" JimH" jimh_osudad@yahooDOT comREMOVETHIS wrote in
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"akheel" wrote in message
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" JimH" jimh_osudad@yahooDOT comREMOVETHIS wrote in
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wrote in message
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JimH wrote:
wrote in message
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wrote:
I hope that this is a good lesson to those in the industry.
Lying about the condition of a boat you sell may not produce
the intended results. I'll bet that MarineMax thought that they
had just clipped another pigeon. It looks like the pigeon won
the battle in the end.

Chuck, I know you are in the industry. The title of the thread
seems to
indicate that you think that this was excessive.

What makes you feel that way?

You made a very quick leap from an assumption that the title
"seems to indicate" something to asking me to defend what you
presumed the title must have meant.

"Ouch!" means that for even a company as large as Marine Max, a
$2.5mm settlement, (plus attorney fees for both sides etc that
will probably bring the total to $3mm) is a good sized bite out
of the bottom line.

Unless the judge ordered otherwise...........their insurance
company was left holding the bill. No big deal for Marine Max
other than possible higher insurance rates.

snip

Maybe not; It wouldn't be unusual for an insurance company to
exclude from coverage any damages awarded to purchasers proving
blatantly dishonest sales practices.


Actually not. Unless the judge or State orders/mandates otherwise
they are paid by the insurance company under most standard
commercial insurance policies.

Wrong. First, most commercial insurance policies specifically exclude
punitive damages and damages from an intentional act. In fact, in
many states, it is illegal to even sell insurance covering punitive
damages. Here the judge ruled the misrepresentations to be
"deliberate." Second, the base amount of the award, the difference
between what the buyer paid and what the boat was worth, is also not
usually covered by insurance. That's becasue had the
misrepresentation never occured, the dealer would have been paid the
lower amount; to have the insurance company now cover the difference
would mean the insurance company would be paying the dealer for the
loss profit that never should have existed in the first place. Sorry,
Marine Max is most likely SOL in this case. And yes, I am a lawyer
and have litigated many insurance coverage cases.


Perhaps that is true in the State you practice in.

I just checked with a friend of mine who is a commercial lines
underwriter for a fairly large insurance company. She said that it is
a State by State decision (whether the insurance company can/shall pay
for punitive) and that her company no longer excludes punitive damages
by endorsement.



It is indeed state by state, and my comments were perhaps too general. In
California where I practice it would be very unlikely that it would be
covered. But insurance for punitive damages are prohibited in many states
as wel, and in those where allowed, often has to be specifically covered in
the policy. Ohio, where the case was brought, seems to follow this rule.
See:

http://www.mcandl.com/puni_states.html

This webpage is a review of all 50 states viewpoint on this issue if anyone
is interested in that sort of thing. My original point was that there's a
good chance the punitive damages weren't covered by insurance and an even
better chance that the fraud damages weren't covered either because they
merely represent the benefit of the bargain that the buyer lost, and most
policies won't cover that. They only way to know for sure is to read the
actual policy.