The Mellor Law Firm understands that the number one priority of insurance companies is to hire quality counsel to represent its customers. The number one priority of those attorneys hired must, at all times, be their client. Other major priorities are that those attorneys keep their clients informed, at all times, of the progress of their case, work efficiently so as to keep costs reasonable, and draw the case to an equitable conclusion.
Our “3 C’s” Philosophy
Communication, Cost Containment, Case Conclusion
1. Communication
Status reports to carrier and insured:
Timely, Relevant, Progressive
- All status reports contain the claim number and the current examiner’s name and number, if applicable.
- Cases generally reported every 30 days, sooner if significant developments warrant.
- Preliminary Evaluative Status Report within 60 days.
- Comprehensive Interim Status Report (CISR) within first 180 days.
- Amended CISR when appropriate but no less than every 6 months.
Comprehensive Interim Status Reports
Insurance companies can expect a very detailed evaluation of any particular case defended by our firm within the first 180 days of case assignment. The CISR is designed to place at the adjuster’s disposal virtually all-salient information to properly and timely evaluate the insured’s exposure and knowledgeably set appropriate reserves. The Mellor Law Firm’s CISR will contain, at a minimum, the following information:
Construction Defect Case Example
- Statement of Facts– This will include project history, type of development, number of units, scope of the insured’s work, status of the insured (viable, bankrupt, suspended corp.), and other general information.
- Damages and Alleged Defects– This information will include plaintiff’s claimed damages, plaintiff’s repair costs and list of defects. In addition, defense costs of repair and the insured’s potential exposure is provided. If the case is in its early stages, we will give our best estimate. If we represent a subcontractor or minor party, we will focus upon those damages, which result from our client’s work.
- Issues of Law– We will evaluate the issues of law in the case and how they bear upon the insured’s liability. Statutes of limitation, strict liability and contractual liability will be addressed along with other pertinent issues of law.
- Status of Parties– We will identify all plaintiffs, defendants and cross-defendants and their counsel of record. In addition, we will provide a summary of those parties’ involvement in the lawsuit, and whether they are still in operation or in bankruptcy. We will also report whether these parties have insurance and, if so, to the extent possible, the identities of the insurance companies, policy periods and applicable coverage.
- Status of Case– We will report the posture of the case, including the status of discovery, whether a Special Master has been appointed, and any important upcoming dates.
- Indemnity Agreements– We will relate whether there are indemnity agreements in favor of the insured, or whether the insured provided indemnity to another party. We will evaluate whether the indemnity agreement is a Type I, II, or some modified version. We will also report, if the insured is provided indemnity by another party, whether there has been a tender to that party and whether the tender has been accepted.
- Insurance– We will, to the extent possible, and with the insured’s participation, investigate and list all other insurance carriers for the insured in years previous and subsequent to any CONTRACTORS BONDING AND INSURANCE COMPANY policy, and any carriers that name the insured as an additional named insured. We will report whether there has been a tender to these other carriers and whether the tender has been accepted.
- Experts– We will discuss what experts we believe will assist our defending the client, their level of expertise, specialty, credibility and demeanor. We will also report the identities of the other parties’ experts and their areas of expertise.
- Settlement Discussions– We will discuss the settlement potential of the case, and the potential contributions by the other parties. We will report what settlement discussions have taken place, the exposure to the insured, and our future settlement strategy.
- Tactics– We will discuss our tactics regarding the resolution of the case, that is, what the best way is to resolve the case on behalf of the insured, and if the case is not going to settle, the reasons therefore.
2. Cost Containment
Defense costs can be an insurer’s second largest expenditure (the largest typically being settlement funds). We are keenly aware of an insurance company’s need to control costs, and we have adopted certain billing practices and case management techniques to meet this goal.
Our Billing Practices:
What We Will Not Do:
- Block bill unless requested to do so. Each service function will show the amount of time to perform the task and will not be grouped with other functions.
- Round time to nearest hour or half hour. Only actual time is listed.
- Bill for unexplained service entries such as “conference,” “telephone call,” “review,” “research,” etc.
- Bill for repetitious revisions of documents. An insurance company is paying professional people for a professional product. You should expect to pay only once for this finished product.
- Bill for duplicate effort. We will bill only once for the performance of a service function. We will not bill for a second attorney or paralegal to attend depositions, court conferences, trial, etc. The only exception would be in the case of complex litigation involving several participants and then permission will be first obtained from the insurance company.
- Engage in excessive review time. This includes repeated review of documents by one attorney, duplication of effort by more than one attorney, and premature reviews for trial.
- Abuse billing for intra-office conferencing and memorandums. Often, these functions are merely administrative, supervisory, instructional or educational in nature and will not be passed on to the insurance company.
- Both fax and mail correspondence/documents to insurers, clients or parties, unless exigent circumstances dictate otherwise.
What We Will Do:
- Obtain prior authority:
- To retain experts
- To travel out of state
- For research exceeding 3 hours
- To conduct IMEs
- For any activity resulting in a major disbursement
- Invite any auditing of our bills and services
- Strictly limit attendance at site inspections by attorneys and paralegals (experts are retained for this very purpose)
- Dispense with unnecessary written discovery
- Strictly limit attendance at homeowner depositions (typically, the limited information obtained does not justify the expense)
- Retain only necessary experts, and control their activities and, thus, their fees
3. Case Conclusion
Unlike some firms, we do not approach any case, particularly complex litigation, as “retirement income” or a “cash cow” to be “milked.” Insurers are more likely to continue using defense firms, which equitably and expeditiously dispose of litigation. In furtherance of this approach, at the outset of any case, we:
- Work to get an immediate handle on a new case assignment
- Do not “draft” behind co-counsel
- Are proactive, not reactive
- Work to obtain an immediate case management order
- Assess indemnity issues
- Where appropriate, tender the defense to other carriers/parties
- Establish the overall “insurance picture”
- Obtain plaintiff’s preliminary defect list
- Generate a “least expensive acceptable permanent” repair methodology and cost estimate
- Schedule an expert-only meeting, if possible
- Engage in earnest settlement discourse
- Steer the case toward an appropriate alternative dispute resolution forum
We fully understand that, aside from diligently protecting the rights of an insurance company’s insureds, we owe a responsibility to assist the handling adjuster on any particular claim to understand and be able to evaluate the full ramifications and consequences of the lawsuit pending against the insured. The foregoing philosophy and case management techniques allow us to achieve this goal.