Kelly-Moore Paint Company, Inc. v. American Manufacturers Mutual Insurance Company
Published: Jan. 1, 1999 | Result Date: Oct. 1, 1998 | Filing Date: Jan. 1, 1900 |Case number: 398263 Verdict – $84,836
Judge
Court
San Mateo Superior
Attorneys
Plaintiff
Philip L. Pillsbury Jr.
(Pillsbury & Coleman LLP)
Ann H. Larson
(Craddick, Candland & Conti)
Defendant
Clifford E. Hirsch
(Hirsch Closson APLC)
Experts
Plaintiff
Thomas Shefchick
(technical)
Paul Hamilton
(technical)
Joseph G. Carleton
(technical)
Defendant
Michael Kirkman
(technical)
Tracy L. Smith
(technical)
Harold Klobukowski
(technical)
Facts
This case involved a Boiler and Machinery insurance coverage dispute. On Sept. 19, 1995, a rotary air compressor unit at Kelly-Moore Paint Company Inc., in San Carlos, was destroyed by a fire and explosion. The plaintiff contended that the cause of the fire was a ruptured diaphragm in the electrical control panel of the air compressor, which sprayed oil onto electrical circuits, which arced, resulting in a fire that destroyed the compressor. Defendant insurance company contended that the fire was caused by an explosion within the air/oil separator tank of the air compressor, which started the fire that destroyed the compressor. The plaintiff submitted its Boiler and Machinery insurance claim to defendant. The defendant denied the claim, citing its fire and explosion exclusions. The defendant contended that no coverage existed under the Boiler and Machinery under either party's theory of causation. The plaintiff initially sued defendant for breach of contract and later amended its complaint to add causes of action for breach of the implied covenant of good faith and fair dealing and a claim for punitive damages. The plaintiff contended that defendant's investigation and denial of its claim was unreasonable. The defendant contended its denial of the claim was reasonable.
Settlement Discussions
On Oct. 6, 1997, plaintiff demanded $151,303.81, reduced to $150,000. The plaintiff made a C.C.P. º998 demand of $125,000. The demand was raised to $1 million plus at trial. The defendant made no offer.
Damages
The plaintiff claimed approximately $85,000 at trial for the replacement of its rotary air compressor and other equipment damaged in the fire, plus punitive damages and attorney fees.
Other Information
The verdict was reached approximately two years after the case was filed. A mediation was held on Oct. 6, 1997 before retired judge Henry Broderick of JAMS resulting in no settlement. The plaintiff intends to appeal the judgment against it for breach of the implied covenant of good faith and fair dealing and punitive damages. The defendant will appeal the breach of contract cause of action.
Deliberation
six hours
Poll
11-1 (for plaintiff's causation), 12-0 (for plaintiff's damages)
Length
21 days
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