Friday, March 11, 2005

Much Ado About Nothing

Paul Flemming of Gannett's Tallahassee Bureau reports in this morning's News Journal that Citizens Property Insurance Co. is dropping the test lawsuit against Ralph and Barbara Perkins of Grand Lagoon.

There's less here than meets the eye. First, Citizens really isn't changing its position about the Perkins' windstorm claim. The company still denies it and will slog on fighting the Perkins -- and every other windstorm claimant who asks for policy limits when their home or business is damaged badly enough to be torn down. The Perkins, who filed a counter-claim after being sued, will have to continue their counterclaim lawsuit on their own to have any hope of collecting on the policy they bought from the state-owned insurance company.

Second, Citizens simply is switching the venue of its betrayal of wind storm policy holders from Escambia to Leon County, where a class action lawsuit was filed challenging Citizens' statewide practice of flouting the existing law as declared by the 4th District Court of Appeals in Mierzwa vs. Florida Windstorm. Presumably, the Black Hole memo continues in effect, too. That is to say, Citizens will continue to single out for adverse treatment all insured customers who have the temerity to assert their rights under Mierzwa and the existing Florida Valued Policy Law.

So, as the Perkins' local lawyer essentially told the News Journal, having Citizens drop its lawsuit is much ado about nothing. Indeed, state C.F.O. Tom Gallagher actually is encouraging Citizens to continue fighting the Leon County class action lawsuit.

Reporter Fleming has hold of a letter Gallagher sent to Citizens Property after his much publicized 'I-feel-your-pain" and "Gosh-whatever-can-we-do" visit to Pensacola. He reports:
"Gallagher continues to encourage the class-action suit against Citizens to move forward quickly.

"Consolidation of the legal issues in the pending suit in Leon (County) will help all affected policyholders with an early resolution of the law concerning coverage in these complex circumstances," Gallagher wrote in a letter to Ricker." [emphasis added]
The key phrase there is "legal issues." The key contradiction lies with "these complex circumstances" which involve intensely factual disputes that will differ from case to case. Except for the outrageously bad faith move by Citizens to categorically deny all Valued Policy claims, every insurance claim depends on a house-by-house, detail-by-detail factual inquiry. That is a situation singularly unsuitable for class action relief, as requested in the case of Scylla Properties vs. Citizens Property Insurance Corp.

While the Leon County class action can settle some issues around the margins -- probably only whether Citizens acts in bad faith when it categorically denies all Valued Policy claims -- individual claimants who have been given the back of the hand by Citizens Property Insurance will have to continue pressing their individual claims in individual cases, just as the Perkins are doing.

Gallagher knows this. Therefore, he know as well that his latest letter is mere window dressing.

It's just more bull from the pulpit while Gallagher studiously avoids invoking the substantial substantive powers of his office that could make a real difference for hurricane victims.

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