Authored by: Joseph Ciollo
Superior Court – Property Loss – Application to Compel Appraisal
In Shaw et al v. CSAA General Insurance Company, the plaintiffs owned property that sustained a windstorm loss. The defendant, which insured the property, initially accepted the plaintiffs’ homeowners claim and afforded coverage, but later denied coverage for additional damage that was discovered. When contractors were performing work to repair the originally claimed exterior roof damage, they discovered additional damage to the interior of the house. The defendant denied coverage for the additional damage and advised the plaintiffs to submit a new claim. The plaintiffs demanded appraisal to resolve the disputed valuation as to the amount of the repair estimates. The defendant rejected the demand for appraisal. The plaintiffs applied for a court order to compel the defendant to proceed to an appraisal pursuant to the terms of the applicable policy. The insurer did not dispute that an appraisal would be the appropriate mechanism to determine the value of the damages for an accepted claim, but asserted that an appraisal would be premature because it had denied coverage. The parties essentially disagreed as to whether the additional damage estimate was in furtherance of the original claim or a new claim. The Court reasoned that simply because there was arguably a coverage dispute did not mean that the appraisal provision could not be utilized. Nothing in the language of the appraisal provision in the policy indicated that resolution of a coverage dispute must precede appraisal. The Court noted that the defendant’s argument would negate the appraisal clause if an insurer could avoid it simply by declining coverage. Citing holdings in prior Connecticut cases, the Court noted that appraisal can be ordered even where the insurer disputes coverage. The plaintiffs’ application to compel appraisal was granted.
Superior Court – Negligent Assault – Duty to Defend
In NLC Insurance Cos. v. Hardgrove et al, the defendant insurer sought a judgment declaring that it had no duty to defend or indemnify its insured in an underlying civil action where the insured was alleged to have violently assaulted and punched the underlying plaintiffs. The insurer filed a motion for summary judgment and made three arguments as to why it was not obligated to provide a defense or to indemnify its insured. First, the insurer argued that the complaint in the underlying action did not contain allegations of an “occurrence” as that term was defined in the policy. Second, the insurer argued that the policy did not apply to a claim of bodily injury or property damage which is expected or intended by the insured. Third, the insurer argued that the policy’s physical abuse exclusion applied to the claims asserted by the underlying plaintiffs. The Court’s analysis of the first and second arguments was closely related. It was of no consequence that the underlying plaintiffs pleaded certain counts as “negligent assaults.” The Court cited to a prior Connecticut Appellate Court decision holding that where a policy excludes coverage for damages resulting from intentional acts, the Court examines the factual allegations to determine whether intentional acts and intended results are present. The result is that even when an action is pleaded as an unintentional tort, such as negligence, the Court examines the alleged activities in the complaint to determine whether the insured intended to commit both the acts and the injuries that resulted. If so, regardless of the title of the action, the Court holds the action to be outside the coverage of the policy. In the present case, the Court found that the alleged violent assault and punching of the underlying plaintiffs was no “accident,” as that term has been defined by the Connecticut Supreme Court, and therefore it was not an “occurrence,” as that term is defined in the policy. Furthermore, the Court found that the insured’s alleged violent assault and punching of the underlying plaintiffs, whatever may have been her intent, could not plausibly be considered anything other than physical abuse, excluded from coverage by the policy. The Court found that the insurer had no duty to defend or indemnify its insured and granted the motion for summary judgment.
Superior Court – Underinsured Motorist Coverage – Arbitration Award
In Tran v. AAA Insurance Company, the plaintiff was injured in a motor vehicle accident and later filed an action against the defendant insurer to recover Underinsured Motorist benefits. The defendant filed an answer with special defenses, asserting that it was entitled to enforce the policy limits and to receive offsets for any sums paid by the tortfeasor and collateral sources. After the plaintiff settled with the tortfeasor, the plaintiff and the defendant agreed to resolve their dispute through binding arbitration. An arbitrator subsequently awarded the plaintiff damages of $45,721.37. The defendant then informed the plaintiff that it was entitled to the offsets claimed in its special defenses. The plaintiff disagreed and filed an application to confirm the award. The defendant argued that the Court should confirm the award but then deduct the offsets. Prior to the arbitration, the parties has executed a binding written arbitration agreement. Following an exchange of e-mails where the parties discussed the parameters of the arbitration, the final written arbitration agreement contained a clause stating. “The arbitration award shall be binding upon the parties. The range of award shall be from $26,500 to $72,500.” The present case was distinguished from a prior decision of the Connecticut Appellate Court which held it was proper for a court to make the deduction of collateral sources from an arbitration award where a written arbitration agreement had required the arbitrator to make such a deduction. Here, nothing in the written arbitration agreement supported the defendant’s claim that the parties agreed to make reductions from the arbitration award. Rather, the express language of the agreement was to the contrary. The Court rejected the defendant’s argument that the arbitration agreement did not reflect a “meeting of the minds” regarding the high/low agreement because the defendant intended that offsets would be applied by the parties after the arbitration. The Court noted that the defendant could have required that the agreement vest the arbitrator with authority to adjust the total damages by deducting the offsets, or alternatively, could have required that the agreement expressly reserve the defendant’s right to apply any offsets as post-arbitration deductions from the arbitrator’s award. The defendant did not take either of these approaches. The application to confirm the arbitration award was granted, and the award was confirmed.
