Breach of Contract

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7^th Circuit Court of Appeals

Case Name: Lexington Insurance Company v. Horace Mann Insurance Company, et al.,

Case No.: 16-2352

Officials: BAUER and FLAUM, Circuit Judges, and SHADID, District Judge

Focus: Breach of Contract

Christopher Drake was involved in a car accident with another driver, who offered to settle the matter with Drake’s automobile insurer, Horace Mann Insurance Company. The offer expired before Horace Mann accepted it, however, and the driver sued Drake and sent a letter to Drake’s lawyer suggesting that Horace Mann had handled the matter in bad faith. Believing that this letter constituted a “claim” against Horace Mann for extracontractual damages—and that this “claim” had accrued before the start date of Horace Mann’s own insurance policy with Lexington Insurance Company—Lexington sought a judicial declaration that it had no duty to indemnify Horace Mann under that policy. Horace Mann counterclaimed for breach of contract and declaratory judgment, and requested (pursuant to an Illinois statute) additional damages for “vexatious and unreasonable” claims-handling. Horace Mann also filed a third-party complaint against its insurance broker, Aon Risk Insurance Services West, for negligence in reporting the extracontractual “claim” to Lexington. The district court resolved Lexington’s complaint, in Horace Mann’s favor, at summary judgment, but awarded judgment to Lexington and Aon on Horace Mann’s claims under Federal Rule of Civil Procedure 50(a). Horace Mann appeals the Rule 50(a) decisions, and for the following reasons, we affirm.

Affirmed

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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.