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Appeals Court reverses trial judge; grants summary disposition to insurer over water damage

William Hankins suffered "significant" water damage when a pipe in his basement burst.  He hired someone to come in and clean up and repair, and didn't think to notify his homeowner's insurer, Fremont Insurance Company, in advance.  When he informed Fremont of the claim, it refused to pay up, arguing that if it had an opportunity to investigate the claim, before the clean-up, it might have found a basis to reject or exclude the claim. 

Hankins sued Fremont, and Fremont sought summary disposition, based on Hankins' failure to "promptly" notify it of the claim. The trial judge denied Fremont's motion for summary disposition, concluding that Hankins' compliance with the policy's notice requirement was a question of fact.  The Court of Appeals panel, which included the "insurer's best friend," Judge Henry Saad, reversed the trial judge and granted Fremont summary disposition.  The Appeals judges ruled that Fremont suffered "substantial prejudice" because workmen disposed of the physical evidence, and therefore Hankins' insurance rights were completely voided, as a matter of law.  They reached this conclusion despite Hankins' claim that he was not aware of the notice requirement in the policy.

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