Berk & Moskowitz, P.C.

All too often we are painfully reminded of the importance of carrying appropriate limits for uninsured (“UM”) and underinsured motorist coverage (“UIM”) on your auto insurance policy. As the names imply, these are insurance coverages that you can purchase to protect you in the event that the other driver is not insured or has insufficient insurance to cover your injuries.

Unfortunately, there are too many drivers out there causing horrific accidents and related injuries that have few assets and either have no liability insurance or an insufficient amount of liability insurance to compensate victims for the damage they cause.  If you or a loved one were the victim of such a driver, your recourse may be limited to your own UM or UIM coverage.

We have seen first hand victims of auto accidents seriously injured by a driver of an auto that does not personally possess a penny and on top of that either has no insurance or very little insurance coverage.  To make matters worse, these victims, sometimes facing hundreds of thousands of dollars in damages or more, only have the statutory minimum of $15,000/$30,000 in UM and UIM coverage.

Please take a look at your UM and UIM coverages and discuss them with your auto insurance representative to make sure you have appropriate coverages in the event you become the victim of an auto accident.

Please also keep us in mind if you, a loved one, or someone else you know is injured in a car or other accident.  We take great pride in helping accident victims through what can be a very difficult and confusing process.

For all of you auto auction junkies out there, beware.  In Castle v. Barrett-Jackson Auction Company, LLC, the Arizona Court of Appeals upheld the trial court’s dismissal of a consumer fraud claim filed against the auction company by the purchaser of a 1957 Thunderbird Convertible ‘E’ Type at the January 2010 auction.  The purchaser claimed that Barrett-Jackson violated the Consumer Fraud Act by falsely representing on the Car Card that the vehicle had undergone a “professional off-body” restoration and was in drivable condition.  There was no allegation that Barrett-Jackson, as opposed to the actual seller of the vehicle, made the alleged misrepresentations on the Car Card.  The Court of Appeals ultimately determined that there were no representations made by Barrett-Jackson that pertained to the vehicle that might otherwise support a consumer fraud claim.  The Court’s finding was based in large part on the Bidder Agreement that the purchaser signed prior to successfully bidding on the vehicle.  In that Agreement, the purchaser acknowledged that Barrett-Jackson made no representations about any of the vehicles in the auction.

Most liability insurance policies include a provision whereby the insured is not insured for intentional acts – called the “intentional acts” or “criminal acts” exclusion.  Typically, such provisions only exclude insurance coverage where the insured policyholder acted intentionally (rather than negligently) and intended the conduct to cause injury.

In Wilshire Ins. Co. v. S.A., the Arizona Court of Appeals was faced with an insurance coverage dispute where the insured policyholder had sexually assaulted a 15 year old while locked in the company’s basement.  The insured pled guilty to sexual assault, among other things.

The insurance policy provided that there was no coverage for conduct “arising out of a criminal act committed by or at the direction of any insured.”  Based on that clause and the public policy that insurance should not protect those who intentionally cause injury, the Court affirmed the trial court’s determination that there was no coverage for the assault.  The Court noted that this was not a case where the insured acted intentionally, but unintentionally caused injury.

In July 2010, there were about 33% more pre-foreclosure notices (notices of trustee’s sales) issued in Maricopa County, Arizona than June.  In June, there were approximately 5,800 notices issues, compared with just over 7,800 in July. 

Notices of trustee’s sales give at least a 90 day notice of the date, time and place of the trustee’s sale, which is the foreclosure sale under a deed of trust.

If you want to learn about foreclosures under Arizona’s Anti-Deficiency Laws, watch our video powerpoint presentation.  The video covers all the basics, including terminology, what constitutes qualifying property and how the Anti-Deficiency Statutes apply in both types of foreclosures.

On April 22, 2010, a Maricopa County Superior Court jury unanimously awarded the firm’s clients $912,500 in a fraud case against the sellers of a Peoria, Arizona business.  Kent Berk tried the case on behalf of the clients, the buyers of the business.

After doing extensive investigation, the clients, John and Margaret Durma, signed a contract to buy The Curve on Peoria bar and restaurant for $375,000. The records provided by the seller appeared valid and confirmed that the business was making $160,000 in profit per year.  But, after taking over the operations of the business, it had losses each month. The Durmas suspected the seller of wrongdoing and investigated further. After filing their lawsuit, the Durmas discovered that the seller had created a second (false) set of financial records and that the business actually had losses each year that the seller owned it, all contrary to the seller’s repeated representations before the sale.

 At trial, Kent Berk, on behalf of the Durmas, presented claims for fraud, consumer fraud, bad faith, negligent misrepresentation and breach of contract.  Before the case went to the jury, the Judge granted the Durmas judgment as a matter of law on their breach of contract and negligent misrepresentation claims, and found that the seller was prohibited from pursuing any claims for the balance of the purchase price.

 The jury unanimously found in favor of the Durmas on their remaining claims – fraud, consumer fraud and bad faith, and unanimously awarded the Durmas $241,000 in economic damages, $196,500 in emotional distress damages and $475,000 in punitive damages.

Governor Brewer repealed the changes to the anti-deficiency statute that were set to go into effect on September 30, 2009.  The much debated changes would have required the borrower under a deed of trust whose property was sold at a trustee’s sale to have demonstrated, among other things, that the borrower “used” the property for six consecutive months in order to qualify for the protection of the anti-deficiency statute. 

At least for the time-being, the current anti-deficiency statutes will stay in effect.  We have drafted a simple summary of the current law.