Facts

On Jan. 19, 1994, after his residence was damaged as a result of the January 1994 Northridge earthquake, Roger Dallan filed a claim with his insurer, Prudential Property and Casualty Insurance Co. An inspector from Prudential allegedly advised Dallan, 50, that he would need a contractor to come out to the property for a thorough inspection. A contractor who Dallan hired claimed that repairs would cost $26,950. In May 1994, Prudential received the estimate and paid Dallan $12,750 in policy benefits after taking into consideration the policy's dwelling deductible which amounted to $14,200. Between January 1995 and October 2001, Dallan did not contact Prudential. During this time, California Code of Civil Procedure Section 340.9 was passed, extending the statute of limitations for claims involving damage from the Northridge earthquake.

Consequently, in October 2001, Dallan requested that his claim be opened and reconsidered by Prudential. No documentation demonstrating a need for further repair was presented by Dallan. However, Prudential paid Dallan additional benefits. Displeased with the amount paid, Dallan filed a lawsuit against Prudential, claiming breach of contract and breach of the implied covenant of good faith and fair dealing.

PLAINTIFF'S CONTENTIONS:
The plaintiff claimed that he was entitled to additional benefits because the earthquake rendered his house inhabitable. The plaintiff supported his claims with the testimonies of a geotechnical engineer and structural engineer, both of whom contended that the property suffered serious damage to its foundation and structure. As a result, the house would need to be rebuilt. In requesting that his claim be re-opened, the plaintiff claimed that some damage had initially not been discovered by his contractor during inspection. The plaintiff's expert in claim handling testified that the defendant did not conduct a complete investigation.

DEFENDANT'S CONTENTIONS:
A defense expert in claims handling contended that the defendant thoroughly investigated the plaintiff's claim in 1994 and 2001-2002. Despite the fact that the plaintiff failed to provide documentation in support of its claim for additional damages, the defendant paid the plaintiff $30,000 in further benefits for cosmetic repairs. A defense structural expert opined that the only structural damage to the house occurred to the chimney. Further, through its geotechnical expert, the defense contended that the damage to the property was minor. The defendant contended that it already paid benefits to cover the chimney damage. The defense challenged the plaintiff's claim for damages and also claimed that the plaintiff did not suffer emotional distress. It took the position that the plaintiff's demand for additional benefits was fueled by the fact that he was unemployed during the pertinent time period, and noted the plaintiff had represented to the California Fair Plan in 1995 that his home had not suffered property damage in the past three years.

Settlement Discussions

The plaintiff demanded $500,000.

Damages

The plaintiff claimed he was entitled to $353,000. This sum would cover the replacement of his house. The plaintiff also sought damages for living expenses he would incur during the time his house was being rebuilt, as well as damages for emotional distress. The plaintiff did not seek treatment for his emotional distress.

Result

Defense verdict.

Deliberation

1.5 hours

Poll

8-0

Length

seven days