A mom and dad tried to set their son up with a Crop Insurance Policy, but the attempt was not successful when the Crop Policy was rescinded by a Federal Court. Among other evidence in the record of that case, the Federal Court pointed out that apparently the son did not invest very much in the crop which he was applying to insure before he made a claim for a big loss on it. Actually, according to the evidence in that case, "[b]eginning with the 2006 crop year," the son "did not own any equipment at that time and had not secured any debt in the name of the nursery". Skymont Farms v. Federal Crop Insurance Corp., 2012 WL 1193407 *1 (E.D. Tenn. April 10, 2012), Download Skymont Farms v. Federal Crop Ins. Corp. (E.D. Tenn. Case No. 4.09cv65, Memorandum and Order of Lee, U.S.M.J.) PUBLIC ACCESS.
Lacking a Federal definition of what is a "material" misrepresentation legally sufficient to void a Federally subsidized Crop Insurance Policy, the Federal Court turned to State Insurance Law for a definition, held that the application for Crop Insurance at bar met the definition because the son just did not display a sufficient insurable interest for the Crop Insurance he was applying for, and ordered that the Crop Insurance Policy was rescinded -- without payment of the son's claim, of course. Id. at *8 - *10.
The son had alleged several claims against the Federal Crop Insurance Corporation which included Bad Faith Claims under Tennessee law. Once the Federal Court reached the decision to rescind this Policy in this case, no Bad Faith Claims existed since there never was legally any Insurance Policy in existence, the Court reasoned. See id. at *2, 14.
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