Ellington

Cough It Up, State Farm
U.S. District Judge L.T. Senter Jr. gave State Farm Fire and Casualty Co. a heavy blow last week, telling them that they have to cover a policy holder's hurricane wind damage unless they can absolutely prove that storm surge was the cause of destruction.

The court ruled that State Farm Fire and Casualty had breached its hurricane coverage contract and engaged in "malicious or grossly negligent conduct," in a $2.5 million suit brought by Biloxi coupleNorman and Genevieve Broussard.

The Broussards' cache of evidence includes house pieces lying scattered in all four directions, suggesting that high winds caused the damage, as opposed to water.

State Farm told the Biloxi Sun Herald that it might appeal the ruling, but the suit spells bad news for insurance companies if future cases follow the same trend. About 200 lawsuits are pending on the Coast against the same insurance company, with about 1,000 lawsuits lining up in courts against a volley of other insurance companies.

Mississippi Attorney General Jim Hood stood with policyholders in the lawsuit.

"(Judge Senter's) ruling reflects what we have been saying all along," Hood said in a statement. "… [T]he strongest aspect of this ruling was that the insurance company did not meet its burden of proof to show that water caused the damage. Judge Senter held that they had no reasonable basis on which to deny the claim. Therefore, the court gave a bad faith jury instruction, and the jury returned the maximum punitive damage verdict available. I hope that the insurance companies will come to their senses and reach a settlement agreement. I will continue to work with them towards a speedy settlement. However, if they continue with their 'robber baron' mentality, I think that Congressmen Taylor and Thompson and Senator Lott will see to it that we have national insurance reform."

Robert Hartwig, chief economist at the Insurance Information Institute in New York, warns that if the insurance companies lose out in this multi-million-dollar suit, then insurance will be harder to find on the coast.

"Insurance companies will come to believe that Mississippi courts will not uphold the terms of contracts if they lose this suit," Hartwig said. "They'll see it as an inhospitable business environment and stop covering for homeownersinsurance."

Where's My Promotion?
A veteran JPD officer of 23 years is suing the city for being passed over for promotion for the last 10 years.

"In 1994, I sent a memo to city leaders informing them about an officer who had embezzled money intended for me and other officers. They ignored my report and since that time I've been black-balled by the department," officer Sam Haymer told the JFP. "They've passed over me for promotion ever since, and I think they need to address my complaints."

Attorney John Mooney said he is representing Officer Haymer in the suit, which is pending in Hinds County Circuit Court, and said he would offer more details on the suit later this week.

Haymer says the matter has also been before Civil Service since 2003 and complains that Civil Service has not taken any action in resolving it.

Haymer said he has also taken the matter to Police Chief Shirlene Anderson, but claims Anderson has not acted upon the complaint and even signed off on a re-written policy that removes the brunt of Haymer's complaint.

Anderson has not returned calls regarding the matter.