Modern Development Co. operates a large swap meet in an open-air marketplace. Juan Moreno, a wheelchair visitor at the swap meet, alleged violations by Modern of the Americans with Disabilities Act (ADA) because he was unable to enter the restrooms, which lack wheelchair access.

In his lawsuit, Moreno said he was humiliated, embarrassed and frustrated, suffering serious emotional and physical injuries by being unable to enter the restroom.

Purchase Bob Bruss reports online.

When Modern tendered defense of Moreno’s lawsuit to its liability insurer, Navigators Insurance Co., the insurer denied coverage and defense of the lawsuit. The reason for denial of defense and coverage was there was no accident or occurrence, as required by the insurance policy.

Modern’s attorney negotiated a settlement of the lawsuit for $9,750, plus $7,600 attorney fees. Then the swap meet owner, Modern, sued its insurer for bad faith denial of coverage and refusal to defend the lawsuit under the liability insurance policy.

IF YOU WERE THE JUDGE would you rule Navigators Insurance Co. had a duty to defend its insured for the alleged ADA violation?

The judge said NO!

The terms of the liability insurance policy determine if there is coverage applicable to this case, the judge began. Reading the policy, he continued, it says the insurer must defend general liability lawsuits and pay claims based on accidents or occurrences.

“Moreno’s allegations did not constitute an accidental, unforeseen occurrence sufficient to trigger Navigators’ duty to defend under Modern’s commercial general policy,” the judge ruled. Because there was no accident or event that might be covered under the insurance policy, the insurer had no duty to defend this lawsuit, the judge concluded.

Based on the 2003 California Court of Appeal decision in Modern Development Co. v. Navigators Insurance Co., 4 Cal.Rptr.3d 528.

(For more information on Bob Bruss publications, visit his
Real Estate Center
).

***

Send a Letter to the Editor for publication.
Send a comment or news tip to our newsroom.
Please include the headline of the story.

Show Comments Hide Comments
Sign up for Inman’s Morning Headlines
What you need to know to start your day with all the latest industry developments
By submitting your email address, you agree to receive marketing emails from Inman.
Success!
Thank you for subscribing to Morning Headlines.
Back to top
Only 3 days left to register for Inman Connect Las Vegas before prices go up! Don't miss the premier event for real estate pros.Register Now ×
Limited Time Offer: Get 1 year of Inman Select for $199SUBSCRIBE×
Log in
If you created your account with Google or Facebook
Don't have an account?
Forgot your password?
No Problem

Simply enter the email address you used to create your account and click "Reset Password". You will receive additional instructions via email.

Forgot your username? If so please contact customer support at (510) 658-9252

Password Reset Confirmation

Password Reset Instructions have been sent to

Subscribe to The Weekender
Get the week's leading headlines delivered straight to your inbox.
Top headlines from around the real estate industry. Breaking news as it happens.
15 stories covering tech, special reports, video and opinion.
Unique features from hacker profiles to portal watch and video interviews.
Unique features from hacker profiles to portal watch and video interviews.
It looks like you’re already a Select Member!
To subscribe to exclusive newsletters, visit your email preferences in the account settings.
Up-to-the-minute news and interviews in your inbox, ticket discounts for Inman events and more
1-Step CheckoutPay with a credit card
By continuing, you agree to Inman’s Terms of Use and Privacy Policy.

You will be charged . Your subscription will automatically renew for on . For more details on our payment terms and how to cancel, click here.

Interested in a group subscription?
Finish setting up your subscription
×