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KELLY D. SIMPKINS OBTAINS SUMMARY JUDGMENT

This action was pending in Jefferson County, Alabama.  The Plaintiff claimed that the insurer who had issued a lender placed policy had not paid benefits for all the losses incurred and such failure was accompanied by bad faith.  Insurer moved for summary judgment on the grounds that the Plaintiff lacked standing to assert a claim because she was not the insured and her losses did not implicate the residual value benefit in the policy.  The Court initially denied Balboa’s motion for summary judgment.  However, during the pretrial conference, based on arguments related to pretrial motions, the Court requested that insurer re-argue its motion for summary judgment.  At 5:30 p.m. on the eve of the trial, the Court vacated its previous order denying the motion for summary judgment and granted insurer summary judgment.  The Court’s decision is significant because it is the first Alabama Court to address the issue of whether a debtor under a lender placed policy has standing to assert claims if the amount of loss does not exceed the lender’s interest.

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