For a landlord, it’s a bad day when your tenant gets busted for operating a meth lab, and the local authorities condemn your house because it’s contaminated with the byproducts of his business. It’s even worse when you learn there is no coverage for the cost of cleaning up the contamination. Neighborhood Investments, LLC, leased a house in Louisville, Kentucky, to a Mr. Kenneth McCormick. As neighborhood investments go, this was not a winner. Mr. McCormick was ... Keep Reading »
Property
Suit Limitations Provisions are Enforceable. Except When They’re Not.
When might a court find a reasonable and enforceable suit limitation provision neither reasonable nor enforceable? According to New York’s highest court, it’s when the provision would bar a claim to enforce the replacement coverage under a property policy, and where completion of the repairs that constitute the replacement is a condition precedent to the suit. In Executive Plaza, LLC v. Peerless Ins. Co., 5 N.E.3d 989, 990 (N.Y. 2014), the Court of Appeals of New York, ... Keep Reading »
CFPB Mortgage-Servicing Regulations will Impact Lender-Placed Insurance
Under Dodd-Frank, the Consumer Financial Protection Bureau (“CFPB”) is authorized to issue regulations that cover the servicing of consumer mortgage loans. In January, the CFPB issued new regulations (‘the “Final Rule”) that extensively amend the mortgage-servicing rules of both Regulation X (the regulation that implements the Real Estate Settlement Procedures Act of 1974 (“RESPA”)) and Regulation Z (which implements the Truth in Lending Act (“TILA”)). The Final Rule ... Keep Reading »
In Late Notice Cases, There’s More at Stake than a Single Claim
Both property and liability policies contain provisions that require the insured to provide its carrier with timely notice of a claim, but cases in which late notice is used as a basis for denying coverage often leave the insurer in an unflattering light. It is not always apparent that the late notice has made any actual difference to the insurer. Consequently, even though most notice provisions are written as strictly as possible, making timely notice a condition ... Keep Reading »
Complaint Charges that Law Firm Ads Deceptively Omitted Coverage Defenses
Selling insurance can be hard, because it can involve making simple statements about complex products. Brokers and agents (as well as insurers) can sometimes be held responsible for their customers’ failure to understand those complexities. A few months ago, New York’s Court of Appeals held that even a corporation’s failure to read its own policy did not bar its claim against its insurance broker for an allegedly negligent failure to obtain certain liability coverage. ... Keep Reading »
What’s in a Proper Name? Coverage Opinions Take Different Approaches
In his 1892 paper, “On Sense and Reference,” Gottlob Frege, the German philosopher who inspired the work of Bertrand Russell, explained that the definition of a word or name can have two components. One, “reference” (or “referent”), is simply the person or object to which the word refers. The “reference” of “Napoleon Bonaparte” is the French emperor who bore that name. The second element, “sense,” is the name’s “mode of presentation,” which reflects the manner in ... Keep Reading »
The Limits of the Real: Narrow Readings of Policy Terms put Losses in a Virtual Realm
Ludwig Wittgenstein famously declared that “[t]he world is everything that is the case.” In three recent cases involving liability policies, courts remind us that injury can occur beyond the limits of the world that consists of “property”—or even of “substance.” 1. PPI Technology Services, L.P., was hired to “assist in well-planning” on three oil leases in Boudreaux, Louisiana. Its responsibilities included overseeing the drilling of wells. When PPI dug an empty ... Keep Reading »
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