STORY FROM: Reinsurance & Arbitration
Counterclaims Survive in $500,000 Battle Over Collateral
May 13, 2008
HARTFORD, Conn. - In a battle over a cedent's demand for $500,000 in collateral from Universal Reinsurance Company Ltd., a Connecticut federal judge has allowed Universal's counterclaims to survive dismissal. Arrowood Indemnity Co. v. Universal Reinsurance Company Ltd., No. 3:06-CV-158, D. Conn.).
In a May 6 order, Judge Warren W. Eginton of the District of Connecticut ruled that Universal's counterclaims of breach of contract, fraud and bad faith are sufficiently pled. He dismissed, however, the reinsurer's claim for atttorneys' fees, finding it did not meet the American Rule criteria.
In 2003, Universal issued a quota share reinsurance agreement to Arrowood's ...