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Insurance
Bad Faith
Denied Coverage

Santa Anita Church v. GuideOne Mutual Insurance Co.

Published: Dec. 30, 2003 | Result Date: Sep. 16, 2003 | Filing Date: Jan. 1, 1900 |

Case number: GC029408 Verdict –  $663,831

Judge

Jan Pluim

Court

L.A. Superior Pasadena


Attorneys

Plaintiff

Michael J. Bidart
(Shernoff, Bidart & Echeveria LLP)


Defendant

David L. Jones


Experts

Plaintiff

James Robie
(technical)

Stephen D. Prater
(technical)

Henry A. Ojendyk
(technical)

Peter Formuzis Ph.D.
(technical)

Defendant

William B. Grinnell
(technical)

Paul Hamilton
(technical)

Charles Wiese
(technical)

Steven Provenghi
(technical)

Facts

The plaintiff, Santa Anita Church, was insured by GuideOne Insurance Co. (GOIC). In March 2001, the church reported a claim to GOIC after discovering a crack in a glue laminated support beam of the A-framed sanctuary. Six months later, GOIC after investigating the claim, denied coverage, on the advice of counsel, on the basis that there was no indication of an imminent collapse. The church sued the defendant and alleged that the defendant breached the covenant of good faith and fair dealing to adequately investigate the claim. It alleged that the defendant only investigated the cause of the loss and not whether a collapse was imminent. The sole basis of the denial was the alleged absence of imminent collapse.

Settlement Discussions

The plaintiff demanded $2.4 million. There was no offer.

Damages

The church claimed repair costs of $1.2 million and loss of income of $149,000 (lost weddings and donations). It also sought a finding of bad faith and punitive damages.

Result

The jury awarded $589,060 in property damages and $64,771 for loss of income. The jury did not find bad faith on the part of the defendant insurer.

Length

16 days


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