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Does the adjudication process follow the Connecticut Arbitration Code? | Property Insurance Protection Law Blog



The post, Can assessment turn into a kangaroo court, noted that a number of Connecticut courts describe adjudication as arbitration. Does the Connecticut Arbitration Code Determine the Process for Adjudication in Connecticut?

While the previous post noted a case order barring the insurer’s attorneys from contacting the panel, there is another current Connecticut appraisal case1 which ostensibly requires the parties to adopt the Arbitration Code:

Our courts have narrowed the distinction between arbitration and adjudication. Looks Covenant Ins. Co. v. Banks1

77 Conn. 273, 279, 413 A.2d 862 (1979)…

In the instant case, it is undisputed that the parties initiated an open-ended arbitration involving arbitrators empowered to determine questions of law and fact and that the arbitral award was upheld by the Supreme Court. the arbitration included issues related to the residence and the plaintiff’s personal property …. The plaintiff and the defendant each appointed an appraiser and the appraisers then selected a neutral judge … The judge visited the property seven times, reviewed over 300 pages of the plaintiff’s pleadings, conducted interviews with several witnesses and reviewed written submissions from other experts. The Supreme Court found that the assessing judge ‘considered all the evidence [the plaintiff’s appraiser] wanted to present to them.’

There is nothing in the minutes to indicate that the preparation group did not take into account everything in the agreement and everything that happened. The claimant could have raised the breach of contract claim in the arbitration. Defendants’ motion for summary judgment to count one of the other Revised Complaints is thus granted because there is no genuine issue of material fact that res judicata precludes a breach of contract action based on the affirmed unrestricted arbitration award.

How do you present a breach of contract action in an award if the award is not really arbitration? If you’re confused, you’re not alone. For most of us in the property and casualty insurance industry, arbitration and adjudication mean two different things.

This current case relied on an older Connecticut Supreme Court case that stated:

A final question regarding the applicability of §§ 52-410 and 52-411 in the present case is whether the judgment clause in the fire insurance policy constitutes “a written agreement to arbitrate”… An agreement to arbitrate is as “[a]n agreement in any written agreement. . . to settle by arbitration any disputes subsequently arising out of such contract, or due to the failure or refusal to perform the whole or any part thereof. . . .’ (Emphasis added.) In the past, courts have sometimes distinguished between arbitration and adjudication, holding that the latter “is not an arbitration in the accepted legal sense of the word, since an arbitration is a method used to resolve pre-existing controversies,” while an appraisal determines “questions of amount, quality, value, or price which may arise during or after the performance of the contract.”…

….The normal connotation of “controversy” is more than sufficient to include the dispute as to the amount of a fire loss triggering the appraisal proceeding in the insurance contract in question. Moreover, our definition of arbitration as “the voluntary submission . . . of an existing or future dispute to a disinterested person or persons for final determination” is broad enough to include the adjudication clause. It is important as an insurance matter to have a device that allows one party to an insurance contract to compel compliance with the insurance’s assessment procedure when the other party is unwilling to proceed. A narrow reading of § 52-411 would unfairly allow an insurance company to unilaterally refuse to proceed with the appraisal process, effectively limiting the insured to an expensive and time-consuming lawsuit against the policy for the amount of the claim. See Comment “Fire Insurance Appraisal Regulations: A Necessary Change,” 1 Conn. L. Rev. 168 (1968).2

Reading this older case, a strong argument can be made that adjudication in Connecticut should be treated as an arbitration award.

The Connecticut courts can simply state one way or the other whether the parties must follow the Arbitration Code and treat appraisal as an arbitration when appraisal is required under a property insurance policy. Until then, I expect adjudication to be a bit of a mess in Connecticut when the stakes are high or the parties disagree about what process is fair.

Today’s thought

Don’t just read the simple stuff. You may be entertained by it, but you will never grow from it.
—Jim Rohn
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1 Kellog v. Middlesex Assur. Co., no. FST-CV16-6027990, 2022 Connection Super. LEXIS 2258 (Conn. Super. Ct.—Norwalk Oct. 17, 2022).
2 Covenant Ins. Co. v. Banks177 Conn. 273, 279, 413 A.2d 862 (Conn. 1979).


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