Connecticut Supreme Court Analyzes "Any One Accident" Reinsurance Wordings

The Connecticut Supreme Court has breathed new life into Hartford's efforts to obtain reimbursement from its reinsurers for $1.15 billion that it paid to settle Western McArthur's asbestos claims.  In Hartford Acc. & Ind. Co. v. Ace-American Reinsurance Co., No. SC 17625 (Conn. December 25, 2007), the court declared that a Superior Court judge should not have granted summary judgment to Harford's reinsurers in light of apparent ambiguity with the respect to the terms of the subject treaties.  As a result, the case has been remanded to the trial court to consider extrinsic evidence of the parties' intent.

The ruling is somewhat surprising, as the same court had ruled six years ago in Metropolitan Life that the "cause" test requires that the number of "occurrences" in asbestos litigation be determined by reference to each individual claimant's injuries and not by reference to the insured's failure to warn.   In this case, however, the court distinguished Metropolitan as well as the similar reinsurance holding of the New York Court of Appeals in Travelers v. Lloyd's, finding that the "any one accident" common cause language in the Hartford treaties was "uniquely broad."  The court also appears to have been influenced by the extrinsic evidence presented by Hartford concerning the adoption of this language in the 1970s, wherein it asked for this "any one accident" language in lieu of an aggregate extension clause to permit it to aggregate losses occurring in more than one policy year.  Under the circumstances, the court found that Hartford's position that diverse injuries could be aggregated if they were of the same kind or "meaningfully related" was a "plausible" interpretation of the subject wordings.

Merry Christmas, Hartford!

 

More News From Corpus Christi

Todd Hoeffner, the Texas plaintiffs’ lawyer who was indicted last June by a federal grand jury in Houston for paying over $3 million in kickbacks to two Hartford claims handlers to orchestrate $34 million in silicosis settlements, has filed a cross-claim against Harford in the malpractice suit that his former clients have since brought against him, claiming that he was a victim of extortion. In papers filed in the U.S. District Court in Corpus Christi last week, Hoeffner seeks $3 million in  damages from Hartford that he is seeking to treble pursuant to a RICO claim, contending that Rachel Rossow and John Prestage threatened to scuttle legitimate settlements unless he agreed to pay them bribes. Hoeffner claims that “employees of The Hartford held hostage the legal rights of Hoeffner and his clients in a plan calculated to enrich themselves.”