Burr v. Nationwide Mut. Ins. Co.
2013 Ohio 4406
Ohio Ct. App.2013Background
- 2006 collision: William Price (driver) hit a motorcycle carrying Raymond Long (decedent) and Patricia Morgan; Long died and Morgan was seriously injured. Price had a Nationwide policy.
- The Estate of Raymond Long (Burr, administrator) and Morgan negotiated with Nationwide adjusters; Estate alleges Nationwide agreed to pay the $300,000 policy limit (to be split with Morgan) and separately offered $17,030 for property loss. Nationwide disputes a binding settlement.
- Afterward, AIG (another insurer connected to Price) settled with Morgan and the Estate for $1,525,000; the Estate signed a release in favor of AIG and Price (release defined Price to include his "insurers").
- The Estate sued Nationwide in Lorain County alleging fraudulent inducement, breach of contract, promissory estoppel, and unjust enrichment; Nationwide moved for summary judgment arguing the AIG release, res judicata, and R.C. 3929.06 barred the claims, among other defenses.
- Trial court granted summary judgment for Nationwide; the Estate appealed. The Ninth District reversed and remanded, holding material factual disputes precluded summary judgment on the release, and that res judicata and R.C. 3929.06 did not bar the Estate’s suit.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Scope of AIG release: does it bar claims against Nationwide for insurer conduct during settlement? | Release did not intend to bar claims arising from Nationwide’s conduct in settlement negotiations. | Release broadly discharged claims against Price and his "insurers," so it bars claims against Nationwide. | Reversed: genuine issue of fact exists whether the release covers post-accident insurer conduct; summary judgment inappropriate. |
| Res judicata: do prior Geauga County settlement/release preclude this suit? | Claims against Nationwide arise from Nationwide’s own conduct and are distinct from claims against Price. | Estate’s settlement with Price/AIG and release preclude relitigation; Nationwide was in privity with Price. | Reversed: different claims and issues; res judicata does not bar suit against Nationwide. |
| Applicability of R.C. 3929.06 (direct action statute) | Inapplicable because Estate sues Nationwide for its own alleged torts/representations, not to collect policy proceeds through insured. | Statute precludes direct action against insurer until judgment against insured and 30-day period passes. | Reversed: statute does not authorize barring independent claims against an insurer for the insurer’s own alleged misconduct. |
| Venue (Nationwide cross-claim) | — | Lorain County was improper; move to dismiss/transfer to Franklin or Geauga. | Not considered on appeal because Nationwide did not timely cross-appeal; appellee’s challenge cannot be used to reverse judgment. |
Key Cases Cited
- Grafton v. Ohio Edison Co., 77 Ohio St.3d 102 (appellate review of summary judgment standard) (sets de novo review and standard)
- Temple v. Wean United, Inc., 50 Ohio St.2d 317 (summary judgment standard under Civ.R. 56) (three-part test)
- Dresher v. Burt, 75 Ohio St.3d 280 (summary judgment burdens) (moving party’s initial burden and nonmoving party’s response)
- Grava v. Parkman Twp., 73 Ohio St.3d 379 (res judicata) (scope of claim preclusion)
- O’Nesti v. DeBartolo Realty Corp., 113 Ohio St.3d 59 (res judicata discussion) (distinguishes claim and issue preclusion)
- W. Broad Chiropractic v. Am. Family Ins., 122 Ohio St.3d 497 (R.C. 3929.06) (describes direct-action limits under statute)
- Marusa v. Erie Ins. Co., 136 Ohio St.3d 118 (contract interpretation) (unambiguous writing controls intent)