Dismissal for Failure to Allege Facts to Establish Breach of Contract
Post 5005
Read the full article at https://lnkd.in/gRJ8vggM, see the full video at https://lnkd.in/gEwNjztD and at https://lnkd.in/gGb947FR and https://zalma.com/blog plus more than 5000 posts.
Boat Owner Only Gets Insurance he Asked the Broker to Obtain
After a boating accident in Greece the boat owner, Nicholas Galakatos (“plaintiff” or “Galakatos”), made claims against defendants, Marsh & McLennan Companies, Inc. and others (collectively, “defendants”) for negligence, breach of contract and breach of fiduciary duty. The case arose from a boating accident in Greece involving Galakatos’ boat, “Galani,” which collided with another vessel in September 2018. This resulted in damage to both vessels and personal injuries to some passengers.
Nicholas Galakatos v. Marsh & McLennan Companies, et al., Civil Action No. 24-11259-NMG, United States District Court, D. Massachusetts (February 24, 2025)
Court’s Decision
The court granted the defendants’ motion to dismiss. The court found that Galakatos failed to state a viable claim for breach of contract because he did not allege any specific provision of the purported agreement that the defendants allegedly breached.
Background
Plaintiff is a resident of Massachusetts and Vermont and owns property in Greece. In 2015, he purchased a boat (“Galani”) to use in Greece. Defendants are associated entities that offer professional services including insurance brokerage. Plaintiff retained defendants’ insurance brokerage services for the first time in 2006 and have purportedly relied since then on their advice to procure insurance.
Plaintiff purchased a one-year, $10,000,000 excess coverage liability policy from American International Group (“AIG”). The AIG policy was to provide coverage for losses sustained “anywhere in the world.” Plaintiff also purchased third party liability insurance for Galani from Groupama Insurances (“Groupama”) in May, 2018. He contends that he disclosed his ownership of Galani and his Groupama insurance policy to defendants that same month.
In September, 2018, Galani collided with another vessel off the coast of Greece, resulting in damage to both vessels, as well as personal injuries to some passengers aboard the other vessel. Plaintiff informed defendants of the accident, and they requested information concerning all of his property and liability exposures, even those for which it may not be providing coverage.
The collision spawned litigation as a result of which plaintiff paid an undisclosed amount in settlement of claims against him. He then made a claim on his AIG policy, which was denied, allegedly because defendants failed to add the Groupama policy to the AIG policy.
Plaintiff sued claiming defendants failed to place and procure adequate liability insurance coverage for Galani.
Legal Standard
Under Massachusetts law, breach of contract claim requires a plaintiff to demonstrate that 1) a valid, binding contract existed, 2) the defendant breached the terms of the contract and 3) the plaintiffs sustained damages as a result of the breach. Similarly, a breach of contract claim under New York law requires a plaintiff to allege 1) the existence of a contract, 2) the defendant’s breach of his or her contractual obligations and 3) damages resulting from the breach.
Galakatos failed to state a viable claim for breach of contract because his complaint does not allege any specific provision of the purported agreement between plaintiff and defendants that defendants allegedly breached.
Plaintiff’s negligence claim is deficient because he does not allege that defendant was duty-bound to procure insurance in the manner he asserted. According to the complaint, defendant had a duty of care to plaintiff to procure adequate third party liability insurance for Galani up to $20 million.
Breach of Fiduciary Duty
Finally, defendant contends that plaintiff’s breach of fiduciary duty claim is not actionable because the complaint does not allege sufficient facts to show that a fiduciary relationship existed between plaintiff and defendants. A fiduciary duty between a broker and an insured arises only in the narrow instance where there is a “special circumstance” or “special relationship” between them which, ordinarily, is a question of fact. Because, Plaintiff failed to state a claim for breach of fiduciary duty he did not adequately allege a fiduciary relationship existed between him and defendants.
ZALMA OPINION
Galakatos’ complaint was that he received the insurance he asked Marsh to acquire rather than the insurance coverage he needed. Insurance brokers, like Marsh, owe a duty to buy the insurance requested by the insured. The facts alleged revealed that they did so and that there was no allegation of a special relationship requiring that Marsh deal with the insured as a fiduciary. Insurance brokers are not required to be clairvoyant and purchase the coverage the insured, like Galakatos, needed rather than what he ordered.
(c) 2025 Barry Zalma & ClaimSchool, Inc.
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No Right to Subrogation Against Tenant
Post 5231
Not Fair to Require Tenant to Pay for Damage Insured by LandlordSee the video at https://lnkd.in/gFkrp_6M and at https://lnkd.in/gQdFQBWj and at https://zalma.com/blog plus more than 5200 posts.
See the video at and at
For Insurer to Subrogate Lease Must Require Tenant to Obtain Insurance for the Benefit of the Landlord
In AmGUARD Insurance Co. v. Tyrone Ellis and Shakyra Ellis, U.S. District Court, District of Connecticut Civil No. 3:25-cv-946 (JCH) (November 19, 2025), Judge, Janet C. Hall the defendant’s Motion to Dismiss the Amended Complaint on the basis of Connecticut’s anti-subrogation doctrine required dismissal.
KEY FACTS
Landlord Michael Caldwell, a Connecticut citizen, owned a multi-family building in Windsor, Connecticut. Defendants Tyrone and Shakyra Ellis were residential tenants in the building. On or about March 1, 2025, a fire ...
Debt Resulting from Fraud is Not Dischargeable in Bankruptcy
Post 5230
Read the full article at https://lnkd.in/gpF3y7Vd, see the video at https://lnkd.in/gR5cVcbY and at https://lnkd.in/gch6Q4_V, and at https://zalma.com/blog plus more than 5200 posts.
Knowing Misappropriation and Conversion of Funds is Fraud
In re Matthew Jene Tubbs (Bankr. N.D. Tex., Fort Worth Div., No. 22-42728-MXM-7; Adv. No. 23-04019-mxm), October 15, 2025 .
Key Facts
Plaintiffs (Robles) and Defendant (Tubbs) met through their church; both held leadership roles. In Feb 2021 Robles home suffered major water damage from Winter Storm Uri and insurance paid $173,000.
In the Fall of 2021: Tubbs represented to Mr. Robles that he personally built a newer house and large barn on his parents’ property “with his own hands” (except foundation/insulation). That he had 10 years’ experience overseeing window/door installations at a major home-improvement chain, was a licensed contractor (false) and carried general contractor liability insurance.
Relying on ...
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ZIFL-Volume 29 Number 22
THE SOURCE FOR THE INSURANCE FRAUD PROFESSIONAL
Post 5228
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/
Read the full 20 page issue of ZIFL at http://zalma.com/blog/wp-content/uploads/2025/11/ZIFL-11-15-2025-1.pdf
Man Bites Dog Story – Hertz Sues Alleged Fraudsters
Hertz Successfully Refuses to Pay Alleged Fraudulent Health Care Providers
Proactive Victim of Fraud Defeats Health Care Providers
More McClenny Moseley & Associates Issues
This is ZIFL’s thirty eighth installment of the saga of McClenny, Moseley & Associates and its problems with the federal courts in the State of Louisiana and what appears to be ...
The Professional Claims Handler
Post 5219
Posted on October 31, 2025 by Barry Zalma
An Insurance claims professionals should be a person who:
Can read and understand the insurance policies issued by the insurer.
Understands the promises made by the policy.
Understand their obligation, as an insurer’s claims staff, to fulfill the promises made.
Are competent investigators.
Have empathy and recognize the difference between empathy and sympathy.
Understand medicine relating to traumatic injuries and are sufficiently versed in tort law to deal with lawyers as equals.
Understand how to repair damage to real and personal property and the value of the repairs or the property.
Understand how to negotiate a fair and reasonable settlement with the insured that is fair and reasonable to both the insured and the insurer.
How to Create Claims Professionals
To avoid fraudulent claims, claims of breach of contract, bad faith, punitive damages, unresolved losses, and to make a profit, insurers ...
The History Behind the Creation of a Claims Handling Expert
The Insurance Industry Needs to Implement Excellence in Claims Handling or Fail
Post 5210
This is a change from my normal blog postings. It is my attempt. in more than one post, to explain the need for professional claims representatives who comply with the basic custom and practice of the insurance industry. This statement of my philosophy on claims handling starts with my history as a claims adjuster, insurance defense and coverage lawyer and insurance claims handling expert.
My Training to be an Insurance Claims Adjuster
When I was discharged from the US Army in 1967 I was hired as an insurance adjuster trainee by a professional and well respected insurance company. The insurer took a chance on me because I had been an Army Intelligence Investigator for my three years in the military and could use that training and experience to be a basis to become a professional insurance adjuster.
I was initially sat at a desk reading a text-book on insurance ...
The History Behind the Creation of a Claims Handling Expert
The Insurance Industry Needs to Implement Excellence in Claims Handling or Fail
Post 5210
This is a change from my normal blog postings. It is my attempt. in more than one post, to explain the need for professional claims representatives who comply with the basic custom and practice of the insurance industry. This statement of my philosophy on claims handling starts with my history as a claims adjuster, insurance defense and coverage lawyer and insurance claims handling expert.
My Training to be an Insurance Claims Adjuster
When I was discharged from the US Army in 1967 I was hired as an insurance adjuster trainee by a professional and well respected insurance company. The insurer took a chance on me because I had been an Army Intelligence Investigator for my three years in the military and could use that training and experience to be a basis to become a professional insurance adjuster.
I was initially sat at a desk reading a text-book on insurance ...
