The Greenville Public School District is demanding a jury in its defense and counterclaim against Argonaut Great Central Insurance Company (AGCIC) according to the district’s answer to AGCIC’s complaint for declaratory judgement filed earlier this month.
AGCIC serves as GPSD’s insurance carrier under its property casualty policy and asserted in its complaint that certain claims of hail damage to GPSD facilities in November 2017 and March 2018 are not “ripe for appraisal.”
GPSD Board of Trustees voted to appoint Brandon McWherter of the Tennessee-based law firm, McWherter, Scott and Bobbitt, as counsel for the matter during a special called meeting on Thursday, Oct. 15.
AGCIC’s complaint stated, “On January 24, 2018, Greenville School District notified AGCIC of hail damage that occurred on November 3, 2017 to the Greenville High School location only, located at 419 East Robertshaw Street Greenville. Mississippi 38701. After timely and properly investigating and adjusting the November 2017 Claim, AGCIC paid a total of $1,931,311.40, which represents the Replacement Cost Value (RCV) and Code work for Greenville High School.”
The complaint went on to say that the two parties executed a release and settlement agreement for the Nov. 2017 claim on June 25, 2019.
Several other allegations were made in AGCIC’s complaint which pertained to hail damage occurring at three other GPSD locations (Weddington, Trigg and the Greenville Vocational Technical Center), an actual cash value payment (ACV) for the damaged locations and a Conditional Sworn Statement in Proof of Loss claiming $3,555,186.70 in damage mitigation and replacement cost.
Summarily, GPSD and AGCIC are in disagreement as to what the actual damages are, the cost of the damages in question will be to repair and specifically how many or which district facilities were actually damaged by the storms.
Essentially, AGCIC is seeking a determination from the judge as to what rights and obligations it has under the insurance policy as well as GPSD.
One of the most glaring denials GPSD makes in its answer to AGCIC’s complaint is that “the full cost of repair or replacement of the hail damage to the covered property for both the November 2017 claim and March 2018 claim was $3,555,186.70.”
The denial, as it pertains to the conditional sworn statement in proof of loss, goes on to state, “Rather, the Conditional Sworn Statement in Proof of Loss was expressly denominated as “conditional” because, as is common in the property insurance adjustment process involving multiple properties and extensive hail damages, a first, “conditional” proof is used to satisfy the insurer’s demands while recognizing that additional supplementation of the claim will be necessary after further claims adjustment, investigation and expert analysis. Here, Argonaut failed to accurately assess the amount of loss associated with the claims, and Greenville disputed the amount of loss.”
In addition, the denial states that in submitting the conditional sworn statement in proof of loss, GPSD expressly reserved the right to amend its estimate during and after the appraisal process and once appraisal is demanded as contemplated by the insurance policy, the appraisers and umpire then independently examine the damage and determine the amount of loss.
Said process is expected to significantly reduce the cost and expense to both GPSD and AGCIC in the insurance adjustment process according to GPSD’s answer.
“This typical process eliminates both: the litigation process, the duplication of effort by having separate entities estimate losses for a series of formal proofs of loss, and then having to pay appraisers and umpires to separately estimate the same losses,” GPSD’s answer asserted.
GPSD’s answer also alleges that Argonaut initially agreed to appraisal and even appointed its own appraiser, but then improperly refused to continue the appraisal once it became aware that GPSD’s appraiser would decipher the extent of Argonaut’s underpayment of the subject losses during its own biased adjustment process.
GPSD also addressed the release and settlement agreement it entered into with AGCIC, alleging that the agreement was related solely to the portion of the 2017 loss concerning the Greenville High School.
“No other locations were a part of the settlement per the express terms of the Release and there was no separation in the release between direct physical loss and codes coverage. Greenville denies that the March 2018 claim relates solely to Trigg Elementary school,” GPSD’s answer stated. “In fact, Argonaut itself has acknowledged damage to many other insured locations resulting from the March 2018 storm for which Argonaut has paid nothing.”
GPSD’s answer to AGCIC’s complaint lists a handful of denials that Argonaut is entitled to the relief sought, but admits it has not made all repairs to covered property only because AGCIC has not properly investigated, evaluated, adjusted or paid the amounts owed to GPSD.
In its complaint, AGCIC proposed that if the judge determines that GPSD’s claim is ripe for appraisal and the two parties’ appraisers cannot agree on the selection of an umpire, the court has authority and jurisdiction to select and appoint one for the parties.
AGCIC nominated Randy Ison and J. Ashley Inabnet to serve as umpire.
In GPSD’s answer to AGCIC’s complaint, it specifically objects to the umpires nominated by AGCIC and stated that it would present the court with umpire options if the parties’ appointed appraisers are unable to agree to an umpire.
GPSD requests in its answer to AGCIC’s complaint that the court deny AGCIC the relief sought in it the complaint, that the court order AGCIC be required to honor the subject insurance policy, order appraisal to proceed and make payments in full pursuant to the same, and further that cost be taxed to Argonaut.
As for GPSD’s counterclaim, none of the allegations listed include the loss to Greenville High School that occurred in November 2017.
As outlined in the “Facts” section of GPSD’s counterclaim, the claim involves no coverage issues, “but rather simply requires a determination of the amount of loss. The only disputed issue is the amount of loss and damage to the buildings and structures on the insured premises that was caused by the loss.”
In addition, GPSD states in the counterclaim that there is no reasonable coverage dispute and the dispute is appropriate for the appraisal process as set forth in the policy.
Two facts listed in GPSD’s counterclaim summarily state that AGCIC unjustifiably declined to proceed with appraisal and fully pay the amounts owed to GPSD as a result of the loss; and that payments that have been made up to this point aren’t sufficient enough to repair or replace the damaged buildings and structures as a result of the loss as required by the insurance policy.
GPSD is alleging in its counterclaim breach of contract, negligence and/or gross negligence and bad faith on the part of AGCIC.
Among its several requests in which it hopes the court would award a judgement against AGCIC on is compensatory damages for economic damages suffered by GPSD as a proximate result of AGCIC’s denial of insurance benefits due Greenville and/or AGCIC’s refusal to fully and promptly and properly investigate and pay GPSD for its losses, including but not limited to amounts to which Greenville is entitled on its contract claims and consequential damages.
GPSD is also requesting a judgment be awarded against AGCIC for extra-contractual damages for AGCIC’s “willful, wanton and bad-faith conduct, punitive and exemplary damages, attorney’s fees, pre- and post- judgment interest and for such other further and general relief as the court deems just and equitable.