Zalma on Insurance
Business • Education
Insurance Claims professional presents articles and videos on insurance, insurance Claims and insurance law for insurance Claims adjusters, insurance professionals and insurance lawyers who wish to improve their skills and knowledge. Presented by an internationally recognized expert and author.
Interested? Want to learn more about the community?
February 07, 2022
Buyer’s Remorse: Motion to Amend to Claim to Assert Bad Faith After Accepting Settlement Fails Acceptance of an Offer of Judgment Resolves Litigation

Read the full article at https://www.linkedin.com/pulse/acceptance-offer-judgment-resolves-litigation-barry-zalma-esq-cfe and at https://zalma.com/blog plus more than 4050 posts.

Posted on February 7, 2022 by Barry Zalma

Plaintiffs Eric Monzo and Dana Spring Monzo (hereinafter collectively “Plaintiffs”) sought damages against their homeowners’ insurance carrier, Defendant Nationwide Property & Casualty Insurance Company (hereinafter “Defendant”). In Eric Monzo And Dana Spring Monzo v. Nationwide Property & Casualty Insurance Co., C. A. No. K18C-11-003 NEP, Superior Court of Delaware (January 27, 2022) the Delaware court dealt with a claim of buyer’s remorse.
FACTS

The background facts of this action are set forth in Monzo v. Nationwide Prop. & Cas. Ins. Co. (hereinafter “Monzo II“). The relevant facts pertaining to the motions include that Plaintiffs filed a Complaint against Defendant relating to Plaintiffs’ homeowners’ policy. Count I of the Complaint sought a declaratory judgment that Defendant was required to cover certain losses pursuant to Plaintiffs’ policy. Count II of the Complaint stated a claim for bad faith breach of contract, which was dismissed pursuant to stipulation between the parties, as approved by the Court, to encourage settlement.

Defendant filed a motion for summary judgment on the remaining claims, which the Court granted in full on March 18, 2020. On March 11, 2021, the Delaware Supreme Court affirmed this Court’s decision in part, but reversed as to the Option R coverage provision in Plaintiffs’ policy.

Plaintiffs filed a motion to amend the Complaint seeking to add back the bad faith claim, with new allegations stemming from limited discovery. These included the assertion that Plaintiffs’ insurance agent, Mr. Papa, had opined that he “believed that coverage may be afforded to Plaintiffs to [sic] the loss suffered.”

Defendant, after some negotiation with the plaintiff, offered to allow judgment to be entered against it in the amount of Eight Thousand Dollars ($8,000.00), inclusive of fees and costs. Mr. Monzo responded on June 16, “We will accept the offer of judgment and instruct the Clerk to enter judgment against Nationwide in the amount of $8000. We will instruct Chambers to continue the hearing scheduled for tomorrow until the next motion calendar.” Thereafter Plaintiffs filed an acceptance of the Offer with the Court, with Plaintiffs’ direction to enter judgment, on June 22, 2021. The Offer was entered by the Clerk, and the amount was paid by Defendant and accepted by Plaintiffs, as indicated in Plaintiffs’ “Satisfaction of Judgment on Count I of the Complaint” filed with the Court on July 26, 2021.
DISCUSSION

The purpose of Superior Court Civil Rule 68 (hereinafter “Rule 68”) is to encourage settlement and avoid litigation. Rule 68 prompts both parties to balance and evaluate the risks and costs of litigation against the likelihood of success at trial on the merits.

Longstanding Delaware case law confirms that general principles of contract law apply to offers of judgment where the issue of attorney fees and costs is not present. The Court applies general contract principles, which permit extrinsic evidence to be considered to arrive at a proper interpretation of contractual terms.

In this case, Plaintiffs argue that the language of the Offer is ambiguous because it is unclear whether it includes within its scope the bad faith claims that were the subject of the pending Motion to Amend. While some of that evidence was presented to the Court in the form of the emails that the parties have made exhibits to their submissions, other evidence has not been placed before the Court, including a telephone conversation between Mr. Monzo and defense counsel that is referenced in those emails. However, the Court found the Motion to Amend was futile.

The Court’s decision on the Motion to Amend resolves the case, since the claims that Plaintiffs contend were not included in the Offer’s scope-the bad faith claims- cannot be brought back into the case, and thus the judgment that has been entered includes all of Plaintiff’s claims in this case.

Generally, a bad faith claim has been recognized in Delaware “when the insurer refuses to honor its obligations under the policy and clearly lacks reasonable justification for doing so.” Bad faith claims “can stem from an insurer’s failure to investigate, pay, process a claim, or in delaying payment.” However, “a mere delay in investigating a claim or paying benefits does not alone establish an insurer’s bad faith if there was a reasonable justification for the insurer’s failure to do so.”

Plaintiffs have not alleged in their proposed amended complaint that Defendant has a “general business practice” of claims denial; therefore, there is no need for analysis under that grouping of claims. Rather, Plaintiffs have alleged that Defendant’s action constituted bad faith in that Defendant “fail[ed] to make complete and timely payment of insurance proceeds . . . without reasonable justification” and “failed to . . . investigate and process” the claim.

The amended complaint’s allegations pertaining to Mr. Papa’s representations that the incident could be covered amount to nothing but statements of first impression from an agent who was neither responsible for interpretation of the contractual provisions of the policy nor familiar with the nuanced circumstances surrounding the damages to Plaintiffs’ property. More to the point, Mr. Papa represented to Plaintiffs that coverage “may be afforded”-not that it would be.
ZALMA OPINION

People who sue their insurance company think they are guaranteed a fortune in damages. When they don’t profit from the suit they get upset and litigate and appeal. This case is a perfect example: they accepted a settlement and then tried for more by attempting to amend their suit by seeking to reinstate a bad faith claim that the plaintiff had withdrawn in hopes of reaching a settlement. It worked, they got a settlement offer that they accepted and then tried to renege on the deal. The try failed.

© 2022 – Barry Zalma

Barry Zalma, Esq., CFE, now limits his practice to service as an insurance consultant specializing in insurance coverage, insurance claims handling, insurance bad faith and insurance fraud almost equally for insurers and policyholders.

He practiced law in California for more than 44 years as an insurance coverage and claims handling lawyer and more than 54 years in the insurance business.

Subscribe to “Zalma on Insurance” at https://zalmaoninsurance.locals.com/subscribe and “Excellence in Claims Handling” at https://barryzalma.substack.com/welcome.

You can contact Mr. Zalma at https://www.zalma.com, https://www.claimschool.com, [email protected] and [email protected] . Mr. Zalma is the first recipient of the first annual Claims Magazine/ACE Legend Award.

You may find interesting the podcast “Zalma On Insurance” at https://anchor.fm/barry-zalma; you can follow Mr. Zalma on Twitter at; you should see Barry Zalma’s videos on https://www.youtube.com/channel/UCysiZklEtxZsSF9DfC0Expg/featured; or videos on https://rumble.com/zalma. Go to the Insurance Claims Library – https://zalma.com/blog/insurance-claims–library/ The last two issues of ZIFL are available at https://zalma.com/zalmas-insurance-fraud-letter-2/

Interested? Want to learn more about the community?
What else you may like…
Videos
Posts
February 21, 2025
No Coverage for Criminal Acts

Concealing a Weapon Used in a Murder is an Intentional & Criminal Act

Post 5002

Read the full article at https://lnkd.in/gmacf4DK, see the full video at https://lnkd.in/gav3GAA2 and at https://lnkd.in/ggxP49GF and at https://zalma.com/blog plus more than 5000 posts.

In Howard I. Rosenberg; Kimberly L. Rosenberg v. Chubb Indemnity Insurance Company Howard I. Rosenberg; Kimberly L. Rosenberg; Kimberly L. Rosenberg; Howard I. Rosenberg v. Hudson Insurance Company, No. 22-3275, United States Court of Appeals, Third Circuit (February 11, 2025) the Third Circuit resolved whether the insurers owed a defense for murder and acts performed to hide the fact of a murder and the murder weapon.

FACTUAL BACKGROUND

Adam Rosenberg and Christian Moore-Rouse befriended one another while they were students at the Community College of Allegheny County. On December 21, 2019, however, while at his parents’ house, Adam shot twenty-two-year-old Christian in the back of the head with a nine-millimeter Ruger SR9C handgun. Adam then dragged...

00:08:09
February 20, 2025
Electronic Notice of Renewal Sufficient

Renewal Notices Sent Electronically Are Legal, Approved by the State and Effective
Post 5000

Read the full article at https://lnkd.in/gpJzZrec, see the full video at https://lnkd.in/ggmkJFqD and at https://lnkd.in/gn3EqeVV and at https://zalma.com/blog plus more than 5000 posts.

Washington state law allows insurers to deliver insurance notices and documents electronically if the party has affirmatively consented to that method of delivery and has not withdrawn the consent. The Plaintiffs argued that the terms and conditions statement was not “conspicuous” because it was hidden behind a hyperlink included in a single line of small text. The court found that the statement was sufficiently conspicuous as it was bolded and set off from the surrounding text in bright blue text.

In James Hughes et al. v. American Strategic Insurance Corp et al., No. 3:24-cv-05114-DGE, United States District Court (February 14, 2025) the USDC resolved the dispute.

The court’s reasoning focused on two main points:

1 whether the ...

00:09:18
February 19, 2025
Post Procurement Fraud Prevents Rescission

Rescission in Michigan Requires Preprocurement Fraud
Post 4999

Read the full article at https://lnkd.in/gGCvgBpK, see the full video at https://lnkd.in/gern_JjU and at https://lnkd.in/gTPSmQD6 and at https://zalma.com/blog plus 4999 posts.

Lie About Where Vehicle Was Garaged After Policy Inception Not Basis for Rescission

This appeal turns on whether fraud occurred in relation to an April 26, 2018 renewal contract for a policy of insurance under the no-fault act issued by plaintiff, Encompass Indemnity Company (“Encompass”).

In Samuel Tourkow, by David Tourkow v. Michael Thomas Fox, and Sweet Insurance Agency, formerly known as Verbiest Insurance Agency, Inc., Third-Party Defendant-Appellee. Encompass Indemnity Company, et al, Nos. 367494, 367512, Court of Appeals of Michigan (February 12, 2025) resolved the claims.

The plaintiff, Encompass Indemnity Company, issued a no-fault insurance policy to Jon and Joyce Fox, with Michael Fox added as an additional insured. The dispute centers on whether fraud occurred in...

00:07:58
February 07, 2025
From Insurance Fraud to Human Trafficking

Insurance Fraud Leads to Violent Crime
Post 4990

Read the full article at https://lnkd.in/gDdKMN29, see the full video at https://lnkd.in/gKKeHSQg and at https://lnkd.in/gvUU_a-8 and at https://zalma.com/blog plus more than 4950 posts.

CRIMINAL CONDUCT NEVER GETS BETTER

In The People v. Dennis Lee Givens, B330497, California Court of Appeals, Second District, Eighth Division (February 3, 2025) Givens appealed to reverse his conviction for human trafficking and sought an order for a new trial.

FACTS

In September 2020, Givens matched with J.C. on the dating app “Tagged.” J.C., who was 20 years old at the time, had known Givens since childhood because their mothers were best friends. After matching, J.C. and Givens saw each other daily, and J.C. began working as a prostitute under Givens’s direction.

Givens set quotas for J.C., took her earnings, and threatened her when she failed to meet his demands. In February 2022, J.C. confided in her mother who then contacted the Los Angeles Police Department. The police ...

post photo preview
February 06, 2025
No Mercy for Crooked Police Officer

Police Officer’s Involvement in Insurance Fraud Results in Jail
Post 4989

Read the full article at https://lnkd.in/gr_w5vcC, see the full video at https://lnkd.in/ggs7dVfg and https://lnkd.in/gK3--Kad and at https://zalma.com/blog plus more than 4900 posts.

Von Harris was convicted of bribery, forgery, and insurance fraud. He appealed his conviction and sentence. His appeal was denied, and the Court of Appeals upheld the conviction.

In State Of Ohio v. Von Harris, 2025-Ohio-279, No. 113618, Court of Appeals of Ohio, Eighth District (January 30, 2025) the Court of Appeals affirmed the conviction.

FACTUAL BACKGROUND

On January 23, 2024, the trial court sentenced Harris. The trial court sentenced Harris to six months in the county jail on Count 15; 12 months in prison on Counts 6, 8, 11, and 13; and 24 months in prison on Counts 5 and 10, with all counts running concurrent to one another for a total of 24 months in prison. The jury found Harris guilty based on his involvement in facilitating payments to an East Cleveland ...

post photo preview
February 05, 2025
EXCUSABLE NEGLECT SUFFICIENT TO DISPUTE ARBITRATION LATE

Read the full article at https://lnkd.in/gRyw5QKG, see the full video at https://lnkd.in/gtNWJs95 and at https://lnkd.in/g4c9QCu3, and at https://zalma.com/blog.

To Dispute an Arbitration Finding Party Must File Dispute Within 20 Days
Post 4988

EXCUSABLE NEGLECT SUFFICIENT TO DISPUTE ARBITRATION LATE

In Howard Roy Housen and Valerie Housen v. Universal Property & Casualty Insurance Company, No. 4D2023-2720, Florida Court of Appeals, Fourth District (January 22, 2025) the Housens appealed a final judgment in their breach of contract action.

FACTS

The Housens filed an insurance claim with Universal, which was denied, leading them to file a breach of contract action. The parties agreed to non-binding arbitration which resulted in an award not

favorable to the Housens. However, the Housens failed to file a notice of rejection of the arbitration decision within the required 20 days. Instead, they filed a motion for a new trial 29 days after the arbitrator’s decision, citing a clerical error for the delay.

The circuit court ...

See More
Available on mobile and TV devices
google store google store app store app store
google store google store app tv store app tv store amazon store amazon store roku store roku store
Powered by Locals