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The Collaborative Clearinghouse for Lawsuits and Other Claims Against ACE Group Insurance Companies

Mast Wrecked, Boat Owners Sue ACE for Arbitration

December 18th, 2012 - Owners of a storm-damaged sailboat have sued ACE American Insurance Co. in an effort to force the insurer to arbitrate their claim for repairs.

Greg Dorland, Debra Macrorie and Legato Adventures LLC filed suit in U.S. District Court for the Eastern District of California against Philadelphia-based ACE. They want the court to compel arbitration against the ACE Group unit.

The petitioners said they had purchased a yachtsman-boatsman insurance policy from ACE American that was in effect from Aug. 8, 2011, to Aug. 8, 2012. The policy reportedly covered a Catana 52 Escapade, which is a catamaran sailboat with two hulls.

The petitioners said that, on June 5, 2012, the Escapade was struck by lightning. This damaged the mast on the boat beyond repair, and a replacement mast costs more than $200,000, according to the petition.

On Oct. 11, the petitioners asked that ACE American either replace the mast or proceed with arbitration. The petitioners did not say what grounds ACE American stood on in denying either the claim or the demand for arbitration, stating in the suit only that the respondent refused to pay or arbitrate, and continues to do so.

Absent resolution of the dispute, on November 2nd, the policyholders invoked a portion of the policy and made a specific demand for arbitration. Terms of the policy allow for such a procedure for any controversy or claim, but ACE American allegedly has ignored that portion of the policy.

Each side is to pay for one-half of the arbitrator. The policy called for arbitration to proceed under governance of the Convention on the Recognition and Enforcement of Foreign Arbitral Awards.

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