A lawsuit originally filed against Church Mutual Insurance Company regarding a claim dispute exceeding $1 million became a potential $2 million award against Skyyguard Corp., Denver, according to Claims Journal. The contractor is not an NRCA member.
A hail and windstorm on June 18, 2018, damaged Calvary Baptist Church of Denver, including the roof. Church Mutual Insurance Company issued a policy for the property in effect between 2017 and 2020 for direct physical loss and damage. The church hired Skyyguard to handle the repairs, and the roofing company allegedly took control of the church’s claim and urged it to start the appraisal process.
After allegedly conspiring with an appraiser, Skyyguard claimed a cost of nearly $2 million. The insurer paid out about $1.1 million on the claim before refusing to pay code requirements coverage, and litigation followed as the church sued the insurer. However, it was found the work completed by the roofing contractor actually cost $760,000.
After discovering the misrepresentation, Calvary Baptist Church of Denver sued Skyyguard for breach of contract and negligent misrepresentation, and Church Mutual Insurance Company sued the contractor for fraud and intentional interference of the insurance contract, causing a breach of the misrepresentation clause and punitive damages.
On May 22, a jury awarded damages to the church and insurance company, finding the contractor intentionally interfered with the insurance contract and caused the litigation between the church and insurer. The jury awarded $115,000 for the church, $282,000 for fraud to the insurer and $823,000 in punitive damages. It requires repayment of the $1.1 million the insurer paid on the claim, so the total judgment could exceed $2 million.
Skyyguard reportedly plans to appeal.
