Aaron Bolton on LinkedIn: In Hansen Yuncken Pty Ltd v The Hollard Insurance Company Pty Ltd [2024]… (2024)

In WSP Structures Pty Ltd v Liberty Mutual Insurance Company t/as LibertySpecialty Markets [2023] FCA 1157, Colvin J upheld WSP's claim for indemnity as an Insured under the head contractor's third-party liability policy, and entitled to indemnity for liability incurred due to settlement of the "Opal Tower" proceedings.WSP was the structural engineer for Opal Tower. It had been engaged by Icon. Opal Tower suffered structural damage. This gave rise to three sets of proceedings. The proceedings were settled. WSP was a party to the settlement. It accepted liability to pay an amount to Icon and an amount to a class action. Part of the payments were made by WSP's parent, WSP Australia, and part by WSP's PI Insurer. WSPA also paid WSP's defence costs. WSP sought indemnity for the amounts paid by WSPA from LSM and excess layer insurers. LSM had issued Icon with a third-party liability policy. First, his Honour held WSP was an Insured under the Policy. Insurers argued that WSP did not fall within the meaning of "insured" under the Policy because it was not a "subcontractor". His Honour disagreed and held that insured was defined broadly and professional consultants may be subcontractors, and that term was not confined to construction contractors. He said that it would be a "most uncommercial result" if there was coverage for some aspects of the works that an Icon entity had contractors to undertake (egconstruction work), but not others (eg engineering design).Second, his Honour held that WSP had not been indemnified by its PI Insurer. Insurers argued WSP had received a full indemnity because its PI insurers had confirmed indemnity in writing, paid some amounts already, and would pay the balance upon request by WSP. His Honour disagreed, holding that full indemnity must mean actual payment. He also held that WSP's pursuit of its PI insurance was not an "election" and there was no inconsistency in pursuing rights under two policies.Third, his Honour held that WSPA was not the proper applicant under the Policy. Insurers argued that because WSPA made payments in respect of WSP's liability, it had suffered loss and should be seeking indemnity. His Honour disagreed, finding that where payment had not been made by another insurer the obligation to indemnify had not been performed or satisfied, and WSPA's payment did not alter WSP's legal liability.Fourth, his Honour held that WSP was entitled to indemnity under the Policy. This was not altered by the payments made by WSPA. His Honour cited authority that whether payment by a third party is one made to reduce the same liability for which indemnity is provided under the policy is a matter of intention and fact. He held that the payments were not made by way of indemnity.

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Now is the time to make sure your firm is prepared for the new year! This week's blog discusses the importance of property insurance.

While the speed of our appellate courts is an important issue, Roy's post raises another point for me. I believe the holding on this would be the exact opposite in NM based on the facts asserted. We don't have a case on point. But this what I do. I understand the law in NM and how our courts analyze coverage issues.The point: Please hire local Coverage and Bad Faith counsel. It will save us all in the end.Have a safe and blessed Independence Day.#insurancecoverage #insuranceclaims #insurancelaw

Rules like this work both ways. Their conclusion can be reworded very slightly....~~~Where [insureds] use attorneys to conduct ordinary claim functions, discovery from those individuals should be expected and freely provided.Experienced [defense] counsel can help [insurance companies] to recognize when [policyholder] attorneys are, in fact, functioning in a claim-handling capacity and thus subject to the ordinary rules of discovery.~~~This should be of interest to the growing number of policyholder attorneys who sign up clients and act like public adjusters in the claims submission process.What's that old saying about a goose and a gander?

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Coverage Pointers Advance: Summary Judgment on Policy Rescission Failed When Insurer Offered Unsigned Policy Application as its Business Record. Insurers Bewarehttps://lnkd.in/dtJg934d05/30/23Scottsdale Ins. Company v. Casino Development Group Appellate Division, First DepartmentUnsigned Application of Insurance Offered as a Business Record in Support of a Rescission Motion, Rejected as Hearsay.Late Disclaimer Based on Delayed Investigation Torpedoes Disclaimer.Insurer’s Beware.Toll sought additional insured coverage under a Scottsdale policy. Scottsdale apparently denied coverage, seeking a determination that it had no coverage under certain policies based on a “Residential Building Project Exclusion” and seeking to rescind an excess policy.The court found that Scottsdale should have conducted a more prompt investigation of the facts and circ*mstances of the project when the contract documented the building project at issue as "residential." Even if this failure to investigate was justified, Scottsdale does not explain when its monitoring counsel had completed his evaluation of the underlying litigation or the necessity of any subsequent delay in disclaiming.Scottsdale thus failed to meet its burden to show that its delay was reasonably related to necessary, prompt, and diligent investigation Accordingly, unless the insurance policy is void ab initio under the second cause of action, Scottsdale is required to provide insurance coverage as to an underlying actionThe court properly denied Scottsdale summary judgment on its second cause of action for a declaration that the commercial excess liability policyis rescinded as void ab intio. Scottdale failed to establish prima facie that Casino made material misrepresentations of fact on its insurance application, as the unsigned application is inadmissible under the best evidence.Scottsdale contends that Casino's unsigned insurance application is admissible based upon the affidavit of its underwriter averring that the document was maintained in the regular course of Scottsdale's business (see CPLR 4518[a]). However, Scottsdale offered no evidence that Casino was the source of the information contained in the application.Since Scottsdale proffered no evidence as to the person relied upon for the completion of the application, the application did not provide the " 'sufficient indicia of reliability' " necessary for the representative of one entity to lay a business records foundation for the records of another.Editor’s Note: The “business record” rule is a tricky one.Insurers ought to make sure that they are working with signed (actual or electronic) policy applications when seeking rescission or trouble may be afoot.

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king Prince Insurance (pty) v MhlongoAnother matter which I feel counsel for the respondent had embarked in an unjust cause ( determine the market value of the vehicle)The matter originated at the Regional Division of Gauteng(RDG)1. Mr Mhlongo had a comprehensive cover with Kingprice insurance for his motor vehicle, after it was written off in a Collison because the cost of repairs to the vehicle or other damages were deemed to be more than the value of the car.2. After kingPrice insurance rejected his insurance claim, the Mr Mhlongo instituted an action in the trial court for breach of the agreement and claimed damages for a fair and reasonable market related value of the vehicle.3. the quantum of damages claimed was R374 960.504. both the trial and the full bench ruled in favour of Mr Mhlongo and damaged pleaded were awarded.5. KingPrice then appealed. Appeal to the SCA was only limited to the question of whether Mr Mhlongo had proved the quantum of his claim. the SCA upheld the appeal although Mr Mhlongo had pleaded damages based on the market value of the vehicle, he had not adduced evidence to support his claim.6.the only evidence he had, was a document provided by standard bank, which had financed the purchase of the vehicle. 7. the SCA found that the the document furnished by Mr Mhlongo which indicated the settlement amount due to the bank under the finance agreement was R374 960,50, shown no relation to the market value of the vehicle.8. in the absence of evidence to establish the market value by Mr Mhlongo, the SCA held that it could not properly be found that the respondent had proved the quantum of his claim. appeal by KingPrice was upheld and the Respndent's claim dismissed.NB-KingPrice case on the appeal was that the evidence adduced by Mr Mhlongo did not support his pleaded case on quantum.the Order:1 The appeal is upheld with costs.2 The order of the Gauteng Division of the High Court, Pretoria is set aside and is substituted by the following order:‘1 The appeal is upheld with costs.2 The order of the Regional Court for the Regional Division of Gauteng, Pretoria is set aside and is substituted by an order granting absolution from the instance with costs

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This is happening more frequently - policyholder attorneys taking the reins shortly after the insured provides the carrier with first notice of loss.As I've argued at trial, the bad faith discussion goes both ways. It's not just a one-way street. The conduct of the insured and its counsel are also probative to extra-contractual claim analysis by the factfinder.#insurance #litigation #Louisiana

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An interesting case out of the 11th Circuit Court of Appeals involved an insurance coverage dispute regarding an installation floater policy (not the same as a builder's risk policy but a good policy for trade subs to procure). In the case, an underground utilities contractor with a general contractor's license constructed 2 residential homes where the owner was an affiliated family entity. The 2 homes, shortly before the certificates of occupancy, burned in a wildfire and the utilities contractor submitted a claim under its installation policy which was denied b/c nothing in the policy or the application identified the homes or that the contractor constructed residential homes. The trial court and appellate court affirmed the denial b/c when the insurance poilcy was read together with the contractor's application, there was no reasonable interpretation that extended coverage to the 2 homes. Here is why it's interesting. First, the insurance application is important under FL law b/c it's construed together with the policy:"[e]very insurance contract shall be construed according to the entirety of its terms and conditions as set forth in the policy and as amplified, extended, or modified by an application therefore….[t]he application becomes a part of the agreement between the parties and the policy together with the application form the contract of insurance.”Second, the 11th Circuit noted that the intepretation to extend coverage to the 2 homes was unreasonable as it would result in limitless coverage:"[The utility contractor’s] reading would simply require [the insurer] to cover any one-off construction project wholly unrelated to [the contractor’s] underground utility or site development work – again, the only types of work disclosed or provided in the renewal application and Policy. … Coverage would follow if [the contractor] decided to install a skylight at a mall, repair the roof of a church, or construct a skyscraper from the ground up.[The insurer] would be on the hook for any number of such projects, even though they were not disclosed in [the contractor’s] application, contemplated by [the insurer], or provided for in the Policy. Taken as a whole, the Policy [and the contractor’s] renewal application do not support such a reading.Indeed, the only reasonable reading of the Policy and the renewal application is that [the insurer] provided coverage for [the contractor’s] underground utility and site development work. The construction of the two residential homes is neither of those items and is not covered by the Policy."

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Liability lessonsThe Dali is owned by Grace Ocean Pte. Ltd., managed by Synergy Marine Pte. Ltd. and covered by The Britannia Steam Ship Insurance Association Ltd., or Britannia P&I Club. Protection and indemnity (P&I) clubs are mutual insurance organizations that insure and pool liability for the global shipping industry.All crew members and the two pilots operating the Dali have been accounted for, according to a statement from a Britannia P&I Club spokesperson. The statement noted that the "exact cause of the incident is yet to be determined."The value of the bridge itself could be about $1.2 billion; it is not yet known if the insured limit on the property placement will fully cover replacement, Worters said. Insurance Insider reported that Chubb Ltd. is the lead insurer of the bridge itself, but any claims are likely to be subrogated to the shipowner's insurance.The incident will impact the International Group of P&I Associations the hardest, according to Worters, who said the group has significant reinsurance coverage, led by AXA XL. Worters also said it was her understanding that Aon PLC covers the bridges and tunnels property placement for the State of Maryland.Claims complexitySeverity has yet to be determined, but the accident will affect several different lines of business.Bridges are typically covered under the inland marine insurance market, Worters said. Liability insurance also protects bridge owners from legal claims arising from accidents and injuries.Business interruption insurance could also be a factor as it also serves to offset loss of revenue or costs incurred during repair or reconstruction of the bridge, Worters said."This collapse is likely to cause huge disruption both for shipping ... as well as roads so there could be supply chain issues," said Worters.Liability lawsuits are surely coming down the pike for losses stemming from injuries and fatalities."There is also clean up from the debris and reconstruction costs, which will be massive," Worters said.There is not expected to be the huge environmental impact associated with, for instance, an oil tanker running aground. Britannia P&I Club said in its statement that no pollution had been associated with the incident.The incident bears some similarity to the May 1980 collapse of the Sunshine Skyway Bridge in Tampa, Fla. In that incident, the M/V Summit Venture collided with one of the bridge's supports during a storm in Tampa Bay, sending a 1,200-foot section of the bridge into the bay below, killing 35 people.Marine Insurance and its complications 🥹🥹

Its always fun to wake up and see that I am the subject of Chip Merlin's daily blog.Today is one of those days.https://lnkd.in/gUVf8prGChip resurrects an old case in which I was appointed as an appraiser.Not surprisingly, the policyholder attorney objected.The court looked at my website and background in finding that as a lawyer representing insurance companies I was not qualified to act as an appraiser.Fair enough. So the insurance company then moved to strike the policyholder’s appraiser, James "Max" Judge , based on statements on his website suggesting he was biased against insurance companies.And the court agreed, striking Mr. Judge as a biased appraiser.Fair is fair.I am headed to Colorado this morning to debate Chip tomorrow at the Rocky Mountain Association of Public Insurance Adjusters Conference.Now that Chip has raised the issue, here is a question I plan to pose to the roomful of public adjusters…..If I cannot serve as an appraiser simply because my profession is to advocate for insurance companies, why should a public adjuster – whose profession is to advocate for policyholders – ever be allowed to be an appraiser?It is an absolutely fair question.Public adjusters enjoy a narrow carve-out from statutes governing the unauthorized practice of law allowing them to advocate for third-parties in insurance claims.They get to do what is otherwise considered to be the practice of law.So why should they be allowed to serve as appraisers if I cant? Look at public adjuster websites. They all talk about how bad insurance companies are.With that said, let me say loud and clear once again that it is my practice not to object to public adjusters serving as appraisers simply because they are public adjusters.I have said that many times. I have suggested to my clients that they appoint public adjusters as appraisers and I routinely propose them as umpires.I object only to those public adjusters who I know are unable to take off their advocate public adjuster hat and put on an unbiased appraiser hat. And there are a few of those. You know who you are. So don't worry. I'm not going to start advocating that public adjusters cannot ever be appraisers or umpires. But I was stricken simply based on the fact that I make a living representing insurance companies.So why shouldn’t public adjusters also be stricken simply based on the fact that they make a living representing policyholders?There’s no difference in the analysis.What’s that old saying about a goose and a gander?

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