In August 2018, an explosion and fire seriously damaged the insured's bar, restaurant and bowling alley. 1 Auto-Owners Insurance Company (“Owners”) insured buildings and personal property at the time of the loss. After resolving their dispute over coverage of damage to the building, the owner paid the payment. However, the parties remained in possession of, inter alia, amounts for corporate personal property ("BPP") and electronic data processing equipment ("EDP").
During the claim, the parties participated through their representatives in a series of communications regarding alleged discrepancies between the values of the damaged BPP that had been handed over to the owner compared to what had been reported by the insured's tax registrar in its tax returns. Such deviations were not resolved before the application.
In disputes, the insured claimed that the owners had violated the insurance policy by not paying for their full BPP loss and by never making any payment for EDP. On the other hand, the owners claimed that the insured did not comply with his duties after loss by not providing the requested documents including purchase receipts which were finally produced during disputes. Neither party ever invoked the policy assessment clause in these disputes. Nor did the owners claim that the insured's alleged failure to comply with customs duties after loss included not continuing the assessment. In the end, the insured moved for a summary assessment of the owners' breach of the insurance policy.
Despite the fact that there was no formal invocation of the evaluation provision by either party, the court ordered the parties to evaluate. Specifically, the court issued a decision granting a partial summary judgment in favor of the insured on his breach of the contract claim, but only to the extent that there was an assessment of the value of BPP and EDP. The Court stated in its opinion that assessment was the only "appropriate legal or equitable measure at this stage, now that the plaintiff's obligations after loss have been fulfilled and the parties still disagree on valuation." The court informed the insurance company that it could review the allegation of breach of contract after the evaluation was completed.