Ruth’s Bar Owners Discover the Importance of Compliance with Terms of Insurance Contract

When a Richard Ruth’s Bar & Grill customer, Emmanuel Kehagias, was assaulted at the bar, owners Richard and Jane Ruth failed to notify their commercial general liability insurer, Founders, of the incident. When Kehagias’s attorney sent a letter of representation, the Ruths forwarded the letter to their agent’s wholesaler Hull & Company. Neither the Ruths agent, Cherie DuMez, Hull nor Founders have any record of further notification about the incident even though Kehagias’s attorney sent a copy of the suit to the Ruths the day after it was filed. It was only after the state court entered a default judgment against them that Founders received notice of the events. Failure of the insured to comply with terms of the insurance contract prevents recovery by the insured, but how does it affect innocent third parties such as Kehagias? Find those details here.