Lawyer Mistake Doesn’t Justify Insurance Adjuster’s Late Filing

An attorney’s mistake as to whether a client needed to answer counterclaims filed against it isn’t ‘excusable neglect’ justifying a late filing, the Fifth Circuit ruled Monday in a win for an insurance adjuster in a commissions dispute with his former company.

L.A. Public Insurance Adjusters Inc. should have realized it was required to answer Timothy Nelson’s counterclaims by a February 2019 court hearing at the latest, the court said in an unpublished split opinion.

But ‘rather than seeking to rectify the issue immediately, the company steadfastly maintained it was not required to file an answer,’ the court said.

This delay, combined with the prejudicial effect LAPIA’s late-filed answer had on Nelson, meant the court had to treat the insurance adjuster as having admitted the allegations that Nelson made that were unrelated to damages, the court said.

It reversed a district judge’s ruling in favor of the company.