellectual property protection, private equity and venture capital funding and mergers & acquisitions. Check out the website at www.hawkins-lawoffices.com or contact them at 262-737-8825.