ACE is listed on the New York Stock Exchange and has numerous American stockholders. However, many of ACE Limited's officers and directors, who are not US residents, might be immune from civil liability under US Securities laws designed to ensure corporate accountability. This is a significant benefit of the ACE board's decision to reincorporate in Switzerland during 2008.
Boat Won’t Float - Yachtsman Sues Ace
June 22nd, 2015 - Fortuitous or faulty: One of these words is key to determining whether the owner of a sunken yacht is due up to $10 million in damages from insurers that covered the ill-fated vessel.
Workers at New World Yacht Builders LLC were launching the M/Y Baden, a 90-foot expedition yacht, when it tilted at Anacortes, Washington, and sank in shallow water. Now, the yacht’s buyers, Iowa business owner Nixon Lauridsen and The Lauridsen Group Inc., are suing ACE American Insurance Co. and four other insurers on a claim that the loss is covered by policies they issued to the boat yard.
On September 30th, 2011, Lauridsen Group and Nixon Lauridsen hired New World to construct what was supposed to be a $5.29 million yacht. But “for a number of reasons,” Lauridsen said, costs on the project ballooned and by May 18th, 2014, the price tag was $10.92 million.
On that day, New World attempted to launch the almost-finished M/Y Baden. Once in the water, though, it promptly rolled over.
It took 36 hours to haul the boat to dry land, by which time salt water had damaged the engines, generators and electronics.
New World had bought insurance on the vessel, which it obtained from the defendants. Both Lauridsen Group and Nixon Lauridsen were named as additional insureds and loss payees for a policy that had a limit of $10 million.
A New World investigation blamed the accident on a fortuitous failure in the launch. The insurers countered that it was due to faulty design, workmanship or production or assembly procedures, none of which is covered.
Plaintiffs notified insurers on July 9th, 2014, that the loss was $10.926 million. The insurers then advised that they believed the boat could be repaired, for $5.795 million. In April, they reportedly advised Lauridsen that they had received repair bids that carried a mid-range of $7.925 million. However, Lauridsen had notified the companies that it considered the boat to be a constructive total loss, which would hit the $10 million policy limit.
In a lawsuit filed in U.S. District Court in Seattle, the plaintiffs accused the insurers of breach of contract and dealing in bad faith.
Plaintiffs seek an order declaring coverage by estoppel. And they asked the court to award treble damages by way of the insurers violating Washington state administrative code relating to their conduct with policyholders.
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