February 8, 2013, Utah Supreme Court Cases

February 8, 2013

Recent Utah Supreme Court Cases

CARTER-REED COMPANY, LLC, et al. v. ADMIRAL INSURANCE COMPANY, 2013 UT 6, No. 20110556 (February 8, 2013)

The Court interprets an insurance contract’s terms regarding coverage for “personal and advertising injury . . . arising out of . . . [t]he use of another’s advertising idea in your advertisement” to NOT cover allegations of false advertising.

In Utah, an insurer has a duty to defend “when the insurer ascertains facts giving rise to potential liability under the insurance policy.” Sharon Steel Corp. v. Aetna Cas. & Sur. Co., 931 P.2d 127, 133 (Utah 1997). Where the allegations, if proved, show “there is no potential liability [under the policy], there is no duty to defend.” Deseret Fed. Sav. & Loan Ass’n v. U.S. Fid. & Guar. Co., 714 P.2d 1143, 1147 (Utah 1986). The question of whether there is potential liability under the policy “is determined by comparing the language of the insurance policy with the allegations of the complaint.” Benjamin v. Amica Mut. Ins. Co., 2006 UT 37, ¶16, 140 P.3d 1210 (internal quotation marks omitted). “The question is whether the allegations, if proved, could result in liability under the policy.” Deseret, 714 P.2d at 1147. “If the language found within the collective ‘eight corners’ of these documents clearly and unambiguously indicates that a duty to defend does or does not exist, the analysis is complete.” Equine Assisted Growth & Learning Ass’n v. Carolina Cas. Ins. Co., 2011 UT 49, ¶ 18, 266 P.3d 733.

At ¶ 7

“[A] contract term is not ambiguous simply because one party ascribes a different meaning to it to suit his or her own interests.” Equitable Life & Cas. Ins. Co. v. Ross, 849 P.2d 1187, 1192 (Utah Ct. App. 1993).

At ¶ 10