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The land unit receives mixed results in the tenant's dispute decision



A federal appeals court upheld Monday that a Markel Corp. unit is not obligated to replace a landlord and a management company in a tenancy dispute, but it can still be held liable for defense costs due to a question of whether it sent a reservation of rights.

The underlying dispute in Evanston Insurance Co. mot Winstar Properties, Inc .; Manhattan Manor, LLC involved a lawsuit filed by tenants in three apartment units in a building purchased by Manhattan Manor and managed by Winstar, both of which are based in Los Angeles, according to court documents.

The 9th U.S. District Court of Appeals in San Francisco confirmed a decision by the U.S. District Court in Los Angeles that Evanston was not liable to defend or replace the two companies because at least part of the claim preceded the insurance period. But that overturned the lower court on the issue of Evanston's reservation of rights.

"However, there are actual questions as to whether Evanston is entitled to recover the costs it incurred to defend" the two companies in the underlying dispute, the decision states.

"Evanston claims that on July 20, 201

7, it sent a letter to Winstar and Manhattan Manor with a reservation of rights … and that its reservation of rights remained in effect on September 12, 2017, when Evanston agreed to participate in Winstar and Manhattan's defense "in the underlying dispute, the judges said.

It stated that Evanston claimed that the letter “is assumed to have been sent and received under the Common Law Mailbox Rule. According to this rule, documents that are correctly addressed and deposited in the US Post Office are assumed to have been physically received.

Winstar and Manhattan claimed that Evanston did not send them the letter.

"Based on the protocol, there are actual problems regarding whether" the letter was sent, "the decision said.

“We see no error in the district court's summary judgment that the policy does not cover claims against Winstar and Manhattan. But we reverse and recall to determine if the July 2017 letter was sent, “which will determine if further action is necessary.

Lawyers in the case did not respond to a request for comment. Catalog

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