A Video About an Essential Element of the Rescission Remedy

Read the full article at https://www.linkedin.com/pulse/proof-materiality-barry-zalma-esq-cfe and see the full video at https://rumble.com/vobcam-proof-of-materiality.html and at https://youtu.be/dJtl3ImVjLU and at https://zalma.com/blog plus more than 3950 posts.

Every rescission requires proof that the facts misrepresented or concealed were material.

Different courts have characterized the element of materiality differently. 

Our conclusion here should not result in an assumption by insurers that policy liability can, with impunity, be avoided or delayed by assertion of a claim for rescission. That is a tactic which is fraught with peril. Where no valid ground for rescission exists, the threat or attempt to seek such relief may itself constitute (1) a breach of the covenant of good faith and fair dealing which is implied in the policy (Fletcher v. Western National Life Ins. Co. (1970) 10 Cal. App. 3d 376, 392, 401 [89 Cal. Rptr. 78, 47 A.L.R.3d 286]) and/or (2) the commission of one or more of the unfair claims settlement practices proscribed by Insurance Code section 790.03, subdivision (h). (Emphasis added)

Mr. Sogomonian was not a nice man. He became, among others, the subject of hearings before the Congress of the United States, in S. Hrg. 104-604, May 15, 1996, Russian Organized Crime in the United States, [http://www.archive.org/stream/russianorganized00unit/russianorganized00unit_djvu.txt] where some of the testimony provided included that from U.S. Customs. Had the insurers known about the information reported to the U.S. Senate they would have been more careful in their dealings with Mr. Sogomonian. The fact that the suit was resolved by proof of rescission eliminated the need for evidence of criminal activity and arson.

The author testified in the trial which, in 40 years as a litigator and expert witness, is the first and only time he observed three armed bailiffs in the courtroom who never took their hands off their weapons. In addition, after testimony was completed, the bailiff offered to escort the author safely to the elevator.


People who lie on an application for insurance will find, if the insurer discovers the lies, with no insurance. Rescission is an important remedy to defeat insurance fraud because people who commit fraud know what to do to deceive an insurer but do not understand insurance law. It is essential, therefore, that every insurance claim investigation includes a verification of the facts presented in the application for insurance and if a misrepresentation is discovered that was material to the decision of the insurer to either accept or reject the application for insurance.

© 2021 – Barry Zalma