Representing Insureds Since 1970

 

W&M Hits Carrier with Verdict in Excess of $1 Million Plus Damages for Bad Faith

In Apollo Express, Inc. and Mohamad Rammal v. Colonial Cooperative Insurance Company, plaintiffs sued its insurance carrier for damages stemming from an April 15, 1999 pipe burst and ensuing flood that damaged its high end clothing inventory. Plaintiffs claimed damages of $925,941.25 representing the replacement cost of its damaged inventory and $26,235.00 for damage to their leasehold improvements and betterments.

Plaintiffs also sought additional damages as a result of the carrier's breach of the implied covenant of good faith and fair dealing. In defending its decision to resist plaintiffs' claim, defendant Colonial alleged that plaintiffs were guilty of fraud by intentionally and grossly exaggerating its claim and submitting false documentation to support its damages. However, the Trial Court (J. Emily Jane Goodman) found no evidence to support these allegations and therefore dismissed Colonial's defenses and directed a verdict in favor of the plaintiff with respect to the carrier's liability to pay the insured with respect to damages suffered to its inventory as a result of the pipe break. After deliberating for only one hour, the jury awarded the insureds all of the damages that it sought for its damaged inventory and leasehold improvements and ruled that the insureds were entitled to consequential damages as a result of the carrier's bad faith conduct. With pre-judgment interest, Colonila will end up paying the insured approximately $1.2 million, exclusive of the bad faith damages yet to be assessed. The case was litigated by William H. Parash, Esq., a member of this firm.