In a recent, precedent-setting opinion, the First Circuit Court of Appeals addressed several significant issues involving liability insurance coverage. Sanders v. Phoenix Ins. Co., 843 F.3d 37 (1st Cir. 2016).[1]

As characterized by Judge Selya, the facts of the case begin with “a tragic tale of unrequited love and morph into a series of imaginative questions regarding the coverage available under a standard form homeowner’s insurance policy.” The claims were brought by the plaintiff, as executor of his wife’s estate, pursuant to an assignment of rights, for liability coverage and unfair claim settlement practices under a homeowner’s policy issued to his late wife’s divorce attorney, whom the plaintiff blamed for her untimely death.

The central holdings of the decision are:

  • There is no duty to defend where no lawsuit has been filed against the insured under the policy language at issue, and a Chapter 93A demand letter is not the functional equivalent of a suit;
  • A request for participation in a voluntary mediation does not trigger a duty to defend;
  • There is no duty to indemnify where there is no duty to defend, and also where there has been no final judgment against the insured or settlement agreement signed by the insurer (under the applicable policy provisions);
  • There is no duty to settle under Chapter 93A where there is no duty to defend or indemnify; and
  • Liability is not “reasonably clear” under Chapter 93A, as a matter of law, where the nature of the claim being made against the insured has not been recognized by existing law, but rather is an adventuresome claim not recognized by existing tort law.

The decision, which was featured in Massachusetts Lawyers Weekly, should prove useful to attorneys and parties because it lends clarity to these common issues in liability coverage cases.

SPECIAL DISCLAIMER: Because this case is one in which Robinson & Cole LLP represented the defendant, we reiterate that the intent of this blog is to serve as an informational resource for readers, not advertising for our legal services. Every case is different and the result achieved in the case described above may differ from the result in some other case, which may involve different facts, different applicable law, or a different jurisdiction. Case results depend upon a variety of factors unique to each case. Case results do not guarantee or predict a similar result in any future case undertaken by the same lawyer(s). This blog does not constitute legal advice and you should always consult your own lawyer about your own case.

[1] Robinson + Cole lawyers Wystan Ackerman and Jonathan Small represented The Phoenix Insurance Company in the Massachusetts Federal District Court and on appeal to the First Circuit.

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Photo of Jonathan Small Jonathan Small

Jonathan Small is a member of the firm’s Litigation Section and Insurance + Reinsurance Group. His complex commercial litigation practice regularly brings him into Massachusetts trial and appellate courts on behalf of insurance companies, real estate developers, and other businesses. His interest in…

Jonathan Small is a member of the firm’s Litigation Section and Insurance + Reinsurance Group. His complex commercial litigation practice regularly brings him into Massachusetts trial and appellate courts on behalf of insurance companies, real estate developers, and other businesses. His interest in appellate practice began in law school when, as a student attorney at Georgetown Law’s Institute for Public Representation, he wrote an amicus curiae brief on behalf of the AARP in U.S. Supreme Court case Warner-Lambert v. Kent, 128 S. Ct. 1168 (2008).

Jonathan has defended clients against bad faith and unfair trade practice claims brought under state consumer protection statutes, including the Massachusetts Consumer Protection Act (Chapter 93A). He has successfully argued dispositive motions in federal and state trial courts, and defended those rulings on appeal. He has also defended clients in class action lawsuits and defeated attempts at class certification at the trial and appellate levels.

Jonathan grew up in the greater Boston area in Easton, Massachusetts. He attended College of the Holy Cross in Worcester, Massachusetts, where he earned his undergraduate degree and majored in philosophy. After graduating from Holy Cross, Jonathan served as an AmeriCorps VISTA supporting low income communities in Miami-Dade County, Florida. He then matriculated at Georgetown University Law Center in Washington, DC, where he was a staff editor of the Georgetown Journal on Poverty Law and Policy, competed in mock trial as a member of the Barristers’ Council, was named a Global Law Scholars Program fellow, and served as a research assistant to Professor Charles R. Lawrence, III. Following law school, Jonathan clerked for the Honorable Lynn Leibovitz of the District of Columbia Superior Court. After the clerkship, he worked at Goulston & Storrs in Boston before moving to Connecticut with his family and joining Robinson+Cole.