A federal appeals court on Tuesday ruled against an Arch Capital Group Ltd. unit in a dispute with a hotel owner over damage caused by 2017’s Hurricane Irma.
Hurricane Irma allegedly damaged an Orlando, Florida hotel owned by Des Moines, Iowa-based BP Investment Partners LLC, according to the ruling by the 11th US Circuit Court of Appeals in Atlanta in Arch Specialty Insurance Co. v. BP Investment Partners Inc.
Under its insurance policy, Arch entity Arch Specialty was obligated to pay for direct physical loss or damage to the property, the ruling said. BPI sought a total of about $8 million for its alleged damages.
However, an insurance adjuster hired by the insurer saw no evidence that the storm damaged the hotel, although he observed that it had been poorly maintained, among other issues that arose. Arch concluded that BPI had incurred no more than $400,000 in damages from the hurricane and paid only that portion of the claim.
Arch then filed suit in the case in US District Court in Orlando, seeking a declaratory judgment against BPI and asserting a claim under the Florida Deceptive and Unfair Trade Practices Act.
The court refused to dismiss the FDUTPA claim. The case was then tried before a jury, which concluded that BPI had “intentionally misrepresented or concealed a material fact or circumstance”; regarding the hotel or its claims and had “materially breached its post-loss obligations.”
The case was appealed to the 11th Circuit. Ruling in favor of the insurer, among other things, a three-judge panel held that the district court had not erred in denying BPI’s motion for partial summary judgment.
“Since there is already a final judgment in this case, it is impossible for us to grant BPI ‘meaningful relief’ on this part of the appeal,” which is moot and must be dismissed, the ruling said.