Insurance company held liable for refusing coverage

Lawyers USA, December 4, 2006, Natalie White, Contributing Writer

Insurance company held liable for refusing coverage
Plaintiff fell from roof trying to remove limb

Missouri Jury recently decided than an insurance company should pay $12.7 million to a man who fell from his sister’s roof and was paralyzed while dis-lodging a fallen tree limb that the homeowner’s policy should have paid to remove.

Galen Richey, 48, climbed onto his sister’s rooftop after an agent with American Family Mutual Insurance Company repeatedly refused to pay to remove the 1400-pound tree limb. The company claimed the women’s homeowners insurance did not cover the removal.

The accident left Richey, a journeyman diesel mechanic, unable to walk.

“Galen Richey was just trying to help his sister. He never would have been up on that roof if they had honored their policy,” said the plaintiff’s attorney, Brian McCallister. “They told his sister that she didn’t have coverage for something they should have paid for, so he was trying to help her.”

Despite the repeated denials of coverage, McCallister argued that the homeowners policy did cover remove of downed tree limbs on a house.

He told jurors that Richey would have remained safely on the ground if the agent had done her job correctly. He said the family called the agent three times to report the downed limb.

The defense, however, contended that Richey went up on the roof of his own accord and that they had nothing to do with this decision or his fall off the roof.

Although jurors agreed that Richey was partially to blame, they assigned him just 5 percent of the responsibility, finding the insurance company 95 percent liable.

The jury awarded a total of $13.35 million in damages, making the insurance company responsible for paying Richey $12.68 million.

No smoking gun

The tree limb sat on Brenda Bricker’s roof for several weeks while she tried to get the insurance company to take care of it. After the third call, Bricker asked her brother to help remove it. In the middle of the job, part of the limb broke and rolled, knocking Richey off the roof to the ground 15 feet below. He suffered a severe spinal cord injury that left him paralyzed from the waist down.

At trial, insurance company officials questioned whether the family had, in face, called the agent three times. There was no paper trail of the calls because the agent destroyed the telephone logs, according to McCallister. He said the agent testified that she routinely destroys telephone logs after a few years in accordance with company policies.

This, McCallister said, set the scene for him to present his best piece of evidence – the Hallmark pocket calendar in which Richey’s mother habitually recorded everyday occurrences. The calendar showed that the family had called the agent three times before Richey’s accident.

“In some ways it came down to a swearing issue,” said McCallister. They said one thing, we said another. Who do you believe? They said my client’s family didn’t call three times, but the agent burned her telephone logs. Our best evidence was the mother’s Hallmark calendar where she wrote down everything. Not just birthdays and anniversaries, but routine, mundane things.”

Although other company records are supposed to be kept for five years the agent testified that telephone logs are supposed to be destroyed after three years. So she burned them in 2003, three years after the accent. Richey didn’t file his suit until 2005.

Because the calls were all local, the telephone company didn’t not have records of them. “I just don’t think that it sat well with the jurors that she burned the telephone logs,” McCallister said.

Policy interpretation

According to McCallister, the agent told Richey’s sister that the policy covered limbs downed by storms, but not tree limbs that came down for no apparent reason. Since the tree limb did not come down in a storm, the agent denied the claim. “That just wasn’t true. Of course it was covered,” McCallister said. The negligence case turned, in part, on whether the insurance company could have reasonable foreseen the problems. McCallister said the agent’s own testimony provided key evident. She testified that the company tried to quickly handle claims involving fallen tree limbs because it’s aware that accidents occur when unqualified people try to handle such damage. “Was it foreseeable” The agent admitted foreseeability,” said McCallister. “Basically, we asked her if it was foreseeable that someone could get seriously injured if she negligently misrepresented policy coverage. The agent admitted that the company has fast, friendly claims service to prevent accidents like this from happening.” The defense argued at trial that even if the agent was negligent in denying the coverage, she did not cause Richey’s fall. “They were arguing that she might have been the “but for” cause but she was not the proximate cause” McCallister said.

Plaintiff’s attorneys” Brian McCallister and Chris Lawler of The McCallister Law Firm in Kansas City, MO, Steve Garner and Jeff Bauer of The Strong Law Firm in Springfield MO.

Defense Attorney: John Franke of Franke, Schultz and Mullen in Kansas City, MO.

The case: Richey v. Philipp-Leatz: Nov 6, 2006, Jackson Country Circuit Court, Independence MO. Judge Jack R. Grate Jr.