{"id":900854,"date":"2023-02-15T14:37:58","date_gmt":"2023-02-15T21:37:58","guid":{"rendered":"https:\/\/www.myconstructionexpert.com\/blog\/?p=900854"},"modified":"2023-02-15T14:38:03","modified_gmt":"2023-02-15T21:38:03","slug":"notice-of-cancellation-notice-of-rescission","status":"publish","type":"post","link":"https:\/\/www.myconstructionexpert.com\/blog\/notice-of-cancellation-notice-of-rescission\/","title":{"rendered":"\u201cNotice of Cancellation\u201d Meets California Requirements for Notice of Rescission"},"content":{"rendered":"\n<p>Thomas Benjamin Boley | <a href=\"https:\/\/www.executivesummaryblog.com\/Notice-of-Cancellation-Meets-California-Requirements-for-Notice-of-Rescission\" target=\"_blank\" rel=\"noreferrer noopener nofollow\">Wiley Rein<\/a><\/p>\n\n\n\n<p>A California federal court has held a \u201cNotice of Cancellation\u201d was sufficient to meet the substantive requirements of rescission in California, where the notice informed the insured of misrepresentations on the application and was accompanied by a return premium.\u00a0<em>Clear Blue Specialty Ins. Co. v. Ozy Media, Inc.<\/em>, 2022 WL 4097338 (N.D. Cal. Sept. 7, 2022).<\/p>\n\n\n\n<p>The insureds, a media company and its directors and officers, submitted a directors and officers insurance application that contained outdated financial information and represented that, in the last three years, the company had not been involved in any civil, criminal, or administrative proceedings alleging violations of any federal or state securities statutes. After a newspaper reported on financial fraud allegedly committed by two of the company\u2019s directors\u2014which prompted SEC subpoenas\u2014the insurer sent a cancellation notice to rescind the policy. After the cancellation notice was sent, the insureds noticed claims to their insurer associated with the subpoenas and the financial fraud. In response, the insurer initiated this action seeking a declaration that its insurance contract was void due to the media company\u2019s material misrepresentations.<\/p>\n\n\n\n<p>The insureds argued in their motion to dismiss that the insurer had waived its right to rescind by sending a cancellation notice instead of a rescission notice. The court rejected this argument because, even though the notice was titled a \u201cNotice of Cancellation of the Policy,\u201d the notice otherwise met the substantive requirements for rescission: it notified the company of its misrepresentations and returned the entire paid premium.<\/p>\n\n\n\n<p>The court ultimately denied the insured\u2019s motion to dismiss on the grounds that the court could not adjudicate the policyholder\u2019s knowledge of facts at the pleading stage.<\/p>\n\n\n\n<hr class=\"wp-block-separator\"\/>\n\n\n\n<p><strong>When one of your cases is in need of a construction expert, estimates, insurance appraisal or umpire services in defect or insurance disputes &#8211; please call Advise &amp; Consult, Inc. at 888.684.8305, or email <a href=\"mailto:experts@adviseandconsult.net\" target=\"_blank\" rel=\"noreferrer noopener\">experts@adviseandconsult.net<\/a>.<\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Thomas Benjamin Boley | Wiley Rein A California federal court has held a \u201cNotice of Cancellation\u201d was sufficient to meet the substantive requirements of rescission in California, where the notice informed the insured of misrepresentations on the application and was accompanied by a return premium.\u00a0Clear Blue Specialty Ins. Co. v. Ozy Media, Inc., 2022 WL&hellip; <a class=\"more-link\" href=\"https:\/\/www.myconstructionexpert.com\/blog\/notice-of-cancellation-notice-of-rescission\/\">Continue reading <span class=\"screen-reader-text\">\u201cNotice of Cancellation\u201d Meets California Requirements for Notice of Rescission<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","enabled":false},"version":2}},"categories":[10721],"tags":[9895,88,11838],"class_list":["post-900854","post","type-post","status-publish","format-standard","hentry","category-insurance","tag-advise-consult","tag-california","tag-notice-of-cancellation","entry"],"jetpack_publicize_connections":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v25.0 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>\u201cNotice of Cancellation\u201d Meets California Requirements for Notice of Rescission - Advise &amp; 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