These services are limited to those directed toward expertise in banking, finance, accounting, risk and systems analysis, design and implementation, asset recovery, and strategy planning.” Perhaps something like this: “Coverage will apply only to those services provided for financial institutions. Re-wording the entire clause might make it crystal-clear and less open to interpretation, a Florida schoolteacher suggested. Scola noted a 1971 federal court decision that said that “while commas at the end of a series can avoid ambiguity, the use of such commas is discretionary.”Ī word nerd or schoolmarm might say that common English usage does not normally place a comma before a final modifier, and that multimillion-dollar matters should not rest on punctuation alone, anyway. In total, Judge Scola concluded, “a plain reading of the 2017-18 policy establishes that Chubb had no duty to defend or duty to indemnify in connection with the underlying litigation, as the services at issue in the underlying litigation were not provided to a financial institution, as required for coverage.” “The court finds that the phrase ‘for financial institutions’ modifies the entire series, meaning that ‘management consulting services’ is defined as the provision of ‘services directed towards expertise in … accounting … for financial institutions.” The judge sided with Chubb on that and most other counts in the litigation. In other words, the words “financial institutions” at the end of the sentence applied only to the words that immediately came before it, “asset recovery and strategy planning,” not the entire clause, ECB contended. The policy surely covered other types of accounting, and audits are generally considered to be part of accounting services, the plaintiffs said. “The plaintiffs’ only argument in opposition comes down to a comma,” the federal judge wrote in the Dec.17 decision.ĮCB’s attorneys argued that because the clause did not have a comma before the words, “for financial institutions,” it meant that the policy was not limited only to work performed for financial institutions. ECB USA and the other plaintiffs disagreed. Chubb’s lawyers argued that the clause meant that the policy covered only those services done for financial institutions. The underlying lawsuit against Constantin did not involve a financial institution. The policy clause at issue was this: Coverage was for management consulting services and those were defined as “services directed toward expertise in banking finance, accounting, risk and systems analysis, design and implementation, asset recovery and strategy planning for financial institutions.” One reason, Chubb argued, was that when Constantin’s and Control Group’s errors and omissions policy was renewed in 2017, the wording had changed and the policy no longer covered audit services done for non-financial firms.ĮCB, a Florida corporation, filed suit against Chubb and ERI, alleging breach of contract. In 2018, ECB USA and others sued Constantin in Miami-Dade Circuit Court, alleging wrongdoing in a professional audit.Ĭonstantin in 2019 settled the lawsuit for $4.9 million and assigned insurance rights to the plaintiffs.īut Chubb and its sister company, ERI, denied the claims for a number of reasons. Chubb and Executive Risk had insured Control Group, a management and financial consulting firm, and its accounting subsidiary, Constantin Associates, for several years. Chubb Insurance and Executive Risk Indemnity, Scola found that the policy punctuation was not unclear and it let the insurers off the hook: A professional liability policy did not cover a multimillion-dollar judgment that resulted from a lawsuit.
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