Shannon Santos (Partner-Los Angeles) obtained summary judgment in Los Angeles Superior Court on behalf of Wilson Elser’s clients, an insurance company and an adjusting firm. The plaintiff insureds brought a coverage action, including claims for breach of contract, bad faith and elder abuse, alleging their first-party claim for water damage in their home was not fully paid. The plaintiffs argued that our insurer client was required to pay for the replacement of all flooring in the house, even though the damage was limited to the first floor.

While initially precluded at the pleading stage, Wilson Elser succeeded on summary judgment and removed the adjusting company from the lawsuit after establishing that it had no contractual relationship with the insureds. In successfully defending the client insurer, Shannon prevailed on two separate theories. First, as a matter of procedure, the "Suit Against Us" provision in the policy precludes the suit as the plaintiffs failed to commence the action within one year of the date of loss after the application of tolling authority. While a challenging argument, as the letters to the insureds were not “unequivocal denials” given the claim was partially paid, Shannon convinced the court that the letters showed which portions of the claim were paid and denied all other portions, sufficient to end the tolling period. Second, the Court agreed that, substantively, there was no coverage under the policy for the benefits sought as the replacement for flooring in areas directly damaged was paid in full.