Insurer Wants Release From $6M Payout to Home Improvement Chain

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North American Elite Insurance is represented by Robert T. Conlon and Scott T. Stirling of Walker Wilcoz Matousek LLP, who said on Friday that “Menard erroneously argues it owed no duties at all and therefore it held the undisputable right to refuse to settle claims within its layer and proceed to verdict, however unreasonable.”

North American said that “Menard’s ‘heads I win, tails you lose’ position is not, and cannot, be the law.” Those were terms used by the Seventh Circuit when it considered this issue in a prior case, the Twin City Fire Ins. Co. v. Country Mut. Ins. Co. suit. North American noted, in that case, the court held that if the insured “was acting irresponsibly in pressing the case to trial,” the excess insurance provider would have a contractual remedy against it under the implied duty of good faith and fair dealing, and based on that ruling, North American is seeking a reversal of the $6M payout to Menard Inc.

Attorneys for North American argued that “The Seventh Circuit’s legal analysis in Twin City aligns with the first part of NAE’s argument in this case: that foundational Illinois contract law requires an implied covenant of good faith and fair dealing, which is applicable in the situation where an insurer unreasonably rejects settlement.” North American said, “Twin City remains the only case under Illinois law to address this issue head-on, and there is no reason to stray from its clear reasoning.”