INSURANCE-RELATED COURT CASES
Digested from case reports published online
COURT DECISIONS
Good news for roofer
Thomas Napolitano, a roofing business owner, sought a judgment declaring that Ace American Insurance Company, a workers compensation carrier, was obligated to defend and indemnify him in connection with a claim filed by his employee. The trial court granted Napolitano’s motion for summary judgment, determining that Ace did not effectively cancel the workers compensation policy. The court found that the conflicting notices provided by Ace, including a noncooperation notice and a cancellation notice, did not constitute an unambiguous and unequivocal notice of cancellation.
The Appellate Court reversed the trial court’s judgment, concluding that Ace effectively canceled the policy before the employee’s injury by complying with the requirements of a statute that governs the reporting and cancellation of workers compensation policies. Ace argued that the Appellate Court incorrectly concluded that the cancellation notice effectively canceled the policy. Napolitano appealed.
The Supreme Court of Connecticut reviewed the case and concluded that insurers must strictly comply with the statute when canceling a workers compensation policy. Compliance with the statute, however, does not supplant an insurer’s obligations under contract law, which requires that a notice of cancellation must be definite, certain, and unambiguous.
The court held that the Appellate Court incorrectly limited its analysis to the statutory compliance and failed to consider all relevant communications between the parties.
The Supreme Court found that Ace’s notice of cancellation was not objectively definite and certain, because of the conflicting noncooperation and cancellation notices, which provided indefinite and ambiguous information about the status of Napolitano’s insurance coverage. Consequently, the Supreme Court reversed the judgment of the Appellate Court and remanded the case with direction to affirm the trial court’s judgment in favor of Napolitano.
Napolitano v. Ace American Insurance Company—Supreme Court of Connecticut—No. SC20922—December 24, 2024.
