Evidence, or Clear Policy Wording About Audit Procedures, is Needed to Prove Right to Additional Premium

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Arch Specialty Insurance Company (“Arch” or “Plaintiff”) sued TDL Restoration, Inc. (“TDL” or “Defendant”), asserting claims for breach of contract, unjust enrichment, and account stated. Currently before the USDC is Plaintiff’s Motion for Summary Judgment on its breach of contract and account stated claims. In Arch Specialty Insurance Company v. TDL Restoration, Inc., No. 18-CV-6712 (KMK), USDC, Southern District Of New York (March 31, 2021) the USDC found it difficult to deal with a motion for summary judgment where some parts were proved and some were not.

ZALMA OPINION

The court concluded that Arch was owed additional premium and that the Defendant breached the contract but will need a trial to determine the total amount owed. This case teaches that with an audit policy where the full amount of premium is only determined after the policy expires, that the wording of the policy should contain a clear and unambiguous manner of determining the premium owed at audit.