February 21, 2014
305-670-1101 Ext. 1023
First Party Property Defense / Misrepresentation and False Statements
FORT LAUDERDALE, Florida – Quintairos, Prieto, Wood & Boyer, P.A. (QPWB) trial attorneys David M. Tarlow and Asika K. Patel achieved a defense verdict on behalf of Citizens Property Insurance Corporation. Homeowners, Ernesto and Rebecca Bascuas, filed a breach of contract lawsuit against their homeowner’s insurance carrier, Citizens Property Insurance Corporation (“Citizens”), for its failure to pay $334,590.81 less deductible and prior payments for repairs allegedly necessary to return the home to pre-loss condition. .
On May 29, 2012 the Bascuases reported to Citizens that they had suffered an accidental loss, four days earlier on May 25, 2012, when a sewer pipe backed up causing an accidental discharge of raw sewage into two rooms in their home. The Bascuases alleged that in an effort to mitigate their damages and avoid further losses, it was necessary for them to immediately hire a plumbing company who eventually determined that the cast iron sewer pipe that ran throughout the home had deteriorated to the point that the entire plumbing system needed to be replaced.
The Bascuases testified that prior to reporting the loss they authorized the plumbing company to replace their plumbing system which necessitated the cutting of trenches through practically every room of their home, including their driveway, in order to access the pipes. The trenches measured approximately eight inches wide and four feet deep. Aside from the trenches, the plumbing company tore out sections of dry wall throughout the home in order to replace the cast iron drain line and existing hot and cold water lines which the plumbing company claimed was a necessary repair to the plumbing system.
Citizens sent an adjuster to the Bascuases’ home to inspect the damage and to take a recorded statement. During the recorded statement, Mr. Bascuas, inter alia, stated the plumbing system had never backed up. Upon Citizens’ adjuster’s arrival at the home he discovered for the first time that the floor had been trenched and the plumbing system had been removed. As such, Citizens could not independently determine causation and had to give the Bascuases the benefit of the doubt that the loss occurred as reported. In July 2012, within thirty days of Citizens’ inspection and investigation, it made a payment of $25,278.43 for the dwelling, limiting payment for damage caused to access repairs to the specific areas of the home where the Bascuases stated the sewage back-up occurred. Citizens also paid the Bascuases $2,200.00 for additional living expenses (“ALE”) because Mr. Bascuas represented same was incurred in part.
There was no activity for approximately three (3) months. Then in September 2012, the Bascuases, without informing Citizens the payment was unacceptable, filed the aforementioned lawsuit.
During litigation, Ernesto Bascuas, a former paint and supply salesman and real estate agent and Rebecca Bascuas, a Catholic school kindergarten teacher, provided sworn answers to interrogatories and testified in deposition that they never experienced any prior plumbing problems and never had contact with or utilized the services of the plumbing company prior to the date of loss. Mr. Bascuas stated his friend recommended the plumbing company to him on the date of loss.
In defending the case, Citizens was able to subpoena cellular telephone records of the homeowners and the global positioning system (“GPS”) records belonging to the plumbing company. The plumbing company had installed GPS monitoring devices in all of its vehicles which documented the date, time and location of its plumbing trucks. Through tedious examination of these records, defense counsel was able to determine that the plumbing company had been to the Bascuases home on three prior occasions and that fourteen separate telephone calls had been made between the Bascuases and the plumbing company prior to the reported date of loss.
Shortly after Citizens had discovered the foregoing, the Bascuases changed their initial deposition testimony by way of an errata sheet to reflect they had a back up in the sewer pipe on May 24, 2012, one (1) day prior to the date of loss. Additionally, contrary to the answers to interrogatories and initial deposition testimony, the same plumbing company provided the Bascuases with services that include but are not limited to a video inspection of the drain line on May 24, 2012, February 21 and 22, 2012.
Based on the discovery of this evidence, Citizens declined to make any further payment and defended the lawsuit pursuant to the policy condition that bars coverage for intentional concealment or misrepresentation of material fact or false statement.
At trial, the plumbing company admitted it knew the plumbing system had to be replaced approximately three (3) months prior to the date of loss. Additionally, the Bascuases more or less admitted prior to being paid they did not tell Citizens about prior plumbing problems, the back up on May 24, 2012, their previous contact with the plumbing company, and work performed by the plumbing company on February 21, 2012, February 22, 2012, and May 24, 2012. The Bascuases did not tell Citizens that three (3) plumbing trucks were at the home for approximately three hours on May 24, 2012. The reason being the Bascuases did not think it was a big deal.
Notwithstanding the foregoing, at trial Rebecca Bascuas gave emotional testimony how her two minor children are being forced to live in a home where insects, small animals and the elements invade her home due to gaping holes made by the plumbers that have not yet been repaired. The Bascuases introduced no less than 50 enlarged photographs of their damaged home.
Despite the emotional testimony, a jury returned a Verdict in favor of Citizens on Plaintiffs’ Complaint for breach of contract after a four (4) day jury trial. Specifically, the jury found that the Bascuases intentionally concealed or made a misrepresentation of material fact and/or made a false statement.