A Policyholder/Debtor with Comprehensive General Liability ("CGL") insurance has a strategic decision to make: Should the Policyholder/ Debtor protect and preserve its insurance for post-bankruptcy claims, or seek to maximize the insurance proceeds available to satisfy third-party claims? Although the Policyholder/Debtor cannot dictate how its policies are treated during the bankruptcy proceeding, without determining a strategy the Policyholder/Debtor cannot hope to influence the outcome. This article addresses the situation where a Chapter 11 Policyholder/Debtor faces third-party environmental claims. Although this area of law is still developing and varies from one jurisdiction to another, the Policyholder/Debtor should consider certain key issues when determining its strategy for dealing with its CGL insurers.

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Insurance companies have increasingly seized upon the argument that they are not liable, under occurrence-based general liability insurance policies ("CGL policies"), for defense costs incurred before a policyholder has notified the insurance company of a claim or suit. They contend that policyholders are not entitled to these "pre-tender" defense costs primarily for two reasons. First, insurance companies assume that their duty to defend does not arise until they are provided with notice, and therefore, they have no obligation to pay defense costs incurred prior to that notice. Second, insurance companies categorize pre-tender defense costs as voluntary payments for which they are not responsible since they did not consent to such costs. Based on the commercial purpose of CGL policies, the language in the policies and established case law on notice and prejudice, policyholders can successfully argue that insurance companies are responsible for reimbursement of pre-tender defense costs.

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Rescission" is a dirty word that no policyholder wants to hear, especially when one considers the law relating to this potential forfeiture of coverage in many locales. While some jurisdictions require that a policyholder's misrepresentation or omission be both material and intentional, others do not require a showing of intent to support rescission — a negligent or unintentional misrepresentation is enough, as long as it is "material." Given the amount of information typically requested by insurance companies when coverage is purchased or renewed, and the potential for an inadvertent error during the process, even the most careful policyholder must then wonder: Could I forfeit all of my coverage?

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Highlights of the latest equipment leasing news from around the country.

A lessee entering into a new lease agreement must be mindful of a waiver-of-defense clause. If a lease agreement contains a waiver-of-defense clause and the lease is later sold or assigned, the purchaser or assignee, if it is a holder in due course, will take the lease free and clear of numerous defenses (including a fraud in the inducement defense) otherwise available to the lessee had the lease not been sold or assigned.

Come hell or high water" has been a motto of movie tough guys since the genre was invented. But as melodramatic as it may sound, it also has application in the world of business as well. Specific to the leasing industry, the phrase connotes a clause or condition of a leasing agreement that mandates the payment of all rent, fees, and costs to the lessor by the lessee, regardless of any intervening circumstances. Put succinctly, a lessee executing a deal with a "hell or high water clause" waives all of its defenses and is indefeasibly bound to pay its due to the lessor.

Every business must manage some degree of risk. Venturing into the Latin American marketplace, according to popular perception, is a particularly risky business.