Jury: OK For Insurer To Stiff Property Owner On $6M Damage Claim Where Latter Found Responsible For Torching Premises While On Verge Of Foreclosure Sale
In Asheville, North Carolina, The Asheville Citizen Times reports:
- A federal jury ruled that the former owner of the Richmond Hill Inn participated in the intentional burning of the historic structure nearly four years ago.
The judgment in a lawsuit means the ownership group, The Hammocks LLC, won’t be able to collect on a $6 million insurance policy taken out on the property overlooking the French Broad River.
U.S. District Court Judge Martin Reidinger also ruled this month the company must pay the legal bills incurred by Harleysville Mutual Insurance Co. in fighting the suit.
The mansion, once the home of former congressman and ambassador Richmond Pearson, was destroyed on March 19, 2009, in a fire set by an arsonist, according to investigators.
Harleysville refused to pay the insurance claim, prompting The Hammocks to sue for breach of contract. The insurance company countersued, claiming the owners violated the terms of the policy.
A jury found at the conclusion of a trial in Asheville that The Hammocks was responsible for setting the fire. It also found the company did not willfully make false representations on its insurance policy application.
“Based on the foregoing facts as found by the jury,” Reidinger wrote in his ruling, “the court concludes as a matter of law that the defendant has no duty to provide coverage for the claim of loss tendered by the plaintiff and that the insurance policy at issue is null and void, under the terms and conditions of the policy, as a result of the plaintiff’s intentional participation of the burning of the insured property.”
William Gray, managing member of The Hammocks, declined to comment on the ruling.
While investigators determined the fire that destroyed the inn was intentionally set, no arrests have been made in the case.
The property was in foreclosure at the time of the blaze, and investigators said the sprinkler system had been turned off and they found evidence that a petroleum product was used to start the fire.
Buddy Thompson of the Asheville-Buncombe Arson Task Force said he doesn’t know if there ever will be an arrest.
“All of our leads have been run at this point,” he said. “We really have nothing else to go on unless someone comes up with some new information.”
Thompson said the jury’s conclusion in the civil trial doesn’t mean there’s enough evidence to bring criminal charges.
“There’s a difference in the way that evidence is looked at in a civil and a criminal case,” he said. “In a civil trial it’s the preponderance of the evidence. In a criminal trial you have to find guilt beyond a reasonable doubt.”
Three days before the fire, Buncombe County officials finalized the property’s foreclosure and set the auction for a month later.