In Download Casper v. American International Southern Insurance Co. (Wis. Case Nos. 2006AP1229 et al, Opinion Filed July 19, 2011) PUBLIC ACCESS, also published as 2011 WL 2820530 (Wis. July 19, 2011) (authorized password required to access Westlaw), the opinion of the Wisconsin Supreme Court identified three issues for the Court's consideration. We are concerned here with the second of those issues, which the Court's opinion identified in the following terms:
¶ 4 Second, can the Caspers maintain a direct action claim against National Union when its policy of insurance was neither delivered nor issued for delivery in Wisconsin but the insurance policy covers the insured's “business operations” conducted in this state? Relying on Kenison v. Wellington Insurance Co., 218 Wis.2d 700, 582 N.W.2d 69 (Ct.App.1998), the circuit court and court of appeals answered “no.” In this review, the Caspers contend that a plain reading of Wis. Stat. § 631.01(1), together with Wis. Stat. § 632.24, authorizes direct action against an insurer in any of four situations stated in the disjunctive in Wis. Stat. § 631.01(1). Only one of these four situations requires delivery of the policy in Wisconsin.
Casper v. American Southern International Insurance Co., 2011 WL 2820530 at *1 ¶ 4.
The Supreme Court overruled previous intermediate appellate court case law and held that the answer to its own question is, in this case, a resounding "yes":
¶ 8 Second, a liability insurance policy need not be delivered or issued for delivery in this state in order to subject the insurer to a direct action under Wis. Stat. §§ 632.24 and 803.04(2). Kenison is accordingly overruled, and the decision of the court of appeals on this issue is reversed.
Id. at *2 ¶ 8. (Prosser, J., for the Supreme Court of Wisconsin).
The Supreme Court's decision has far-reaching implications for direct actions under similarly worded statutes in other jurisdictions. Insurers which have issued all kinds of Insurance Policies may find themselves defending lawsuits in places they never imagined going. Until then, keep an eye on the Wisconsin Bar Website, among other sites, such as "Legislation: Insurance Litigation & Regulatory Law Blog" (see in particular there, this post on August 10, 2010 by James Carlyle, "The California Supreme Court Reiterates Analysis for Determining Whether a Statutory Violation Confers a Private Cause of Action") to see what others have to say about the implications of this Wisconsin Supreme Court decision.
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