Confidential
Settlement – $400,000Judge
Court
L.A. Superior Norwalk
Attorneys
Plaintiff
Defendant
Facts
Plaintiff purchased a 1985 Mercedes Benz 500SL coupe for $27,500 and insured it with Defendant insurance company. Near the end of the initial policy period, coverage was rewritten with Defendant's "preferred" auto carrier and additional coverage for loss of use and medical pay were provided. A binder reflecting this coverage was issued. On June 21, 1991, the car was totaled in an accident. Despite immediately reporting the claim, Defendant failed to assign a claims representative to investigate or communicate with Plaintiff for over one month. Without notice to Plaintiff, Defendant deleted the loss of use and medical pay coverage, and "rewrote" coverage with the original company division, three weeks after the accident. Defendant told Plaintiff that the loss of use and medical pay coverage did not apply to this loss. Although Defendant's "salvage specialist" confirmed that the care was a total loss and that the actual cash value was $24,000, Plaintiff was not informed of this. Instead, Defendant hired an independent appraiser, who concluded that the "grey market" car was worth only $19,800. Plaintiff disputed this and was told that Defendant would pay $20,442 if he could provide the EPA and DOT documents. Plaintiff was not the original purchaser of the car and did not have these documents, only the pink slip. Defendant refused to change its position and would not assist Plaintiff in obtaining these documents, saying that only the registered owner could obtain them. Two of Defendant's expert witnesses, however, obtained the EPA and DOT documents in a matter of hours. After binding appraisal hearing, Defendant refused to pay the award of $24,919.
Settlement Discussions
Plaintiff contends its original demand was $500,000 decreased to $450,000; and Defendant offered $30,000 at the MSC increased to $100,000 (six weeks before trial) and increased to $200,000 and $350,000 prior to this settlement.
Damages
Appraisal award of $24,919 plus interest; loss of use at $15 per day for one month plus interest; emotional distress; attorneys' fees.
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