Aviva wants to throw away our settlement agreement and Renegotiate

Discussion in 'Insurance not covered in other forums' started by jdcarn, May 11, 2018.

  1. jdcarn

    jdcarn New Member

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    Hi All,

    I am trying to get my head around this one.
    Years ago I settled with Aviva for a storm damage claim and they paid out c.80% of the settlement amount. They have frustrated me for years about the remainder so I started a civil action. Aviva have simply ignored me and refuse to provide a defence but their continuing obfuscation has been to tell the court that the claim should be dealt with as per an arbitration clause in our contract, which I paste below.
    Any dispute between you and us on our liability, in respect of a claim or the amount to be paid shall, in default of agreement, be referred within twelve months of the dispute arising, to an arbitrator, appointed jointly to you and us in agreement, or failing agreement, appointed by the President of the Law Society of Ireland and the decision of such arbitrator shall be final and binding on both parties. If the dispute has not been referred to arbitration within the aforesaid twelve month period, then the claim shall be deemed to have been abandoned and not recoverable thereafter.

    I told the court about this "final settlement agreement" effectivly nullifying this clause as
    per "in default of agreement" but I must not be getting my point across as the Aviva counsel continue with their arbitration obfuscation.
    So that got me thinking - how many insurance settlement agreements are out there which did not satisfy the final bill for repairs or renewals ? Certainly I ended up in rental property for 16 months because the tradesmen were not available to complete the repairs and that cost was not in part of my final settlement calculation. Anyone got any comments ?
     
  2. Leo

    Leo Moderator

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    8,909
    Are you representing yourself in this? Surely a competent solicitor could enforce the terms.

    When did they first dispute the amount, and how long from then did it take for them to suggest arbitration?
     
  3. jdcarn

    jdcarn New Member

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    Competent solicitors are not readily identifiable when you are outside of the professional arena.
    The amount is not disputed, in fact nothing is disputed as their legal team simply refuse to file a defence.
    Over the years no mention was ever made of arbitration until they found themselves in court having not filed niether appearence or a defence.
    My opinion is that when they got to court, then a strategy kicked in which was " legal intellectual abuse of process"
    I am not a legal practice competent person but on a right of way issue a few years ago I was dragged to the high court on appeal. Three days later the Judge erupted in anger with the quality and the believeability of the other side and I won the case with costs. That is not where I wish to go but the legal council would appear to use that strategy.
    So I wonder if the Aviva legal council is digging a hugh hole for themselves - Could there be a sizeable amount of disgruntled consumers who were similarly 'ridden' through the settlement procedure and ended up with a poor deal which they would like to re-negotiate ?
    And by the way, if there is a competent solicitor out there who would finish this job I should be pleased to appoint. The award of costs does me no good and would leave me suing for damages. My opinion is that the irish lay litigant costs legislation is retarded as compared to our international peers.
     
  4. renter45

    renter45 Frequent Poster

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    Did you approach an arbitrator within 12 months of the 80% being settled? If you didn't and weren't aware of same, you could approach Aviva to show you where they stated you could appeal to arbitrator within 12 mths?? However if they sent documents stating this, I don't think you'll go any further. If you lose will costs be awarded against you??
     
  5. jdcarn

    jdcarn New Member

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    8
    Hi Renter45,
    the arbitration clause in the original contract is designed to facilitate binding arbitration in the event the insured and the insurer cannot agree to a settlement figure. It is industrywide policy that settlements are in 'full and final settlement ' for the loss suffered. In my case the settlement was agreed and niether party had any need of arbitration and the application of the clause was thus redundant. There can be no arguement of any substance that an alternative interpretation could be offered for that arbitration clause - I had no part in the drafting of the contract or any of its clauses.
    For whatever reason, Aviva would seem to be opening a door for any and all parties who agreed settlement figures and later found them to have shortfalls, to go back and renegotiate for bigger settlement amounts. If nobody had any shortfalls then my post is moot.
     
  6. Ravima

    Ravima Frequent Poster

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    I won the case with costs.

    Are you certain of this point? I was always of the understanding that a lay person could not get costs.
     
  7. jdcarn

    jdcarn New Member

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    I am not an expert in legal costs but I think all I could do would be to sue for damages. Try finding a 'no foal. no fee' team to stand up to one of their own !
    My opinion is that the irish lay litigant costs legislation is retarded as compared to our international peers ie UK, Canada etc . I doubt it is a reflection of governmant, a feeding frenzy at the taxpayers expense - changing that is a task for a social justice philandrophist.

    But that is all off subject.
    I am really wondering if there is a volume of people who were disgruntled by their settlement agreement not fulfilling the purpose.
     
  8. Jim2007

    Jim2007 Frequent Poster

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    Could you gives us some actual facts?
    - What was the reason given by the insurance company for not paying out the total agreed amount?
    - What was the outcome of the court case?
    You’ve been to court so it should not be difficult to provide these facts.
     
  9. jdcarn

    jdcarn New Member

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    to jim2007 and all.
    Thankyou for the responses.
    I mentioned the High Court case and its outcome to support my status as not being afraid to go to the High Court if necessary. However that case is not what I am posting about in this thread.
    This thread is about an Arbitration clause in a residential home policy.
    Having considered my earlier posts I believe that the first hurdle that I need to overcome is to answer the following question. If my interpretation is faulty then the rest of my post is moot

    My residential home policy contains an arbitration clause.

    " Any dispute between you and us on our liability, in respect of a claim or the amount to be paid shall, in default of agreement, be referred within twelve months of the dispute arising, to an arbitrator, appointed jointly to you and us in agreement, or failing agreement, appointed by the President of the Law Society of Ireland and the decision of such arbitrator shall be final and binding on both parties. If the dispute has not been referred to arbitration within the aforesaid twelve month period, then the claim shall be deemed to have been abandoned and not recoverable thereafter. "

    Storm damage occurred.
    Liability was accepted.
    A settlement figure was agreed and a settlement Agreement was signed.
    c.80 % of the settlement was paid.
    Balance has been withheld
    After many years of frustration I started a civil bill in jan 2017.

    Are you able to advise a barrister who would provide me with a written legal opinion to answer the following question ?


    In the situation where Liability was accepted and a Settlement Agreement was proposed by the Insurer and signed by the insured, and c.80% was paid - are the Insurers able to invoke the above arbitration clause as an argument to support a Conditional Appearence and to support a motion to send the matter to arbitration under the Arbitration Act 2010, against my consent ?


    Indeed, would you provide me with your opinion ?
     
  10. Ravima

    Ravima Frequent Poster

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    I am NOT a barrister. if you wish to engage one, you must do so via your solicitor. In Ireland, you cannot engage barrister directly.

    Storm happened, damage was caused, 80% was paid. Presumably, the insurer will pay the balance on receipt of the final accounts and/or having the repair assessed to confirm that it was repaired as per the specification agreed at time of paying the 80%.

    if you have not spent the balance of 20%, or have not repaired as per the spec, then insurer will not pay out.

    In my opinion, you must arbitrate before you commence legal proceedings. Insurer is within rights to send to arbitration and Courts will more than likely uphold that.
     
    peteb likes this.
  11. DirectDevil

    DirectDevil Frequent Poster

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    In short, the arbitration condition is designed to oust the jurisdiction of the courts.
    It is a contract term binding on both insurer and policyholder.

    AVIVA would be right to make an application to have the Circuit Court proceedings stayed on the basis that the issue(s) must be resolved by arbitration in accordance with the arbitration condition in the insurance contract. Against that AVIVA might be argued as having waived the arbitration condition by virtue of conducting litigation with OP as distinct from seeking promptly to stay the Circuit Court proceedings.

    What is not clear is why settlement does not seem to have been completed. When the discharge form was signed did OP agree that the sum mentioned was a complete discharge of AVIVA's liability or was it a conditional discharge subject to final adjustment ? If the latter, why can the final balance due not be agreed and paid ?

    What is not always clear either in these situations is the exact date of the dispute and thus the date from which time runs.

    I wonder would an insurance loss adjuster be of more practical value to the OP than the legal system ?
     
  12. jdcarn

    jdcarn New Member

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    DirectDevil - what does OP stand for ?
    The settlement agreement was a "complete discharge" - stated in the settlement agreement text.

    Is the clause AS QUOTED an absolute condition of the contract ?
    I have never heard of insurance settlement agreements being re-negotiated. But I can see the fairness when particular circumstances necessitate a "conditional discharge subject to final adjustment."
    '
     
  13. DirectDevil

    DirectDevil Frequent Poster

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    Last edited: May 23, 2018
    OP = original poster (i.e. your good self).

    Generally, contract conditions are presumed to mean what they say in the terms in which they are expressed. Where problems can arise is the matter of interpretation or construction of conditions. Conditions can be read literally which is strict construction. Alternatively, they can be read by reference to overall intention - which is intentionalist construction. To answer your question as best as I can, I would say that the arbitration condition you cited is soundly constructed and devoid of ambiguity so a strict interpretation would seem justified. In that sense you might say it was "absolute". I would expect a court to grant any application by AVIVA to stay your civil proceedings and to proceed to arbitrate.

    On reading one of AVIVA's home insurance products I see the following in relation to claims settlement ;

    We will settle claims by either repairing, replacing or reinstating property or by making a payment or stage payments.


    Under this policy stage payments can be made where a portion of the claim payment will be retained by us until the works are completed.

    When these works have been completed and supporting invoices and receipts or any additional evidence we may reasonably request have been provided to us to confirm the total cost incurred, the full agreed sum will be paid.


    I assume that you are dealing with similar terms under your policy. If you were sent a discharge form that referred unconditionally to the 80% sum as the final settlement that looks like a simple mistake on the part of AVIVA and not one which should operate to your disadvantage. If this is what happened AVIVA should be asked, by agreement with you, to withdraw the original discharge form and to substitute it with one which makes clear that settlement is agreed conditionally subject to final adjustment. This would create a position in which you would be able to have the work completed and final invoices rendered to facilitate final settlement. It would also obviate the need for any further legal headaches for you.

    Best of luck with it.
     
    Last edited: May 23, 2018
  14. jdcarn

    jdcarn New Member

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    8
    Direct devil - Thankyou and please bear with me:
    The actual Aviva clause is repeated below: reproduced exactly as formatted in the policy.

    Any dispute between you and us on our liability, in respect of a claim or the amount to be paid shall, in default of agreement, be referred within twelve months of the dispute arising, to an arbitrator, appointed jointly to you and us in agreement, or failing agreement, appointed by the President of the Law Society of Ireland and the decision of such arbitrator shall be final and binding on both parties. If the dispute has not been referred to arbitration within the aforesaid twelve month period, then the claim shall be deemed to have been abandoned and not recoverable thereafter.

    I am a consumer and interpreted the clause literally.
    The loss adjuster and I negotiated the single 'claim and the amount to be paid' as a single sum - no talk of staged payments, supporting invoices and receipts, or retention - not in the policy contract or subsequent settlement agreement.
    My thinking is stuck with the crux of the matter: ie the line ' in default of an agreement'
    As I read the clause, the fact that there was a "Settlement Agreement' nullifies the ability of either Aviva or myself going to arbitration 'in respect of a claim or the amount to be paid' under the above arbitration clause.
    Can you give me your interpretation ?

    I have never been sent a discharge form.
     
  15. DirectDevil

    DirectDevil Frequent Poster

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    Last edited: May 24, 2018
    If the basis of settlement was that there was no retention pending completion of works and submission of accounts the final agreed figure should have been for 100% of what was agreed. You indicate that you are in receipt of 80% only of the full value. On this basis your settlement figure is indeed short. You would need to review all of your papers for any references to the basis of settlement.

    You mention a loss adjuster. I assume this was an adjuster acting for AVIVA. The adjuster's file and or their correspondence with you should clarify the basis of settlement i.e. an interim or a full basis. That needs to be probed. If proceeding by way of litigation you would probably need to seek discovery of the adjuster's file. This can be requested on a voluntary basis failing which it may be necessary to make an application for an Order for Discovery. This must be sought from a court. This is going to drag you in to more litigious convolutions.

    If you were not sent a discharge form you may well find that there was one endorsed on the rear of the settlement cheque if that is how they paid. They can be worded on the basis that lodgement of the cheque constitutes acceptance of it as full and final settlement. I am speculating on this point.

    I do not see that the arbitration clause is nullified. There seems to be no dispute on liability to pay. However, it seems that there is a clear dispute on the issue of quantum (and or the basis on which it was calculated) and that is capable of being arbitrated.

    You can argue the issue of "in default of an agreement" a few ways. However, your position is that there is a dispute on the measure of quantum and or the basis of the mechanics of the settlement.

    I see no mention of it but did you consider a complaint to the Financial Services Ombudsmans Bureau ? You will probably find reference to it somewhere in your policy wording. You could submit this complaint to them to adjudicate. Be aware however that any decision rendered by the FSOB is legally binding on both parties and can only be appealed to the High Court by way of motion and that could run you in to very serious legal expenditure if it goes against you.

    On a general level I would try hard to get AVIVA to review their file to reconsider your issue with a view to mind to resolving this by negotiation. I just cannot help feeling that a relatively simple net issue is getting out of proportion and I would be looking to try and stop it spiralling in to a complex mess. I know that you seem to have some frustration with AVIVA's solicitors but I would try and deal with AVIVA directly even at this stage.
     
    Last edited: May 24, 2018