Taylor Woodrow Homes v. Acceptance Insurance Companies
Published: Jun. 14, 2001 | Result Date: May 10, 2001 | Filing Date: Jan. 1, 1900 |Case number: 811992 Verdict – $5,000,000
Judge
Court
Orange Superior
Attorneys
Plaintiff
Defendant
Andrew Morrow
(Koletsky, Mancini, Feldman & Morrow)
Experts
Plaintiff
Henry Stotsenberg
(technical)
David F. Peterson
(technical)
Defendant
Boyd A. Veenstra
(technical)
Facts
In 1997, Taylor Woodrow, a residential home builder, constructed a new home in the Castaways project in
Newport Beach, using defendant New Plumbing as the plumbing contractor. New Plumbing was insured with
defendant Acceptance Insurance Companies under a general liability insurance policy. Taylor Woodrow was
named as an additional insured under the Acceptance Insurance policy under ISO Form 2010.
Approximately two months after completion of the home and purchase by Robert and Ali
Bartholomew, a plumbing valve in the upstairs laundry room cracked and flooded the home while
the Bartholomews were away on vacation. The damage to the home, cost of repair, relocation
costs and incidental damages totaled $155,520. Taylor Woodrow tendered the loss to
Acceptance on Jan. 22, 1998. Acceptance responded April 15, 1998 acknowledging Taylor
Woodrow was an additional insured, advising Acceptance would provide coverage for this claim
and advising that Acceptance would honor its obligations if there were delays in payment by the
valve manufacturer who was ultimately responsible. Taylor Woodrow subsequently submitted its
expense package to Acceptance in December 1998. No payment was made by Acceptance
while the plumbing valve was tested and in June 1999, Acceptance denied liability on behalf of
New Plumbing when it was determined that the valve was defectively manufactured. With no
payment forthcoming, Taylor Woodrow filed suit against New Plumbing for breach of contract
and against Acceptance for bad faith.
Result
$5 million punitive damages for insurance bad faith.
Deliberation
half hour (liability), one hour (punitives)
Poll
12-0 (breach of contract), 12-0 (breach of implied covenant of good faith and fair dealing), 12-0 (liability), 10-2 (punitive damages)
Length
seven days
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