Preview
1 Gregg
Garrison
S. Garrison (SBN
Law Corporation
141653)
SAg
FILED
MATPQ COUNTY
2 161 Cortez Avenue
Half Moon Bay, CA 94019 PgT 1 2013
3 Telephone: (650) 726-1111
4 Herman I. Kalfen (SBN 160592)
KALFEN LAW CORPORATION D
1 Embarcadero Center, Suite 500
San Francisco, CA 94111
Telephone: 415.315.1710
Facsimile: 415.433.5992
7
Attorneys for Plaintiff and Policyholder MICHAELCHANG
10
IN THE SUPERIOR COURT OF THE STATE OF CALIFORNIA
IN AND FOR THE COUNTY OF SAN MATEO
z 12
MICHAELCHANG, an individual,
Case No. CIV 489065
I- IA Pl
13
Plaintiff,
vs.
DECLARATIONOF BRIAN T. KELLEHER IN
14 SUPPORT OF PLAINTIFF AND POLICYHOLDEI'.
FAI&4ERS INSURANCE COMPANY, INC., MICHAELCHANG'S OPPOSITION TO FARMER l
15
$ ok+ FARMERS GROUP, INC., FARMERS
THIRD (3 ) MOTION FOR SUMMARY
INSURANCE EXCHANGE AND TRUCK JUDGMENT AND POINTS & AUTHORITIES IN
16 SUPPORT THEREOF
tL Z+z
0 INSURANCE EXCHANGE, reciprocal inter-
a.
's 17 insurance exchanges; Does 1 to 99, Inclusive,
Date: October 15, 2013
Time: 9:00 a.m.
18 Dept.: L&M
19 Defendants.
Farmers Denial: June 29, 2009
20 Complaint Filed: October 28, 2009
ROR Letter: April 24, 2012
21 Trial Date: November 25, 2013
22 BY FAX
My name is Brian T. Kelleher. I, Brian Kelleher, hereby declare under penalty of perjury that
24 all the information contained in this Declaration is true and if required to testify to the facts and
25 authenticity of the facts and documents cited in a court of law, I could and would do so.
1. In November 2007 during, the process of removing additional tanks and lines as the Project
27
1 of 5 pages
28 Declaration of Brian T. Kelleher in Support of Plaintiff 8r, Policyholder Michael Chang's Opposition to
Farmers''otion for Summary Judgment
(Case No: CIV49065)
Manager at the 233/235 Baldwin Avenue Site that is the subject of the Changs v.
Farmers action, I determined that the vent line connected to Tank ¹ 1 was completely
intact.
2. Tank ¹ 1 was removed in September 2006.
3. Tank ¹ 1 is the subject of the water damage claim by the policyholders Michael Chang,
Roxanne Change and Sunrise Cleaners to Farmers Insurance Exchange and Truck
Insurance Exchange.
4. Commencing in about June 2008, I was designated as a third-party neutral and consultant to
10
Special Master William Nagle. In my role as court consultant, I was sending e-mails to
Farmers providing a neutral opinion on water damage coverage that were taking into
Z n 12
Q Ch
consideration in investigating the water damage claim.
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13
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14
5. As a court consultant, I was tasked with the responsibility of investigating the Site,
15 contamination and causation issues for the Court, the Special Master William Nagle and
16 the parties to the Bilal Kartal v. Michael Chang, eI. al and related actions, San Mateo
lOz
5 17 County Superior Court Case No. CIV 458146.
18
6. My findings were then communicated to the Special Master William Nagle, the parties,
19
carriers and associated counsel to assist them is evaluating and investigating the claims and
20
related, underlying facts so the case could be settled without the need for trial.
21
7. Mr. Call's deposition makes it clear,that Farmers was indeed supposed to cover the loss
22
23 when the new info was provided to him. "Yes. There's a limited amount of coverage for
24 pollutant cleanup." Alan Call Deposition, September 18, 2013, pages 44 - 45, line 25 and
25 1. "Q. So pollution is covered ifit results &om a specific cause of loss, then Farmers will
26
27
2 of 5 pages
28 Declaration of Brian T. Kelleher in Support of Plaintiff & Policyholder Michael Chang's Opposition to
Farmers' Motion for Summary Judgment
(Case No: CIV49065)
pay the loss or damage caused by that specified cause of loss. Correct? A. Correct." Alan
Call Deposition, September 18, 2013, page 47, lines 6 - 9. Mr. Call also states that the
Farmers policy is ambiguous, and that ambiguities are resolved in favor of the policyholder
in finding coverage: "Q. You'e saying it's ambiguity. It's ambiguous? Yes or no,
ambiguous, yes or no? A. Huh, yes. Q. Yes. And in policy interpretation, do you know if
something is ambiguous if it is interpreted in favor of the insured or the carrier? A.
Insured. Q. Tie goes to the insured, huh? A. Yes." Alan Call Deposition, September 18,
2013, pages 50 - 51, lines 23 —25 and 1-4.
10
8. From his deposition, Mr. Call never received the information Garrison Law Corporation
provided him via the letter dated April 29, 2008. A. "That''hat we based our coverage
12
0 decision on was from these experts who inspected the tank prior to the removal. It was
LO CV
13
already moved before we received the loss. So all we had to go on was their expert
o 14
15 opinion, the ones who actually inspected the tank, and there's the ones who advised us that
16 there was no break or crack in the tank." Alan Call Deposition, September 18, 2013, page
+ g
z
17 45, lines 11 -17.
18
9.I am aware that that Farmers agreed to reevaluate the critical new information about the loss
19
in May 2008 and was still investigating the claim in mid 2008, I was present when the
20
Special Master asked Farmers by phone to participate in mediation efforts. Commencing
21
with a letter dated June 4, 2008, Farmers took a hard and firm position that there was no
22
23 water damage coverage and I was firmly disagreeing with them as court consultant..
24 10. The new information discovered in November 2007 was the water that had been entering
25 Tank ¹ 1 because of the breaking apart/cracking of a line that was connected to the top of
26
27
3 of 5 pages
28 Declaration of Brian T. Kelleher in Support of Plaintiff & Policyholder Michael Chang's Opposition to
Farmers''otion for Summary Judgment
.(Case No: CIV49065)
that tank.
11. The breaking apart/cracking of the line and resulting water leakage into the tank caused the
man way seal to rupture at the top of the tank and create severe odors within the banquet
hall in March 2006.
12. This breaking apart/cracking of the line information was first provided to Farmers in a
letter from Garrison Law Corporation to Alan Call dated April 29, 2008, exactly two years
after the date of loss as determined by Farmers.
13. Susan Utay of Farmers Environmental Claims Group immediately responded on May 1,
10
2008 assuring the policyholders that Farmers would review the new information. Mr. Call,
however, reported he was never asked to review this important new information.. "Q.
Z r) 12
0
I ?bi
Nl 13
Have you been informed [since October 2006] by anyone since then about any
Q hPo
14 break or crack in the manway seal of the tank? A. I haven't been informed. I
15 think I read something somewhere. Alan Call Deposition, September 18, 2013, page
0 16
? 45 lines 17-21.
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17
I 14. Based on the breaking apart/cracking information provided to in April 2008, Farmers
18
relating to the cause of the loss, the policyholders had every reason to believe that,Farmers
19
would approve the claim. First party Claim's supervisor Alan Call confirms this new
20
21 breaking apart/cracking information was sufficient to prove coverage: "Q. If the tank in
22 question leaked water containing pollutants out of a ruptured manway seal due to the tank
23 overfilling with rainwater, would the claim have been approved?" "A. Ifit was considered
24 yes."
a break, Alan Call Deposition, September 18, 2013, page 77, lines 9 -16.
25
15. Moreover commencing in June 2008 and for a short period thereafter. Farmers was being
26
27
4 of 5 pages
28 Declaration of Brian T. Kelleher in Support of Plaintiff 8r. Policyholder Michael Chang's Opposition to
Farmers'" Motion for Summary Judgment
(Case No: CIV49065)
asked by the Special Master William Nagle to participate in the mediation, attend case
status conferences in assisting the court settle the case, and contribute sufficient money to
an escrow account to get the banquet hall back in operation as soon as possible.
16. As project coordinator and the person responsible Rom mid 2008 to mid 2009 for assisting
the parties to the Kartal v Chang suit resolve the suit, I am shocked and appalled to learn at
this late date that Farmers did not provide critical new breaking apart/cracking information
8 to Mr. Chang's First Party claims supervisor Alan Call given that he expressly asked for
9 this information in his November 14, 2006 letter denying the claim..
10
17. Farmers Insurance Exchange and Truck Insurance Exchange are very belatedly defending
the action Bilal Karfal v. Michael Chang, et.al and related actions, San Mateo County
Z nID 12
Q
I
Superior Court Case No. CIV 458146 per their acceptance of defense letter of Michael
ID'.
13
go) Chang, Roxanne Change, Sunrise Cleaners ("Policyholders") dated April 24, 2013.
Q 14
15 I declare under penalty of perjury under the laws of the State of California that the
/ok~
? 16 foregoing is true and correct.
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17 Executed on October 1. 2013, at Santa Clara Countv, California.
18 Respectfully Submitted:
19
DATED: October 1, 2013
21
23
Ac
Brian T. Kelleher, Kelleher &; Associates
24
25
26
27
5 of 5 pages
28 Declaration of Brian T. Kelleher in Support of Plaintiff & Policyholder Michael Chang's Opposition to
Farmers' Motion for Summary Judgment
(Case No: CIV49065)
Preview
1 Gregg Garrison S. Garrison (SBN Law Corporation 141653) SAg FILED MATPQ COUNTY 2 161 Cortez Avenue Half Moon Bay, CA 94019 PgT 1 2013 3 Telephone: (650) 726-1111 4 Herman I. Kalfen (SBN 160592) KALFEN LAW CORPORATION D 1 Embarcadero Center, Suite 500 San Francisco, CA 94111 Telephone: 415.315.1710 Facsimile: 415.433.5992 7 Attorneys for Plaintiff and Policyholder MICHAELCHANG 10 IN THE SUPERIOR COURT OF THE STATE OF CALIFORNIA IN AND FOR THE COUNTY OF SAN MATEO z 12 MICHAELCHANG, an individual, Case No. CIV 489065 I- IA Pl 13 Plaintiff, vs. DECLARATIONOF BRIAN T. KELLEHER IN 14 SUPPORT OF PLAINTIFF AND POLICYHOLDEI'. FAI&4ERS INSURANCE COMPANY, INC., MICHAELCHANG'S OPPOSITION TO FARMER l 15 $ ok+ FARMERS GROUP, INC., FARMERS THIRD (3 ) MOTION FOR SUMMARY INSURANCE EXCHANGE AND TRUCK JUDGMENT AND POINTS & AUTHORITIES IN 16 SUPPORT THEREOF tL Z+z 0 INSURANCE EXCHANGE, reciprocal inter- a. 's 17 insurance exchanges; Does 1 to 99, Inclusive, Date: October 15, 2013 Time: 9:00 a.m. 18 Dept.: L&M 19 Defendants. Farmers Denial: June 29, 2009 20 Complaint Filed: October 28, 2009 ROR Letter: April 24, 2012 21 Trial Date: November 25, 2013 22 BY FAX My name is Brian T. Kelleher. I, Brian Kelleher, hereby declare under penalty of perjury that 24 all the information contained in this Declaration is true and if required to testify to the facts and 25 authenticity of the facts and documents cited in a court of law, I could and would do so. 1. In November 2007 during, the process of removing additional tanks and lines as the Project 27 1 of 5 pages 28 Declaration of Brian T. Kelleher in Support of Plaintiff 8r, Policyholder Michael Chang's Opposition to Farmers''otion for Summary Judgment (Case No: CIV49065) Manager at the 233/235 Baldwin Avenue Site that is the subject of the Changs v. Farmers action, I determined that the vent line connected to Tank ¹ 1 was completely intact. 2. Tank ¹ 1 was removed in September 2006. 3. Tank ¹ 1 is the subject of the water damage claim by the policyholders Michael Chang, Roxanne Change and Sunrise Cleaners to Farmers Insurance Exchange and Truck Insurance Exchange. 4. Commencing in about June 2008, I was designated as a third-party neutral and consultant to 10 Special Master William Nagle. In my role as court consultant, I was sending e-mails to Farmers providing a neutral opinion on water damage coverage that were taking into Z n 12 Q Ch consideration in investigating the water damage claim. I- IA CV 13 o hS a.~og 14 5. As a court consultant, I was tasked with the responsibility of investigating the Site, 15 contamination and causation issues for the Court, the Special Master William Nagle and 16 the parties to the Bilal Kartal v. Michael Chang, eI. al and related actions, San Mateo lOz 5 17 County Superior Court Case No. CIV 458146. 18 6. My findings were then communicated to the Special Master William Nagle, the parties, 19 carriers and associated counsel to assist them is evaluating and investigating the claims and 20 related, underlying facts so the case could be settled without the need for trial. 21 7. Mr. Call's deposition makes it clear,that Farmers was indeed supposed to cover the loss 22 23 when the new info was provided to him. "Yes. There's a limited amount of coverage for 24 pollutant cleanup." Alan Call Deposition, September 18, 2013, pages 44 - 45, line 25 and 25 1. "Q. So pollution is covered ifit results &om a specific cause of loss, then Farmers will 26 27 2 of 5 pages 28 Declaration of Brian T. Kelleher in Support of Plaintiff & Policyholder Michael Chang's Opposition to Farmers' Motion for Summary Judgment (Case No: CIV49065) pay the loss or damage caused by that specified cause of loss. Correct? A. Correct." Alan Call Deposition, September 18, 2013, page 47, lines 6 - 9. Mr. Call also states that the Farmers policy is ambiguous, and that ambiguities are resolved in favor of the policyholder in finding coverage: "Q. You'e saying it's ambiguity. It's ambiguous? Yes or no, ambiguous, yes or no? A. Huh, yes. Q. Yes. And in policy interpretation, do you know if something is ambiguous if it is interpreted in favor of the insured or the carrier? A. Insured. Q. Tie goes to the insured, huh? A. Yes." Alan Call Deposition, September 18, 2013, pages 50 - 51, lines 23 —25 and 1-4. 10 8. From his deposition, Mr. Call never received the information Garrison Law Corporation provided him via the letter dated April 29, 2008. A. "That''hat we based our coverage 12 0 decision on was from these experts who inspected the tank prior to the removal. It was LO CV 13 already moved before we received the loss. So all we had to go on was their expert o 14 15 opinion, the ones who actually inspected the tank, and there's the ones who advised us that 16 there was no break or crack in the tank." Alan Call Deposition, September 18, 2013, page + g z 17 45, lines 11 -17. 18 9.I am aware that that Farmers agreed to reevaluate the critical new information about the loss 19 in May 2008 and was still investigating the claim in mid 2008, I was present when the 20 Special Master asked Farmers by phone to participate in mediation efforts. Commencing 21 with a letter dated June 4, 2008, Farmers took a hard and firm position that there was no 22 23 water damage coverage and I was firmly disagreeing with them as court consultant.. 24 10. The new information discovered in November 2007 was the water that had been entering 25 Tank ¹ 1 because of the breaking apart/cracking of a line that was connected to the top of 26 27 3 of 5 pages 28 Declaration of Brian T. Kelleher in Support of Plaintiff & Policyholder Michael Chang's Opposition to Farmers''otion for Summary Judgment .(Case No: CIV49065) that tank. 11. The breaking apart/cracking of the line and resulting water leakage into the tank caused the man way seal to rupture at the top of the tank and create severe odors within the banquet hall in March 2006. 12. This breaking apart/cracking of the line information was first provided to Farmers in a letter from Garrison Law Corporation to Alan Call dated April 29, 2008, exactly two years after the date of loss as determined by Farmers. 13. Susan Utay of Farmers Environmental Claims Group immediately responded on May 1, 10 2008 assuring the policyholders that Farmers would review the new information. Mr. Call, however, reported he was never asked to review this important new information.. "Q. Z r) 12 0 I ?bi Nl 13 Have you been informed [since October 2006] by anyone since then about any Q hPo 14 break or crack in the manway seal of the tank? A. I haven't been informed. I 15 think I read something somewhere. Alan Call Deposition, September 18, 2013, page 0 16 ? 45 lines 17-21. >~z 17 I 14. Based on the breaking apart/cracking information provided to in April 2008, Farmers 18 relating to the cause of the loss, the policyholders had every reason to believe that,Farmers 19 would approve the claim. First party Claim's supervisor Alan Call confirms this new 20 21 breaking apart/cracking information was sufficient to prove coverage: "Q. If the tank in 22 question leaked water containing pollutants out of a ruptured manway seal due to the tank 23 overfilling with rainwater, would the claim have been approved?" "A. Ifit was considered 24 yes." a break, Alan Call Deposition, September 18, 2013, page 77, lines 9 -16. 25 15. Moreover commencing in June 2008 and for a short period thereafter. Farmers was being 26 27 4 of 5 pages 28 Declaration of Brian T. Kelleher in Support of Plaintiff 8r. Policyholder Michael Chang's Opposition to Farmers'" Motion for Summary Judgment (Case No: CIV49065) asked by the Special Master William Nagle to participate in the mediation, attend case status conferences in assisting the court settle the case, and contribute sufficient money to an escrow account to get the banquet hall back in operation as soon as possible. 16. As project coordinator and the person responsible Rom mid 2008 to mid 2009 for assisting the parties to the Kartal v Chang suit resolve the suit, I am shocked and appalled to learn at this late date that Farmers did not provide critical new breaking apart/cracking information 8 to Mr. Chang's First Party claims supervisor Alan Call given that he expressly asked for 9 this information in his November 14, 2006 letter denying the claim.. 10 17. Farmers Insurance Exchange and Truck Insurance Exchange are very belatedly defending the action Bilal Karfal v. Michael Chang, et.al and related actions, San Mateo County Z nID 12 Q I Superior Court Case No. CIV 458146 per their acceptance of defense letter of Michael ID'. 13 go) Chang, Roxanne Change, Sunrise Cleaners ("Policyholders") dated April 24, 2013. Q 14 15 I declare under penalty of perjury under the laws of the State of California that the /ok~ ? 16 foregoing is true and correct. >~z 17 Executed on October 1. 2013, at Santa Clara Countv, California. 18 Respectfully Submitted: 19 DATED: October 1, 2013 21 23 Ac Brian T. Kelleher, Kelleher &; Associates 24 25 26 27 5 of 5 pages 28 Declaration of Brian T. Kelleher in Support of Plaintiff & Policyholder Michael Chang's Opposition to Farmers' Motion for Summary Judgment (Case No: CIV49065)