TT&H Attorneys Charles Adams, Benjamin Frommer and Jeanette Ho Win Summary Judgment in Insurance Coverage Dispute

TT&H Attorneys Charles Adams, Benjamin Frommer and Jeanette Ho recently won summary judgment in connection with an insurance coverage dispute.  The insureds owned a house that was damaged by a fire.  After the fire, the insureds submitted a claim under their homeowners policy.  The insurer paid the insureds the actual cash value of the damaged property.  The insureds then submitted a claim to recover the cost of replacing the structure.  The insurer informed the insureds that they could not obtain replacement costs until after they had actually repaired or replaced the house, which they had not yet done.  The insurer asked the insureds to provide documents which would allow the insurer to evaluate the claim for replacement costs.  The insurer also requested that the insureds appear for an examination under oath.  The insureds refused to comply with the insurer’s requests.  The insureds subsequently filed a lawsuit alleging that the insurer had engaged in a breach of contract by failing to pay their claim and acted in bad faith.

Chuck, Ben and Jeanette filed a Motion for Summary Judgment on behalf of the insurer.  The Motion noted that the insurance policy contained provisions that:  (a) gave the insurer the right to ask the insured to produce documents and records in connection with a claim and to appear for an examination under oath, and (b) precluded an insured from filing a lawsuit against the insurer if the insured failed to fully comply with all policy terms.  TT&H argued that the insureds could not maintain their suit because, by refusing to provide the requested documents and examinations under oath, the insureds had not complied with all of the terms of the insurance policy.  TT&H also argued that the insureds did not have any evidence to support their claims that the insurer had acted in bad faith.

The United States District Court for the Middle District of Pennsylvania agreed with the arguments made by Chuck, Ben and Jeanette.  The Court initially determined that the insureds could not maintain their breach of contract claim because they had not provided the insurer with requested documents and had not appeared for an examination under oath.  The Court also concluded that although the insureds had alleged a “litany” of bad faith conduct on the part of the insurer, they had failed to present clear and convincing evidence that the insurer lacked a reasonable basis for denying coverage and recklessly disregarded the lack of a reasonable basis.  As a result, the Court granted TT&H’s Motion and entered summary judgment in favor of the insurer.

Questions about this case can be directed to Charles Adams at (267) 861-7582 or cadams@tthlaw.com, to Benjamin Frommer at (267) 861-7585 or bfrommer@tthlaw.com, or to Jeanette Ho at (412) 926-1449 or jho@tthlaw.com.