McCormick v. Chippewa, Inc.Annotate this Case
In August 2007 Brent McCormick was injured while working aboard FV CHIPPEWA, owned by Chippewa,Inc. McCormick filed a lawsuit against Chippewa and Louis Olsen, the vessel's captain in August 2010. McCormick initiated settlement negotiations with the employer's insurance company for "policy limits." Under the insurance policy there was a per-occurrence coverage limit. During negotiations, counsel for McCormick and the insurance company discussed the terms of the settlement over a phone call; the parties provided inconsistent accounts of which issues were addressed on the call. McCormick's counsel’s affidavit asserted he raised the issue of the number of occurrences and the parties agreed to leave it unresolved. Shortly after this phone call, the parties reached a purported settlement agreement. McCormick filed suit to enforce the purported settlement agreement for policy limits based on three occurrences. The insurance company filed for summary judgment, asserting that the agreement was for policy limits of a single occurrence. The superior court granted summary judgment for the insurance company, concluding that its interpretation of the purported settlement agreement was correct. On appeal, McCormick argued the superior court abused its discretion on evidentiary and discovery issues and erred by granting the insurer’s motion for summary judgment. After review, the Alaska Supreme Court found no abuse of discretion. But the Court did find an issue of fact barring summary judgment due to the contradictory accounts of the phone call. A reasonable person could have discerned a genuine factual dispute on a material issue because this phone call could have either: (1) provided extrinsic evidence of the meaning of the settlement agreement, or (2) indicated there was no meeting of the minds on an essential term, and thus no enforceable agreement was formed. Therefore, summary judgment was inappropriate and the matter was remanded for further proceedings.