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Negligent Procurement and Breach-of-Contract

By: Derek Hawkins//November 1, 2021//

Negligent Procurement and Breach-of-Contract

By: Derek Hawkins//November 1, 2021//

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7th Circuit Court of Appeals

Case Name: Chad E. Mathis v. Metropolitan Life Insurance Company

Case No.: 20-2719

Officials: MANION, ROVNER, and ST. EVE, Circuit Judges.

Focus: Negligent Procurement and Breach-of-Contract

Dr. Chad Mathis served as an orthopedic surgeon in Alabama. He had a disability-insurance policy issued by Standard Insurance. This policy provided “occupational disability coverage.” It insured his income if he became disabled and unable to work as an orthopedic surgeon. This coverage applied even if he obtained (or was able to obtain) other employment. In other words, it covered Dr. Mathis if he was unable to perform his occupation, regardless of whether he was otherwise gainfully employed.

Dr. Mathis switched insurance policies. But the new policy turned out to be different from what he wanted and expected. So he sued Lee Moore (the insurance broker) and Source Brokerage for negligent procurement. Dr. Mathis also sued MetLife (the new insurer) for breach of contract because MetLife did not pay him the entire sum he thought even the new, wrong policy required.

The district judge dismissed the negligent-procurement claim with prejudice and granted summary judgment to MetLife on most of the breach-of-contract claim. A narrow portion of the contract claim survived: the claim for the period from August 21 to September 30, 2017. Dr. Mathis and MetLife then settled this narrow portion. So the case ended below.

Dr. Mathis appeals. He argues Indiana law, not Alabama law, should govern his negligent-procurement claim. And he argues his breach-of-contract claim is not ripe. We disagree on both points and affirm.

Affirmed

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Derek A Hawkins is Corporate Counsel, at Salesforce.

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