July 3, 2023Share
Kelley Kronenberg Obtains De Minimus Settlement in Multi-Million Dollar Claim
In the subject suit, Plaintiffs sued their insurance carrier for breach of contract in relation to a Hurricane Irma claim; however, Plaintiffs’ insurance claim pertained to a loss that occurred within a different policy period and was unrelated to the hurricane.
The insurance carrier initially retained an attorney other than Mr. Ciell and Mrs. Koener and, despite Plaintiffs filing a Civil Remedy Notice, said attorney demanded appraisal rather than challenging the alleged cause of loss. The appraisal was completed before the carrier substituted its original counsel with Kelley Kronenberg. The appraisal award explicitly referenced the actual reported cause of loss, not Hurricane Irma. The appraisal was paid, after which, Plaintiffs attempted to win Summary Judgment and amend their Complaint to sue for Bad Faith. Plaintiffs then demanded millions of dollars for resolution of the claim. After the carrier received this demand, Kelley Kronenberg put on an aggressive defense premised on the argument that the cause of loss alleged in litigation (Hurricane Irma) was not the cause of loss reported by Plaintiffs and determined by the appraisal panel.
Two years of aggressive litigation ensued. During litigation, Mrs. Koener deposed Plaintiffs and their public adjuster, through which it was revealed that no one considered associating the subject insurance claim with Hurricane Irma. Plaintiffs then amended their Complaint to allege the proper date of loss, arguing that a small amount of the appraisal award was still owed, despite the carrier paying that same amount prior to the completion of appraisal.
At times during litigation, Plaintiffs argued that their decision to originally allege a Hurricane Irma loss was a “litigation decision” (despite several false allegations that Plaintiffs requested the claim be changed to reflect Hurricane Irma prior to the state of litigation), and the date of loss was irrelevant so long as there was some determination that the property suffered damage while the carrier insured the property. However, case law makes it clear that separate policy periods are treated like separate contracts. Thus, the carrier could not be liable for breach of contract for a loss occurring during the 2017-2018 policy period when the actual claim was filed and appraised under a loss occurring during the 2018-2019 policy period.
Because Plaintiffs changed the date of loss, Mr. Ciell was able to file a Motion for Summary Judgment, asserting the entirety of the amount due on Plaintiffs’ insurance claim was paid prior to Plaintiffs amending the date of loss in their Complaint. Before the Motion for Summary Judgment was heard, and after almost three and a half years of litigation, Plaintiffs agreed to settle their case for a nominal amount.
In the face of Plaintiffs’ attempts to recover millions of dollars in damages, Mr. Ciell and Mrs. Koener were able to leverage their knowledge of the applicable case law and the facts revealed through their discovery efforts to formulate a savvy litigation strategy that brought about a de minimus settlement.