Crawford adjusters continue court fight

The appeal of a judgement made by Justice Alexander Henderson in a case between Crawford Adjusters (Cayman) Ltd. and Sagicor General Insurance Ltd., stemming from a Windsor Village claim that resulted from Hurricane Ivan got underway on 21 November.

The initial case consisted of six plaintiffs. These included Hurlstone Ltd., Crawford Adjusters (Cayman) Ltd., Bould Patterson Ltd., Alastair Patterson, John Hurlstone and Robert Hurlstone, who counter-sued Cayman General, which was sold twice and became Sagicor General and is now known as Cayman First, after the company filed a writ against them in 2006 alleging fraud and conspiracy. That cause was abandoned on the verge of the trial in December 2008.

As a result, the plaintiffs received a pay out of costs, in addition to $930,000, which was paid to the Hurlstones for breach of contract.

After the countersuit, an award in the region of $7 million to the Hurlstones was made in the ruling by Justice Alexander Henderson, which is considered to be one of the largest awards in a civil matter in the Cayman Islands. However, despite Justice Henderson finding there was malice in the prosecution against Mr. Patterson of Crawford Adjusters (Cayman) Ltd., he ruled that no damages were to be awarded to the plaintiff because he could not be sure that destruction of his reputation, finances and health were the sole motivating factors in the action being taken against him and/or his company.

At the end of the trial, appeals were filed by Sagicor regarding the award the Hurlstones were to receive, while Crawford Adjusters filed an appeal in relation to no damages being awarded. The Hurlstone’s are not listed as parties on the court of appeal cause list, indicating a settlement has been reached with regard to their interests. This could not be confirmed by the attorney for the Hurlstones, Christopher McDuff, who said he could not comment on the matter, as he was, “sworn to secrecy for life”.

During Monday’s opening arguments, lead counsel for Mr. Patterson, Isaac Jacob, QC, who is being instructed by Graham Hampson, said he was setting out to prove Justice Henderson’s conclusion that Frank DeLessio, who was the vice president of Sagicor General at the time of the allegations of fraud and conspiracy, was not guided solely by a personal hatred for Mr. Patterson, was incorrect.

He said he was using the tort of abuse of process to substantiate his assertion. In the previous trial, Justice Henderson found Sagicor General was vicariously liable for Mr. DeLessio’s actions and as a result, the question of culpability in the matter is one that need not be addressed, according to the attorney.

Mr. Jacob said it was DeLessio’s hatred for Patterson that led to the matter being brought as a case of fraud and conspiracy and not simply as a case of over-charging or breach of contract, which Justice Henderson’s ruling accepts.

However, in order to make a case that Sagicor is liable to pay damages to Mr. Patterson, the attorney has to prove that this was Mr. DeLessio’s sole intention.

He said the judge’s finding that he would have awarded $1.3 million in special damages and $30,000 in pain and suffering to Mr. Patterson was trumped by his notion that there had been no overt act and the collateral purpose for bringing the case was not out of the scope of process.

Mr. Jacob said in his opinion, the facts show there was a blatant abuse of process because the whole basis of the claim of fraud and conspiracy was based on a report done by Alan Purbrick of Capital Consulting, which set out that the amount of work done on the Windsor Village site was over-valued by several million dollars, a finding that Mr. DeLessio knew was baseless because he withheld critical information that would have assisted Mr. Purbrick in coming to a more accurate valuation of the work done. However, Mr. Jacob said Mr. DeLessio, which he said was simply shorthand for Sagicor General, still used the erroneous information to instruct lawyers to pursue a case of fraud and conspiracy against Mr. Patterson and the Hurlstones. Additionally, Mr. Jacob cited an article that was printed in the Caymanian Compass, which he said Justice Henderson found was instigated by Mr. DeLessio, saying this was further proof of Sagicor General’s vice president’s state of mind.

He said the fact the case sat for nearly two years with no apparent effort to start proceedings was another glaring sign that would lead one to conclude that the financial ruination of his client and his business were the sole purposes of the action being brought. “Frank DeLessio knew there was nothing for Sagicor General to gain,” Mr. Jacob told the appellate court judges, adding the matter sat for so long that a letter of intent to proceed had to be sent by the then defendants.

“Delay is abuse of process,” urged Mr. Jacob, who added Sagicor General’s vice president’s actions were not consistent with a genuine belief that he truly had a case.

Because there was a Mareva injunction against the Hurlstones they were awarded $6.9 million in lost earnings and profit share. Attempts to secure a Mareva injunction against Mr. Patterson by Mr. DeLessio and Sagicor General failed because they could not produce evidence of the likelihood of dissipation of funds.

Cayman General Insurance, which became Sagicor General and is now Cayman First spent more than $8 million on an initial insurance claim of $6.5 million; $1 million of which would have been paid by the Windsor Village Strata Committee.

From that original claim, $3 million was paid out through Mr. Paterson. This would have left Cayman General with only $2.5 million left outstanding.

However, two weeks after the arrival of Mr. DeLessio, Mr. Paterson and the Hurlstones were banned from the Windsor Village site. Another contractor was then hired and paid on a cost-plus arrangement, which was totally different than the fixed price arrangement in play before his arrival.

At the completion of work, M and J Contractors was paid $5.5 million, which was $3 million over the estimated $2.5 left on the claim.

These numbers do not include what may have been settled with the Hurlstones at the end of previous proceedings or what is being spent on the current appeal lodged by Mr. Patterson.

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