The Flood Act Does Not Bar a Common Law Negligence Claim Crought by a Borrower Against a Third Party Flood Determiner.
The home of the plaintiffs, Jeffrey and Karen Klecan, was damaged by widespread flooding in 2008. When the Klecans turned to their lender, Countrywide Home Loans, Inc., for coverage, they learned that Countrywide did not require them to purchase flood insurance. The Klecans sued Countrywide and its subsidiary flood determiner, Landsafe Flood Determination, Inc. The trial court dismissed the Klecans’ complaint and the Klecans appealed that the Flood Act did not bar a common law negligence claim against Landsafe.
The appellate court first determined that the Flood Act does not bar a common law negligence claim brought by a borrower against a flood determiner. It next found that the Rozny factors should be used to determine if a flood determiner owes a duty of care to foreseeable plaintiffs. Based on these factors, the court determined that the Klecans were foreseeable plaintiffs and Landsafe owed them a duty of care. The court reversed and remanded the lower court’s motion to dismiss.
Klecan v. Countrywide Home Loans, Inc., 951 N.E.2d 1212, Ill.Dec. 548 (Ill. App. 3 Dist., 2011), No. 3-10-0084
