3 rd Party Liability Claim. Kansas. Liability Plan. Khan L. Adams, CPCU, AIC Claims Manager Great American Custom Insurance Services

Transcription

1 3 rd Party Liability Claim Kansas Underground Storage Tank Liability Plan Khan L. Adams, CPCU, AIC Claims Manager Great American Custom Insurance Services

2 Who am I? Kansas Underground Storage Tank Liability Plan (the Plan ) Established 1991 Works in tandem with the Fund Administered by the Servicing Carrier Underwritten to be actuarially sound Profits shared 50/50, policy holder/fund

3 Who are you? Why are you here? What do you expect in this session? What issues have you had with 3 rd party claims?

4 Overview The Story: what happened The Jury: Law & Order The Point: CSI

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6 L fi fi ht li b t th d fl t k Lawrence firefighters climb to the second floor to work a fire at a house at 838 La. that was heavily damaged in the blaze early Sunday morning. Residents of apartments in the house saw smoke in the house about 3 a.m. Firefighters were still on the scene at 7 a.m.

7 Tomich, 35, and her boyfriend Powell, 28, lived in one of the five apartments in the older home. They had moved in Friday night. It just doesn t seem right, Powell said. You work hard, you save your money, you buy new things and then, in two days, it all burns up. The couple escaped with the clothes they were wearing and their two cats, Sabbath and Sebastian.

8 Little Miracles Jim Luhning, a Pizza Hut delivery driver who lived in one of the lower-level apartments, thought he had lost everything. His clothes. Long-owned family photographs. The money he had diligently stashed away so he could attend his son s wedding in Washington state next month. And for the first time since early Sunday, Luhning s eyes lit up bright. He hugged his friends and thanked the firefighters, relieved that he wouldn t have to ask his boy for the money to come see him. I didn t want him to have to pay for my ticket, he said.

9 Exploding Fumes Lawrence-Douglas County Fire Chief Mark Bradford said 28 firefighters were needed to extinguish the fire, with at least two being blown back when fumes leaking from the basement exploded near the front of the house. It caught them off guard, Bradford said of the explosion. No residents or firefighters were injured in the fire. But Bradford said the exploding fumes and the strong scent of gasoline streaming from the basement caused serious concern.

10 Cause and Origin i Classic V Pattern marks the spot. Vapors in the basement are the likely l culprit. Sharp rise in the groundwater that t weekend attributed to heavy rain storms.

11 Gasoline Leak Suspected in Blaze State and local officials Monday confirmed gasoline had been found in a series of soil samples taken between the house and Presto Convenience Store No. 25, 602 W. Ninth St.

12 43 homes are tested for leaking gasoline Officials checked 43 other houses in the neighborhood for fumes Tuesday in the wake of a Sunday fire that destroyed an apartment house at 838 La., displacing the occupants but causing no injuries.

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14 Press Briefing Sharon Watson, director of communications for the Kansas Department of Health and Environment, speaks to the media about the attempts to locate the source of gasoline suspected of causing the fire at 838 La. The remains of the torched house, which occupied the lot in the upper right of the frame, were razed on Tuesday by construction crews.

15 Yep, looks like a ditch. Workers and city officials watch as a 14-foot ditch is dug to allow gasoline believed to be leaking from underground tanks to be drained. The work took place Tuesday behind the home at 838 La., which was severely damaged by a fire Sunday. The blaze was caused by leaking gasoline, firefighters said Tuesday.

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18 Source of gas leak remains a mystery But pressure tests (5/3/06) have since shown the store s three underground tanks and their connecting lines are tight tight, Wald said. They re not leaking.

19 Gas station ordered to remove tanks The owners of the Presto Convenience Store at 602 W. Ninth St. were ordered to remove the store s s underground storage tanks Thursday after state workers detected fresh quantities of gasoline.

20 Tank Removal

21 Careful Inspection

22 So how does the tight tank look?

23 A backhoe removes contaminated soil at the Presto Phillips 66 site, 602 W. Ninth St. The underground gas tanks, which leaked fuel that helped spark a house fire, were removed earlier this week. The HCS Petroleum worker at right refused to be identified d Thursday at the site.

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26 Lawsuit Filed

27 Lawsuit Filed The suit also claims that the Capps business also suffered in the fire. Capps have suffered a loss of revenue, loss of profits... because they are unable to collect rent from their apartment building, the petition said. The lawsuit doesn t ask for a specific damage amount. The home is valued at $172,700, according to 2005 county records.

28 Insurance Coverage!

29 Free Product Removal As of May 10, 2006, the state had pumped more than 30,000 gallons of gas-laden water and 1,700 gallons of pure fuel from trenches near where the underground tanks were, Kellerman said. The tanks were removed earlier this week.

30 State crews dug seven wells in the area to monitor gas levels, and officials said that they would continue to take soil samples and remove any excess liquids until the area was clean.

31 Ladies and Gentleman of the Jury Duty Breach Proximate Cause Damage

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33 Remediation Shed A small building across the street to the east of the Presto Phillips 66 station at Ninth and dlouisiana i streets contains equipment to measure levels of gasoline in the ground. Fuel that leaked from underground storage tanks remains in the soil around the station, but rains over the weekend did not cause the gasoline to seep into homes in the neighborhood. After heavy rains in April, gasoline leaked out of the saturated ground into a basement at 838 La., causing a fire that destroyed a five- apartment t house.

34 Dan Riedemann, a builder with Nineteenth Century Restorations, installs a gas vapor sensor next to the sump pump in the basement of Dan Schriner s new home. The house is less than a block from the site of a home that caught fire because of gas leaking from an underground gas storage tank at Presto Phillips 66, 602 W. Ninth St. Schriner said Tuesday that he was pleased that the Kansas Department of Health and Environment has a plan to dispose of the leaked gasoline.

35 What kind of claims? The resident you hope doesn t live across the street from your leaking tanks?

36 What kind of claims? How to off a Law Firm:

37 The Rest of the Story Gas was sent to fingerprinting analysis

38 Different Products Who s gas is it anyway?

39 Clean-up Ongoing More than a year after a gasoline leak from a nearby convenience store fueled an apartment fire, state regulators still are trying to clean up the area near Ninth and Louisiana streets. A Kansas Department of Health and Environment regulator said Wednesday the risk for another explosion from the spilled fuel is all but gone, but it may take several more years to remove contaminants from the ground and water. It will be a long time before we leave, probably, said Randy Carlson, section chief for the storage tank division of KDHE. Carlson estimated the state had spent about $600,000 on the cleanup. The money comes from state funds generated by part of the motor fuel tax.

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42 Phases of Litigation Pre-suit avoidance Choice of counsel Discovery Early negotiations Mediation Jurisdiction Settlement vs. the judge and jury

43 Managing the Litigation Importance of coordinating with the clean-up folks. Defense attorneys: the good, the bad and the ugly. They are good at billing, fighting or resolving. Plaintiffs attorney _ vs. Advocate Plaintiff/claimant Greed vs. Need

44 Lessons Learned 1. Relationships 2. Choice of counsel Cost/benefit analysis Expertise 3. Coordination between state officials Cleanup, funding and 3 rd party claims 4. Communication With plaintiffs/claimants With responsible party(s) With counsel/attorneys

45 Conclusion The very best litigation Manage the: Environmental Impact Legal Impact (most importantly) the human aspects of the case.

46 3 rd Party Liability Claim Kansas Underground d Storage Tank Liability Plan Khan L. Adams, CPCU, AIC Claims Manager Great American Custom Insurance Services