Rescission Results in Policy Void From its Inception
Barry Zalma
Sep 15, 2023
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Read the full article at https://lnkd.in/gh46Evtz and see the full video at https://lnkd.in/gxJVuVFJ and at https://lnkd.in/gT3CcwA8 and https://zalma.com/blog plus more than 4600 posts.
Rescission Results in Policy Void From its Inception
Imperial Casualty and Lloyd’s Underwriters retained me in the 1980’s to advise concerning the fire claim presented by Levon Sogomonian and his wife as a result of a major arson fire and explosion that destroyed their home. The investigation took more than a year, multiple days of examination under oath (EUO), death threats to the claims investigator and a bomb threat at my office.
In Imperial Casualty And Indemnity, Company v. Levon Sogomonian and Elichka Sogomonian, No. B022012, 243 Cal.Rptr. 639, 198 Cal.App.3d 169, Court of Appeal, California (Feb. 4, 1988) Levon and Elichka Sogomonian (defendants) appealed.
FACTUAL BACKGROUND
On July 14, 1982, Imperial issued a homeowner’s policy to defendants which provided casualty and fire insurance protection for defendants’ home. On or about October 9, 1982, defendants’ home was destroyed by a fire and explosion. A second fire on October 10, 1982 a second arson fire destroyed what had not been destroyed by the first fire.
DISCUSSION
“A contract is extinguished by rescission.” (Civil Code § 1688.)
DISPOSITION
Since the summary judgment did not provide a complete restitution to Imperial and Lloyd’s, the judgment was reversed, with directions to the trial court to make and enter a new order granting summary adjudication of issues which is consistent herewith. A trial was held thereafter and I testified as a fact and expert witness only to have Mr. Sogomonian threaten my life as I entered the courtroom to testify. Judgment was had in favor of Imperial and Lloyd’s and they recovered all advance payments, attorneys and investigation fees.
In 15 years of work all litigation was resolved, Sogomonian paid, and went on to litigate with others on various other schemes. Contrary to his hopes I survived and am now 81-years-old and still working.
ZALMA OPINION
Importantly this case established the law of the state of California with regard to rescission of insurance. Although there was evidence that the fire was created on behalf of Mr. Sogomonian no criminal charges were brought and Sogomonian continued to attempt to gain from the fire by suing the investigator.
If you want the full details of this case see my book “Arson for Terrorism and Profit” a fictionalized novel about arson for profit https://lnkd.in/gGmEV7zp
(c) 2023 Barry Zalma & ClaimSchool, Inc.
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Chutzpah: After Criminal Prosecution Defendant Sues USA
Post 5164
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Dr. Segun Patrick Adeoye, a medical doctor, filed a lawsuit against the United States of America, seeking damages for alleged violations during his criminal prosecution. He was acquitted by a jury but claims to have suffered significant harm, including financial losses, damage to his professional reputation, and personal distress.
In Dr. Segun Patrick Adeoye v. The United States Of America, Civil Action No. 4:25-cv-83, United States District Court, E.D. Texas, Sherman Division (July 23, 2025) the USDC dismissed Adeoye’s suit.
FACTUAL BACKGROUND
Dr. Adeoye was indicted on charges of conspiracy to commit wire fraud and money laundering. The indictment alleged that he and his co-conspirators obtained at least seventeen million dollars through various fraudulent schemes. Despite being acquitted, Dr. Adeoye claims that his ...
Payment of Appraisal Award Defeats Claim of Bad Faith
Post 5163
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Hurricane Damage to Dwelling Established by Appraisal Award
In Homeowners Of America Insurance Company v. Emilio Menchaca, No. 01-23-00633-CV, Court of Appeals of Texas, First District (July 31, 2025) after a hurricane Homeowners of America Insurance Company (“HAIC”) estimated that the cost of covered repair to Menchaca’s house was $3,688.54, which was less than his deductible, and therefore no payment would be made.
FACTS
After Menchaca retained counsel HAIC advised that, under the terms of the policy, Menchaca was required to first invoke the appraisal process prior to filing suit, and that HAIC reserved the right to request that Menchaca and any adjuster hired on his behalf submit to an Examination Under Oath (“EUO”).
On August 23, 2018, Menchaca’s counsel ...
Payment of Appraisal Award Defeats Claim of Bad Faith
Post 5163
Read the full article at https://lnkd.in/dNpKKcYx, see the full video at https://lnkd.in/dNgwRP8q and at https://lnkd.in/dA9dvd-D, and at https://zalma.com/blog plus more than 5150 posts.
Hurricane Damage to Dwelling Established by Appraisal Award
In Homeowners Of America Insurance Company v. Emilio Menchaca, No. 01-23-00633-CV, Court of Appeals of Texas, First District (July 31, 2025) after a hurricane Homeowners of America Insurance Company (“HAIC”) estimated that the cost of covered repair to Menchaca’s house was $3,688.54, which was less than his deductible, and therefore no payment would be made.
FACTS
After Menchaca retained counsel HAIC advised that, under the terms of the policy, Menchaca was required to first invoke the appraisal process prior to filing suit, and that HAIC reserved the right to request that Menchaca and any adjuster hired on his behalf submit to an Examination Under Oath (“EUO”).
On August 23, 2018, Menchaca’s counsel ...
Rulings on Motions Reduced the Issues to be Presented at Trial
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CASE OVERVIEW
In Richard Bernier v. State Farm Mutual Automobile Insurance Company, No. 4:24-cv-00002-GMS, USDC, D. Alaska (May 28, 2025) Richard Bernier made claim under the underinsured motorist (UIM) coverage provided in his State Farm policy, was not satisfied with State Farm's offer and sued. Both parties tried to win by filing motions for summary judgment.
FACTS
Bernier was involved in an auto accident on November 18, 2020, and sought the maximum available UIM coverage under his policy, which was $50,000. State Farm initially offered him $31,342.36, which did not include prejudgment interest or attorney fees.
Prior to trial Bernier had three remaining claims against State Farm:
1. negligent and reckless claims handling;
2. violation of covenant of good faith and fair dealing; and
3. award of punitive damages.
Both Bernier and State Farm dispositive motions before ...
ZIFL Volume 29, Issue 10
The Source for the Insurance Fraud Professional
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Zalma’s Insurance Fraud Letter (ZIFL) continues its 29th year of publication dedicated to those involved in reducing the effect of insurance fraud. ZIFL is published 24 times a year by ClaimSchool and is written by Barry Zalma. It is provided FREE to anyone who visits the site at http://zalma.com/zalmas-insurance-fraud-letter-2/ You can read the full issue of the May 15, 2025 issue at http://zalma.com/blog/wp-content/uploads/2025/05/ZIFL-05-15-2025.pdf
This issue contains the following articles about insurance fraud:
Health Care Fraud Trial Results in Murder for Hire of Witness
To Avoid Conviction for Insurance Fraud Defendants Murder Witness
In United States of America v. Louis Age, Jr.; Stanton Guillory; Louis Age, III; Ronald Wilson, Jr., No. 22-30656, United States Court of Appeals, Fifth Circuit (April 25, 2025) the Fifth Circuit dealt with the ...
Professional Health Care Services Exclusion Effective
Post 5073
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This opinion is the recommendation of a Magistrate Judge to the District Court Judge and involves Travelers Casualty Insurance Company and its duty to defend the New Mexico Bone and Joint Institute (NMBJI) and its physicians in a medical negligence lawsuit brought by Tervon Dorsey.
In Travelers Casualty Insurance Company Of America v. New Mexico Bone And Joint Institute, P.C.; American Foundation Of Lower Extremity Surgery And Research, Inc., a New Mexico Corporation; Riley Rampton, DPM; Loren K. Spencer, DPM; Tervon Dorsey, individually; Kimberly Dorsey, individually; and Kate Ferlic as Guardian Ad Litem for K.D. and J.D., minors, No. 2:24-cv-0027 MV/DLM, United States District Court, D. New Mexico (May 8, 2025) the Magistrate Judge Recommended:
Insurance Coverage Dispute:
Travelers issued a Commercial General Liability ...
