Defendant’s motion to dismiss was denied with respect to breach of the implied covenant of good faith and fair dealing and violation of the New Jersey Consumer Fraud Act in this case regarding damage to a home caused by Hurricane Sandy

The plaintiff’s home was destroyed by Hurricane Sandy. The plaintiff’s insurer subsequently denied coverage since the policy did not cover loss caused by flooding. The plaintiff sued, arguing that the loss was caused by wind damage, which was covered by the policy. The defendant filed a 12(b)(6) motion to dismiss. The court denied the defendant’s motion with respect to the plaintiff’s cause of action for breach of the implied covenant of good faith and fair dealing, finding that the question of whether the claim was “fairly debatable” was a fact-specific inquiry. The defendant’s motion with respect to the plaintiff’s claim for violation of the New Jersey Consumer Fraud Act was also denied. The court predicted that the New Jersey Supreme Court would find that the New Jersey CFA applies to the payment of insurance benefits. The court dismissed the plaintiff’s claim for punitive damages since it found that the plaintiff had failed to plead facts that rose to the level of egregiousness necessary for punitive damages in an insurance contract case. The defendant’s motion to dismiss the plaintiff’s claim for attorney fees was also granted.

_{Case Law Alerts, 3rd Quarter, July 2015}

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