Bankruptcies in several districts have come down dramatically. In North West Ohio they’re down 29%. Read Here. In South Central Texas, they’re down nearly one third. Bloomberg reports that business bankruptcies are down 22% Nationwide. . One analyst attributes the decline in business bankruptcies in part to low interest rates. Perhaps most of the businesses and individuals who needed to file already have done so. But the foreclosure rate in my area has increased noticeably, perhaps because of the backlog or federal or local programs to stop them are coming to an end.

Lawyer Convicted of Hiding Bankruptcy Asset for Girlfriend Despite Defense Claim He's Not a 'Moron' - News - ABA Journal

Lawyer Convicted of Hiding Bankruptcy Asset for Girlfriend Despite Defense Claim He's Not a 'Moron' - News - ABA Journal

Statute of limitation chart link

Here's a helpful link to a chart of statutes of limitations for 3rd party claims. http://diminishedvalueofgeorgia.com/diminished-value-statute-of-limitations-by-state/

Diminished value for damaged real estate

Diminished value for damaged real estate: A recent ruling by the Georgia Supreme Court that garnered little attention deals with insurance compensation for damaged real estate. The court ruled that a property owner is entitled to a “...

Diminished Value of Real Estate

Here’s a big development in the area of diminished value law. A unanimous Georgia Supreme court held that property insurers have to pay diminished value damages to their policyholders when real estate is damaged. Georgia has been a leader to some degree in the area of diminished value claims. In Georgia, unlike most other states, an auto policyholder can make a claim against his own insurer for lost value of a vehicle after it has been in an accident. Most other states only allow a claim for lost value against the party who caused the accident. If the accident is a one car collision, or if the policyholder is the one at fault, these other states don’t permit a recovery of money. The reason this Georgia Supreme court decision is important, is that the reasoning behind the diminished value argument in Georgia has been extended to real estate by the Supreme Court of Georgia. As Georgia has been a leader in this area, it’s not too hard to imagine that other states may follow their lead. Furthermore, it reinforces that argument in other states that loss of value from damage to real estate is a legitimate claim. Here’s a link to an article that discusses this case. http://www.ajc.com/news/ruling-a-big-deal-1463884.html (right click your mouse and choose” open hyperlink, and if the article doesn’t open up right away, try refreshing the page)

Back to the Acura MDX diminution of value case. I finally got through to the adjuster. She stubbornly refused to raise her offer and asked if I had an appraisal by a certified appraiser. This is an important point. She did not know that a certified appraisal is not necessary for a lot of diminished value or property damage claims. If you have a sale or a trade-in, that is proof of value just as much as a certified appraisal. In court, an insurance company lawyer could probably attack the sale or trade-in in court for any number of reasons, but that doesn’t make it invalid. Similarly, an appraisal can be attacked. No proof is beyond some criticism. But for smaller to mid-sized claims, an appraisal is not needed. There are other forms of proof you can use such as dealer estimates, wholesale records, Blue book or NADA records, offers to buy or trade that are not completed, actual sales and trades. In any event she wasn’t persuaded, so you’ll hear from me about the outcome of the lawsuit.

This week’s case holds a lesson for everyone. It involves my client, an owner of a 2012 Land Rover with 2000 miles on it. He was traveling on a suburban road within the speed limit when another car going in the opposite direction tried to make a left had turn in front of him. Unfortunately, the other car was a late model Corvette and it was totaled. The Corvette took full responsibility. My client did what many of my clients do. He had it towed, fixed and then went to have an estimate done, to see how much he could get if he traded it in for a new one. The estimate came back with a loss of value of $15,000.00. His car was on carfax. Then my client contacted the insurance company directly to demand a settlement, and he sent them the estimate he got of $15,000.00. The insurance company responds by sending him their “appraisal” that says the diminished value claims are too speculative to pay out, and the appraiser goes on to recommend that no payment is made to my client. The insurance company gives this to my client, and despite the recommendation of their appraiser, they offer him just over $1,000. Of course, the insurance company appraiser never inspected the Range Rover and never even asked to see it. He just gave an opinion that auto diminished value claims should not be paid. Naturally, the client called me soon after that. This is not unusual. The at-fault insurance company wants to limit their payouts, so they have a list of appraisers who will provide them with a favorable report to justify minimal payouts. Many people don’t want to fight about it, so they’ll take whatever is offered. This is true in personal injury cases too, where insurance companies will call a victim soon after the accident, and offer some minimal payout and have the victim sign a release giving up any future claims. So, beware. Just because an insurance company says you’re not entitled to be paid, don’t take it as necessarily true. I’ll follow up on this case as it progresses, as it’s early in the process.

Here’s a new diminished value case that just came in and it’s troubling because there may be no good solution. The owner is a woman who has a 2012 Acura. She took it to a car wash, and got out so the attendant could drive it into the car wash. After the attendant got the front tire into the track that pushes the car through the car wash, he got out and the car lurched forward into the car in front, damaging her front bumper. He probably forgot to put in neutral. No one called the police and the car wash paid to repair the bumper, which totaled under $700. Unfortunately, the repairs were not done well so she has to take it to another place to do it to her liking. The problem is that the damage is so small, it would be tough to prove a lot of lost value, but if the repair shop reports it to carfax, then she’s going to pay a lot when it comes time to trade it in or sell it. The car fax alone probably diminishes the value of the car, even if the repairs are done right. And the claim for diminished auto value would be against the car wash, or their business insurance carrier, who have no experience in this area. They probably wouldn’t offer anything. So, she’s got a real problem, but I don’t see any good solution.

I'm back from vacation and still no movement on the Acura

Sorry for the long absence. I was away for a long vacation and got very backed up. Unfortunately, the delay did not help the Acura MDX claim. The adjuster just sent me for a second time what she sent before, namely, her company’s breakdown of how they calculate diminished value claims, and a claim form to fill out to accept their low offer. I called the adjuster at least three times, and faxed her cover letters and documents that I have no intention of accepting their low offer. I have yet to receive a call back. However, it makes sense to keep on trying and as soon as I can catch up on the backlog that happened while I was away, I’ll call her again. Persistence sometimes pays off, and I have lots of time to file suit if I need to.

The Acura MDX auto property loss claim hasn’t made much progress, sadly. I called the adjuster to say that her breakdown is not really important to us. I did not get through to her, and she did not call back. The reason that her breakdown is not important to us is that a court is not bound by the insurance company’s policy on what to pay for a diminished value recovery. If that were true, there would be no need for courts. The court is bound by the Pennsylvania diminished value claims law and in this case that means if the defendant has conceded liability, we can claim any damage we can prove, regardless of what the insurance company wants to pay. So, if they offer $1,000.00 based on their procedures, and we can prove $10,000.00 in damage, we are very likely to get a lot more than they offer. We can prove our loss by a dealer estimate, an appraisal or an actual sale of the vehicle. Probably the best is an actual sale, because the best was to establish the market value of property is an actual transaction on the open market. In this case we have a trade in, as the owner didn’t want to wait for the case to be resolved before getting a new car. This case is likely to be a contest over competing valuations, but the actual transaction will probably be more persuasive than an internal valuation by the insurance company for many reasons. Among them, the insurance company didn’t inspect the actual car, they just used some internal method to make an offer, and the insurance company has an obvious bias, i.e. the less they pay the more they keep for themselves. That cannot be said by the dealer who took the car in trade. The dealer has an interest in making money, but they do not have an interest in overstating or understating the value of the trade in car. Instead, they have an interest in being as accurate as they can because of market pressures. We’ll see if the adjuster is reasonable.

Getting Paid on an auto diminished value claim

Vic’s auto diminished value claim has been concluded – mostly. If you’ve been following these posts you know that we’ve been working on a small auto accident property damage claim that we won in court, and the insurance company lost and then appealed. They missed some deadlines, and made other mistakes, so we filed papers in court to strike the appeal. The insurance company tried 4 times to get the appeal reinstated, and each time violated local court rules so the judge never made a ruling. He just filed an order that the reinstatement would not be considered until the insurance company followed the correct procedure. Finally, this week, we got an order that the reinstatement was denied. Then next day, the insurance company called to ask where to send the check for the full amount of the auto property damage, plus court costs from the small claims court. Furthermore, we incurred some costs during the appeal, and the insurance company has not indicated whether they will pay the additional costs.
This claim originally started in the summer of 2011, and here it is April of 2012 and the payment is not here yet. Diminution of value claims like this are not always for the do it yourself claimant.
Another example is the case I first wrote about on 3/31/12. The client has a car accident property damage claim for $10,000.00 and the insurance agent for the at-fault driver has offered roughly 10% as a settlement. We rejected it and sent the claims adjuster the written car damage estimates, the actual trade in documents from the damaged vehicle, and the Pennsylvania diminished value law that is in our favor. The adjuster again sent forms for us to sign to accept the low ball offer. Then, the adjuster sent a letter stating that they would send a breakdown of their offer. This is not uncommon. Insurance companies are in business to make money, and they do that by paying as little as possible to victims. The next step will be to try to talk to the claims manager or supervisor to persuade them they’re going to lose this one.

Stubborn Insurance company refuses to settle car accident property damage claim

3/31/12
Another Pennsylvania diminished value claim we’re working on also shows the difficulty of settling diminution of value claims. It involves a 2 year old Acura MDX with 23,000 miles that was in a moderate accident. No passengers were hurt, but the car had $14,000 in repair costs. The owner went to the dealer to find out about a trade in, and learned that the accident cost her $10,000.00 in auto value damage. She had the dealer put the auto property loss estimate in writing, and she used that to negotiate herself but only got a lowball offer for about ten percent of her loss. She continued to negotiate, but the insurance company refused to offer any more money. She wanted to trade in her car, but didn’t want to absorb all of the car accident property loss herself. Ultimately she traded in her car, got an updated estimate of the loss, which was exactly the same as the first one, and came to us for help. We contacted the insurance company, provided them with the damage estimates and Pennsylvania value claims law for diminished value claims, and demanded the full lost value of $10,000.00. The insurance company sent back a form for us to complete and return and told us when they received the completed form they’d send a check for 10% of the loss! The next step is to call the adjuster and see if she read our letters and the law and see if we can resolve this but you can see the problem going after these claims yourself. If there’s no flexibility, we’re going to court.

Stubborn Insurance company refuses to pay judgment

There’s still no movement on the auto diminished value claim of Vic, and there’s a very good lesson for those of you following this story. I have a judgment against the other driver, I have recorded the judgment in 2 counties, and the insurance company still hasn’t paid the damages. The next step is to start collection activities such as suspending the driver’s license of the at fault driver, attaching his bank account and property, demanding the insurance company turn over information about his policy and whereabouts, among others. Despite the risk to the at fault driver of having his driver’s license suspended, and his property seized, the insurance company still refuses to pay. This is exactly the opposite of what insurance is supposed to do. Insurance is supposed provide a financial source to pay claims and judgments. This doesn’t do any good for the driver. He still hasn’t been paid for his diminished value claim. But it’s also a great lesson for do-it-yourself claimants.

Diminished value claim just in the nick of time

There is no movement on the appeal yet, the insurance company hasn’t offered to pay the diminished value claim yet and I’m preparing to execute the judgment and take other enforcement actions. So, I’ll move on to another diminution of value claim that I had in the past. It involved a Mercury Milan V-6 SUV with very low mileage at the time of the accident. The Milan was stopped at a four way stop, then entered the intersection when a vehicle coming from her right ran a stop sign and hit her broadside. The car was taken to the repair shop and the damages were originally $11,000.00. But, after the repairs were made, the car still didn’t run right so it was brought back to the shop two more times. The additional repairs were around $8,000.00 more, but the owners still weren’t happy with the way the car ran, so they wanted to trade it in. As usual, when they went to the dealer to do that, they realized that the accident diminished the value of their car so much they couldn’t afford to do the trade unless they got some money for the diminished value claim. The contacted the insurance company for the other driver and at first, the auto diminished value claim was entirely denied. After several months the insurance company told them to get an estimate of the Pennsylvania diminished value and they would consider it. The owners got and estimate for the automobile property damage, submitted it to the insurance company and were told it was insufficient, and that they had to get another diminished value property loss estimate from a different dealer. The owners did as they were instructed and submitted it and again were told the estimate was insufficient, and that they’d have to trade the car in, and advise the insurance company how much they got in the trade. The owners still hadn’t hired me yet, but time was running out. The case had dragged on for nearly two years at this point, and they didn’t want to trade in the car and then find out that the insurance company would refuse to pay anything for an auto diminished value loss, so they came to my office. It’s lucky for them, because they only had two months left before the statute of limitations ran. It’s not unusual for an insurance company to delay the case for more than two years, assure the claimant that they’ll consider the claim, and then deny the claim after the statute of limitation has run out. I advised my clients of this defense strategy, and told them we‘d file suit in time if we needed to. I submitted the claim for them, but again we had no luck. The insurance company adjuster refused to make an offer based on the estimates my client already obtained, and insisted he had to sell or trade the car to arrive at a value they’d accept for the car accident property damage. We filed suit, and the insurance claim was sent to a law firm, and we settled out of court for $12,000.00 without a day in court.

Diminished value case new development

I was going to move on to another diminished value claim, but there is an interesting development in Dan’s diminution of value case that shows how difficult a diminished value auto claim can be. Remember that Dan’s attorney tried to appeal the case from the small claims level to the trial court level but missed some deadlines, and I filed a praecipe (a notice) to strike the appeal. Well, Dan’s insurance company filed some papers to reinstate the appeal. The procedure to do so is pretty clear. To reinstate the appeal one has to file a motion to reinstate. Motions have specific forms to follow; it’s not just a letter to the judge. This has nothing to do with Pennsylvania diminished value law, or diminished value claims at all. It has to do with the Rules of Civil Procedure and local court rules. Dan’s new attorney filed something called a “Reply to Praecipe to Strike Appeal.” They cited law, had a moderately long legal brief, a proposed court order for the court to sign to re-instate the appeal. But it was not a motion in the strict sense because it didn’t follow the specific format for a motion. After I read it I realized that the law was actually on my side, not theirs, and that Dan’s new attorney had selectively pick old or inapplicable cases. So, I replied with my own legal brief, pointing out along the way that Dan’s new attorney had violated the local court rules by failing to follow the strict rules for a motion. I was hoping to get their Reply to Praecipe rejected and the appeal denied. However, I just got an order from the judge that states he will not consider the matter, because Dan’s new attorney did not follow the guidelines for a motion. So we’re not quite back to square one, because we have a judgment against Dan that has not been effectively appealed, and Dan is insured but his insurance company refuses to pay the insurance money on the judgment. Legally, Dan is entitled to his judgment, $8,000.00, but his insurance company refuses to pay up. I can go after Dan personally, but that takes time, costs money, and shouldn’t be necessary because he has insurance. Still think Claims for auto property damage or diminished value car claims are easy? It’s bee n months since we won our case, and we haven’t been paid a penny. In my next installment, I’ll review any developments in this case, or if nothing happens, move on to another Pennsylvania diminished value claim for auto damages from my files

So Dan’s attorney appealed, and we didn’t get paid our diminished value claim yet. The appeal went from the District Justice to the trial court. In other states the District Justice would be referred to a small claims court, District Magistrate or a people’s court. They are courts that deal with claims involving relatively small amounts of money. In PA these courts hear claims up to $12,000.000, for a variety of claims, including auto diminished value. However, the attorney missed a few steps, so I filed a notice to strike the appeal (in PA a notice like this is called a Praecipe). At this point, there are no “fill-in-the-blank” forms to use like the District Justice has and no one at the courthouse to help you. There are papers that must be filed, and deadlines that must be met. As a perfect illustration of how technical this is, Dan’s attorney missed a few critical steps, and as a result we have a chance to stop his appeal in its tracks and enforce the judgment we got from the District Justice on the auto claim for diminution of value. However no decision has been made yet. In my next post I’ll move on to another diminished value case. But and important point is that on appeal, we're not dealing with auto diminished value law, but the rules of civil procedure, which have nothing to do with diminished value.

In this case, Vic was struck by a vehicle owned by Carmella and driven by Dan. For the sake of simplicity, let’s assume that it was not Vic’s fault in any way. So who does Vic make a diminution of value claim against? Dan was driving, but he was driving Carmella’s car. Let’s look at the possibilities. If Dan had the permission of Carmella then her insurance might cover Dan while he was driving her car. That presents a source of recovery for the auto property damage. But, what if he didn’t have her permission or if he wasn’t covered under her policy? You could sue him and there would be no insurance coverage, and to collect you’d have to find some of his assets. You’d have to pay for an investigation of his assets, pay the sheriff to find, seize and sell his assets, and hope they were worth something. On the other hand, Dan was doing the driving, but we don’t know if he had a car, or if he did, if he has insurance. If we make a claim against Dan, and he has a car with insurance, his company might claim that they are not primarily liable because there’s another insurance policy on a vehicle that was actually involved in the accident. The same is true if you make a claim against Carmella. Her insurer could say that she wasn’t involved in any way with the accident or that he policy didn’t cover Dan. Either way, there’s no clear path for this PA auto damage claim. This is not an unusual outcome in cases like this. Sometimes there are multiple policies, and sometimes multiple vehicles. So, you can sue all the vehicles and all the owners and drivers. That has repercussions, too, and this case is a perfect illustration. If you have multiple parties, you are not only fighting them, but they are fighting each other. Reaching an agreement among them is nearly impossible because everyone is pointing a finger at everyone else. We found Dan’s car and insurance, Carmella’s car and insurance and sued them both for a diminished value claim in Pennsylvania. Carmella’s insurer refused to pay anything towards the settlement and tried to put it all on Dan. Dan’s insurer refused to pay a reasonable amount for a full settlement of the diminution of value, offering only part of the damage as his share, and wanted Carmella’s insurer to contribute something, which they refused to do. So we were forced to get a court date. At the hearing, Carmella showed up, with her attorney, and presented a policy exclusion that excluded Dan from coverage under her policy. Dan didn’t show up, but his insurance company attorney did, and refused to settle “on the court house steps.” We had a hearing and won the full amount that we demanded, plus court costs. But Dan’s insurer appealed, because they didn’t want to pay the full damages by themselves.

The second mistake of diminished value claimants

The second mistake most do-it-yourself claimants make is to give the diminished value report to the insurance company that they want to pay the claim. Obviously, the claimant has to back up his claim with something, but once the report is submitted to the insurance company, it sets the ceiling for the negotiations that will occur. If the do-it-yourselfer takes the first diminished value report he gets and gives it to the insurance company there’s no chance of demanding more than that. Once the insurance company gets it they will do one of three things. They will reject the claim entirely, make a low ball nuisance value offer or they will ask to inspect the vehicle to get an opinion of their own. In the first two instances, giving the diminished value report to the insurance company hasn’t hurt you, because they are ignoring it. So, giving it to them didn’t really create a ceiling for the negotiations, because they aren’t negotiating based on the report. However, in the third situation, they will have their own expert look at it, and invariably come up with a value that is a fraction of yours. If any compromise is to be reached it will be somewhere in the middle and by providing them with an “opening bid” that’s not the most favorable for you, you just lost some negotiation leverage. In my next post, I’ll address the questions of who to make the claim against and which court to go to if you must go to court.

Two common mistakes of a do-it-yourself diminished value claim

Vic has a number of questions to answer for his claim. But the first step, which is where most people start, is to research the claim on line. It’s certainly helpful, but much of what one reads online is wrong, or at least misleading. So Vic read online about the claims and set out to make his claim by himself. Unfortunately he made the same two most common mistakes most do-it-yourself claimants make. The first mistake is that he went and got a value for the diminished value claim. The reason that it’s usually a mistake is because most people don’t understand that a report, opinion, or appraisal of diminished value is nothing more than that – an opinion. Opinions differ, and one so called expert can give one value and another expert looking at the same car might give a very different value. There are many reasons for this but two most common are these. First, there is some expertise that goes into an appraisal, and appraisals, opinions etc., depend greatly on the expertise of the person giving the opinion. Some so called experts are very good at antique or collector vehicles, but not so good at current SUVs, classic muscle cars or recent model sedans. If you ask for a report, they’ll give you one and charge a fee, but unless you know that their area of expertise pertains directly to your vehicle, you’re likely to get a poor or useless report. As for other car industry workers, they usually have no special training. Many of them are in sales or management, but don’t have any training or credentials in diminished value estimates. They may do it for free, but you will get what you pay for. The second reason that opinions differ so much is because of a built in bias in the system. Many appraisers, for example, get much of their business from auto insurance companies. As a result, they might be very cautious about providing a report that you are going to use for a claim against an insurance company. Their report is going to have their name on it, and if it’s presented to insurance company that sends them lots of business, they offend a good source of other business. No one will admit to this, but it’s how things work. So they may play it safe, and you’ll never know. The same is true of car dealers. If you bring your car there for a diminished value estimate, the dealer probably hopes that you will trade your vehicle in for one of theirs, and the best way to make the most profit on that deal is to give you a low value on the trade in. There simply is no way to assure that the value you get is in your best interest unless you’ve done a lot of these claims, and know who you’re dealing with.
The second mistake Vic made was to provide the value he got to other interested parties in the claim, and in my next post I’ll describe why that is the second mistake most do-it-yourself claimants make.

Think diminished value claims are easy?

Think that diminished value claims are easy? I’m dealing with one now that will change your mind. As of now, my client, let’s call him Vic, as in innocent victim, was driving home through Pennsylvania in winter. He pulled off on the shoulder of an on ramp to an interstate highway. He was nervous about the road conditions and he wanted to wait until the weather cleared up. Another driver came from behind Vic, lost control of his vehicle, and slid into Vic. Let’s call the other driver Dan, as is Dangerous driver. At the time of the accident, Dan was driving a car owned by Carmella, as in car-owner. I learned later that Dan was Carmella’s boyfriend. My client has damage to his vehicle and had to leave it, rent a vehicle, drive home that was in Virginia, then drive back when the car was repaired. He then went to trade in his car for a new one, when he learned firsthand how diminished value claims work. He couldn’t trade in his damaged vehicle for a fair amount due to the vehicle title report that showed an accident. So, he was stuck with a functional yet damaged car. He was given a value for the diminished value claim, but who does he make the claim against? Is it against his policy, or Dan or Carmella? Is it in Virginia or Pennsylvania? Does he have to go to court and if so, which court? What about lost time from work or the car rental charges to go back and forth to Pennsylvania? I’ll answer these questions one at a time as I post updates.

Inflated appraisal of damaged car and diminished value claim

Here's a situation involving a first party claim and a diminished value claim.

I bought a 2010 Subaru Forrester in Oct 2010. I paid $20,000.00 in cash and traded in my old car that was worth about $5,000. 10 months later, I got into a bad accident involving 6 cars under an underpass. I was at fault for the collision in front of me, but other cars hit me from behind and I am not at fault for that. When Progress came out to asses my car they said that there was $13,192 worth of damage and valued my car for more than $27,000. It was an awful estimate because they ended up putting out $18,726.16 (they claim they would have totaled if it hit $19,196). My car is and was worth nowhere near that amount, and Kelly Blue book value put it at $20,000. The dealer was shocked with that value when I brought the car there. Third, they never checked to ensure that my car was fixed properly and it was leaking transmission fluid that has now stained my street and driveway (since then that time it has been fixed). The car was just finally deemed fixed as of mid-December.

My issue is that my car should have been totaled. I keep cars 10 years. I just got this car, and now I feel that it has been cobbled together. I brought this issue to the insurance commission, but they don't feel that it is viable. I am just at my wits end. Would you happen to have any suggestions?


Here was my reply, in essence.
First, as you were at fault for part of the collision, you have no diminished value claim for that. You could conceivably make a claim for the diminished value from the collisions behind you, but somehow you’d have to separate out the loss of value from the front end collisions from the rear end collisions and that would be very difficult. As for suing your insurance company, that also would be hard. It’s odd that they valued a 10 month old car bought for $25,000.00 at $27,000.00. But to sue them for an appraisal that you think is wrong would be very costly. Also, many insurance policies require you to make a claim within one year of the event or you lose the right to make a claim.

Washington Court upholds diminished value claim

Here's a link to an interesting case involving diminished value for cars. It's a Washington State case, and also a class action suit. The court upheld the consumers right to diminished value under a Washington insurance policy. http://insurancenewsnet.com/article.aspx?id=323510