Hingham Mutual Fire Ins.Co. v. Niagara Fire Ins. Co., 46 Mass. App. Ct. 500

This coverage dispute between a homeowners and a motor vehicle insurer arose out of a single car accident wherein it was alleged that the passenger, while under the influence of a hallucinogenic drug, perceived something in the road and grabbed the steering wheel causing the vehicle to roll over with resultant injuries to all three occupants. In response to an action brought by two of the occupants against the passenger, the latter's homeowner insurer made demand upon the insurer of the motor vehicle to defend and indemnify the passenger. The motor vehicle insurer refused on the basis that the passenger was not an "operator" of the car, or if so, she was not "authorized". A decision by the trial court in this declaratory judgment action that each insurer was responsible for the payment of one half the costs of defense was upheld on appeal as authorization might be inferred in an emergency. As to the homeowner insurer's contention that coverage was excluded by operation of a motor vehicle, the Appeals Court found that the term "operated" could be interpreted in more than one way, and any ambiguity in the policy language was to be construed against the insurer.

Simplex Technologies, Inc. vs. Liberty Mutual Insurance Company, 429 Mass. 196

In this declaratory judgment action brought by the insured, Simplex, against the primary insurer, Liberty Mutual, as well as some excess insurers, once again the Court reasoned that the duty to defend is broad and arises when there is a possibility that some of the losses are compensable under the insurance policy. The SJC said that the insured does not bear the burden of proving that the complaint by the plaintiffs in the underlying personal injury action relates to products manufactured by the insured. Finally, the Court indicated that the excess insurers were relieved of any defense obligations as the primary insurer had been found responsible.

Dominguez v. Liberty Mutual Insurance Co., 429 Mass. 112

This case involved interpretation of the personal injury protection statute, G.L.c. 90 § 34A. The plaintiff had been injured in a motor vehicle accident and was a subscriber to a health insurance plan. His medical expenses exceeded $2,000 and for that amount in excess of $2,000, he made application for payment to his health insurer. The health insurer denied the application on the basis that the physician who provided the services was not on the approved list of the health insurer. The plaintiff then made application to the motor vehicle insurer for payment of the balance pursuant to the PIP provision. The motor vehicle insurer's refusal to pay those expenses which have been rejected by the health insurer was upheld by the SJC. The Court indicated that the statute was not clear, and that it must use principles of statutory construction to reach the conclusion that the plaintiff was not entitled to pursue the motor vehicle insurer for the payment of medical expenses under the PIP provision when said expenses had been rejected by the health insurer.

Metropolitan Property and Casualty Insurance Company v. Choukas, 47 Mass. App. Ct. 196.

In this case, Metropolitan insured both the tortfeasor and the claimant. Conceding clear liability, Metropolitan paid the tortfeasor's policy limit immediately and filed an action to compel arbitration of the policyholder/plaintiff's claim for underinsured motorist benefits. The demand had been for $90,000, the entire monetary coverage available. Discussion ensued between the claimant/insured's attorney and a claim representative. When asked if the claimant would come off the $90,000, his counsel replied that he would settle the case for $89,000.

The claim representative advanced no offer and the arbitration resulted in an award of $25,000 to the claimant/insured. The arbitration award was confirmed in the Court. The claimant then brought the instant bad faith action against Metropolitan. The court tossed aside the argument that the high-handed negotiation technique of the claimant's attorney justified Metropolitan decision not to make an offer. It said where liability is clear and the damages are appreciable, notwithstanding the conduct of the claimant or his or her attorney, the insurer is obligated to make a good faith settlement offer. The trial judge concluded that Metropolitan had acted willfully and knowingly. The Appeals Court found that the proper measure of damages for purposes of multiplication was the amount of the underlying judgment. While an arbitration award itself is not a "judgment," where it is confirmed in court, it becomes a judgment and thus subject to multiplication.

Lumbermens Mutual Casualty Company v. Y.C.N. Transportation Company, 46 Mass. App. Ct. 209

This was a declaratory judgment action initiated by an insurer which in turn resulted in a counterclaim for costs of defense and alleged bad faith. The defendant insured was the operator of a bus company and one of its employees allegedly committed a sexual assault and molestation of a child passenger. The filing of the action predated the decision of Roe v. Lawn, 418 Mass. 66 (1994). The issue is whether Lumbermens as the insurer of the transportation company was obligated to defend and indemnify the transportation company with respect to an underlying claim of sexual assault by an employee. Specifically, the issue was whether the cause of action arose out of the "ownership maintenance, or use of the motor vehicle." The Roe decision interpreting a similar policy reached the conclusion that there was coverage. However, the incident giving rise to the underlying dispute, and Lumbermens decision not to afford coverage and defense predated the Roe decision. The court decided that the precedent established in Roe should be applied retroactively. Lumbermens contended that it should not be responsible for the payment for the cost of defense which predated the decision in Roe. It had voluntarily made payment of the cost of the defense after the Roe decision. The Appeals Court concluded that the partial payment constituted a waiver of the statute of limitations defense. Finally, the Court said that there was no basis for a finding of bad faith on the part of Lumbermens as its decision to deny coverage was based on a "plausible, reasoned legal position."

Abdella v. USF&G, 47 Mass. App. Ct. 148.

This dispute arose out of a claim for PIP and underinsured motorist benefits by an insured against his motor vehicle carrier. There was delay in the production of medical records and bills, and a dispute as to whether or not the insurer was entitled to disclaim coverage because of a failure on the part of the insured to appear for an IME. The matter went to arbitration pursuant to G.L.c. 251. There was a finding that coverage was in place, and that the damages exceeded what had been recovered from the tortfeasor's insurer and from PIP. The plaintiff insured filed a motion for summary judgment on the instant action, a bad faith claim pursuant to G.L.c. 176D and c. 93A. The plaintiff argued that the defendant was estopped from relitigating issues decided by the arbitrator, namely that there had been a violation of c. 176D. The motion for summary judgment was denied and a subsequent trial before a different superior court judge resulted in a finding of a violation of c. 176D, but with no resultant damages. The Appeals Court decided that the summary judgment motion was properly denied inasmuch as the arbitrator did not have authority to make a decision with respect to a bad faith claim, and that there can be a finding of a violation of c. 176D without an award of damages. In parting, the Court mentioned that the plaintiff had incurred approximately $3,500 in medical expenses, had lost one week from work and his claim was essentially a "soft tissue" suit.

Shamban v. Worcester Insurance Company, 47 Mass. App. Ct. 10.

This dispute arose out of an accident involving two children, one operating a "dirt bike" and the other operating a "three-wheeler." One struck the other as they were driving about a landfill. The parents of the injured child sued the operator of the "dirt bike" as well as his parents for negligent supervision. The insurer immediately disclaimed coverage based upon the motor vehicle exclusion in the homeowner's policy. The insurer did not file a declaratory judgment action and had no further involvement in the dispute. The insured lacked the funds to properly defend the case and there was a large judgment. The instant action against the homeowner's insurer resulted in a finding in favor of the insured. The Court referred to the previous decision of Worcester Mut. Ins. Co. v. Marnell, 398 Mass. 240 (1986). The Appeals Court pointed out that in the instant case, as in the Marnell decision, there was a severability clause in the policy. Thus, while coverage for the child who operated the "dirt bike" might properly be excluded pursuant to the motor vehicle exclusion, the claims of negligent supervision against the parents were not susceptible to that exclusion. The homeowner's insurer therefore should have offered a defense and indemnity with regard to the parents which it failed to do. Once again, the Court indicated that exclusions would be strictly construed against insurers and that it is always the better practice for an insurer to file a declaratory judgment action rather than a perfunctory denial of defense and coverage. It also affirmed the proposition that where an insurer contests coverage and loses, it pays the insured's legal expenses in conjunction with that action.

Nercessian v. Board of Appeal of Motor Vehicle Liability Policies and Bonds, 46 Mass. App. 766.

The plaintiff appealed from an adverse decision at the Board of Appeal of Motor Vehicle Liability Policies involving a surcharge as a consequence of a single vehicle accident. This brought the matter to the superior court pursuant to G.L.c. 175 § 113P. The superior court affirmed the board's decision as to the adequacy of the evidence. The matter then went to the Appeals Court. The Appeals Court found that it should not review the decision of the superior court.

The Money Store/Massachusetts, Inc. v. Hingham Mutual Fire Insurance Company, 46 Mass. App. Ct. 636.

Hingham Mutual insured a house which suffered an explosion with resultant loss. Named as insureds on the policy were the mortgagees,Chicopee Savings Bank first and The Money Store second. Hingham paid Chicopee Savings Bank and took an assignment, in essence becoming the first mortgagee. It then foreclosed on the property, cutting off the rights of The Money Store. The Appeals Court said that Hingham Mutual's actions were violative of its obligations pursuant to the insurance contract. It could not exercise its subrogation and related assignment rights until the indebtedness due the mortgagees had been fully paid in the same order as the priority of the mortgages to the limit of the policy.

The Money Store/Massachusetts, Inc. v. Hingham Mutual Fire Insurance Company, 430 Mass. 298.

The SJC reviewed and reversed the decision of the Appeals Court in this case. Hingham Mutual's insured had purposely damaged the home subject to two liens, a first mortgage to Chicopee Savings Bank and a second to The Money Store. Hingham paid Chicopee the entire debt and took an assignment of Chicopee's rights in the collateral. It then foreclosed upon the property and sold it, realizing a profit. This cut off The Money Store's security and opportunity to recoup the balance of the note. The SJC said that an insurance policy is to be interpreted as any contract. Here, Hingham Mutual sought to insure the property, and not The Money Store's mortgage and debt. As second mortgagee, The Money Store extended credit with all the risks inherent in a second mortgage. The policy recognized the possibility of multiple mortgagees, but it also recognized the right of Hingham to purchase the first mortgage and to obtain an assignment and transfer of that mortgage with all securities.

Murphy v. Safety Insurance Company; Murphy, 429 Mass. 517.

The minor plaintiff suffered severe injuries in a two-vehicle collision while riding in an automobile operated by his mother. The adverse vehicle was deemed at fault and the policy limit of $100,000 was paid. Additionally, the adverse driver had excess coverage of $1,000,000 which was also paid. The household vehicle occupied by the minor plaintiff had underinsurance coverage of $250,000 per person per accident. The plaintiff sought a declaration in this action that the recovery on the excess policy of the tortfeasor should not be counted for purposes of the underinsurance claim.

Safety took the position that both the tortfeasor's primary auto coverage and the excess coverage should be counted to determine whether there could be recovery against it on the underinsured coverage of the occupied vehicle. The SJC reasoned that while the excess coverage was primary coverage as to certain risks and supplementary coverage as to the tortfeasor's operation of a motor vehicle, it was automobile insurance and must be counted to determine whether there would be any recovery on the underinsured coverage. Inasmuch as the primary auto policy and the excess coverage of the tortfeasor were greater than the underinsured coverage on the occupied vehicle, there could be no recovery against Safety for underinsured motorist benefits.

Rubenstein v. Royal Insurance Company of America, 429 Mass. 355.

The SJC accepted the defendant's application for further review of the decision in Rubenstein vs. Royal Insurance Company of America, 45 Mass. App. Ct. 244 (1998). At issue was whether the plaintiffs, who had never been able to locate the actual insurance policies but whose evidence persuaded the trial court that such policies had been issued, should be entitled to recover attorneys' fees and costs in their litigation to establish entitlement to defense and indemnity. The SJC discounted the insurer's argument against the award of fees and costs on the basis that it was a comprehensive general liability policy versus a homeowners policy (see Preferred Mut. Ins. Co. v. Gamache, 426 Mass. 93 (1997)), and that as other insurers had provided the plaintiffs with defense, Royal should not be penalized. The SJC said whether the insurer's election to deny coverage was made in good or bad faith is irrelevant once it is determined that it breached its contract. Once the plaintiffs established a violation of a duty to defend , they were entitled to recovery of attorneys fees and costs.

Atlas Tack Corporation vs. Liberty Mutual Insurance Company, 48 Mass. App. Ct. 378.

The plaintiff which manufactured nails, rivets and other hardware for decades was cited for pollution violations beginning in the 1970's and through the 1980's. In response to this, Atlas Tack entered into consent decrees by which it was required to expend funds to begin the clean-up process. It brought an action, after spending a great deal of money on clean-up, against the Commonwealth to ascertain what additional expenditures would be necessary and to avoid punitive damages because of an inability to meet a deadline. The Commonwealth counterclaimed pursuant to G.L.c. 21E for all past and future costs associated with assessment, containment and removal hazardous materials. Thereafter, Atlas Tack notified Liberty Mutual of the claims and requested defense and indemnification. Liberty Mutual cited a number of provisions that arguably relieved it of its responsibility with respect to the environmental claims against Atlas Tack. However, the Court relied on one which prohibited an insured from voluntarily paying a claimant. Its agreement to the consent judgment to clean up the lagoon and the payment of at least a portion of the cost to remediate violated that provision of the policy and absolved Liberty Mutual from any responsibility to defend or indemnify.

Bagley v. Monticello Insurance Company, 430 Mass. 454.

This was an action to reach and apply a judgment which the plaintiff had obtained against the defendant insured. The plaintiff had been beaten and raped by a fellow patron in a truck stop. She and the fellow patron had become intoxicated together in the truck stop bar before retiring to the rapist's room. The truck stop's insurance policy contained an exclusion for illegal acts. The trial court's decision to allow the plaintiff's motion for summary judgment as to damages attributable to the rape was reversed by the SJC. The words of exclusionary clauses in insurance policies be construed in their usual and ordinary sense. The phrase "arising out of" must be viewed expansively, incorporating a greater range of causation than proximate cause. In assessing the viability of an illegal acts exclusion, one must consider the source of the plaintiff's harm as opposed to the various theories of liability alleged in a complaint.

United National Insurance Company v. Parish, 48 Mass. App. Ct. 67.

This was a declaratory judgment action brought in response to an application to reach and apply a plaintiff's judgment in an underlying case against United National's insured, David Parish. Parish was the owner of a multi-unit residential dwelling in a high-crime area. The plaintiff, James Sarantikis, obtained by default a sizeable judgment against Parish for negligent failure to provide adequate security and lighting. Sarantikis had been the victim of a severe assault, resulting in permanent injuries.

United National sought to disclaim coverage on an exclusion for any damages arising out of an assault and battery, whether caused by the insured or his employees or by their failure to prevent the same. The Court again noted the phrase "arising out of" is to be construed quite broadly. It is more expansive than the phrase "caused by." The plaintiff in the underlying tort case argued that his damages were not caused by an assault and battery involving the insured, or his employees, and therefore the exclusion was inapplicable. He further argued that the gravamen of the complaint was negligence so that the exclusion should not apply. The Appeals Court disagreed, indicating that the expansive exclusion would pertain to any damages resulting from an assault and battery and that the coverage was therefore not available to satisfy the underlying judgment.

Utica Mutual Insurance Company vs. Hamel, 46 Mass. App. Ct. 622.

This was a declaratory judgment action brought by Utica against its insured. The insured rented a portion of a building from a realty trust. As part of the insured's manufacturing process, there was production of excess liquid consisting of water and chemicals. The insured had built a rather rudimentary water treatment facility. Over a period of a number of years, there was repetitive spillage of these materials, gradually permeating a good portion of the building. A property damage claim was brought against the insured. Utica Mutual sought to disclaim coverage on the basis of an exclusion which did not provide compensation for damage expected or intended from the standpoint of the insured. Here, while the Appeals Court conceded that the initial spills may not have been sufficient to invoke the exclusion, because of the repeated and extensive nature of the spills, the finding by the superior court judge that the exclusion was applicable was sustained on appeal.

Harrison v. Woodland Insurance Agency, 46 Mass. App. Ct. 632.

The plaintiff in this action purchased an older vehicle and purportedly refurbished it at great expense, giving it a current market value of approximately $30,000. He purchased, through the defendant insurance agency, a policy of insurance by Commerce purportedly providing protection for damage or theft on the basis of it being a special interest vehicle. Commerce disputed the plaintiff's contentions regarding the value of the vehicle and offered $6,000. Thereafter, the dispute was referred to appraisers pursuant to G.L.c. 175 § 191A. However, the process established in that statute was not followed and instead the plaintiff brought the instant action against the insurance agency for failing to obtain proper coverage. The Appeals Court agreed with the trial judge's conclusion that having elected to proceed through the appraisal process pursuant to G.L.c. 175 § 191A, that must be concluded in order to establish the actual value of the vehicle for purposes of calculation of damages, if any are to be awarded in the suit against the insurance agency.

The Town of Middleborough v. Middleborough Gas & Electric Department, 47 Mass. App. 655.

This was a property damage subrogation claim brought in the name of the insured, a municipality pursuant to a subrogation clause in the insurance policy against a municipal utility whose negligence caused a fire in a public school. The insurer elected to bring the action in the name of the insured. In an earlier decision entitled Middleborough v. Middleborough Gas & Electric Department, 422 Mass. 583 (1996), it was decided that the municipality and the utility were distinct so that the town might bring an action against the municipality. In other words, that the insurer standing in the place of the town could maintain such a lawsuit. After extensive litigation, including the aforementioned appeal, a clause was found in an endorsement to the insurance contract providing that the insured could waive in writing any and all rights of recovery against any party for a loss. Thereafter, the Board of Selectmen voted to waive any claim which the municipality might have against the electrical utility. The entities were distinct, but the utility in essence was owned by the town. The Court said that whether the waiver occurred within a reasonable time was a question of law for the Court. It refused to read the contract so as to permit the insured, having observed lengthy and expensive litigation, to at that late date undermine the subrogation action.

Niles-Robinson v. Brigham and Women's Hospital, Inc., 47 Mass. App. Ct. 203.

The plaintiff was an employee of the defendant hospital. The claim was for mental and physical injuries primarily due to multiple chemical sensitivity as a consequence of faulty ventilation at the hospital. She was also a recipient of worker's compensation benefits. Thereafter, she brought a tort claim against the hospital on the basis that her condition, multiple chemical sensitivity, was not a "personal injury" and therefore it stood outside the scope of the worker's compensation claim. The Court said that she could not have it both ways. She was foreclosed from bringing a liability suit by operation of G.L.c. 152 § 23. The plaintiff was bound by the doctrine of judicial estoppel where a party, having made a judicial declaration, may not in a subsequent proceeding contradict that assertion.

Aguiar v. Generali Assicurazioni Insurance Company, 47 Mass. App. Ct. 687.

The allowance of summary judgment by the trial court was affirmed on appeal. The case involved a claim against the defendant insurer for failing to pay the proceeds of a fire insurance policy issued in the standard form prescribed by G.L.c. 175 § 99. There was a disclaimer was based upon the fact that the commercial premises, a restaurant, had been vacant for more than 30 days and because the insureds had made material misrepresentations. The Court found the disclaimer effective because of the vacancy. There was ancillary evidence of numerous attempts to burn the building at various points during the year or so before the ultimate fire. The plaintiffs countered with an argument that they had a "reasonable expectation" that the occupancy requirement was waived. They claimed that they had not received the policy in a timely fashion and were not aware of the provisions contained therein. The Court said that the occupancy requirement is statutory in origin and cannot be waived. Secondly, they were charged with the knowledge of their insurance agent with respect to the terms and conditions of the policy. Finally, they assert a waiver based upon a letter from an officer of the insurer with respect to the possibility of the premises being "unused for any long period." The Appeals Court said that waivers implied from circumstances, knowledge or conduct may not broaden the coverage of an insurance policy. Such broadening requires an amendment to the insurance contract.

Armstrong's Case, 47 Mass. App. Ct. 693.

The Appeals Court affirmed a finding by the reviewing board of the D.I.A. to the effect that the insurer, Aetna, had not complied with the notice requirements of G.L.c. 152 § 65B to cancel a worker's compensation insurance policy; and that Aetna, rather than the Worker's Compensation Trust Fund, should be responsible for compensating an injured employee. Here, there was a mix-up as to the address of the policyholder as well as a failure to make timely payment of the premium. Having sent the notice of cancellation to the incorrect address and receiving the notice back undelivered, Aetna did not make another attempt to effect cancellation even after it was in receipt of a proper address.

Richardson v. Liberty Mutual Fire Insurance Company, 47 Mass. App. Ct. 698.

This dispute arose out of the death of a seventeen-year-old day in the midst of sexual relations with a married woman in her automobile. Unsure what to do, she left the boy's body outside his residence during the early morning hours where it was discovered by his immediate family, including his mother, the plaintiff in the instant action. The woman was insured under a homeowner's policy providing for $100,000 coverage for each occurrence. It assumed her defense. The plaintiff demanded $200,000: $100,000 for the boy's wrongful death; and $100,000 for the insured's negligent disposal of his body. The plaintiff argued that these were two different occurrences and thus she would be entitled to the policy limit for each. The matter evolved into a declaratory judgment action and the wrongful death case was settled for $100,000. The plaintiff alleged that as a consequence of the discovery of her son's body, she suffered abiding mental distress and was unable to leave her home for over a year. The superior court judge found that the death of the boy and the disposal of the body constituted two distinct occurrences. However, he found that the insured's disposition of the body warranted an exclusion of coverage for an "expected or intended" injury.

The Appeals Court, however, analyzing the policy, found that coverage was inapplicable because the policy did not compensate for injuries which did not result in bodily injury. Purely emotional distress was not a compensible loss under the policy. The term "bodily injury" is narrow and unambiguous.

Medeiros v. Middlesex Insurance Company, 48 Mass. App. Ct. 51.

The plaintiff resided with her boyfriend. In addition to her own motor vehicle policy, she was named as an additional insured on her boyfriend's policy issued by the defendant. An insurance agent, representing the defendant, told the plaintiff that in order to be properly insured while frequently driving her boyfriend's automobile, she should be named as an additional operator. In 1987, she was involved in a motor vehicle accident and sustained serious injuries. She obtained $25,000 from the tortfeasor's insurer and an additional $10,000 pursuant to her own motor vehicle underinsurance coverage. Thereafter, she sought additional underinsurance coverage with regard to her boyfriend's policy issued by the defendant. Coverage was denied on the basis that she was not a "household member," not being "related by blood or marriage" to the policyholder. Suit was brought against the agent and the insurance company. As to the insurance company, recovery was sought for declaratory judgment, vicarious liability for negligent misrepresentation and breach of a contract to insure. Prior to the trial of the case, the plaintiff moved, with the assent of the defendant agent, to the dismissal of all claims against the agent. The insurer did not participate, either in favor or against the motion. Following trial, a jury returned a verdict in favor of the plaintiff, both on the theory of vicarious liability and tort for the negligent misrepresentation of the agent and also for breach of contract. The defendant insurer sought judgment NOV on the basis that the dismissal of the claim against the agent with prejudice absolved the principal, that is the insurance company, of vicarious liability, both in tort and in contract. The Appeals Court found that the defendant's argument had merit with regard to the tort claim as the dismissal of a suit against the agent also, by operation of law, dismisses the action against the principal where liability is entirely vicarious. However, with regard to the contract claim, the result was different. In contract, liability is effectively consentual and the principal is the obligor to the undertaking. Thus, the contractual claim against the insurer was upheld notwithstanding the dismissal of the action as to the agent.

Green v. Blue Cross & Blue Shield of Massachusetts, Inc., 47 Mass. App. Ct. 443.

This is a dispute over health insurance coverage. The plaintiff suffered from an unusual affliction requiring jaw surgery. Prior to undertaking the procedure, the plaintiff contacted BCBS on a number of occasions to determine the cost and the coverage. BCBS was less than forthcoming with regard to the same. The plaintiff elected to have the surgery performed in Texas. Prior thereto, the surgeon provided the plaintiff with a letter setting forth the anticipated costs of the procedure. This letter was shared with BCBS. The Appeals Court reversed the finding of both the district court judge and the appellate division of the district court to the effect that the plaintiff had failed to seek information concerning the pricing. Non-Massachusetts physicians were permitted to bill the patient for the balance of the charges after deduction for the insurance payment. Thus, the issue of cost was significant to the plaintiff. The Appeals Court found that BCBS failed in its obligation under 93A to deal with its insured with candor and fairness. The evidence demonstrated that BCBS was able to compute their payment share when called upon to do so after the procedure. BCBS had breached its duty of good faith and fair dealing. The matter was remanded for damages and attorney's fees.

Espinal v. Liberty Mutual Insurance Company, 47 Mass. App. Ct. 593.

This was an action to reach and apply a verdict which had been obtained by default against a Liberty Mutual insured with respect to a motor vehicle policy with compulsory limits. Liberty, detecting fraud, asserted that no accident had occurred and failed to defend the insured in an underlying district court action where the plaintiffs obtained a judgment. The plaintiffs contended that, having failed to defend the district court action, Liberty was barred from raising the defense of fraud as to the reach and apply claim. Moreover, as the insured had only the statutory minimum coverage, Liberty could not assert the defense of fraud. The Appeals Court acknowledged the stated purpose of G.L.c. 175 § 113A to the effect that compulsory insurance, unlike ordinary insurance designed to protect the owner or operator alone, is designed to provide compensation for persons injured on the public way. It acknowledged that non-cooperation of an insured is not a basis for disclaimer of compulsory coverage. Here, however, the defendant insurer contended that there had been no accident and under these circumstances, it could raise fraud as a defense even as to the compulsory coverage. An insurer is not obligated to defend an insured when it has concluded that the insured and the claimant have conspired to assert a fraudulent claim. However, the Court chided Liberty Mutual indicating, once again, when there are coverage issues, the insurer's best course is to file a declaratory judgment action.

Columbia Chiropractic Group, Inc. v. Trust Insurance Company, 430 Mass. 60.

This action was brought by a chiropractic group pursuant to G.L.c. 93A against Trust for its refusal to pay medical expenses incurred in the treatment of insureds following motor vehicle accidents. Trust counterclaimed, also under 93A, alleging that the medical expenses were neither reasonable nor necessary, and were incurred solely for the purpose of surmounting the tort threshold created by G.L.c. 231 § 6D. The jury rendered an advisory verdict with respect to the 93A claims, finding that the bills were neither reasonable nor necessary, and that Trust should not have to honor the same. Based upon that, the Court reached a similar conclusion and awarded double costs and fees against the chiropractic group. On appeal, the chiropractic group asserted that the matter should not have been adjudicated in the superior court, but rather by the doctrine of primary jurisdiction, it was regulatory in nature and should have been resolved before the Board of Registration of Chiropractors. The SJC dismissed this argument inasmuch as said agency had no authority to adjudicate 93A litigation and that the reasonableness and necessity of medical bills was appropriately decided by a judge or jury. The advisory jury found that Trust had incurred no damages but the judge was free to ignore that conclusion and to award Trust its litigation expenses. The incurrence of attorneys' fees and litigation costs constitute a loss of money or property and are recoverable as 93A damages. With respect to the chiropractic group's assertion that Trust should only recover fees and costs incurred in the prosecution of the 93A claim, and not fees and costs incurred in the defense of the chiropractic group's claim, the SJC found that the disputes involved the same facts and there was no need to apportion counsel fees.