Confidential
Settlement – $500,000Judge
Court
L.A. Superior Central
Attorneys
Plaintiff
Experts
Plaintiff
Bernard R. Martin
(technical)
Facts
On March 5, 1991, Plaintiffs husband and wife sustained burglary loss at their home. Alleged personal entertainment theater equipment worth more than $23,000 was stolen. At the time of the loss, the Plaintiff family was in the process of converting their garage into a highly sophisticated home entertainment theater. Plaintiff husband was in the business of installing such equipment for residential homes, businesses, and schools. At the time of the loss, Plaintiff family had a homeowner's policy issued by one insurance carrier and a business policy with another insurance carrier, both administered by Defendant. On the day following the burglary, Plaintiff family submitted a claim for benefits under their homeowner's policy. On March 19, 1991, Plaintiffs submitted their proof of loss along with records which documented the loss. At some time between one day and six weeks later, Defendant knew of the existence of the business policy. Defendant then demanded that Plaintiffs submit themselves to an examination under oath in an alleged attempt to gather information that the stolen property had been for a business purpose, not for personal use. During the first year of its investigation, Defendant allegedly did not disclose to Plaintiffs the nature of their investigation and its attempt to characterize the stolen property as "business" in nature; Plaintiffs continued to provide relevant documents to substantiate that the stolen property was "personal." In November of 1991, Defendant threatened to deny the claim for failure to cooperate; Plaintiffs filed this suit for breach of contract and breach of the implied covenant. On March 12, 1992, Defendant disclosed that the purpose of its investigation was to determine whether the stolen property was personal or business property. Plaintiffs responded by allegedly informing Defendant that it did not matter whether the stolen goods were business or personal because, if the property was defined as business, they would still be covered for their loss under the business policy. Shortly thereafter, Defendant denied the claim previously submitted; in October of 1992, Defendant paid the entire $22,000 claim under the homeowner's policy.
Settlement Discussions
Plaintiffs contend their demand was $900,000 and Defendant offered $50,000.
Damages
Delay in payment of the policy limits and attorney fees.
Other Information
This case settled on the first day of trial.
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