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Arson for Profit Scheme Defeated by RescissionPosted on September 14, 2023 by Barry Zalma\\t\\t\\t\\t\\tRescission of Insurance for Innocent Misrepresentation of Material Facts
\\nSee the full video at https://rumble.com/v3hdpj2-arson-for-profit-scheme-defeated-by-rescission.html\\xa0 and at https://youtu.be/CAarrB84t6E
\\nBack\\n in 2001 I examined James E. Mitchell under oath on behalf of his \\ninsurer, United National Insurance Company who admitted to \\nmisrepresenting material facts when he applied for the insurance. As a \\nresult of that EUO and the testimony of the underwriter, United National\\n decided to rescind the policy rather than accuse him of fraud and arson\\n for profit, but still refuse his claim for fire damage and offered to \\nreturn the premium he paid. Of course, in an expression of \\u201cchutzpah\\u201d \\n(unlimited gall) he sued only to have the court conclude the rescission \\nwas appropriate.
\\nIn James E. Mitchell, Individually and as Trustee of the Mitchell Family Trust v. United National Insurance Company,\\n No. B170364, Court of Appeal, Second District, Division 5, 25 \\nCal.Rptr.3d 627, 127 Cal.App.4th 457 (March 8, 2005) the Court of Appeal\\n established a standard for dealing with rescission of an insurance \\npolicy.\\xa0 It concluded that an insurer may, under Insurance Code sections\\n 331 and 359, rescind a fire insurance policy based on an insured\\u2019s \\nnegligent or unintentional misrepresentation of a material fact in an \\ninsurance application. Because there was undisputed evidence that the \\ninsurer relied upon the misstatements of material facts in the insured\\u2019s\\n application for insurance, the summary judgment granted by the trial \\ncourt was affirmed.
\\nDuring the policy period, the building was destroyed by arson. The \\narsonist, an acquaintance of Mitchell\\u2019s, perished in the fire. The trial\\n court granted summary judgment. Mitchell purchased the building in \\nFebruary 2000 in the name of his trust. On April 11, 2000, Mitchell\\u2019s \\nbrokers applied for insurance to Debra Messina of Excess & Surplus \\nLines Insurance Brokers, Inc., an authorized underwriter for United \\nNational.
\\nMitchell represented in the application that:
\\nIn fact, the seven representations were false including the fact that\\n the building was subject to a City of Los Angeles abatement order \\nstating that the building could not be occupied without a clearance or \\nrepaired without a permit and contained such deficiencies as being open \\nto unauthorized entry, littered with combustible debris, excessive dry \\nweeds or vegetation, broken windows, damaged or missing doors, damaged \\nexterior wall covering, damaged interior wall and ceiling covering, and \\ndeteriorated flooring (and no permit had been obtained for corrective \\nwork on these deficiencies).
\\nCarl Robinson a business consultant with a prospective buyer for the \\nproperty. Mitchell gave Robinson the keys to the property for the \\npurpose of showing it to the prospective buyer. On November 22, 2000, \\nwhile Mitchell was in Chicago, Robinson set fire to the building and was\\n killed in the ensuing blaze.
\\nAlthough evidence indicated that Mitchell retained Robinson to burn \\nthe building, his death in the fire, made proving Robinson and Mitchell \\nwere working an arson-for-profit scheme, United National limited its \\ndenial of Mitchell\\u2019s claim on the ground that it had rescinded the \\npolicy based on material misrepresentations in Mitchell\\u2019s application \\nfor insurance.
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