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Nationwide Mutual Insurance Co. units are entitled to the return of $275,000 paid towards a settlement in a sexual assault case at an Atlanta condominium complex because they were not informed of the incident until 21 months after it took place, a federal appeals court ruled Friday.
The Nationwide units insured several firms with ownership interests in Renaissance Walk, an Atlanta condominium and retail complex, according to the ruling by the 11th U.S. Circuit Court of Appeals in Atlanta in Nationwide Property & Casualty Co., Nationwide Mutual Fire Insurance Co. v. Renaissance Bliss, et al, Paris Evans.
Nationwide Property issued the primary commercial general liability policy, which had a general aggregate $2 million limit and a $1 million per occurrence limit, and Nationwide Mutual issued an excess policy with a $5 million per occurrence limit.
The primary policy provided that the insurer must be notified of an occurrence as soon as practicable.
In September 2013, Ms. Evans, the property manager for the company contracted to manage the condominium units, was sexually assaulted in the complex’s parking area.
An official of the complex’s management firm, which is a defendant in the case, flew to Atlanta from California to investigate but, on the advice of a workers comp broker who was not involved in placing the complex’s insurance, did not inform Nationwide of the incident, allegedly because the Renaissance entities were not responsible for the complex’s common areas, including the parking area.
Twenty-one months after the incident, Ms. Evan’s counsel requested information on liability insurance and later filed suit in state court in connection with the assault. Nationwide provided a defense, subject to a reservation of rights, and after mediation agreed to pay $275,000.
It then filed suit in U.S. District Court in Atlanta against the Renaissance entities on the basis that their failure to provide timely notice breached its coverage.
The district court ruled in Nationwide’s favor, and the ruling was affirmed by a three-judge appeals court panel.
“The Renaissance entities argue that their delay was legally justified because following (the management firm official’s) good-faith investigation, they believed they bore no responsibility for the attack,” the ruling said.
“But ‘misplaced confidence’ does not excuse late notice to an insurer under Georgia law,” said the ruling, citing an earlier case.
“Under the circumstances of this case the Renaissance Entities’ 21-month delay in providing notice to Nationwide was unreasonable as a matter of law,” it said, in affirming the lower court’s decision.
Attorneys in the case could not be reached for comment.