October 31, 2022
ShareKelley Kronenberg Prevails On Motion For Sanctions Based On Plaintiff’s Frivolous Claims For Three Years
Kelley Kronenberg Partners, Alison Trejo, and Todd Schwartz prevailed on Defendant’s Motion for Sanctions upon Plaintiff and Plaintiff’s counsel for perpetuating three years of litigation upon a claim for property insurance proceeds not supported by the material facts necessary to establish that claim. The Honorable Judge Richard L. Oftedal presided.
Plaintiff purchased a property in Delray Beach and secured homeowner’s insurance through Tower Hill Signature Insurance Company (“Tower Hill”) with a policy effective from March 3, 2017, through March 3, 2018. The policy was renewed for the period of March 3, 2018, through March 3, 2019.
On January 8, 2019, Plaintiff reported damages, including a ceiling leak in the front bedroom, allegedly occurring on January 8, 2019. Tower Hill investigated this claim through inspection by a professional engineer on February 14, 2019. The engineer concluded the damages were not the result of a covered peril but from long-term leaking that significantly predated the reported date of loss. On this basis, Tower Hill denied the January 8, 2019, claim.
Seven months later, on November 13, 2019, Plaintiff filed the subject lawsuit against Tower Hill, wherein he alleged damages related to Hurricane Irma, occurring on September 10, 2017. The Complaint constituted the first notice to Tower Hill of a potential Hurricane Irma loss. Plaintiff’s counsel was informed a Hurricane Irma claim was never reported to the carrier, and a Motion to Dismiss was filed on January 24, 2020. This motion was granted without prejudice. Despite the lack of proper notice, Plaintiff filed three Amended Complaints alleging Hurricane Irma damage, all of which were met with similar motions to dismiss and orders granting the motions without prejudice.
Discovery commenced during which Defendant’s corporate representative testified Tower Hill was never advised of Hurricane Irma damage prior to the filing of this lawsuit. Defendant’s engineer testified consistent with his report, adding his conclusions were based on information provided by Plaintiff and his representatives. Further, Tower Hill provided Plaintiff with a copy of his prepurchase inspection report showing the damage alleged in the lawsuit preexisted on both January 8, 2019 and Hurricane Irma.
On April 30, 2020, Defendant filed its Notice of Intent to seek sanctions and provided Plaintiff’s counsel with the requisite safer harbor letter accompanied by a copy of the proposed motion within which Defendant enumerated specific facts and evidence delineating why Plaintiff’s lawsuit had no basis in law and fact. As this did not prompt dismissal of Plaintiff’s suit, on May 22, 2020, Defendant filed its Motion for Sanctions. Eight months later, Plaintiff filed his Fifth Amended Complaint.
In reviewing the evidence, the Court acknowledged two reports obtained by Plaintiff attributing the damages to Hurricane Irma; however, the Judge found the evidence overwhelmingly established Plaintiff never reported a claim for a date of loss related to Hurricane Irma to Tower Hill. As such, Plaintiff and Plaintiff’s counsel knew or should have known that when initially presented to the court and at all times thereafter, the Hurricane Irma claim was not supported by the material facts necessary to support the claim. Further, as all the evidence presented pertains to a Hurricane Irma loss, Plaintiff and Plaintiff’s counsel knew or should have known that the January 8, 2019, claim was not supported by the material facts necessary to support that claim. The Court stated that, despite being placed on notice early in the litigation that all the evidence pertained to a Hurricane Irma loss and that such a loss had never been reported to Tower Hill, Plaintiff chose not to dismiss his frivolous claim; rather, he opted to “double down” and file not one, but five different complaints, dragging Defendant through years of litigation, ultimately filing a voluntary dismissal at 4:10 p.m. the day before trial.
The Court found there were no justiciable issues of law or fact, and that Plaintiff’s attorney did not act in good faith based on the representations of his client and Plaintiff’s action is so clearly devoid of merit both on the facts and the law, the same is completely untenable. Based on the same, and the fact that Plaintiff dismissed his suit on the eve of trial, the Court granted the motion for sanctions and mandated an award for attorney’s fees to Defendant (including pre-judgment interest) to be paid by Plaintiff and Plaintiff’s counsel equally for those fees incurred in this action from the inception of the case.