Payton & Associates, LLC
Commercial Litigation Attorneys
Miami, Florida
786-574-4943

Insurance company sued for breach of contract

In the wake of a serious fertilizer plant explosion, a school board is suing its insurance carrier for breaches and violations. Florida residents may have heard about the explosion which damaged nearby school buildings. The board is suing several insurance companies for breach of contract, claiming the companies are failing to pay out damages.

The accident occurred on April 17 of last year, at which time the district school board reported roughly $53 million in damages as a direct result of the explosion. The insurance company and its claims adjustor agreed to pay out $30 million of that sum, despite the claim being for the full $53 million. The suit claims the company is in breach of contract for not paying the full amount, as the insurance claim is "without dispute."

Should the case not pan out in court, it will fall on local taxpayers to shore up the difference, paying out to build a new high school and several outbuildings. The cost of the repairs and rebuilding is estimated at between $50 million and $60 million to replace destroyed buildings and downsize existing infrastructure. The case is currently being overseen in a local court.

Breach of contract does not just refer to small businesses — even the largest conglomerates are beholden to honor their agreements, as Florida business owners can attest. Depending on the outcome of this case, the insurance provider may be required to pay out the agreed-upon amount, plus additional fees, like court costs and interest fees. A victory in this case would be a boon to the people of the area who rely on the services of the school board for their educational needs.

Source: wacotrib.com, "West ISD lawsuit alleges breach of contract against insurance carrier", Tommy Witherspoon, May 22, 2014

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