Summary Judgment Win for Insurance Agent

Following a deadly fire at a commercial property, the property owner was sued by the decedents’ heirs for wrongful death. After funding the property owner’s $1.5 million in defense fees and $3.5 million settlement with the heirs in the wrongful death action, the property owner’s insurer sued the property owner, seeking to rescind the policy based on material misrepresentations the property owner had made in the description of the property in its insurance application. In turn, the property owner sued its insurance broker and our client, an appointed agent of the insurer. The property owner urged the untenable argument that the agent somehow owed the property owner a duty to catch the property owner’s misrepresentations and the fact that the insurer had combined two of the properties in the owner’s portfolio, which the property owner argued gave the insurer a basis for rescission of the policy.

Following discovery, Landon Schwob brought a motion for summary judgment, based on the fact that the agent was exclusively an appointed agent for the property owner’s insurer – not an agent or broker of the property owner – and, therefore, did not owe any duties to the property owner, either directly or through its broker. The court agreed and granted our motion for summary judgment in favor of the agent, sidestepping a potential exposure in excess of $5 million. The lower court’s ruling was affirmed in August 2016 by the Second District Court of Appeal.