Updates on Insurance Coverage, Construction Defect
and Commercial Auto Law Developments
in North Carolina and South Carolina
Greetings from Evans & Co. Counselors and Litigators, with our July edition of our Case Notes series. 
We write with our regular updates on insurance, construction defect [1], and commercial auto law in the states of North Carolina and South Carolina, which we last visited about four months ago. We attach 21 pages presenting and analyzing the cases we mention below.
Please recall that our past Case Notes are archived at and we would be pleased to bring current the decisions on which we've reported previously, at your request.
The North Carolina Court of Appeals affirms a strict reading of the UM/UIM policy wording, which requires actual physical contact between the uninsured vehicle and the claimant, to trigger coverage. 
A Federal District Court, applying North Carolina law, construes the Entrustment Exclusion to bar property loss coverage of restaurant equipment entrusted to the operator of a “Christian Restaurant and Lounge”, who subsequently stole it. In a second Federal District Court case, the North Carolina procedures for determining UM/UIM liability and damages, which require litigation by the claimant, did not give rise to a claim for bad faith claims practices against the UM/UIM insurer.
In South Carolina, their Supreme Court responds to certified questions from a federal court, regarding the jury’s ability to consider, in a tort case, the fault or responsibility of the plaintiff’s employer in causing the injury. Of course the employer is immune from tort suit and adjusts its exposure, without regard to fault, to the insured under workers’ compensation laws. Sometimes the employer, or co-employees, are a cause or the cause of the injury. When an injured employee later sues third parties, what are those third parties to do to raise the fault of the employer, which they contend caused the loss in part or in whole? The response of the Supreme Court looks fair and balanced but presents the jury with inconsistent and incomprehensible instructions.  At least the jury gets to think about employer fault – but what they will do under this ruling is impossible to say. 
We digest a case from the Federal 4th Circuit Court of Appeals, considering whether a claimant standing on the shoulder of a road when struck, was “getting in” an insured vehicle for purposes of UM/UIM coverage – concluding the claimant was not and therefore was not covered.  We have had the occasion to conduct near-50-state research on this subject so inquire if this issue comes up in your claims!
In a Federal District Court, applying South Carolina law, claims against an additional insured, arising not out of vicarious liability for the named insured, but from direct liability to the claimant, were not covered for the additional insured. In a second Federal District Court case, involving commercial auto liability for alleged negligent hiring and negligent supervision, facts were sufficient to support a dismissal of the first but not the second claim.
[1]   Once again these courts have not graced us with construction defect decisions during the relevant recent period. 
Click here for our Case Notes for both states (21 pages).
Click here for North Carolina only (9 pages).
Click here for South Carolina only (13 pages).
Click here to go to the Evans & Co. law firm website for firm information and access to prior case digests.

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