Claims And Issues

THE CASE THAT WAS NOT ABOUT PROTECTING RELIGION.

           Looking at the arguments actually made in a new case reveals something about the people making them.  The case is Priests For Life v. U.S. Dept. of Health and Human Services, --- F.3d ----, 2014 WL 5904732
(D.C. Cir. November 14, 2014).  In that case, the Circuit Court of Appeals for the D.C. Circuit held 3-0 that the current regulations concerning insurance health plans’ providing access to contraceptive services are constitutional.

          The appellants all lost in the trial courts in these consolidated appeals, of course, or they would not be appellants in the appellate court.  They argued against Federal regulations on behalf of nonprofit organizations such as universities and hospitals.  The appellants themselves included a group of nonprofit organizations other than universities and hospitals who identified themselves as “religious,” such as the named appellant, Priests For Life (who from the name alone might be supposed never to have a need for contraceptives), as well as representatives of actual churches such as the Roman Catholic Archbishop of Washington, D.C.

          The appellants argued that the Federal regulations in question “impermissibly discriminated” between churches, on the one hand, “and nonprofit organizations that may have a religious character or affiliation,” on the other hand.  They argued to the D.C. Circuit Court of Appeals that the regulations are unconstitutional because they automatically exempt the churches from providing health insurance plans with access to contraception benefits, but the regulations allow the nonprofits to “opt out” of providing contraception benefits under the health insurance plans the nonprofits provide to their employees.

          Their argument appears to have been made in two parts.  First, they argued that nonprofits are churches.  Their second argument is not entirely clear, however.  The appellants also argued in this case that accommodating the “opt out” option afforded to the nonprofits, by having the nonprofits provide a notice instead of a health plan with contraception coverage, somehow impermissibly “established” a religion or perhaps interfered with the free exercise of a religion.

          Judge Cornelia Pillard wrote the opinion for a unanimous D.C. Circuit panel in this case.  She patiently explained that the Federal regulations concerning health coverage for contraception “draw a long-recognized and permissible distinction between houses of worship and religious nonprofits” in tax law.  There is a rational purpose in discriminating between churches, which usually have only a few employees and who are also usually all of the same denomination, on the one hand, and religious nonprofits such as universities and hospitals, on the other hand, which almost always have many employees and their many employees come from different denominations with different religious practices.

          The Court held that the regulations in this case were born from a rational distinction, narrowly tailored to accomplish a legitimate government objective.

          Looking at the arguments actually made in this case, it seems impossible to escape the conclusion that the Federal government did not try to establish a religion in this case, but the appellants did.

          The appellants and their arguments could not obtain an outright prohibition of a constitutionally protected right in the D.C. Circuit Court.  Instead, their arguments were purposefully designed to make it much harder for women to use contraception because the appellants view contraception as being against the appellants’ avowed religion.

          You can read the arguments for yourselves in the Westlaw version of this opinion before the Federal Reporter 3d is published, at Priests For Life v. U.S. Dept. of Health and Human Services, --- F.3d ----, 2014 WL 5904732 (D.C. Cir. November 14, 2014).  These particular arguments are addressed at pages *35-*36 of the opinion reported on Westlaw.

Tomorrow is Thanksgiving Day!   Spend a Happy Thanksgiving with your family and friends, and this year, share with those who have nothing.

Please Read The Disclaimer.  Copyright 2014 by Dennis J. Wall.  All rights reserved.  No claim to original U.S. Government Works.

         

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"Fortuity?" "Doctrine"? How Fortuitous! "Doctrines for Every Occasion" Coming Soon.

POSTSCRIPT TO "FEDERAL COURT IN NEW YORK INVESTIGATES SANDY ADJUSTING".

    Following our article posted here on November 12, 2014, calls have come from several sources about the changed engineering report issues addressed by the New York Federal Magistrate Judge in the recent decision discussed here.  See "FEDERAL COURT IN NEW YORK INVESTIGATES SANDY ADJUSTING."

    U.S. Senator Robert Mendez of New Jersey released his letter to FEMA on November 14th calling for an investigation and a report to Congress in addition to the investigation being conducted by the Federal Court in New York.  See Russ Zimmer, "Senator:  Investigate Changes to Flood-Insurance Reports" posted online on November 14, 2014 by the Asbury Park Press.

    Florida lawyer Chip Merlin also released a letter in which he urged the U.S. District Judge to adopt and affirm the U.S. Magistrate's Order launching the investigation.  See Russ Zimmer, Asbury Park Press, supra.  Background on the story is provided by Chip Merlin's blog.

    The Property Casualty Insurers Association of American "declined to comment".  See Russ Zimmer, Asbury Park Press, supra.

    Time, and perhaps the U.S. District Court for the Eastern District of New York, will tell.

Please Read The Disclaimer.  Copyright 2014 by Dennis J. Wall.  All Rights Reserved.

"FORTUITY?" "DOCTRINE"? HOW FORTUITOUS! "DOCTRINES FOR EVERY OCCASION" COMING SOON.

    Every so often, you will read an assertion that a claim is barred by something called "the fortuity doctrine".  The idea that there is something called "fortuity" that acts like an exclusion except that the burden of proof is on the policyholder rather than on the carrier, is baseless.  "Fortuity" is not a "doctrine".  It is inherent in the concept of insurance, and there are many things inherent in the concept of insurance which are not written in insurance policies.  Policyholders do not have to put on proof about those things, either.

    The idea of "fortuitousness" or "fortuity" first appeared in the case law in dicta in a North Carolina Supreme Court opinion in 1973, so far as it has been traced to date.  The North Carolina Supreme Court cited an A.L.R. article and an Am. Jur. article as its authorities that the claimed "loss" or the "event" in question (two different things, of course) must be "fortuitous".  Avis v. Hartord Fire Ins. Co., 283 N.C. 142, 148, 195 S.E.2d 545, 548 (1973).

    In 1984, one Federal Judge in one case in Connecticut imposed "fortuitousness" or "fortuity" as a requirement that the policyholder put on proof and show that the claimed loss was "fortuitous".  In pertinent part, the Connecticut Federal Judge's legal authorities were the 1973 North Carolina Supreme Court's dicta, and again an A.L.R.  See Standard Structural Steel Co. v. Bethlehem Steel Corp., 597 F. Supp. 164, 191 (D. Conn. 1984).

    Substituting  a maxim or a phrase for thought is not a good substitute for lawyers and judges, to rephrase a saying of Justice Oliver Wendell Holmes.  Or, to put it another way, off-hand judicial comments sometimes make bad law.

Please Read The Disclaimer.  Copyright 2014 by Dennis J. Wall.  All rights reserved.  No claim to Original U.S. Government Works.

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FEDERAL COURT IN NEW YORK INVESTIGATES SANDY ADJUSTING.

    Mr. George Hernemar is a licensed engineer.  His employer, an engineering firm, sent Mr. Hernemar to inspect approximately 50 homes for damage Sandy may have caused to them in 2012.

    The engineering firm that Mr. Hernemar worked for was retained by the policyholders' insurance company to investigate their claim of damage.  The policyholders owned a rental house adjacent to their own home.  Upon inspection of the rental house, Mr. Herneman affirmatively wrote that he observed among other things that Sandy structurally damaged the building.

    "However, plaintiffs never received this report from their insurance carrier."  Instead, the policyholders received a report written afterward, which contained the conclusion that, among other things, "the subject building was not structurally damaged".  In re Hurricane Sandy Cases (Raimey v. Wright National Flood Insurance Co.), 2014 WL 5801540 *3 (E.D.N.Y. November 7, 2014)(Brown, U.S.M.J.).  [Emphasis by the Court.] 

    Although Mr. Hernemar took responsibility for both reports and contended that the first one was only a draft and not a real report, the Court noted Mr. Hernemar's testimony that the "'rewrote my report'" and that the second report did not exist until after Mr. Hernemar had a telephone conversation with a representative of his employer.

    The first Hernemar report surfaced in the case only by "happenstance," the Court said.  It was apparently not produced in discovery.  The second Hernemar report was produced in discovery and, as noted, the policyholders received the second Hernemar report, but not the first one.

      "Based upon this [second] report, defendant refused to pay for any structural damage to the home."  In re Hurricane Sandy Cases (Raimey v. Wright National Flood Insurance Co.), 2014 WL 5801540 *3 (E.D.N.Y. November 7, 2014)(Brown, U.S.M.J.).

    Under all the evidence before it in this case, the Court concluded that adjustment of Sandy claims is apparently ripe for investigation:

   Against this backdrop arises the instant dispute, which has exposed reprehensible gamesmanship by a professional engineering company that unjustly frustrated efforts by two homeowners to get fair consideration of their claims. Worse yet, evidence suggests that these unprincipled practices may be widespread.

 In re Hurricane Sandy Cases (Raimey v. Wright National Flood Insurance Co.), 2014 WL 5801540 *1 (E.D.N.Y. November 7, 2014)(Brown, U.S.M.J.).

    In addition to adjusting practices in all of the consolidated Sandy-claim-cases, the Court considered the case before it, concluding that in the case at bar (1) the defendant insurance company "is prohibited from supporting its defenses or opposing plaintiffs' claims with any expert testimony other than that of George Hernemar," and (2) the plaintiffs' counsel may file a motion "for reimbursement from defendant's counsel for all reasonable costs associated with this motion, the hearing and all related briefing, including attorneys' fees, travel costs and transcription costs".

    With respect to this case and all of the other pending consolidated Sandy cases, the Court further ruled: 

3. Within thirty days of this Order, defendants in all Hurricane Sandy cases shall provide plaintiffs with copies of all reports described in CMO 1 not previously produced—plus any drafts, redlines, markups, reports, notes, measurements, photographs and written communications related thereto—prepared, collected or taken by any engineer, adjustor or other agent or contractor affiliated with any defendant, relating to the properties and damage at issue in each and every case, whether such documents are in the possession of defendant or any third party.

In re Hurricane Sandy Cases (Raimey v. Wright National Flood Insurance Co.), 2014 WL 5801540 *15 (E.D.N.Y. November 7, 2014)(Brown, U.S.M.J.).

    Clearly, the Court in this case was not pleased.  Yet no-one who reads this opinion and considers this ruling on the evidence can reasonably second-guess the decision.  The ruling, like the unpleasant taste left by the apparent conduct at issue here, was a result of the evidence in the record.

Please Read The Disclaimer.  Copyright 2014 by Dennis J. Wall.  All rights reserved.  No claim to Original U.S. Government Works.

BOND INSURERS AGAIN MAKE HEADLINES FOR RISKY UNDERWRITING, PAY PRICE.

    Bond insurance companies have made news again for policies they issued in the past to cover municipal bonds of dubious value:

 Some financial creditors, like the bond insurer Syncora Guarantee, will get about 14 cents on the dollar for their debts, a low recovery rate but not as low as the city had initially proposed. Syncora and Financial Guaranty Insurance Company had insured a type of debt that was never very secure to begin with, and the city contended that low recoveries were appropriate given the level of risk.

Moncia Davey and Mary Williams Walsh, "Plan to Exit Bankruptcy is Approved for Detroit" p. A11, col. 1 (New York Times Nat'l ed., Saturday, November 8, 2014).

    Bond insurers' wanderings from the far-less-risky fields of coverage which they previously occupied has been the subject of many headlines here and elsewhere since the Financial Fiasco that burst into the open in 2007-2008.  See, e.g., "Bond Insurance Premiums May Not Mean Protection for Munis" published here on January 8, 2014; "Gaming the Muni System:  Another Kind of Muni Bond Insurance?" published here on May 23, 2010; and "Bank Bailouts, Bond Insurance, and a Better Way" published here on November 21, 2008.  See also the many other articles archived here under the category of "Bond Insurance".

Please Read The Disclaimer.  Copyright 2014 by Dennis J. Wall.  All rights reserved.

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"DECEPTIVE PRACTICES" AND LENDER FORCE-PLACED INSURANCE: NEW YORK'S EXAMPLE.

    The role that New York's Deceptive Practices Act is playing in recent lender force-placed insurance ("LFPI") cases is on display in two parts on Thomson Reuter's Legal Solutions Blog.  Both are entitled "'Deceptive Practices' and Lender Force-Placed Insurance:  New York's State of Mind".  Here is Part 1, and here is Part 2.

    Check them out.  The New York statute is a lesson in progress on how to prosecute and defend LFPI claims under State Unfair and Deceptive Practices Acts.

The author is at work on a book on "Lender Force-Placed Insurance" to be published by the American Bar Association in the Spring of 2015.

Please Read The Disclaimer.  Copyright 2014 by Dennis J. Wall.  All rights reserved.  No claim to Original Works produced for Thomson Reuter's Legal Solutions Blog.

FORECLOSURES ATTRACT HOME INVESTORS, CHANGE OF OWNERSHIP AND RENTALS.

    Ever since the Great Financial Fiasco that began in 2007-2008, home owners have become house renters.  Investors became the new home owners after the previous owners were foreclosed.  The new owners, meaning the investors and their agents, became landlords and the former homeowners are now renters.  See Floyd Norris, "Off the Charts / More Americans are Preferring the Lease to the Mortgage" p. B3, col. 1 (New York Times Nat'l ed. Saturday, November 1, 2014).

    The new set of renters are so numerous that as a group they should take a look at renter's insurance to protect their personal property -- and perhaps to protect their exposure to bodily injury and property damage claims,or even to obtain Additional Living Expense Coverage for "additional living expenses incurred when the home can't be occupied because of a fire or other covered peril."  Randy Hutchinson, "If Renting, You May Want to Consider Having Insurance" (Jackson Sun (Tennessee) Online, posted Thursday evening, October 30, 2014)(also citing evidence that 95% of homeowners have homeowner's insurance, while only 37% of renters have renter's insurance).

    Renter's insurance.  Definitely something for former homeowners and all renters to consider.

Dennis Wall is working on a book on "Lender Force-Placed Insurance".  The American Bar Association is scheduling it for publication in the Spring of 2015.

Please Read The Disclaimer.  Copyright 2014 by Dennis J. Wall.  All rights reserved.