False Answers to Material Insurance Application Questions Requires Rescission

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Insurance is a contract of the utmost good faith that requires that both parties to the contract of insurance do nothing to deprive the other of the benefits of the policy. In Michael Favreau et al. v. Navigators Insurance Company et al., G056718 c/w G056938, CA California (December 15, 2020) Favreau sought reversal of a summary judgment granted to Navigators claiming he wasn’t treated fairly.

ZALMA OPINION

As my mother said to me 70 years ago: “Liars never prosper!” In this case Favreau lied on the application for insurance claiming to be a small time cabinet maker when, in fact, he was working as a general contractor building new houses from scratch, remodeling houses from the foundation up, and not acting as a tiny cabinet maker taking jobs worth less than $3,000 when in fact he was taking on jobs worth hundreds of thousands of dollars. The court concluded he lied to his insure. The equitable remedy of rescission was applied and Favreau recovered nothing.