Foran Glennon shareholder Charles Rocco and partner Dawn Brehony, achieved a significant victory as the United States District Court for the District of New Jersey granted summary judgment in favor of their insurer client. The court ruled that the insurer fulfilled its obligations under the policy, resulting in the dismissal of the policyholder’s multi-million-dollar claim.
Background
The case involved a policyholder who submitted a claim for damages to its facility following a hurricane in the New Jersey area. The insurer assessed the loss and paid the undisputed actual cash value for the covered damage. As per the policy, the insured was entitled to receive replacement cost value once the actual repair or replacement of the damaged property was completed.
The policyholder failed to carry out the necessary repairs or replacement of the damaged property. Instead, nearly two years post-loss, the policyholder submitted new estimates, claiming millions in additional damage to its property.
After the insurer conducted a second site inspection of the policyholder’s property, the insurer found no further damage to the property and denied additional payment for the loss. Subsequently, the policyholder filed a lawsuit against the insurer, alleging breach of contract and bad faith.
Foran Glennon successfully obtained dismissal of the bad faith claim. Following this, the parties entered an appraisal process to determine the amount of damages. Charles and Dawn worked closely with the insurer’s appointed appraiser to concisely present the insurer’s position. They also developed a strategy to demonstrate that the policyholder’s appraiser’s $11.2 million estimate was grossly inflated. The appraisal panel issued an award favorable to the firm’s insurer client, reflecting the results of our attorneys’ efforts.
Dissatisfied with the appraisal award, the policyholder filed a motion for summary judgment to vacate the award. In response, the insurer moved to confirm the appraisal award and dismiss the entire action, claiming all contractual obligations under the policy had been fulfilled.
Court Ruling
The district court ruled in favor of the insurer, asserting that the policyholder was bound by the appraisal award. The court highlighted that the policyholder’s motion appeared to be an attempt to “nullify the results” due to an unfavorable outcome, paralleling it to “a case of buyer’s remorse.” With no outstanding issues remaining in the case, the district court dismissed the lawsuit in its entirety.
Both Charles and Dawn concentrate their practice in first-party property insurance disputes. Their experience includes the full array of first-party property insurance matters, including bad faith claims, builder’s risk claims, and construction and design defect claims.