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Lawyer Lies on Application for Malpractice Insurance - Policy Rescinded  

Travelers issued a Lawyers Professional Liability Insurance Policy to  Grimmer, Davis, Revelli & Ballif (\\u201cGrimmer Davis\\u201d). Grimmer Davis is  a law firm with its principal place of business in Lehi, Utah. Matthew  Grimmer was the sole shareholder of Grimmer Davis and had general  managing and governing responsibilities at the firm. Grimmer is a  licensed attorney with knowledge of the rules of professional conduct.  Jacob Davis was an employee of Grimmer Davis. Davis is also an attorney  with knowledge of the rules of professional conduct. Defendant Grimmer  and Associates, P.C. (\\u201cG&A\\u201d) is a law firm with its principal place  of business in Lehi, Utah. G&A is located in the same office as  Grimmer Davis. Grimmer is the sole shareholder of G&A, and Davis was  also employed at G&A.  Grimmer made false statements in the  application and in Travelers Casualty And Surety Company Of America v.  Grimmer Davis Revelli & Ballif, P.C., et al., No. 2:19-cv-597-DAK-JCB, United States District Court, D. Utah (November 10, 2021) Travelers sought to rescind the policy.  

BACKGROUND

Georgia Noel Inman and her twin brother Walker Patterson Inman III  (\\u201cPatterson\\u201d) were clients or former clients of G&A and its  attorneys. Patterson was also a client or former client of Grimmer Davis  and its attorneys. Georgia and Patterson\'s father died when they were  twelve years old. Their stepmother served as their deceased father\'s  personal representative and successor trustee. However, there were  allegations that she was pilfering or hiding assets from the estate. In  2013, Grimmer and G&A began representing Georgia and Patterson in  the probate dispute with their stepmother in an action in Wyoming.  On June 27, 2018, Georgia filed a motion to disqualify the firm Grimmer  Davis and the individual attorneys Grimmer and Davis from representing  Patterson in the consolidated trust cases pending in Wyoming, citing  various conflicts of interest and breaches of professional duties  against Grimmer, Davis, G&A and Grimmer Davis (\\u201cGrimmer Parties\\u201d).  In this disqualification motion, Georgia asserted that the Grimmer  Parties advocated for positions that favored Patterson and were adverse  to her interests. The motion states that \\u201cGeorgia potentially has claims  against parties and lawyers in this litigation\\u201d and \\u201cGeorgia now has  viable claims, which she will be bringing to undo both the Greenfield  Plantation sale and the assignment of claims\\u201d-two transactions involving  Georgia, Patterson, and Grimmer.

ZALMA OPINION  

A lawyer should know that insurance is a contract of utmost good faith  where neither party may do anything to deprive the other of the benefits  of the contract. In this case, a lawyer not only failed to act in good  faith when applying for malpractice insurance, he acted badly by  misrepresenting to the insurer that he knew of no potential action  against him or his firms when, in fact, he had been so advised by  Georgia and her counsel and by orders of two different courts.  Rescission was the only appropriate action available to the Travelers.