Kanakuk Kamps Sues Insurer for Breach of Contract, Refusal to Defend
The Christian youth camp claims the insurer withheld information during settlement negotiations with sex abuse survivors
Kanakuk Kamps is suing its insurance carrier, ACE American Insurance Company, for breach of contract and fiduciary duty and for bad faith refusal to defend Kanakuk over the lawsuit brought against the camp by a sexual abuse victim.
Kanakuk alleges the insurance carrier withheld information from victims and threatened to deny coverage to the camp during the years immediately following the sexual abuse scandal.
Logan Yandell, a Kanakuk camp sexual abuse victim, filed a lawsuit against the camp in November 2022. The lawsuit asserts a fraud claim against Kanakuk Ministries, Kanakuk Heritage, and Joe White, president of Kanakuk.
In 2010, Yandell agreed to a settlement for an undisclosed amount and signed a nondisclosure agreement, but now claims those were based on false and fraudulent representations by the Kanakuk defendants.
Between 2005 and 2008, Yandell says he was sexually abused by former camp counselor Peter Newman. Newman was convicted of child sexual abuse in 2009 and is currently serving two life sentences plus 30 years in prison.
Yandell said Kanakuk represented to him that it “had no prior knowledge of any sexual misconduct committed by Newman.”
Now Kanakuk has filed a cross-claim against ACE American Insurance because it says ACE was the camp’s liability insurer during the years of Yandell’s abuse and that “Ace orchestrated, directed, and assumed complete control over the negotiation and settlement of Plaintiff Yandell’s claims.”
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Kanakuk alleges that ACE knew about Newman’s sexual misconduct and yet misrepresented to Yandell that it “had no such knowledge.” Kanakuk asserts that it did not instruct ACE to withhold knowledge of Newman’s misconduct.
“Throughout 2009 and 2010, Kanakuk continued to update ACE with information it learned of regarding Newman’s activities,” the lawsuit reads.
In 2010, Kanakuk planned to send email letters to about 8,000 families of campers who had enrolled at Kanakuk Kamps that summer to inform them about Newman’s misconduct, but was stopped by ACE.
According to the facts in the lawsuit, ACE adjuster Marilyn Cannon wrote to the camp, “Such disclosures threaten to expose Kanakuk to greater liability and may interfere with ACE’s contractual right to defend claims and to have Kanakuk’s cooperation in that defense. We strongly recommend that you do not send out the proposed public disclosures about Mr. Newman’s misconduct at camp and Kanakuk’s response to that conduct.”
When Yandell filed his lawsuit against Kanakuk, ACE apparently refused to defend the camp because Yandell’s lawsuit “arose in fraud,” which the insurer said is not covered by the policy.
However, Kanakuk asserts that ACE is the one that perpetrated the fraud by controlling the settlement negotiations and withholding information from Yandell.
Elizabeth Carlock Phillips’s brother Trey Carlock died by suicide in 2019, shortly after settling a case with Kanakuk. She has since been an outspoken critic of Kanakuk and its longtime leader Joe White. She told MinistryWatch, “This cross-filing confirms that Kanakuk chose coverage over kids in 2009 and have withheld information since. Joe White and Kanakuk are trying to shift blame for their fraud by suing the insurance company to keep them at the table. In my eyes, they all lied and should be held accountable.”
