The United States District Court for the Eastern District of Pennsylvania ruled Monday that Church Mutual Ins. Co.’s lawsuit against a public adjusting firm and licensed public adjuster may proceed for claims of negligent misrepresentation, fraud and civil conspiracy. Church Mutual’s claims for civil conspiracy against two attorneys also survived.

The action arose from two claims presented by a public adjusting firm on behalf of Church Mutual’s insured, African Episcopal Church of St. Thomas (AEC), for alleged water damage caused by frozen pipes in a chiller system and roof damage caused by hurricane Irene. Investigation into the claims and testimony of members of AEC revealed that the public adjuster’s estimates, which AEC did not see or approve, included pre-existing water damage that was paid by Church Mutual as part of a prior insurance claim but never repaired by AEC, and that the claimed roof damage pre-existed hurricane Irene.

Church Mutual’s Complaint alleges the public adjusting firm and adjuster negligently or knowingly submitted the claims containing false information. Church Mutual also alleged that after it denied the claims, the attorneys negligently or knowingly pursued the claims in litigation. Church Mutual also alleges that the defendants conspired with each other to profit through the filing and pursuit of the false claims. Dismissed from the action was a HVAC company that inspected the chiller, diagnosed the problem and recommended the appropriate repair. For more information, see Church Mutual Ins. Co. v. Alliance Adjustment Group, et al., United State District Court, Eastern District of Pennsylvania, Case No. 2:15-cv-00461.