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Superior Court – Property Insurance Appraisal – Insurance Laws and Products

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In Kellogg v. Middlesex Assurance Company, the plaintiff was the owner of a historic property insured by a restoration policy issued by the defendant insurer. In 2010, the property was damaged when a four and a half ton tree fell on the roof and chimney during a storm. After the plaintiff filed a claim with the insurer, the parties could not agree on the amount of the loss. The insurer relied on the policy’s appraisal provision, which required the parties to each appoint one appraiser to serve as an arbitrator, and those two appraisers would then select a neutral third arbitrator to act as an arbitrator. In September 2013, after the panel’s arbitration award was issued, the claimant filed an application in the Supreme Court to vacate the award. Over the next several years, the litigation went through various stages in the Connecticut Superior Court, Court of Appeals, and Supreme Court. Earlier in 2022, the Court of Appeals reversed an earlier denial of the insurer’s motion for summary judgment and remanded the case to the Supreme Court for a proper consideration of the motion for summary judgment. Ultimately, the motion was granted on all counts. Of note, it was undisputed that the parties entered into an unrestricted arbitration involving arbitrators authorized to decide questions of law and fact, and that the arbitration award was confirmed by the Supreme Court. The insurer argued that the award constituted a binding judgment and that the doctrine of res judicata barred the breach of contract claim. The plaintiff argued that there was a genuine issue of material fact as to whether the insurer had properly performed the terms of the agreement. The Court found nothing in the record to indicate that the review panel did not consider everything in the agreement and everything that occurred. The claimant could have raised the breach of contract action in the arbitration. Thus, the Court agreed that the breach of contract action based on the affirmed unlimited arbitration award was barred by the doctrine of res judicata. As to the plaintiff’s claims for violations of the Connecticut Unfair Trade Practices Act and the Connecticut Unfair Insurance Practices Act based on alleged misrepresentations by the insurer, the Court held that the claims were all barred by the applicable statute of limitations and further, that the continuing conduct doctrine could not apply to the claims. Finally, the Court rejected the plaintiff’s claim for promissory estoppel when it found that the parties had a valid written contract, noting that such a claim generally lies when there is no written contract, or the contract cannot be enforced for one reason or another.

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