Communication between insurance companies and their insured is always important, and copies of these are encouraged to understand insurance claims when submitting a complaint. Recently, the Board of Appeal of Puerto Rico decided a case in which the plaintiff presented a memo from the recipient contradicting its allegations against the plaintiff's hurricane claim.
Prieto Castillo v MAPFRE Pan American Insurance Company 1 The plaintiff claimed that the insurer (MAPFRE) underpaid its hurricane Maria claim and was engaging in unfair practices, in violation of the Puerto Rico insurance code. MAPFRE denied all allegations and filed a summary judgment claiming that they had fulfilled their contractual obligations and the insurance code by investigating, estimating the damages covered and paying the policyholder the final amount of $ 5,604.28, which the plaintiff accepted and therefore deleted. all additional obligation because a agreement and satisfaction had been fulfilled in this case. The plaintiff replied that even if the check had been deposited she had not given notice because MAPFRE did not contain a letter with the check explaining the consequences of depositing the check and advising her of her right to request reconsideration if she thought the amount of the check was incorrect (underpaid) . The plaintiff also claimed that she had not accepted that check as a final payment and that she had subsequently employed a Public Adjuster and a lawyer to represent her and continue with her insurance claim.
MAPFRE then, contrary to the plaintiff's response to the Summary Judgment due to the plaintiff had reconsidered but it had been denied by the insurer and she deposited the check without any other complaints regarding the payment. On the basis of the evidence adduced, the Court of First Instance (Court of Appeal) ruled on MAPFRE's allegations of conformity and satisfaction and found that the payment constituted a total and definitive liquidation of the plaintiff's claim. In disagreement, the plaintiff filed a request for reconsideration, arguing:
[T] his idea of Accord and Satisfaction is not compatible with Puerto Rico's insurance code and a summary judgment is not the appropriate vehicle to use to evaluate an Accord and Satisfaction claim.  In addition, the plaintiff submitted new evidence and requested a deposit from MAPFRE's sales director. Together with the deposit request, the plaintiff attached a memo sent by MAPFRE in April 2018, which stated the following:
The collection of the sent check is perfectly compatible with all subsequent reviews. new evidence replied that since the plaintiff never submitted a request for review before or after the deposit of the check, the interpretation of the memo was irrelevant to her claim. The Court of First Instance rejected the applicant's proposal for reconsideration.
The plaintiff brought his case before the Court of Appeal, claiming that the Court of First Instance erred in its decision:
The Court of First Instance erred in finding that all the elements necessary for the application of agreement and satisfaction had been complied with and that no essential facts were in dispute. therefore, they continued to decide in favor of rejection or grant summary judgment and dismiss the complaint
As I have discussed in a previous blog, 2 and according to Puerto Rico's Supreme Court, 3 required the following elements for Accord and Satisfaction to exist:
- A claim must have monetary value or a controversial controversy must exist.
- The debtor makes a payment offer.
- The creditor accepts the payment offer.
In this case, the Board of Appeal ruled that the case should not have been resolved by a summary judge
First, it was clear that there was a controversy regarding the payment, but it was not clear whether the offer from MAPFRE followed the insurance code. and was done in good faith as there is no evidence that MAPFRE explained in detail the damages they denied coverage or the conditions for requesting reconsideration of the claim. Nor did MAPFRE warn the plaintiff of the legal consequences of accepting and depositing the check. MAPFRE made an offer without providing all the necessary information for the plaintiff to give consent to complete knowledge e .
Second, even if the plaintiff deposited the check, it is unclear whether the plaintiff had accepted the payment as a full or partial payment for her claim. The control has printed the following message on the back:
The approval of this check constitutes the total and final payment of all obligations, receivables or accounts for the concept stated before
The Board of Appeal determined that this notice in itself did not add complete knowledge to the plaintiff when she approved and deposited the check. The plaintiff even engaged a private company to adjust the damages after she had deposited the check, so it was unclear whether she really understood the consequences of MAPFRE's offer and whether the check was a partial or final payment.
Before concluding its decision, the court appealed against the contradiction caused by MAPFRE through the memorandum prepared by MAPFRE's sales director and sent to all insured persons. As mentioned earlier, this memo contained the following message:
The collection of the sent check is fully compatible with all subsequent reviews.
This phrase seemed to indicate that depositing a check from MAPFRE did not close an insurance claim. MAPFRE caused confusion by first saying that the insured had indeed requested reconsideration, but they had denied it and then in response to the plaintiff's reconsideration proposal they stated that the memo was irrelevant to this claim because the plaintiff had never requested reconsideration.  This brought two more facts into controversy:
- Could the check be deposited without understanding that this measure would close the claim?
- Did the plaintiff request a reconsideration of the amount paid based on the insurer's covered claims?  The Court of Appeal ruled that these controversies could not be resolved by summary judgment and that it was necessary to continue the discovery process to determine whether an agreement and satisfaction were applied in this case.
1 ] Prieto Castillo v MAPFRE Pan American Ins. Co. Appeals Court, Panel III, Case No. KLAN202000835 (Decided January 12, 2021).
2 https://www.propertyinsurancecoveragelaw.com/2019/07/articles/insurance/accord- tillfredsställelse-kommer-min-försäkringsanspråk-avskedas-om-jag-s deposits an payment / (21 July 2019 ).
3 HR Elec., Inc. v. Rodriguez et. al 114 D.P.R. 236, (1983).