Executive Summary Blog

Executive Summary Blog

Legal developments affecting professional liability insurers

Category Archives: Bankruptcy

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Claim Brought by Lenders Against Officers Based on Company’s Misstated Financials Barred by Bankruptcy and Creditors Exclusion

Posted in Bankruptcy, Breach of Contract – coverage for amounts due pursuant to contract, exclusions
Applying Texas law, the United States Court of Appeals for the Fifth Circuit has held that an exclusion barring coverage for any claim brought or maintained by or on behalf of any creditor of the company precluded coverage for claims by lenders against company officers alleging that they misrepresented the financial condition of a company. … Continue Reading

Fraudulent Overbilling Likely Is “Professional Services” But Coverage Barred by Fraudulent Acts Exclusion

Posted in Bankruptcy, Dishonesty Exclusion, Professional Services
The United States Bankruptcy Court for the Middle District of Florida has held that an attorney’s overbilling stemming from fraudulent misrepresentations likely involved “professional services” under a lawyers’ professional liability policy but coverage was barred, in any event, under the policy’s exclusion for “criminal, dishonest, intentional, malicious or fraudulent act(s).” Fla. Lawyers Mut. Ins. Co.… Continue Reading

Borrower’s Bankruptcy Petition Triggers Bankruptcy Exclusion of Lender’s Political Risk Policy

Posted in Bankruptcy
Applying New York law, a New York state intermediate appellate court has held that the bankruptcy exclusion of a lender’s political risk insurance policy barred coverage for a claim following a borrower’s bankruptcy petition. CT Investment Mgmt. Co., LLC v. Chartis Spec. Ins. Co., 2015 WL 2184309 (N.Y. App. Div. May 12, 2015). The court… Continue Reading