Lewis F. Holmes,III, d/b/a Lewis F. Holmes and Son, Lewis F. Holmes, Inc. v. Kathy D. McKay, et al.

Insurance - Costs - Lewis F. Holmes, d/b/a Lewis F. Holmes & Son (Holmes), seeks
reimbursement from United States Fidelity & Guaranty Company (USF
& G) for costs incurred in settling and defending a migrant
workers' lawsuit.

In the light most favorable to Holmes, the facts are as
follows.

Holmes approached Wynn B. Seigler of the Seigler Insurance
Agency (Seigler) to procure farm liability insurance. Seigler
lacked personal access to a farm liability market at that time
but contacted Kathy D. McKay, d/b/a Stelling & Associates
(McKay), on Holmes's behalf. McKay held an agent's license from
USF&G and planned to use USF&G as the insurance carrier.

Seigler and McKay met with Holmes at his farm to discuss a
potential farm liability policy (the Policy). At the initial
meeting, Seigler and McKay inspected Holmes's farm, including the
migrant workers' camps and dwellings. Holmes told both Seigler
and McKay he "needed to be protected against all claims by
migrant workers, any and all claims." Seigler and McKay assured
him of such coverage.

Based on the meeting with Holmes, McKay, on behalf of USF&G,
issued Holmes a USF&G insurance binder on May 20, 1993 indicating
broad coverage for general farm liability from June 1, 1993 to
June 1, 1994. In a letter dated May 20, 1993 (the 5/20/93
letter), McKay and Seigler wrote that "[i]n accordance with your
request, we have arranged for insurance protection to become
effective 05/20/93 on all properties as scheduled on the enclosed
binder . . . . Meanwhile, coverage is in force just as though you
have a policy in your hands."

USF&G subsequently issued the Policy pursuant to this binder.
Holmes paid the required premium and received the Policy several
weeks later, after the occurrence of the events giving rise to
the migrant worker's lawsuit. The Policy listed Stelling and
Associates as "agent."

The Policy stated:

We will pay those sums that the "insured" becomes legally
obligated to pay as damages because of "bodily injury" or
"property damage" to which this insurance applies . . . . No
other obligation or liability to pay sums or perform acts or
services is covered unless explicitly provided for under the
ADDITIONAL COVERAGES.

On October 1, 1993, certain migrant workers brought a civil
action against Holmes alleging he violated their rights under the
Migrant Seasonal Agricultural Worker Protection Act (AWPA), 29
U.S.C.A. § 1801 et seq. (West 1999), and breached an
employment contract. Holmes talked with McKay and Seigler about
the suit. Both assured Holmes that he was covered. Nonetheless,
USF&G subsequently sent Holmes a letter denying coverage. After
settling the lawsuit, Holmes initiated this action on December
20, 1995.

Judge granted summary judgemtn to USF & G and denied summary judgment to the other defendants.

Unknown

Unknown

Affirmed in part, reversed in part, and remanded by the Court of Appeals of South Carolina. See: 513 S.E.2d 851 (S.C.App. 1999). The above date reflects the appellate court date, not the original trial date. Reported by kkm.