Auto Glass Shop Sues Arbella Mutual Insurance Company for Failure to Pay
April 26, 2012

by Katie O'Mara,

Village Glassmith, located in Wellesley Hills, Mass., filed a suit in Massachusetts against Arbella Mutual Insurance Company for failure to pay the auto glass shop’s invoices in October 2010. Donald Cotton, owner of the business, claims that a contract existed between his shop and the insurance company due to the assignment of rights.

Cotton sent a written demand for payment in January of 2010 to Arbella and received a response from the insurance company refusing to pay the auto glass shop. Cotton claims that the insurance company owes him $21,417.26, exclusive of attorney’s fees and costs, and says that the unpaid invoices were “reasonable and covered under the policies.”

The court has now requested that both Cotton and Arbella file briefs for and against a summary judgment. In his written brief, Cotton includes a breakdown of the 179 unpaid claims between 2005 and 2009. He goes on to explain to the court that the industry refers to cases where the insurance company pays the auto glass shop less than the invoice amount as short pays.

“Arbella, rather than pay Village Glassmith the amount listed on the invoice, remitted a lesser amount according to the Arbella’s self-determined reimbursement rate for the cost of the glass and the labor,” read court documents filed by Cotton.

The documents go on to say that Village Glassmith invoiced Arbella, “based on the suggested price published by NAGS at the time of the installation. In fact, the plaintiff invoiced the exact amount suggested and published by NAGS® for the glass installed.”

Labor was also based off of NAGS as well, according to Cotton, who argues in the brief that since the rates were based off of a “respected and widely recognized” body like NAGS that the invoice was reasonable.

Arbella has claimed that due to notices sent to auto glass installers about price changes that they were in a unilateral contract regarding pricing.

The court is expected to make a decision regarding the briefs filed for summary judgment.

This story is an original story by AGRR™ magazine/™. Subscribe to AGRR™ Magazine.
Subscribe to receive the free e-newsletter.