Quote of the Day - Be a fountain, not a drain.
Will Insurers Dodge The Katrina-Rita Cocktail Of Hurricanes?
You know the mantra: insurance companies are happy to accept your premium payment, but not at all pleased to pay claims. Will they dodge the multiple bullets of hurricanes this season? If past hurricane devastation is any precedent, the answer depends on policy forms and state law.
Insurers change the policy forms all the time, but it may not be a form change that eliminates coverage. It may be Mother Nature herself. As we already know, only the Federal government provides flood insurance. There's a reason. Private insurance companies don't cover damage from floods.
So, is the damage to homes from wind, rain or flood? The damage for many homes in Louisiana and other areas affected by Katrina may be from floods. But what caused the flood? To really answer that question, we have to dig into the tort bag of definitions for the terms proximate cause, concurrent cause, principal cause and other exclusions. In short, and generally, proximate cause means the actual event that set another series of events in motion. Concurrent cause means two causes, virtually at the same time, that caused the damage. Principal cause is the choice of one cause from an evaluation of multiple events that caused damage. Which one applies to damage from hurricanes is an open question. Did the wind and rain cause the floods? Did the storm surge? Did the negligence of the government in maintaining the dikes cause the flooding? Even if you have this answer, the analysis isn't finished.
All insurance policies are different and each must be read individually to evaluate coverage, and then applied in light of each state's law. In California, we have the long-standing (for our state, 1963 is a long time ago) doctrine of efficient moving (or proximate) cause. That means if the first thing that set the chain of events in motion is covered, then the ultimate damage is also covered, even if there are intervening causes that are not covered. Read it to say that hurricanes, which rarely hit California, would likely be covered if the cause of the damage was wind, typically listed as a covered peril in an insurance policy, even if a flood hit as a consequence of the wind. Instead of hurricanes, we get earthquakes, though, which is why our law hasn't factually addressed the question in the South.
Earthquakes, perhaps not surprisingly, aren't covered on typical homeowners policies here, likely for the same reasons that floods aren't covered on policies where floods happen often. You can purchase earthquake coverage from the State of California, just like you can purchase flood insurance from the Federal government. Many people don't purchase either earthquake or flood insurance, however. Insurers in the South, then, may be looking to avoid coverage for the floods based on policy exclusions.
Not everyone is happy about this situation, and it looks like some are going to try to do something about it.
ACLU Reestablishes Orange County Office
News from the Los Angeles Daily Journal reports that the ACLU (American Civil Liberties Union) is opening an office in conservative Orange County. It must be true: the group is actively advertising for a legal assistant to help staff attorneys in the office.
There's no doubt that the ACLU has recently been active here, seeking last week to assure voting for former Representative Chris Cox's seat for Jewish voters, since the election was set for the first day of Rosh Hashanah.
Surely it will come as a shock to OC Republicans, and to others, a welcome relief. The Daily Journal article by Blair Clarkson quotes Birdie Reed, President of the ACLU's Orange County Chapter, who noted in the article that the ACLU had an office here eight years ago, and has been missed since then.
Why Read 2,800 Pages When You Can Read 46?
If you're at all concerned with energy, foreign oil, solar, daylight savings time, rights of way for utilities and easements or ethanol, and don't want to read the 1,724 pages of the new Energy Policy Act of 2005 or the 1,077-page transportation bill, just signed into law by President Bush, then saunter your mouse on over to this Lexis news site.
You can skip easily through the 16-page Special Alert prepared by Jones Day, and a second, 30-page Special Alert that covers both bills, prepared by Michael Gerrard, an editor of the Environmental Law Practice Guide.
Will Smiling Become A Crime?I happened to spot a small article in The Wall Street Journal (subscription required) on Friday, that caught my attention. The brief article focused on new rules in Britain, that now require those posing for passport photos to display only a neutral face. No smiling, no frowning. Apparently, the expressions confuse the biometric facial-recognition scanners in use to detect terrorism and identity theft.
I am not sure about you, but I'm a generally happy guy and I try to have a smile on my face most of the time I walk around. If Iím upset, I may frown, but hopefully for everyone on the street, I donít walk around with an expressionless zombie look on my face all day. What a dreadful sight that would be. If the scanners canít account for smiles and frowns, perhaps theyíre not quite ready for use. Is security really enhanced if the showing of emotion beats the system? I think not.
The Psychology Of Laying Blame For Levee Breaks - Or Not
Whose fault is it? President Bush has accepted responsibility for the problems with the response to Hurricane Katrina. Or, are we trying to lay blame elsewhere? Apparently, the Senate's Environmental and Public Works Committee sent an email to US Attorneys in the Gulf Coast, asking whether they've had to defend the US Army Corps of Engineers against lawsuits attacking their efforts to strengthen the dike system around New Orleans.
The Sierra Club seems pretty sensitive to the question. The press release in that last link begs that question, though, because it doesn't directly respond to the Committee's inquiry. Another page on the Sierra Club website identifies two lawsuits it filed over such efforts. The Sierra Club's website concludes with this statement: "Conservation groups never opposed raising the levees; just the heavy handed way in which the Corps was going to do it." Other environmental groups are defending themselves, too. They call it spin.
Conservative groups look at it differently. They point to those lawsuits as evidence that conservation groups may have contributed to the disaster. Even so, it appears that the lawsuits were not filed over Lake Pontchartrain near New Orleans, but over more distant Mississippi River levees.
Others, however, point back to the government (check the stinging commentary at the bottom of that last link -my point exactly).
Perhaps the better question to ask is how can we get it fixed as quickly as possible, and what can we do to prevent it from happening again. Does it truly matter whose fault it is? Pointing the finger rarely leads to a productive result; it may tend to satisfy biblical urgings, but generally doesn't do much to solve or prevent the problem. Right now, we're fixing it, cleaning it up, getting people back into the affected areas and coming together.
Is now the right time to investigate? Where is our collective energy best spent?
Mississippi Insurers Named In Suit Over Flood Exclusions
Katrina's devastation may be on more than one front - and it's apparently not just nature this time. Mississippi Attorney General Jim Hood has filed suit in Chancery Court, alleging that certain insurance companies, including Nationwide Mutual Insurance Company, Mississippi Farm Bureau Insurance, State Farm Fire & Casualty Company, Allstate Property & Casualty Company and United Services Automobile Association are taking undue advantage of Hurricane Katrina victims by asking them to sign statements acknowledging that they suffered flood damage.
Among others, Nationwide denies the allegations. In a statement to Reuters, Nationwide said, "The allegations made by the Mississippi attorney general are unfounded. Our company is absolutely not asking policyholders to acknowledge damage is flood-related in order to receive a check for living expenses." At the time this post was made, none of the insurance companies had a statement about this suit on their website.
What is perhaps more interesting is the company's next statement, which according to Reuters, Nationwide said: "The company said policyholders were told upfront that their homeowner insurance did not cover flooding."
Towing In California Is Not Subject To Federal Aviation Law, And Other Shockers
You may have wondered how towing companies seem to rack up all those fees for storing your towed vehicle. At least one of those towing companies claimed it was allowed to do so based on the Federal Aviation Administration Authorization Act . Don't be fooled by the title, though. It's really about Federal authority over intrastate transportation.
Even so, California has a specific statute in its Vehicle Code that addresses towing:
Vehicle Code section 22658(i) pertains to towing and storage fees. It provides in part: "(1) A charge for towing or storage, or both, of a vehicle under this section is excessive if the charge is greater than that which would have been charged for towing or storage, or both, made at the request of a law enforcement agency under an agreement between the law enforcement agency and a towing company in the city or county in which is located the private property from which the vehicle was, or was attempted to be, removed. (2) If a vehicle is released within 24 hours from the time the vehicle is brought into the storage facility, regardless of the calendar date, the storage charge shall be for only one day. Not more than one day's storage charge may be required for any vehicle released the same day that it is stored." That's a bit different than cases that interpret federal law, and have held that the Aviation Act "generally preempts state and local regulation 'related to a price, route, or service of any motor carrier . . . with respect to the transportation of property.' " The court, however, decided that Congress didn't intend to regulate the storage fees charged by local towing companies, and that the state had the right to do so. All over a $200.00 charge.
Vehicle Code section 22658(i) pertains to towing and storage fees. It provides in part: "(1) A charge for towing or storage, or both, of a vehicle under this section is excessive if the charge is greater than that which would have been charged for towing or storage, or both, made at the request of a law enforcement agency under an agreement between the law enforcement agency and a towing company in the city or county in which is located the private property from which the vehicle was, or was attempted to be, removed. (2) If a vehicle is released within 24 hours from the time the vehicle is brought into the storage facility, regardless of the calendar date, the storage charge shall be for only one day. Not more than one day's storage charge may be required for any vehicle released the same day that it is stored."
That's a bit different than cases that interpret federal law, and have held that the Aviation Act "generally preempts state and local regulation 'related to a price, route, or service of any motor carrier . . . with respect to the transportation of property.' "
The court, however, decided that Congress didn't intend to regulate the storage fees charged by local towing companies, and that the state had the right to do so.
All over a $200.00 charge.
Katrina Lawyers Looking For Assistance Reach Out
You may be wondering how to help Katrina victims, and if you're a lawyer, how to help fellow lawyers. Certainly, the Red Cross is a great place to start. The Texas Bar, the Louisiana State Bar, the Louisiana Supreme Court and the Texas Supreme Court are providing help, too. But if you're looking to get directly involved, here's a possibility.
When I arrived at work this morning, I found the following email in my inbox. I called and spoke directly with Tammie Holley, and got her permission to post her email, slightly edited, here. From what I can tell, Tammie's need is real, and her email legitimate. She reports that she rode out the hurricane on the 14th floor of a condo complex, but when the levee broke, she left town for a friend's place in Lafayette. If you're looking for a way to help directly, read on:
"I am Tammie Holley, a downtown New Orleans attorney desperately trying to establish a Lafayette, LA office as quickly as possible. I need a web site named something like Tammie Holley, LLC or the like. I need to market in the Lafayette area, in any medium; I use radio in New Orleans and record my own ads. I have very little start-up capital, so unless you can donate 30 -60 days of service to my firm, please disregard this request.
I am networking with the Woman's Caucus of ATLA, and they will be shipping me supplies that I will distribute to ANY displaced attorney in need in conjunction with the Lafayette Bar Assn. and/or the LSBA [Louisiana State Bar Association]. Any donated laptops and/or PCs will be distributed accordingly, and you will receive notice of who received the equipment.
I need a storage facility, or warehouse space with an address for distribution. If this space is not donated by close of business on Thursday the 15th, I will rent the space myself Friday morning and forward you that address.
I am still looking for small donated office space in Lafayette, as we (three) are operating from our homes, coffee shops, and lap tops at present. We could use any software that you can send, and any excess will be distributed to those in need. My temporary home address is 162 Knollwood Drive, Lafayette, LA 70506, and my cell below still works. My P.O. Box is 4400 Ambassador Caffery Parkway, Suite "A", Box 339, Lafayette, LA 70508. You may mail ANYTHING you like to either address as time is of the essence. I will transport everything to our warehouse once established. Thank you all so much for caring, and God bless.
Tammie Holley, Esq, RN
La. Bar No. 26659
344 Saint Joseph Street #413
New Orleans, Louisiana 70130
Please communicate with Tammie at her temporary Lafayette address. She doesn't have the economic ability to get back to New Orleans for the next three to six months.