Moffett V Computer Sciences All Combined

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Page 1 Slip Copy, 2011 WL 4381760 (D.Md.) (Cite as: 2011 WL 4381760 (D.Md.))
Only the Westlaw citation is currently available. United States District Court, D. Maryland, Southern Division. Thomas L. MOFFETT, II, et al., Plaintiffs, v. COMPUTER SCIENCES CORPORATION, et al., Defendants. Civil Action No. 805CV01547. Sept. 18, 2011. Donald W. Marcari, Frank D. Lawrence, III, Marcari Russotto and Spencer, Chesapeake, VA, Martin H. Freeman, Freeman and Freeman PC, Rockville, MD, for Plaintiffs. Arthur F. Fergenson, Ansa Assuncao LLP, Holly Drumheller Butler, DLA Piper US LLP, Jason Daniel Medinger, Allen F. Loucks, Office of the United States Attorney, Steven Michael Klepper, Kramon and Graham PC, James D. Skeen, Skeen and Kauffman LLP, Brett Anthony Buckwalter, Niles Barton and Wilmer LLP, Baltimore, MD, Jay I. Morstein, Owings Mills, MD, Tyler Brian Raimo, Computer Sciences Corporation, Falls Church, VA, Darren Seth Wall, Department of Homeland Security, Federal Emergency Management Agency, Arlington, VA, Robert H. King, Jr., Sonnenschein Nath and Rosenthal LLP, Chicago, IL, Kirk Robert Ruthenberg, SNR Denton US LLP, Steuart H. Thomsen, Sutherland Asbill and Brennan LLP, Scott Nathan Auby, W. Neil Eggleston, Debevoise and Plimpton LLP, Elizabeth Treubert Simon, Pamela Anne Bresnahan, Vorys Sater Seymour and Pease LLP, Washington, DC, Gerald Joseph Nielsen, Nielsen Law Firm LLC, Metairie, LA, Peter F. Axelrad, Council Baradel Kosmerl and Nolan PA, Annapolis, MD, Patricia McHugh Lambert, Steven B. Schwartzman, Hodes Pessin and Katz PA, Towson, MD, Craig Russell Blackman, Samuel J. Arena, Jr., Stradley Ronon Stevens and Young
LLP, Philadelphia, PA, Edward J. Hutchins, Jr., Stacey Ann Moffet, Eccleston and Wolf PC, Hanover, M.d, William J. Hickey, Law Offices of William J. Hickey LLC, Rockville, MD, Debra Anne Nelson, William Lowell Mundy, Mundy and Nelson, Huntington, WV, James Hilton Crosby, Crosby Saad LLC, Mobile, AL, William Gerald Gandy, Wilson Elser Moskowitz Edelman and Dicker, McLean, VA, Bradish J. Waring, Mary Legare Hughes, Nexsen Pruet LLC, Charleston, SC, for Defendants. REPORT AND RECOMMENDATION CONCERNING WAIVER CLAIM OF FREDERICK STAIGERWALD DENNIS M. SWEENEY, Special Master. *1 This constitutes the Report and Recommendation to the Court concerning the waiver claim FN1 of Frederick Staigerwald pursuant to Part 1.f of the Memorandum Order of the Court (Document 467). In preparing this report, the Special Master reviewed the motions, memoranda, affidavits and exhibits provided in connection with the process specified in the Memorandum Order. As necessary, the Special Master also reviewed other documents that are part of the Court filings in this case. The Special Master was also provided by the Federal Emergency Management Agency (FEMA) the computer disc of the appropriate documents of record for this claim, as specified in Part 1.a of the Memorandum Order. In this case, the documents consist of 488 pages labeled FEMA000001 to 000488. FN1. At various points the parties refer to Clarence and Garnetta Staigerwald as also pursuing this claim as co-owners with Frederick Staigerwald. The determination here applies to all these persons. I. Background Plaintiff's property located at 9203 Cuckold Point Road, Baltimore, Maryland, was insured un-
2011 Thomson Reuters. No Claim to Orig. US Gov. Works.
der a Standard Flood Insurance Policy (SFIP or Policy), Policy Number 1947155378, which was purchased directly from FEMA. See FEMA000005. Plaintiff's structure was insured up to $198,700.00 and his contents were insured up to $32,100.00, with each subject to a $1,000.00 deductible. Id. On September 18, 2003, Hurricane Isabel struck the coast of Maryland, causing damage along the coast including the insured structure owned by Plaintiff. See FEMA000079. Plaintiff's policy was effective July 20, 2003 through July 20, 2004 and was covered at the time of the loss. See FEMA000124. On or about January 6, 2004, Bryan Shober, an independent adjuster from Bellmon Adjusters, Inc., completed his adjustment of Plaintiff's claim and issued his report. See FEMA000393 through FEMA000411. The adjuster concluded Plaintiff's contents loss exceeded policy limits and that the Actual Cash Value of the damage to the structure was $82,875.75 after application of $15,428.88 in depreciation and Plaintiff's $1,000.00 deductible. See FEMA000393. The adjuster also concluded that the full replacement cost of the structure was $139,773.12 with an actual cash value of $111,818.50. Id. On January 14, 2004, Plaintiff submitted a Proof of Loss for $114,975.75 with the words CONTESTING AMOUNT written on the bottom, which was rejected. See FEMA000413. Plaintiff also notated Plus excess over contents policy Limits next to Line 8. Id. On February 11, 2004, FEMA issued a partial denial of Plaintiff's claim. See FEMA000345. Plaintiff was informed that checks would be issued for $82,875.75 to cover the damage to his building and for the remainder of his contents policy limit of $32,100.00. Id. Plaintiff was notified that he had one year from the date of this partial denial letter to file a lawsuit. Id.
On March 19, 2004, Plaintiff was sent a letter notifying him that the adjuster requested a special assistance review to facilitate the completion of his claim. See FEMA000331. Plaintiff was reminded that his claim was partially denied on February 11, 2004 and that he had to file a lawsuit within one year of that date. Id. *2 On April 14, 2004, FEMA notified Plaintiff that it was in receipt of the re-inspection report. See FEMA000315. The re-inspection resulted in a recommendation for additional compensation, and the report was being sent back to Bellmon Adjusters, Inc. for completion of the supplemental claim. Id. Plaintiff was once again reminded that if he was going to file a lawsuit, he had one year from the date of the original denial of February 11, 2004. Id. On April 20, 2004, Michael Bellmon, an independent adjuster from Bellmon Adjusters completed a supplemental adjustment of Plaintiff's claim based on the re-inspection report. See FEMA000115 through FEMA000119. Mr. Bellmon increased the actual cash value of the building loss claim by $11,659.48. At about the same time, Plaintiff requested review by the Hurricane Isabel Task Force. On June 3, 2004, the Task Force determined Plaintiff was entitled to additional compensation totaling $50,865.16. See FEMA000111. On June 18, 2004, Plaintiff was paid the full $50,865.16. See FEMA000022. On July 20, 2004, a FEMA examiner reviewed the estimates Plaintiff provided from Palmer Contracting Company and C.W. Over & Sons, Inc. See FEMA000186 and FEMA000187. The examiner concluded the home was poorly constructed. Id. FEMA contends that The Palmer Contracting estimate did not provide a sufficient breakdown to do a detailed comparison. Id. C.W. Over & Sons' estimate contained pricing that was significantly inflated, and after adjusting the costs, the C.W. Over & Sons estimate was reduced to $121,133.17 (see FEMA000227 through FEMA000229), which
was less than the $149,169.79 Plaintiff was compensated. Id . On July 21, 2004, Plaintiff submitted another Proof of Loss based on the supplemental claim prepared by Mr. Bellmon. See FEMA000112. This supplemental Proof of Loss was not timely and it was annotated: Actual Loss-$233,000.00. PARTIAL PAYMENT. Id. On September 7, 2004, Plaintiff was sent a letter informing him that the adjuster from Bellmon was unaware of the Task Force review when he provided the supplemental claim documents. See FEMA000097. The items and figures included in the supplemental claim from the Task Force included all the items the adjuster included in his supplemental report. Id. Accordingly, Plaintiff's July 21, 2004 Proof of Loss was denied. Id. Plaintiff requested a second review of his claim. See FEMA0000079. On October 7, 2004, FEMA notified Plaintiff he had been paid $149,169.79 for the damage to his building plus an additional $32,100.00 for his contents loss, and Plaintiff was not entitled to any additional compensation under his policy. Id. In addition, Plaintiff was paid the policy limit of $30,000.00 under the Increased Cost of Compliance provision of his policy. See FEMA000005. II. Waiver Claim and Denial On December 3, 2007, this Court permitted Plaintiffs to submit applications for waivers to FEMA. See Order of December 4, 2007, Doc. No. 196 and Doc. No. 197. On or about February 25, 2008, Plaintiff submitted to FEMA a document entitled PLAINTIFF FREDERICK STAIGERWALD'S INDIVIDUAL APPLICATION FOR WAIVER OF PROOF OF LOSS REQUIREMENTS. FEMA denied the request for a waiver of the proof of loss requirements in an undated letter. See FEMA000075 to 000076. III. Reasons for Waiver Denial *3 The reasons for the denial of the Waiver
Claim are found at 1823 of the Supplemental Declaration of Karen Christian for the Claim of Frederick Staigerwald. It states: Plaintiff submitted the same estimates that were thoroughly reviewed during the claims and Task Force review process. In addition, Plaintiff claimed his cost to repair ballooned to over $350,000.00, but did not submit a single document to support or explain this new amount. Plaintiff calculated his shortfall of $48,530.21 by taking his policy limit and deducting FEMA's payments for the damage to his structure. He claimed his undocumented repair costs plus the estimates from Palmer Contracting and C.W. Over & Sons, Inc. justified compensation of his policy limits. See FEMA000044. Both of these estimates were reviewed and considered over the course of the review process. A detailed review of these estimates by a FEMA Claims Examiner, as discussed above, was completed during the review of this claim. See FEMA000186 and FEMA000187. When reviewing Plaintiff's waiver application, the Administrator evaluated the facts and circumstances relating to the request. See FEMA000075 and FEMA000076. Specific to this case, the Administrator considered the following whether: 1. Policy holder demonstrated additional damages exist that are covered by the SFIP; 2. Policy holder submitted appropriate documentation supporting the additional compensation being requested; and 3. Policy holder provided a reasonable explanation for the delay in submitting the POL. Id. In the letter providing FEMA's determination on Plaintiff's waiver application, the Administrator stated:
... you claim your actual damages exceeded the amount allowed by the National Flood Insurance Program Servicing Agent (NFIPSA). Your claim was originally reviewed by an independent adjuster and subsequently reviewed by the Hurricane Isabel Task Force. A supplemental payment was approved by the Task Force and paid by the NFIPSA. You also received $30,000, the maximum amount of coverage for your Increased Cost of Compliance claim. Your supplemental claim is documented with two contractor estimates that do not provide justification that additional monies are owed. A lump sum cost without any explanation is not acceptable. Another includes upgrades to the property and does not identify specific rooms or measurements. Upgrades are not covered by the SFIP. Further, your waiver resulted in a comprehensive review of your claim by a FEMA Insurance Examiner. After further review, the Insurance Examiner found no basis to set aside the original findings. Id. Plaintif failed to demonstrate he met any of the criteria used to determine whether to grant a waiver. Plaintif's waiver application was based on the same documents that were thoroughly reviewed during the claims process plus his undocumented claim that he incurred expenses over $350,000.00 repairing his home. Plaintif failed to document any additional damages he sought were actually covered by his SFIP. Plaintiff did not provide any documentation of his actual expenses for the repairs and simply claimed his costs exceeded $350,000.00 to repair his home. *4 Accordingly, after another comprehensive review of the claim, FEMA determined no further compensation was warranted. Id. Plaintiff's waiver application was denied for a multitude of reasons, but primarily because he failed to document any physical loss by or from flood covered
under his SFIP for which he did not receive full compensation for. IV. Plaintiffs Assertions Plaintiffs' contentions are set out in the Plaintiffs' Opposition (Document 713) at pages 35 to 42. Plaintiffs recount the damage to the home caused by the flood including the structural damage to the home, Id at 35 to 36, and the difficulties that elevation of the residence would present. Id. at 37. They note that they received a substantial damage determination from Baltimore County which indicated that elevation would have to occur. FEMA hired its own engineering consultants. Plaintiffs found various deficiencies in the FEMA engineering report. Plaintiffs claim that the Proof of Loss signed by Mr. Staigerwald was under protest. He received a total payment of $114,875.75, which included policy limits of $32,100 for contents and $83,875.75 for structure damage. The Plaintiffs also received a recoverable depreciation hold back of $15,428.88. Id. at 39. These amounts were not sufficient to cover the estimates that Mr. Staigerwald secured for repair of his home. Id at 39 to 40. After a reinspection of the home, Plaintiffs were paid an additional payment of $11,659.48 for structure damage and $1,874.21 for recoverable depreciation. Id. at 40. Further review by the Hurricane Isabel Task Force lead to Plaintiffs receiving an additional amount of $50,865.16. A second review by the Task Force was requested by Plaintiffs and the claim was reviewed. Plaintiffs believe that the waiver claim should have been granted. They believe that the only evidence in the record was that the existing structure could not be elevated. Plaintiffs note that Mr. Staigerwald decided upon the advice of his engineers to demolish the home and rebuild on the same footprint. They claim that in excess of $350,000 was spent on rebuilding the home. Plaintiffs claim that FEMA was incorrect that structural damages are to be covered by the ICC payment. Plaintiffs contend that FEMA was arbitrary and capricious in their
blanket denial of the waiver application. Id at 42. Plaintiffs seek an entry of summary judgment in their favor in the amount of $48,530.21. Id at 46. V. Special Master's Analysis FN2
FN2. In their Oppositions at Document No. 713 at Pages 3 to 9, Group Six Plaintiffs have raised what they term to be twentyfour common issues that the Court has previously considered or resolved in consideration of prior groups. To the extent that these issues are not further cited in the individual Plaintiffs' discussion of their particular cases, the Special Master will not specifically address these issues in this Report and Recommendation, but will incorporate and rely on the Court's prior rulings on these issues (see Documents 594, 596, 597 and 679) and the previously-filed Memorandum on Role of the Special Master and Report and Recommendation of the Special Master on General Issues Raised by Plaintiffs and Defendants (Document 563). FEMA in its Reply (Document 715) notes correctly that Plaintiffs' Opposition is largely a recitation of the history of the claim and a contention at the conclusion that Plaintiffs did not receive sufficient funds which Plaintiffs continue to claim. The Plaintiffs received several reviews including one by the Hurricane Isabel Task Force that resulted in them receiving an additional $50, 865.15. FEMA explained in its letter denying the waiver claim why it was not accepting Plaintiffs' claim: *5 ... you claim your actual damages exceeded the amount allowed by the National Flood Insurance Program Servicing Agent (NFIPSA). Your claim was originally reviewed by an independent adjuster and subsequently reviewed by the Hurricane Isabel Task Force. A supplemental payment was approved by the Task
Force and paid by the NFIPSA. You also received $30,000, the maximum amount of coverage for your Increased Cost of Compliance claim. Your supplemental claim is documented with two contractor estimates that do not provide justification that additional monies are owed. A lump sum cost without any explanation is not acceptable. Another includes upgrades to the property and does not identify specific rooms or measurements. Upgrades are not covered by the SFIP. Further, your waiver resulted in a comprehensive review of your claim by a FEMA Insurance Examiner. After further review, the Insurance Examiner found no basis to set aside the original findings. FEMA was not required to accept the arguments and estimates provided by the Plaintiffs and their engineering consultants. As the Special Master has noted in earlier cases, when FEMA is faced with conicting expert reports, they are entitled to make the judgment as to which to credit in whole or part. They evaluated the evidence and had a sufcient basis to make the determinations they did. As noted, upon review, FEMA accepted some of Plaintiffs' arguments and provided greater payments. Ultimately, when presented with the waiver claim, they made a decision based on the SFIP and FEMA's analysis of the documentation submitted in the waiver application. There is no indication that the determination was arbitrary or capricious or an abuse of discretion. VI. Recommendation of the Special Master After a review and a consideration of the matter and the arguments presented by the parties, it is the recommendation of the Special Master that the Defendants' Motion for Partial Summary Judgment affirming FEMA's determination of Plaintiff's waiver application be granted; and it is further recommended that Plaintiffs' Motion for Summary Judgment be denied. D.Md.,2011.
Moffett v. Computer Sciences Corp. Slip Copy, 2011 WL 4381760 (D.Md.) END OF DOCUMENT
Only the Westlaw citation is currently available. United States District Court, D. Maryland, Southern Division. Thomas L. MOFFETT, II, et al., Plaintiffs, v. COMPUTER SCIENCES CORPORATION, et al., Defendants. Civil Action No. 8:05CV01547. Aug. 4, 2011. Donald W. Marcari, Frank D. Lawrence, III, Marcari Russotto and Spencer, Chesapeake, VA, Martin H. Freeman, Freeman And Freeman P.C., Rockville, MD, for Plaintiffs. Arthur F. Fergenson, Ansa Assuncao LLP, Holly Drumheller Butler, DLA Piper U.S. LLP, Jason Daniel Medinger, Allen F. Loucks, Office of the United States Attorney, Steven Michael Klepper, Kramon and Graham P.C., James D. Skeen, Skeen and Kauffman LLP, Brett Anthony Buckwalter, Niles Barton and Wilmer LLP, Baltimore, MD, Jay I. Morstein, Owings Mills, MD, Tyler Brian Raimo, Computer Sciences Corporation, Falls Church, VA, Darren Seth Wall, Department of Homeland Security, Arlington, VA, Robert H. King, Jr., Sonnenschein Nath and Rosenthal LLP, Chicago, IL, Kirk Robert Ruthenberg, SNR Denton U.S. LLP, Steuart H. Thomsen, Sutherland Asbill and Brennan LLP, Scott Nathan Auby, W. Neil Eggleston, Debevoise and Plimpton LLP, Elizabeth Treubert Simon, Pamela Anne Bresnahan, Vorys Sater Seymour and Pease LLP, Washington, DC, Gerald Joseph Nielsen, Nielsen Law Firm LLC, Metairie, LA, Peter F. Axelrad, Council Baradel Kosmerl and Nolan P.A., Annapolis, MD, Patricia Mchugh Lambert, Steven B. Schwartzman, Hodes Pessin and Katz P.A., Towson, MD, Craig Russell Blackman, Samuel J. Arena, Jr., Stradley Ronon Stevens and Young LLP, Philadelphia, PA, Edward
J. Hutchins, Jr., Stacey Ann Moffet, Eccleston and Wolf P.C., Hanover, MD, William J. Hickey, Law Offices of William J. Hickey LLC, Rockville, MD, Debra Anne Nelson, William Lowell Mundy, Mundy and Nelson, Huntington, WV, James Hilton Crosby, Crosby Saad LLC, Mobile, AL, William Gerald Gandy, Wilson Elser Moskowitz Edelman and Dicker, McLean, VA, Bradish J. Waring, Mary Legare Hughes, Nexsen Pruet LLC, Charleston, SC, for Defendants. REPORT AND RECOMMENDATION CONCERNING WAIVER CLAIM OF MICHELLE PETRO DENNIS M. SWEENEY, Special Master. *1 This constitutes the Report and Recommendation to the Court concerning the waiver claim FN1 of Michelle Petro pursuant to Part 1.f of the Memorandum Order of the Court (Document 467). In preparing this report, the Special Master reviewed the motions, memoranda, affidavits and exhibits provided in connection with the process specified in the Memorandum Order. As necessary, the Special Master also reviewed other documents that are part of the Court filings in this case. The Special Master was also provided by the Federal Emergency Management Agency (FEMA) the computer disc of the appropriate documents of record for this claim, as specified in Part 1.a of the Memorandum Order. In this case, the documents consist of 307 pages labeled FEMA000001 to 000307. FN1. The waiver claim was led by Michelle Petro. FEMA000001 to 000009. This claim has also been referred to as the claim of David Markham and this report deals with the claim of both individuals that are before the court as well as any related individuals as are discussed in footnote 1 of FEMA's Supplemental Memorandum of Law. Document 6361.
I. Background Plaintiff's property located at 1191 Grove Avenue, Shady Side, Maryland, was insured directly by Standard Fire Insurance Company (Standard Fire) in its capacity as a Write Your Own (WYO) Program insurance company participating in the National Fire Insurance Program (NFIP) under Standard Flood Insurance Policy (SFIP) Number 6001370615. Plaintiff did not maintain any contents coverage under her SFIP. On September 19, 2003, Hurricane Isabel struck the Middle Atlantic States, including Maryland, which caused flooding resulting in damage to Plaintiff's home. Plaintiff reported her loss to Standard Fire, who assigned an independent adjuster to assist the insured with the loss pursuant to SFIP Article VII(J)(5), (7) and (8). The independent adjuster was Jim Hardy from J.E.J, Inc. See FEMA00010. A separate independent adjuster, Nathan Smith from American Frontline Incorporated, was assigned to Plaintiff's Increased Costs of Compliance (ICC) claim under Article III, Coverage D of the SFIP. See FEMA000075. Plaintiff submitted a one-page engineering report from E.G. Germanos to support her claim that the building was damaged to the point of having to be razed and rebuilt. See FEMA00021. The WYO Carrier then hired John Garner from G & A Engineering to examine the building. See FEMA000095 through FEMA000124. He concluded that not all of the damages were caused by the flood at issue, that some of the damages to the pier and beam system pre-dated the flood, that some of the piers that were displaced or knocked over were not load bearing, and most importantly, that the building did not need to be demolished and could be repaired. Id. As a result of the inspections by Jim Hardy, Nathan Smith and John Garner, Plaintiff was paid $33,015.35 for the damages to her building under Coverage A of her SFIP, and an additional $29,482.64 under the Increased Cost of Compliance provision (Coverage D) of her SFIP. Plaintiff signed Proofs of Loss for these amounts and re-
ceived the full amounts then claimed. See Doc. No. FN2 3042. FN2. This document is the Declaration of Scott Holmes who handled the matter for Standard and submitted the declaration earlier in this litigation. Plaintiff did not submit an additional timely, signed and sworn Proof of Loss to support additional claim payments beyond the $33,015.35 for the damages to her building that were previously claimed by Plaintiff and paid by Standard Fire. Id. *2 Plaintiff did not request a review of her claim by the Hurricane Isabel Task Force (Task Force), but was provided notice of this review being made available to her. Id. II. Waiver Claim and Denial On December 3, 2007, this Court permitted Plaintiffs to submit applications for waivers to FEMA. See Doc. No. 196 and Doc. No. 197, Order of December 4, 2007. On February 25, 2008, Plaintiff submitted to FEMA a document entitled PLAINTIFF MICHELLE PETRO'S INDIVIDUAL APPLICATION FOR WAIVER OF PROOF OF LOSS REQUIREMENTS. See FEMA000001 through FEMA0000037. The waiver application requested that FEMA compensate Plaintiff an additional $68,484.65. See FEMA000005. FEMA denied the request in a letter dated October 28, 2008. See FEMA000038 to 000039. III. Reasons for Waiver Denial The reasons for the denial of the Waiver Claim are found at 1423 of the Supplemental Declaration of Karen Christian for the Claim of Michelle Petro. FN3 Document 6362. It states: FN3. Ms. Christian relied, in part, on the declaration led in this case of Scott Holmes who was with the WYO carrier. See Document 3442. Plaintiff based this amount solely upon the two-page estimate provided to her by John
Maurice Roberts, Inc. to construct a new home for $134,000.00. See FEMA000019 through FEMA000020. The estimate was based on a new home and not damage to her existing home. Plaintiff's shortfall was calculated by taking the $134,000.00 estimate to build a new upgraded home, subtracting ICC benefits of $30,000.00 (but Plaintiff was paid $29,482.64 in ICC benefits), and then asserting that she was entitled to receive her claimed policy limits of $102,000.00. See FEMA000018. Plaintiff did even less to support her claim than those individuals relying upon the cost per square foot formula calculation. Plaintiff's Shortfall Itemization was based completely on the cost of her new upgraded home. See FEMA000018 through FEMA000020. Plaintiff's method of calculating her damages does not take into account any of the SFIP's coverage limits or exclusions. Plaintiff presented no evidence requiring her to demolish her home. To the contrary, Plaintiff actually secured estimates to elevate the existing house. See FEMA000157 and FEMA000175. Plaintiff's sole focus was on receiving compensation based on the cost of building a substantially improved structure. The SFIP is not a valued policy per SFIP Article II (Definitions), number 28. A valued policy pays an agreed-to amount if the insured property is substantially damaged. The SFIP is a single-risk policy that only pays for direct physical loss by or from flood, and all that a substantial damage determination does is render the insured eligible for a maximum possible payment under Article III, Coverage D of the SFIP of $30,000.00 for Increased Cost of Compliance benefits. When reviewing Plaintiffs' waiver application, the Administrator evaluated the facts and circumstances relating to the request. See
FEMA000038 and FEMA000039. Specific to this case, the Administrator considered the following whether: *3 1. Policy holder demonstrated additional damages exist that are covered by the SFIP; 2. Policy holder submitted appropriate documentation supporting the additional compensation being requested; and 3. Policy holder provided a reasonable explanation for the delay in submitting the POL. Id. The SFIP only covers direct physical loss caused by or from flooding. Plaintiff's claim is based on the cost of a new dwelling without regard to the actual loss caused by the flooding and includes code and material upgrades. In addition to only insuring against loss caused by or from flood, the SFIP excludes coverage for upgrades and requires the use of material that is of like kind and quality. Finally, the SFIP has a policy limit of $30,000.00 for Increased Cost of Compliance expenses and Plaintiff's methods of calculating her shortfall makes it impossible to separate out these expenses. In the letter providing FEMA's determination on Plaintiffs waiver application the Administrator stated: You claim your damages necessitated the demolition of your dwelling s a result of the flooding. To support the amount claimed, your attorney provided documentation for the cost associated with the replacement of a new structure. Your claim was originally reviewed by an independent adjuster and subsequently reviewed by an engineer hired by your Write Your Own Company, Travelers Insurance Company (Travelers). The engineer's findings of the additional damages resulted in the $27,373.51 supplemental payment issued by Travelers. You have received a total of $33,015.35 for flood related damages to the
structure and $29,482.64 for the covered expenses incurred under your Increased Cost of Compliance (ICC) claim. The maximum amount of coverage under ICC is $30,000. You did not request a review of your claim by the Hurricane Isabel Task Force. Further, your waiver request resulted in a comprehensive review of your claim by a FEMA Insurance Examiner. The Insurance Examiner found no basis to set aside the original findings. Id. Plaintif failed to demonstrate she met any of the criteria used to determine whether to grant a waiver. First, she failed to demonstrate any additional damages she sought were actually covered by her SFIP. Second, she did not submit detailed line-item documentation of uncompensated damages caused directly by flooding to her original home, but instead based the claim solely on a two-page estimate to construct a new home. Accordingly, after another comprehensive review of the claim, FEMA determined no further compensation was warranted. Id. Plaintiff's waiver application was denied for a multitude of reasons, but primarily because she failed to document any physical loss by or from flood covered under her SFIP for which she did not receive full compensation. IV. Plaintiff's Assertions In Plaintiff's Opposition (Document 677) at pages 9 to 13, Ms. Petro states the reasons why she believes that FEMA's determination on the waiver was arbitrary and capricious. Plaintiff first cites the Declaration of Karen Christian (Document 6362) and states that FEMA's rejection of the report from E.G. Germanos is wrong. Plaintiff states her belief that Ms. Christian statements are patently untrue and accuse her of blatant lying and blatantly misleading the Court. Id. at page 9.
*4 Plaintiff believes that FEMA and the WYO carrier, Standard Fire, should have accepted the Germanos report. Plaintiff further argues that the G & A Engineering Report obtained by Standard Fire can be fairly read to support her claim for replacement of the house. Plaintiff also points to the report from the Anne Arundel County Government which found the house to be significantly damaged. Id. at page 11. Plaintiff asserts that FEMA and specifically Ms. Christian have engaged in a slanted interpretation of the G & A Engineering Report especially as it pertains to foundational and structural issues. Plaintiff concludes that FEMA and Standard (Travelers) did not like the claim Markham/Petro presented to them and they, well after the storm, went about creating and fabricating documentation to low-ball the claim. Plaintiff does acknowledge a minor miscalculation of the amount received for the ICC claim. It was stated as $30,000, but they agree they received $29, 482.64. Id. at page 13. Plaintiffs seek the entry of summary judgment in their favor in the amount of $68,484.65. Id. at page 50. V. Special Master's Analysis FN4
FN4. In their Oppositions at Document No. 677 at Pages 3 to 9, Group Five Plaintiffs have raised what they term to be twentyfour common issues that the Court has previously considered or resolved in consideration of prior groups. To the extent that these issues are not further cited in the individual Plaintiffs discussion of their particular cases, the Special Master will not specifically address these issues in this Report and Recommendation, but will incorporate and rely on the Courts prior rulings on these issues (see Documents 594, 596, 597 and 679) and the previouslyfiled Memorandum on Role of the Special Master and Report and Recommendation of the Special Master on General Issues
Raised by Plaintiffs (Document 563).
and
Defendants
Plaintiff's claim for waiver was originally based on the square footage formula derived from the cost of new construction. FEMA 000018. In this case the new home had the same square footage as the demolished home. This formula has however been repeatedly rejected by the District Court. See,e.g. Memorandum Opinion at to Group 3 Householdrs filed August 3, 2011. Document 693. In apparent recognition of this rejection,Plaintiff has now shifted her arguments in the opposition filed to FEMA's motion for summary judgment to attempt to raise other issues. Plaintiff now claims, as the Special Master reads it, that FEMA and Standard (Travelers) were engaged in a conspiracy to deny this claim and ignore the evidence that Plaintiffs had submitted shortly after the flood in favor of other reports subsequently obtained. Plaintiff makes various claims of blatant lying and blatantly misleading the Court by Ms. Christian and FEMA which presumably would also extend to FEMAs counsel of record. Document 677 at page 9. In the Special Master's view these assertions are overwrought, not supported by the evidence of record and detract from the purpose of the review of the waiver claim that is at issue. They are little more than bald allegations about the process of claim analysis and review of the waiver applications. These claims have been rejected to this point by the U.S. District Court. There is no doubt that the report obtained by Plaintiff in September, 2003 was very supportive of her claim. The one page report was by E.S. Germanos, a professional engineer with Associated Designers, Inc. (FEMA 000021). The engineer concluded that the house would have to be demolished and rebuilt, but the report contained no detail nor supporting analysis. When the report was submitted to the adjuster he concluded that his own inspection of the property did not support the conclusions of
the report and he recommended that Standard engage an engineering firm to do a full analysis. The narrative reports in the file do not show any conspiracy to deny the claim, but a recognition that the Germanos report although not in line with the adjuster analysis,would have to be evaluated and that the best way to do it was to hire an engineering firm to evaluate the property. See FEMA 000263 and 000270 to 000272. This was done and G & A Engineering Consultants provided a comprehensive report that on review does not appear to be one FN5 sided. FEMA 000022 to 000030 . This report concluded that not all of the damages were caused by the flood at issue, that some of the damages to the pier and beam system pre-dated the flood, that some of the piers that were displaced or knocked over were not load bearing, and most importantly, that the building did not need to be demolished and could be repaired. Id. FN5. The full G & A report is in the record at FEMA 000095 to 000124 which includes the drawings and photos which were attached to it. *5 As Plaintiff herself notes, G & A did agree with some of the findings of Plaintiff's engineer, but disagreed with others. G & A found that that the damage could be repaired and set out what the repairs would entail. Comparing the Germanos report and the G & A side by side, it is hard to fault FEMA for giving more weight to the very detailed G & A report since it is documented in great detail while the Germanos report is simply conclusions with no analysis. If detail behind the Germanos report does exist, there is no explanation as to why it was not submitted with the waiver application in 2008. As FEMA notes in their Reply (Document 688) at page 6, Plaintiffs January 14, 2004 Proof of Loss was based on the adjuster's review of the interior damage and the repairs recommended by G & A. In addition, they were paid $29,482.64 on their ICC claim. These claims were paid in full on these submissions and as FEMA notes this Plaintiff al-
though possessing the engineering report days after the flood surprisingly did not seek any review by the Hurricane Isabel Task Force which was available to her at no cost and made no further claim until the waiver application was filed in 2008 as a result of this court's ruling. Plaintiffs' objections appear to be that FEMA and Standard (Travelers) chose to accept the engineering report they obtained rather than the report that Plaintiff presented. There is no indication that the G & A engineering firm was in any way not conducting a professional and good faith analysis. To the extent that there were conflicting evidence and opinions, FEMA was entitled to evaluate the reports and accept those reports or portions of reports it found most persuasive and in accord with the requirements of the SFIP. There is no indication of any personal animus to the Plaintiff or of any conspiracy to low ball the adjustment. A review of the record including the full file of the adjusters that has been presented instead appear to support an attempt to adjust the claim in a fair and balanced fashion. Plaintiffs also rely on the significant damage report submitted by Anne Arundel County's Department of Inspections and Permits, FEMA 000275 to 000276, which was a necessary pre-condition for the ICC payment. The ICC payment under Part D was made based on this report and, as has been stated many times in the review of these cases, these letters do not establish that Part A claims must be paid. As FEMA notes, the Anne Arundel County estimate of damage was $45,888.41 (FEMA000033) which is significantly less than Plaintiffs' current claim for policy limits of $102,000.00. FEMA Reply at page 6. VI. Recommendation of the Special Master After a review and a consideration of the matter and the arguments presented by the parties, it is the recommendation of the Special Master that the Defendants' Motion for Partial Summary Judgment affirming FEMAs determination of Plaintiff's waiver application be granted; and it is further re-
commended that Plaintiff's Motion for Summary Judgment be denied. D.Md.,2011. Moffett v. Computer Sciences Corp. Slip Copy, 2011 WL 3439277 (D.Md.) END OF DOCUMENT
Only the Westlaw citation is currently available. United States District Court, D. Maryland, Southern Division. Thomas L. MOFFETT, II, et al., Plaintiffs, v. COMPUTER SCIENCES CORPORATION, et al., Defendants. Civil Action No. 8:05CV01547. Aug. 4, 2011. Donald W. Marcari, Frank D. Lawrence, III, Marcari Russotto and Spencer, Chesapeake, VA, Martin H. Freeman, Freeman and Freeman PC, Rockville, MD, for Plaintiffs. Arthur F. Fergenson, Ansa Assuncao LLP, Holly Drumheller Butler, DLA Piper U.S. LLP, Jason Daniel Medinger, Allen F. Loucks, Office of the United States Attorney, Steven Michael Klepper, Kramon and Graham PC, James D. Skeen, Skeen and Kauffman LLP, Brett Anthony Buckwalter, Niles Barton and Wilmer LLP, Baltimore, MD, Jay I. Morstein, Owings Mills, MD, Tyler Brian Raimo, Computer Sciences Corporation, Falls Church, VA, Darren Seth Wall, Department of Homeland Security, Federal Emergency Management Agency, Arlington, VA, Robert H. King, Jr., Sonnenschein Nath and Rosenthal LLP, Chicago, IL, Kirk Robert Ruthenberg, SNR Denton U.S. LLP, Steuart H. Thomsen, Sutherland Asbill and Brennan LLP, Scott Nathan Auby, W. Neil Eggleston, Debevoise and Plimpton LLP, Elizabeth Treubert Simon, Pamela Anne Bresnahan, Vorys Sater Seymour and Pease LLP, Washington, DC, Gerald Joseph Nielsen, Nielsen Law Firm LLC, Metairie, LA, Peter F. Axelrad, Council Baradel Kosmerl and Nolan PA, Annapolis, MD, Patricia McHugh Lambert, Steven B. Schwartzman, Hodes Pessin and Katz PA, Towson, MD, Craig Russell Blackman, Samuel J. Arena, Jr., Stradley Ronon Stevens and Young
LLP, Philadelphia, PA, Edward J. Hutchins, Jr., Stacey Ann Moffet, Eccleston and Wolf PC, Hanover, MD, William J. Hickey, Law Offices of William J. Hickey LLC, Rockville, MD, Debra Anne Nelson, William Lowell Mundy, Mundy and Nelson, Huntington, WV, James Hilton Crosby, Crosby Saad LLC, Mobile, AL, William Gerald Gandy, Wilson Elser Moskowitz Edelman and Dicker, McLean, VA, Bradish J. Waring, Mary Legare Hughes, Nexsen Pruet LLC, Charleston, SC, for Defendants. REPORT AND RECOMMENDATION CONCERNING WAIVER CLAIM OF DAVID L. AND BEVERLY MOTTA DENNIS M. SWEENEY, Special Master. *1 This constitutes the Report and Recommendation to the Court concerning the waiver claim of David L. and Beverly Motta pursuant to Part 1.f of the Memorandum Order of the Court (Document 467). In preparing this report, the Special Master reviewed the motions, memoranda, affidavits and exhibits provided in connection with the process specified in the Memorandum Order. As necessary, the Special Master also reviewed other documents that are part of the Court filings in this case. The Special Master was also provided by the Federal Emergency Management Agency (FEMA) the computer disc of the appropriate documents of record for this claim, as specified in Part 1.a of the Memorandum Order. In this case, the documents consist of 183 pages labeled FEMA000001 to 000183. I. Background Plaintiffs' property located at 8812 Hinton Avenue, Millers Island, Maryland, was insured by Selective Insurance Company of the Southeast (Selective) under Policy Number 0000062738, with a coverage limit of $250,000.00 for their FN1 building with a $5,000.00 deductible. See FEMA000005 and 000036. Plaintiffs also maintained contents coverage with a coverage limit of
$68,600.00 with a $2,000.00 deductible. See FEMA000005. FN1. For clarification, Plaintiffs David L. and Beverly Motta own the insured property at issue although only Beverly Motta is the named insured in the Standard Flood Insurance Policy (SFIP). On or about September 18, 2003, Hurricane Isabel struck the Middle Atlantic States, including Maryland, which caused flooding resulting in damage to Plaintiffs' home. See FEMA000141. Plaintiffs, with the assistance of their public adjuster, submitted timely Proofs of Loss totaling $194,365.12. See Doc. No. 3182 at 119. On October 9, 2003, Selective issued to Plaintiffs a check in the amount of $25,000.00 as an advance payment on their contents claim. See FEMA000373. On December 23, 2003, Selective issued Plaintiffs a second check in the amount of $43,600 for the remaining policy limits on their contents claim. See FEMA000564. On March 30, 2004, Selective issued Plaintiffs a check in the amount of $50,000.00 as an advance payment on their Building claim. See FEMA000563. Selective issued Plaintiffs another $50,000.00 advance payment check on or about April 22, 2004. See FEMA000464. On June 28, 2004, as a result of the Hurricane Isabel Task Force review, Selective issued Plaintiffs a supplemental payment check for building coverage totaling $34,312.89. See FEMA000466. Additional supplemental building checks were issued to Plaintiffs on August 16, 2004 ($10,000.00), September 10, 2004 ($10,000.00), September 21, 2004 ($6,279.89), and October 13, 2004 ($8,426.22). See FEMA000473 through FEMA000475, and 000481. Plaintiffs were paid a total of $169,019.00 under their building coverage and policy limits of $68,600.00 under their contents coverage. See FEMA000005. The amount Plaintiffs received in building coverage was less than the $194,365.12
they requested on their timely Proof of Loss. II. Waiver Claim and Denial On December 3, 2007, this Court permitted Plaintiffs to submit applications for waivers to FEMA. See Doc. No. 196 and Doc. No. 197, Order of December 4, 2007. On February 25, 2008, Plaintiffs submitted to FEMA a document entitled PLAINTIFFS DAVID L. AND BEVERLY MOTTA INDIVIDUAL APPLICATION FOR WAIVER OF PROOF OF LOSS REQUIREMENTS. The waiver application requested that FEMA compensate Plaintiffs an additional $47,195.51. See FEMA000005. FEMA denied the request in a letter dated July 31, 2008. See FEMA000080 to 000081. III. Reasons for Waiver Denial *2 The reasons for the denial of the Waiver Claim are found at 1119 of the Supplemental Declaration of Karen Christian for the Claim of FN2 Todd and Jean Lewis . Document 6422. It states: FN2. Ms. Christian also relied on the Declaration of Deborah Gangemi of Selective Insurance which is part of the court file in this case. See Document 3182. Plaintiffs' $47,195.51 shortfall was based on their assertion that the total FEMA payments for building coverage in the amount of $169,019.00 (including the $5,000 deductible) did not cover all the expenses required to repair their home which totaled $221,214.51. Id. The maximum recovery Plaintiffs may receive for building coverage here is $25,346.12 (difference between their timely Proof of Loss$194,365.12 and amounts already paid for building coverage-$169,019.00). See Doc. No. 3182 at 119. Plaintiffs' claimed shortfall amount of $47,195.51 exceeds the amount Plaintiffs claimed on their timely Proof of Loss amount
($194,365.12) by $21,849.39. A review of Plaintiffs' shortfall itemization and supporting documents indicates that these were the same documents reviewed by the National Flood Insurance Program, Bureau and Statistical Agent, the General Adjuster, Hurricane Isabel Task Force and by FEMA. See FEMA000051 through FEMA000065. There is no evidence Plaintiffs are entitled to any additional compensation. When reviewing Plaintiffs' waiver application, the Administrator evaluated the facts and circumstances relating to the request. See FEMA000080 and FEMA000081. Specific to this case, the Administrator considered the following whether: 1. Policy holder demonstrated additional damages exist that are covered by the SFIP; 2. Policy holder submitted appropriate documentation supporting the additional compensation being requested; and 3. Policy holder provided a reasonable explanation for the delay in submitting the POL. Id. In the letter providing FEMA's determination on Plaintiff's waiver application, the Administrator stated: ... you claim your expenses for repair of your home exceeded the amount paid to you by your Write Your Own Company, Selective Insurance Company (Selective). To support the amount claimed, you provided receipts for your cost spent to repair your home. Your claim was originally reviewed by an independent adjuster and subsequently reviewed by the Hurricane Isabel Task Force that recommended two supplemental payments that were issued by Selective. All reviews of your claim concluded that the final evaluation of your claim was accurate.
The current documents presented appear to be the same items presented during the handling of your claim with FEMA and the Hurricane Isabel Task Force. Several of the items presented were previously denied as they are not covered by the SFIP (detached carport) or involved betterment (floor joists and fixture replacement). Further, your waiver resulted in a comprehensive review of your claim by a FEMA Insurance Examiner. After further review, the Insurance Examiner found no basis to set aside the original findings. *3 Id. Plaintifs' waiver application does not meet the criteria for approval because they failed to demonstrate any additional damages sought were actually covered by their SFIP. Plaintiffs' shortfall included Increased Cost of Compliance line items (Plaintiffs did not make a claim for these expenses), spiral staircase replacement, kitchen counters (uncertain of contractor-no name), plumbing expenses, and preexisting structural damage. See FEMA000051. Plaintiffs were either not entitled to compensation for these items or there was no explanation of how the claim related to the flood loss. Accordingly, after another comprehensive review of the claim, FEMA determined no further compensation was warranted. Id. Plaintiffs' waiver application was denied for a multitude of reasons, but primarily because they failed to document any physical loss by or from flood covered under their SFIP for which they did not receive full compensation for. IV. Plaintiffs' Assertions Plaintiffs contends that FEMA has agreed that a timely POL was filed in this case and that $25,346.12 is now due to Plaintiffs. They seek to have this paid at this time.
Plaintiffs also seek an additional $21,849.39. They claim that structural damage of $2,000 should be paid based on what they view as a concession by FEMA's agent. Furthermore, they contend that the entire structural damage amount ($10,000.00 more) should be paid based on the Tanner and Sons report. Based on Plaintiff's review, they allege that the remaining shortfall of $19,849.49 should be paid since they believe that FEMA agent's did not correctly evaluate the shortfall claim. V. Special Master's Analysis FN3
with FEMA on this issue. That claim should proceed independent of the review of the waiver denial process that is being conducted here. As far as the waiver portion of the review is concerned, it involves any claim above the timely submitted Proof of Loss claim and is limited to $21,849.39. FEMA argues that the record does not show that any claimed shortfall above the $194,365.12 level has been shown. As far as the arguments concerning the Tanner report and the contention that preexisting structural damage should not be considered, FEMA notes that these were not presented in the waiver application and should not now be allowed to be raised. This appears to be the case. *4 The Special Master concurs with FEMA that Plaintiffs should be allowed to proceed with their timely filed POL up to the amount of $194,365.12, but that FEMA has not conceded that any payment above $169,019.00 already paid should be paid. As to Plaintiffs other arguments, they have not shown that FEMA's denial of the waiver application was either arbitrary or capricious or an abuse of discretion. The reasons given by FEMA in Part III above for denial of the waiver application are more than adequate to support its decision. Plaintiffs however may pursue their claim to receive compensation up to $194,365.12 including the sums already received by Plaintiffs.. VI. Recommendation of the Special Master After a review and a consideration of the matter and the arguments presented by the parties, it is the recommendation of the Special Master that the Defendants' Motion for Partial Summary Judgment affirming FEMA's determination of Plaintiff's waiver application be granted but that Plaintiffs' claim arising out of the disallowance or partial disallowance of their timely filed Proof of Loss shall proceed against Defendant Selective Insurance Company of the Southeast limited to the amount specified in the disallowed timely filed Proof of Loss; and it is further recommended that Plaintiff's Motion for Summary Judgment be denied.
FN3. In their Oppositions at Document No. 677 at Pages 3 to 9, Group Five Plaintiffs have raised what they term to be twentyfour common issues that the Court has previously considered or resolved in consideration of prior groups. To the extent that these issues are not further cited in the individual Plaintiffs' discussion of their particular cases, the Special Master will not specifically address these issues in this Report and Recommendation, but will incorporate and rely on the Court's prior rulings on these issues (see Documents 594, 596, 597 and 679) and the previously-filed Memorandum on Role of the Special Master and Report and Recommendation of the Special Master on General Issues Raised by Plaintiffs and Defendants (Document 563). FEMA view of the Plaintiffs' claim is substantially different than Plaintiff has set out above. FEMA does not concede that the $25,346.12 is due and owing to Plaintiffs. Instead, they acknowledge that this amount is the difference between the amount they were paid by Selective ($169,019.00) and the amount they claimed on their timely submitted Proof of Loss ($194,365.12). FEMA acknowledges that a claim in the $25,346.12 amount can proceed against Selective, but they assert that there is no concession that the claim has ultimate merit or that FEMA or Selective has waived any defenses they may have. The Special Master agrees
D.Md.,2011. Moffett v. Computer Sciences Corp. Slip Copy, 2011 WL 3439281 (D.Md.) END OF DOCUMENT
Only the Westlaw citation is currently available. United States District Court, D. Maryland, Southern Division. Thomas L. MOFFETT, II, et al., Plaintiffs, v. COMPUTER SCIENCES CORPORATION, et al., Defendants. Civil Action No. 8:05CV01547. Aug. 4, 2011. Donald W. Marcari, Frank D. Lawrence, III, Marcari Russotto and Spencer, Chesapeake, VA, Martin H. Freeman, Freeman and Freeman PC, Rockville, MD, for Plaintiffs. Arthur F. Fergenson, Ansa Assuncao LLP, Holly Drumheller Butler, DLA Piper US LLP, Jason Daniel Medinger, Allen F. Loucks, Office of the United States Attorney, Steven Michael Klepper, Kramon and Graham PC, James D. Skeen, Skeen and Kauffman LLP, Brett Anthony Buckwalter, Niles Barton and Wilmer LLP, Baltimore, MD, Jay I. Morstein, Owings Mills, MD, Tyler Brian Raimo, Computer Sciences Corporation, Falls Church, VA, Darren Seth Wall, Department of Homeland Security, Federal Emergency Management Agency, Arlington, VA, Robert H. King, Jr., Sonnenschein Nath and Rosenthal LLP, Chicago, IL, Kirk Robert Ruthenberg, SNR Denton US LLP, Steuart H. Thomsen, Sutherland Asbill and Brennan LLP, Scott Nathan Auby, W. Neil Eggleston, Debevoise and Plimpton LLP, Elizabeth Treubert Simon, Pamela Anne Bresnahan, Vorys Sater Seymour and Pease LLP, Washington, DC, Gerald Joseph Nielsen, Nielsen Law Firm LLC, Metairie, LA, Peter F. Axelrad, Council Baradel Kosmerl and Nolan PA, Annapolis, MD, Patricia McHugh Lambert, Steven B. Schwartzman, Hodes Pessin and Katz PA, Towson, MD, Craig Russell Blackman, Samuel J. Arena, Jr., Stradley Ronon Stevens and Young
LLP, Philadelphia, PA, Edward J. Hutchins, Jr., Stacey Ann Moffet, Eccleston and Wolf PC, Hanover, MD, William J. Hickey, Law Offices of William J. Hickey LLC, Rockville, MD, Debra Anne Nelson, William Lowell Mundy, Mundy and Nelson, Huntington, WV, James Hilton Crosby, Crosby Saad LLC, Mobile, AL, William Gerald Gandy, Wilson Elser Moskowitz Edelman and Dicker, McLean, VA, Bradish J. Waring, Mary Legare Hughes, Nexsen Pruet LLC, Charleston, SC, for Defendants. REPORT AND RECOMMENDATION CONCERNING WAIVER CLAIM OF ANTHONY MARZOCCHI DENNIS M. SWEENEY, Special Master. *1 This constitutes the Report and Recommendation to the Court concerning the waiver claim of Anthony Marzocchi pursuant to Part 1.f of the Memorandum Order of the Court (Document 467). In preparing this report, the Special Master reviewed the motions, memoranda, affidavits and exhibits provided in connection with the process specified in the Memorandum Order. As necessary, the Special Master also reviewed other documents that are part of the Court filings in this case. The Special Master was also provided by the Federal Emergency Management Agency (FEMA) the computer disc of the appropriate documents of record for this claim, as specified in Part 1.a of the Memorandum Order. In this case, the documents consist of 250 pages labeled FEMA000001 to 000250. I. Background Plaintiff's property located at 9200 North Point Road, Fort Howard, Maryland, was insured by State Farm Fire and Casualty Company (State Farm) under Policy Number 902090191, with a coverage limit of $165,000.00 for his building with a $1,000.00 deductible. See FEMA000005. Plaintiff did not maintain any contents coverage. Id.
On September 18, 2003, Hurricane Isabel struck the Middle Atlantic States, including Maryland, which caused flooding resulting in damage to Plaintiff's home. See DeWitt Declaration, Attachment A2 at 48. On October 22, 2003, State Farm paid Plaintiff $50,214.64. See Exhibit A2 at 50. On December 19, 2003, State Farm paid Plaintiff $3,361.17. See Exhibit A2 at 52. On June 21, 2004, State Farm paid Plaintiff a further $1,787.41. See Exhibit A2 at 54. Plaintiff concedes he was compensated a total of $55,363.22 for his structure and $30,000.00 under the Increased Cost of Compliance (ICC) provision of his policy. See FEMA000005. Plaintiff provided a contract from Nicely Contracting to perform all the repairs in accordance with the State Farm estimate for $51,924.59. See FEMA000124. II. Waiver Claim and Denial On December 3, 2007, this Court permitted Plaintiffs to submit applications for waivers to FEMA. See Doc. No. 196 and Doc. No. 197, Order of December 4, 2007. On February 25, 2008, Plaintiff submitted to FEMA a document entitled PLAINTIFF ANTHONY MARZOCCHI'S INDIVIDUAL APPLICATION FOR WAIVER OF PROOF OF LOSS REQUIREMENTS. The waiver application requested that FEMA compensate Plaintiff an additional $108,636.78. See FEMA000005. FEMA denied the request in a letter dated October 28, 2008. See FEMA000113 to 000114. III. Reasons for Waiver Denial The reasons for the denial of the Waiver Claim are found at 1018 of the Supplemental Declaration of Karen Christian for the Claim of Anthony FN1 Marzocchi. Document 6382. It states: FN1. Ms. Christian also relied on the Declaration of Patricia Dewitt of State Farm already of record in this litigation at Document 2943 which discusses the claim of
this Plaintiff as well as others. Plaintiff based this amount [$108,638.78] upon his assertion that it cost him $296,500.00, not inclusive of personal labor, to construct a new substantially improved and larger home. Id. Plaintiff then deducted the Increased Cost of Compliance payment he received and divided the square footage of the new upgraded home by the remaining $266,500.00 to arrive at $88.95 per square foot to construct the new upgraded home. See FEMA000036. He then multiplied the cost per square foot of the new upgraded home by the square footage of his old home (2760 square feet) to arrive at a cost to restore the old home of $245,502.00. See FEMA000037. Plaintiff concluded this amount exceeded his policy limit of $165,000.00. Id. Plaintiff then deducted State Farm's payments totaling $55,363.22 and his $1,000.00 deductible from his policy limit to arrive at a shortfall of $108,636.78. Id. *2 Plaintiff stated on February 25, 2008, he was ... gathering supporting documentation showing costs to rebuild and intends to submit in timely fashion. See FEMA000005. Almost five years after the storm, Plaintiff did not have documentation to support his claim and to date, Plaintiff still has not provided the promised supporting documentation. Plaintiff's method of calculating his damages by taking the square footage of his original structure and multiplying it by the cost per square foot of the new upgraded structure does not take into account any of the SFIP's coverage limits or exclusions. Plaintiff's itemization did not actually include any itemization that could be used for a meaningful comparison to the adjuster's estimate. Plaintiff presented no evidence challenging the repair estimates provided by State Farm. To the contrary, Plaintiff provided an estimate from Nicely Contracting to perform the necessary repairs in accordance with State Farm's estimate. Plaintiff provides no explanation why Nicely
Contracting did not perform the repairs or why the repairs could not be completed. When reviewing Plaintiffs' waiver application, the Administrator evaluated the facts and circumstances relating to the request. See FEMA000113 and FEMA000114. Specific to this case, the Administrator considered the following whether: 1. Policy holder demonstrated additional damages exist that are covered by the SFIP; 2. Policy holder submitted appropriate documentation supporting the additional compensation being requested; and 3. Policy holder provided a reasonable explanation for the delay in submitting the POL. Id. The SFIP only covers direct physical loss caused by or from flooding. Plaintiff's supplemental claim is based on the square footage cost of a new upgraded dwelling without regard to the actual physical loss caused by or from the flooding. In addition to only insuring against physical loss by or from flooding, the SFIP excludes coverage for upgrades and requires the use of material that is of like kind and quality, which Plaintiff's formula disregards. See Exhibit A at 16 and 17. Finally, the SFIP has a policy limit of $30,000.00 for Increased Cost of Compliance expenses and Plaintiff's formula makes it impossible to separate out these expenses. In the letter providing FEMA's determination on Plaintiff's waiver application, the Administrator stated: ... you claim your damages exceed the flood damages determined by your carrier, State Farm Fire and Casualty (State Farm) as a result of the flooding. You did not submit a request to the Hurricane Isabel Task Force to review your claim to determine if you were owed an additional pay-
ment. However, a comprehensive review of your file was conducted by a FEMA Insurance Examiner and the findings were that the information provided by your attorney does not support a supplemental payment. State Farm issued payments to you totaling $55,363.22 for the covered flood damage to the structure and $30,000, the maximum amount of coverage available, for your Increased Cost of Compliance (ICC) claim. Although you demolished the original home and built a new structure, the additional expenses you have incurred during this process are not covered as they have exceeded the maximum amount of coverage under ICC. The Insurance Examiner found no basis to set aside the original findings *3 Id. Plaintiff failed to demonstrate he met any of the criteria used to determine whether to grant a waiver. First, he failed to demonstrate any additional damages he sought were actually covered by his SFIP. Second, he stated he would provide documentation to support his claim when it became available and never did. Finally, he took a formulaic approach based on the cost per square foot of a substantially improved home to calculate his loss that did not take into account the coverages and exclusions found within his SFIP. Accordingly, after another comprehensive review of the claim, FEMA determined no further compensation was warranted. Id. Plaintiffs waiver application was denied for a multitude of reasons, but primarily because he failed to document any physical loss by or from flood covered under his SFIP for which he did not receive full compensation for. IV. Plaintiffs' Assertions At this juncture, Plaintiff argues that the the administrative record and the affidavit of Ms. Christian demonstrate a prime example of the high pressure, low-ball tactics that FEMA and State Farm have used to avoid full payment of coverage to Plaintiff. Document 677 at page 14. Plaintiff ar-
gues that he could not afford to have the work needed done for the amount of money paid him under the claim. Id, Plaintiff argues that the Nicely Contracting proposal of $171,195.00 should have been accepted by FEMA in the waiver application and that it provides sufficient evidence to counter the State Farm analysis which FEMA relies upon. Plaintiff points to the letters and determinations on substantial damage from the Baltimore County government and 46 pages of documents submitted at FEMA 000036 to 000081 as support that his claim should have been granted in full for the total amount of coverage. Id at page 15. Plaintiff argues that while the square footage of the damaged home was 2,760 the new home was only slightly larger at 2,996 and that the cost per square foot construction of $88.95 was well within the norm for construction costs per square foot for the area ... Id at page 16. V. Special Master's Analysis FN2
plied. This argument has been rejected not only by FEMA, but also by the Special Master and the U.S. District Court in the February 17, 2011 opinion and the July 1, 2011 memorandum opinion. The Court has again rejected this argument in a memorandum filed August 3, 2011 on the Group 3 Householders. Document 693. As is demonstrated in Part III above, FEMA's analysis of why it rejected the formulaic approach for this Plaintiff is detailed and comprehensive. There is no need to go over these arguments again in any detail since Plaintiff's contention has been repeatedly rejected in this litigation. Plaintiff in their opposition have now tried to recast his claim to suggest that FEMA did not fairly evaluate the evidence and that it applied pressure tactics to the Plaintiff to have him accept State Farm and FEMA's determinations. There is no evidence of a credible nature in this record to support such allegations and in any event these claims were not made in the waiver application that is the sole subject of this review. There is no indication that the waiver denial in this case was either arbitrary, capricious or an abuse of discretion. VI. Recommendation of the Special Master *4 After a review and a consideration of the matter and the arguments presented by the parties, it is the recommendation of the Special Master that the Defendants' Motion for Partial Summary Judgment affirming FEMA's determination of Plaintiff's waiver application be granted; and it is further recommended that Plaintiff's Motion for Summary Judgment be denied. D.Md.,2011. Moffett v. Computer Sciences Corp. Slip Copy, 2011 WL 3439288 (D.Md.) END OF DOCUMENT
FN2. In their Oppositions at Document No. 677 at Pages 3 to 9, Group Five Plaintiffs have raised what they term to be twentyfour common issues that the Court has previously considered or resolved in consideration of prior groups. To the extent that these issues are not further cited in the individual Plaintiffs' discussion of their particular cases, the Special Master will not specifically address these issues in this Report and Recommendation, but will incorporate and rely on the Court's prior rulings on these issues (see Documents 594, 596, 597 and 679) and the previously-filed Memorandum on Role of the Special Master and Report and Recommendation of the Special Master on General Issues Raised by Plaintiffs and Defendants (Document 563). As FEMA notes in its reply at page 8, this claim is one where the waiver application was premised entirely on the argument that the square foot formula for new construction should be ap-
A(1) at Art. VII(R). Only the Westlaw citation is currently available. United States District Court, D. Maryland, Southern Division. Thomas L. MOFFETT, II, et al., Plaintiffs, v. COMPUTER SCIENCES CORPORATION, et al., Defendants. Civil Action No. 8:05CV01547. Aug. 4, 2011. Donald W. Marcari, Frank D. Lawrence, III, Marcari RussottoAnd Spencer, Chesapeake, VA, Martin H. Freeman, Freeman and Freeman PC, Rockville, MD, for Plaintiffs. Arthur F. Fergenson, Holly Drumheller Butler, Dla Piper US LLP, Baltimore, MD, Jay I. Morstein, Owings Mills, MD, for Defendants. REPORT AND RECOMMENDATION CONCERNING THE WAIVER CLAIM OF WILLIAM AND JANICE NORRIS DENNIS M. SWEENEY, Special Master. *1 In FEMA's Motion for Partial Summary Judgment on this claim, FEMA concedes at the outset that their was no need for William and Janice Norris to file a waiver claim since it has been discovered that on January 13, 2004, Plaintiffs did in fact file a timely handwritten document titled Proof of Loss requesting a net claim amount of $393,297.00. FEMA concedes that a Proof of Loss was submitted prior to the extended deadline to file a Proof of Loss for Hurricane Isabel claims. FEMA further concedes that not only do these Plaintiffs not need a waiver of the time requirement to challenge the unpaid amount requested on their timely Proof of Loss, but also that they now have the right to pursue the amount claimed on their timely Proof of Loss in the U.S. District Court under Article VII(R) of the policy. See 44 CFR Sec.61, App. As a result of these concessions, FEMA did not file the administrative record of the waiver review with the court and did not further argue the correctness of its determination of the waiver application. FEMA also did not file a declaration explaining the reasons for the waiver denial since it is now conceding that no waiver request was needed for these Plaintiffs to proceed with their claim. Plaintiffs do not disagree with FEMA's concessions, but are concerned that FEMA did not file the full record of the waiver request and the history of the claim with the court. While Plaintiffs state they are in agreement with FEMA's recommendation with respect to the POL, they note that in their view the handling of this matter by FEMA points up that FEMA's waiver review process was arbitrary and capricious and that it did not review the applications for waiver appropriately. Plaintiffs believe that the handling of this matter provides a basis for a motion for reconsideration of motions earlier denied by the Court. Plaintiffs ask that (1) Defendants' Motion for Partial Summary Judgment be denied; (2) that Plaintiff's William and Janis Norris' claim be allowed to go forward; (3) that the Court require defendants to provide a complete copy of the file to Plaintiff's counsel immediately; and (4) that FEMA be directed to pay the policy limits, less the deductible, to the Norrises. Plaintiffs seek at page 50 of the Opposition (Document 677), that summary judgment be granted to the Plaintiffs in the amount of $176,567.57. FEMA in its Reply (Document 688) responds to Plaintiffs' charges about the review process and explains why its waiver determination letter was written the way it was. For purpose of the very limited review of the waiver denial that the Special Master is conducting, there is no need for the Special Master to resolve whose fault it was that it was not determined earlier
that this case did not need to be reviewed as a waiver case. It is also not for the Special Master to determine whether the handling of this claim demonstrates any basis for the U.S. District Court to reconsider any prior orders relating to the review of the claims. Plaintiffs apparently recognize this limitation of the Master's powers and on June 28, 2011 filed a Motion directed to the U.S. District Court for an order that FEMA's denials of all of the Plaintiffs' applications for waiver of POL requirements were arbitrary and capricious. See Document 678. In that motion, Plaintiffs set out their concerns about how the Norris case was handled as evidence of why the motion should be granted. *2 As to the matters properly before the Special Master under the delegation from the Court, the Special Master determines that (1) Defendants' Motion for Partial Summary Judgment should be granted since there was no need for a waiver to be granted in this case; (2) that the Plaintiffs' claim conceded by the parties to result from the timely filed Proof of Loss should proceed in normal course in the U.S. District Court; (3) that access to the FEMA files regarding this claim should be governed by the discovery process available to the parties in the U.S. District Court; and (4) the Plaintiffs' request by summary judgment motion for the immediate payment of the $176,567.57 as part of the waiver review process be denied. Recommendation of the Special Master After a review and a consideration of the matter, it is the recommendation of the Special Master that the Defendants' Motion for Partial Summary Judgment affirming FEMA's determination of Plaintiff's waiver application be granted on the basis that Plaintiffs did not require a waiver in order to proceed with their claim in the U.S. District Court; and it is further recommended that Plaintiffs' Motion for Summary Judgment be denied; and it is further recommended that Plaintiffs' claim arising out of the disallowance or partial disallowance of their timely filed Proof of Loss be allowed to proceed in the U.S. District Court.
Id. Only the Westlaw citation is currently available. United States District Court, D. Maryland, Southern Division. THOMAS L. MOFFETT, II, et al., Plaintiffs, v. COMPUTER SCIENCES CORPORATION, et al., Defendants. Civil Action No. 8:05CV01547. Aug. 4, 2011. REPORT AND RECOMMENDATION CONCERNING WAIVER CLAIM OF THOMAS AND VIRGINIA PARSONS DENNIS M. SWEENEY, Special Master. *1 This constitutes the Report and Recommendation to the Court concerning the waiver claim of Thomas and Virginia Parsons pursuant to Part 1.f of the Memorandum Order of the Court (Document 467). In preparing this report, the Special Master reviewed the motions, memoranda, affidavits and exhibits provided in connection with the process specified in the Memorandum Order. As necessary, the Special Master also reviewed other documents that are part of the Court filings in this case. The Special Master was also provided by the Federal Emergency Management Agency (FEMA) the computer disc of the appropriate documents of record for this claim, as specified in Part 1.a of the Memorandum Order. In this case, the documents consist of 618 pages labeled FEMA000001 to 000618. I. Background Plaintiffs' property located at 11242 Bird River Grove Road, White Marsh, Maryland, was insured by Allstate Insurance Company (Allstate) under Policy Number 1804413118, with a coverage limit of $125,000.00 for their building subject to a $1,000.00 deductible. See FEMA000005. Plaintiffs did not maintain any contents coverage. On September 18, 2003, Hurricane Isabel struck the Middle Atlantic States, including Maryland, which caused flooding resulting in damage to Plaintiffs' home. Id. On February 12, 2004, Allstate paid Plaintiffs $5,807.31. See FEMA000121. On April 19, 2004, Allstate paid Plaintiffs $1.241.65. See FEMA000028. On May 13, 2004, Allstate paid Plaintiffs $19,688.00. See FEMA000029. Plaintiffs agree they were compensated a total of $26,736.96 for their structure and $30,000.00 under the Increased Cost of Compliance (ICC) provision of their policy. See FEMA000005. Plaintiffs assert that they are entitled to additional payments totaling $41, 175.68. II. Waiver Claim and Denial On December 3, 2007, this Court permitted Plaintiffs to submit applications for waivers to FEMA. See Doc. No. 196 and Doc. No. 197, Order of December 4, 2007. On February 25, 2008, Plaintiffs submitted to FEMA a document entitled PLAINTIFFS THOMAS AND VIRGINIA PARSONS' INDIVIDUAL APPLICATION FOR WAIVER OF PROOF OF LOSS REQUIREMENTS. The waiver application requested that FEMA compensate Plaintiffs an additional $41,175.68. See FEMA000005. FEMA denied the request in a letter dated August 31, 2008. See FEMA000080 to 000081. III. Reasons for Waiver Denial The reasons for the denial of the Waiver Claim are found at 916 of the Supplemental Declaration of Karen Christian for the Claim of Thomas FN1 and Virginia Parsons. Document No. 6442 . It states: FN1. Ms. Christian also relies on the Declaration of Jason Raske (Document 2812) who reviewed and handled the
claim file for Allstate, the Write Your Own carrier in this case. Plaintiffs based this amount upon their assertion that it cost them $68,912.64 to construct a new improved and larger home (Plaintiffs arrived at the $68,912.64 figure by [c]omparing old square footage at new construction costs). Id. Subtracting the amounts FEMA already paid in building coverage ($26,736.96) from their estimated cost to replace their original home ($68,912.64), Plaintiffs assert that they are entitled to a shortfall payment of $41,175.68. See FEMA000039. *2 Plaintiffs' method of calculating their damages by taking the square footage of their original structure and multiplying it by the cost per square foot of the new upgraded structure does not take into account any of the SFIP's coverage limits or exclusions. Plaintiffs' itemization did not actually include any itemization that could be used for a meaningful comparison to the adjuster's estimate. Plaintiffs presented no evidence challenging the repair estimates provided by Allstate. Plaintiffs' sole focus was on receiving compensation based on the cost of building a substantially improved structure. When reviewing Plaintiffs' waiver application, the Administrator evaluated the facts and circumstances relating to the request. See FEMA000080 and FEMA000081. Specific to this case, the Administrator considered the following whether: 1. Policy holder demonstrated additional damages exist that are covered by the SFIP; 2. Policy holder submitted appropriate documentation supporting the additional compensation being requested; and 3. Policy holder provided a reasonable explanation for the delay in submitting the POL.
Id. The SFIP only covers direct physical loss caused by or from flooding. Plaintiffs' supplemental claim is based on the square footage cost of a new upgraded dwelling without regard to the actual physical loss caused by or from the flooding. In addition to only insuring against physical loss by or from flooding, the SFIP excludes coverage for upgrades and requires the use of material that is of like kind and quality, which Plaintiffs' formula disregards. See FEMA000005 and FEMA000039. Finally, the SFIP has a policy limit of $30,000.00 for Increased Cost of Compliance expenses and Plaintiffs' formula makes it impossible to deduct any of these expenses in excess of that limit. In the letter providing FEMA's determination on Plaintiffs' waiver application, the Administrator stated: ... you claim your damages necessitated the demolition of your dwelling as a result of the flooding. To support the amount claimed, you provided an estimate for the replacement cost of your new home. Your claim was originally reviewed by an independent adjuster, a General Adjuster with the National Flood Insurance Program and subsequently, by the Hurricane Isabel Task Force. You did receive a supplemental claim payment that was recommended by the Hurricane Isabel Task Force and paid by your Write Your Own Company, Allstate Insurance Company (Allstate). You also received the maximum payment under the Increased Cost of Compliance coverage from Allstate. All reviews of your claim including the inspection of the structure concluded the cost of the new dwelling did not accurately reflect damages caused by the flood event. Further, your waiver request resulted in a comprehensive review of your claim by a FEMA Insurance Examiner. After further review, the Insurance Examiner found no basis to set aside
the original findings. *3 Id. Plaintifs failed to demonstrate they met any of the criteria used to determine whether to grant a waiver. First, they failed to demonstrate any additional damages they sought were actually covered by his SFIP. Second, they took a formulaic approach based on the cost per square foot of a substantially improved home to calculate their loss that did not take into account the coverages and exclusions found within their SFIP. Accordingly, after another comprehensive review of the claim, FEMA determined no further compensation was warranted. Id. Plaintiffs' waiver application was denied for a multitude of reasons, but primarily because they failed to document any physical loss by or from flood covered under his SFIP for which they did not receive full compensation. IV. Plaintiffs' Assertions Plaintiffs arguments in Opposition to FEMA's Supplemental Motion for Summary Judgment is found at pages 40 to 42 of Document 677. In summary, Plaintiffs believe that FEMA did not take into account the extent of the damage to their home when there was water level in the interior up to 5 feet 9 inches and water in the residence for up to 63 hours. Id at 40. They feel that FEMA did not properly take into account the determination of the Baltimore County Government that the cost to repair exceeded 50% of the assessed value of the home. FEMA is accused of engaging in low ball tactics. Id at 41. Plaintiffs find FEMA position on the amount of damages to be arbitrary and capricious. Plaintiffs also defend using the cost per square foot of new construction as a formula for assessing the cost to be applied to the damaged dwelling. Id at 41 to 42. Plaintiffs also disagree with the statements of Ms. Christian in her Declaration that insufficient proof was submitted pointing to 17 pages of documents submitted at FEMA 000039 to 000056. Plaintiffs state that they did not base their shortfall
on the cost of building a substantially improved structure, but on the cost per square foot based on their old, storm damaged structure. V. Special Master's Analysis FN2
FN2. In their Oppositions at Document No. 677 at Pages 3 to 9, Group Five Plaintiffs have raised what they term to be twentyfour common issues that the Court has previously considered or resolved in consideration of prior groups. To the extent that these issues are not further cited in the individual Plaintiffs' discussion of their particular cases, the Special Master will not specifically address these issues in this Report and Recommendation, but will incorporate and rely on the Court's prior rulings on these issues (see Documents 594, 596, 597 and 679) and the previously-filed Memorandum on Role of the Special Master and Report and Recommendation of the Special Master on General Issues Raised by Plaintiffs and Defendants (Document 563). As FEMA notes in its Reply at page 8, these Plaintiffs waiver claim was squarely based on the now rejected square foot formula of new construction as applied to the original square footage of the damaged house. This formula has been found wanting by FEMA, the Special Master and the court in its February 17, 2011 opinion (Document 597 at pages 8 to 9) and again in the July 1, 2011 memorandum opinion (Document 679 at page 5). The U.S. District Court has reaffirmed this view in the Memorandum Opinion issued on August 3, 2011. See Document 693. The Special Master does not find that Plaintiffs have presented any other arguments that merit any further detailed consideration. The Baltimore County government letter was considered by FEMA and in fact it formed the basis for payment of the full amount ($30,000) of the ICC claim that is available under the policy. FEMA considered the
documentation submitted in the waiver application and,as is set forth in Part III above, FEMA articulated reasonable explanations for rejecting Plaintiffs' waiver application. It found the proof submitted insufficient to alter its prior determinations that had been made by Allstate and the adjusters who reviewed the claim as well as the Hurricane Isabel Task Force who reviewed the claim before the waiver claim was made. It was within Allstate and FEMA's discretion to evaluate the evidence presented and determine what evidence it found credible and most in accord with the requirements of the SFIP. The Special Master sees no basis to conclude that FEMA's position on denial of a waiver to be arbitrary or capricious or an abuse of discretion. VI. Recommendation of the Special Master *4 After a review and a consideration of the matter and the arguments presented by the parties, it is the recommendation of the Special Master that the Defendants' Motion for Partial Summary Judgment affirming FEMA's determination of Plaintiff's waiver application be granted; and it is further recommended that Plaintiffs' Motion for Summary Judgment be denied. D.Md.,2011. Moffett v. Computer Sciences Corp. Slip Copy, 2011 WL 3439290 (D.Md.) END OF DOCUMENT
Only the Westlaw citation is currently available. United States District Court, D. Maryland, Southern Division. Thomas L. MOFFETT, II, et al., Plaintiffs, v. COMPUTER SCIENCES CORPORATION, et al., Defendants. Civil Action No. 8:05CV01547. Aug. 4, 2011. Donald W. Marcari, Frank D. Lawrence, III, Marcari Russotto and Spencer, Chesapeake, VA, Martin H. Freeman, Freeman and Freeman PC, Rockville, MD, for Plaintiffs. Arthur F. Fergenson, Ansa Assuncao LLP, Holly Drumheller Butler, DLA Piper US LLP, Jason Daniel Medinger, Office of the United States Attorney, Baltimore, MD, Jay I. Morstein, Owings Mills, MD, Tyler Brian Raimo, Computer Sciences Corporation, Falls Church, VA, Darren Seth Wall, Department of Homeland Security, Arlington, VA, Robert H. King, Jr., Sonnenschein Nath and Rosenthal LLP, Chicago, IL, Kirk Robert Ruthenberg, SNR Denton US LLP, Steuart H. Thomsen, Sutherland Asbill and Brennan LLP, Scott Nathan Auby, W. Neil Eggleston, Scott Nathan Auby, Debevoise and Plimpton LLP, Elizabeth Treubert Simon, Pamela Anne Bresnahan, Vorys Sater Seymour and Pease LLP, Washington, DC, Gerald Joseph Nielsen, Nielsen Law Firm LLC, Metairie, LA, Peter F. Axelrad, Council Baradel Kosmerl and Nolan PA, Annapolis, MD, Patricia McHugh Lambert, Steven B. Schwartzman, Hodes Pessin and Katz PA, Towson, MD, Craig Russell Blackman, Samuel J. Arena, Jr., Stradley Ronon Stevens and Young LLP, Philadelphia, PA, Steven Michael Klepper, Kramon and Graham PC, James D. Skeen, Skeen and Kauffman LLP, Brett Anthony Buckwalter, Niles Barton and Wilmer LLP, Baltimore, MD,
Edward J. Hutchins, Jr., Stacey Ann Moffet, Eccleston and Wolf PC, Hanover, MD, William J. Hickey, Law Offices of William J. Hickey LLC, Rockville, MD, Debra Anne Nelson, William Lowell Mundy, Mundy and Nelson, Huntington, WV, James Hilton Crosby, Crosby Saad LLC, Mobile, AL, William Gerald Gandy, Wilson Elser Moskowitz Edelman and Dicker, McLean, VA, Bradish J. Waring, Mary Legare Hughes, Nexsen Pruet LLC, Charleston, SC, for Defendants. REPORT AND RECOMMENDATION CONCERNING WAIVER CLAIM OF MONICA MCCALL DENNIS M. SWEENEY, Special Master. *1 This constitutes the Report and Recommendation to the Court concerning the waiver claim of Monica McCall pursuant to Part 1.f of the Memorandum Order of the Court (Document 467). In preparing this report, the Special Master reviewed the motions, memoranda, affidavits and exhibits provided in connection with the process specified in the Memorandum Order. As necessary, the Special Master also reviewed other documents that are part of the Court filings in this case. The Special Master was also provided by the Federal Emergency Management Agency (FEMA) the computer disc of the appropriate documents of record for this claim, as specified in Part 1.a of the Memorandum Order. In this case, the documents consist of 147 pages labeled FEMA000001 to 000147. I. Background Plaintiff's property located at 932 Seneca Park Road, Middle River, Maryland, was insured directly by FEMA under Policy Number 3000204561 with a coverage limit of $172,700.00 for her building, subject to a $1,000.00 deductible. See FEMA000005. Plaintiff did not maintain any contents coverage. Id. On September 19, 2003, Hurricane Isabel
struck the Middle Atlantic States, including Maryland, which caused flooding resulting in damage to Plaintiff's home. See FEMA000200. Plaintiff reported her loss to FEMA and on September 25, 2003, an independent adjuster inspected the loss. Id. On October 28, 2003, Plaintiff requested a $5,000.00 advance payment. See FEMA000252. On October 29, 2003, FEMA issued a check for $5,000.00. See FEMA000276. On November 21, 2003, G & A Engineering Consultants, LLC completed a detailed inspection of Plaintiff's home and issued its Engineering Report. See FEMA000123 through FEMA000137. The engineer found that the structure had been deteriorating for a long time, and that there was evidence of past foundation movement. See FEMA000125. The engineer also concluded that the damage to the roof was from wind. Id. There was also evidence of significant past repair work to the foundation, with jacks holding up portions of the home. See FEMA000126. The engineer concluded the home itself was not in bad condition and could be repaired. See FEMA000127 and FEMA000128. On December 27, 2003, the adjuster completed his final report and noted that two inches of water entered Plaintiff's home. Id. In addition, he reviewed the report from G & A Engineering Consultants discussed above. See FEMA000200. He concluded Plaintiff should be paid $43,438.39, less her $1,000.00 deductible, and an additional $11,128.59 for recoverable depreciation, if eligible. See FEMA000285. On December 31, 2003, in accordance with the adjuster's recommendation, Plaintiff submitted a Proof of Loss for $42,438.39, and an undated Statement as to Full Cost of Repair or Replacement for $11,128.59 for compensation of the recoverable depreciation portion of her loss. See FEMA000050 through FEMA000052.
*2 On January 28, 2004, FEMA issued a partial denial on Plaintiff's claim. See FEMA000211. The overhead and profit was deducted from the adjuster's estimate because Plaintiff's Overhead and Profit Affidavit (See FEMA000205) was incorrectly calculated (See FEMA000214). Plaintiff's claim was reduced to $36,625.03, and her recoverable depreciation was reduced to $10,849.93. See FEMA000211. She was notified that since a portion of her claim was rejected, she had one year from the date of the denial to file suit. Id. Plaintiff was paid the reduced amount ($36,625.03) on the actual cash value of the loss, but inadvertently paid the original replacement value cost of $11,128.59. See FEMA000053 and FEMA000055. Plaintiff requested review by the Hurricane Isabel Task Force (Task Force) claiming she had unpaid foundation damage based on two engineers' opinions. See FEMA000014. On August 24, 2004, the Task Force completed its review. See FEMA000163. The Task Force made some adjustments to the claim allowing an additional $2,926.35. Id. When the Task Force informed Plaintiff of their determination, she stated she agreed and understood. Id. On September 11, 2004, Plaintiff submitted a Proof of Loss for the supplemental amount the Task Force approved. See FEMA000051. On January 28, 2004, FEMA paid Plaintiff in full that POL. See FEMA000058. Plaintiff was paid a total of $55,679.97 for the damage to her structure ($5,000.00, $36,625.03, $11,128.59, and $2,926.35) plus $26,095.00 under the Increased Cost of Compliance (ICC) provision of her SFIP. See FEMA000005. II. Waiver Claim and Denial On December 3, 2007, this Court permitted Plaintiffs to submit applications for waivers to FEMA. See Doc. No. 196 and Doc. No. 197, Order of December 4, 2007. On February 25, 2008, Plaintiff submitted to FEMA a document entitled PLAINTIFF MONICA McCALL'S INDIVIDUAL APPLICATION FOR WAIVER OF PROOF OF
LOSS REQUIREMENTS. The waiver application simply requested that FEMA compensate Plaintiff an additional $67,491.77. See FEMA000005. FEMA denied the request in an undated letter. See FEMA000067 to 000068. III. Reasons for Waiver Denial The reasons for the denial of the Waiver Claim are found at 1626 of the Supplemental Declaration of Karen Christian for the Claim of Monica FN1 McCall. Document No. 6392. It states: FN1. Ms. Christian also relies on the declaration of Suzanne Woods which was led earlier in this case explaining the reasons for FEMA's actions. See Document No. 2982. Plaintiff based her loss on a formula, which was based on her assertion that it cost her $200,450.00 to construct a new substantially improved and larger home, deducted the Increased Cost of Compliance payment she received, and divided that number by the square footage of the new upgraded home to arrive at a cost of $78.54 per square foot. See FEMA000068. She then multiplied the cost per square foot of the new home by the square footage of her old home (1581 square feet) to arrive at a cost to restore the old home of $124,171.74. Id. Plaintiff then deducted the NFIP payments totaling $55,679.97 and applied her $1,000.00 deductible to arrive at a shortfall of $67,491.77. Id. *3 Plaintiff's formulaic Shortfall Itemization was based completely on the cost of her new upgraded home. Id. Plaintiff's itemization did not actually include any itemization that could be used for a meaningful comparison to the adjuster's estimate. Id. Plaintiff's method of calculating her damages by taking the square footage of her original structure and multiplying it by the cost per square foot of the new upgraded structure does not take into account any of the SFIP's coverage limits or ex-
clusions. Plaintiff presented no evidence challenging the repair estimates provided by FEMA and the Task Force. Plaintiff's sole focus was on receiving compensation based on the cost of building a substantially improved structure. When reviewing Plaintiffs' waiver application, the Administrator evaluated the facts and circumstances relating to the request. See FEMA000148 and FEMA000149. Specific to this case, the Administrator considered the following whether: 1. Policy holder demonstrated additional damages exist that are covered by the SFIP; 2. Policy holder submitted appropriate documentation supporting the additional compensation being requested; and 3. Policy holder provided a reasonable explanation for the delay in submitting the POL. Id. The SFIP only covers direct physical loss caused by or from flooding. Plaintiff's formulaic shortfall calculation fails to account for the fact that only two inches of water entered her structure and that her home was built in July of 1965 ( See FEMA000166). Plaintiff's supplemental claim is based on the square footage cost of a new upgraded dwelling without regard to the actual loss caused by the flooding and includes code and material upgrades. In addition to only insuring against loss caused by or from flood, the SFIP excludes coverage for upgrades and requires the use of material that is of like kind and quality. See Exhibit A at 16 and 17. Finally, the SFIP has a policy limit of $30,000.00 for Increased Cost of Compliance expenses and Plaintiff's formula makes it impossible to separate out these expenses. In the letter providing FEMA's determination
on Plaintiff's waiver application, the Administrator stated: ... you claim your actual building damages exceed the amount allowed by the National Flood Insurance Program Servicing Agent (NFIPSA). Your claim was originally reviewed by an independent adjuster and subsequently reviewed by the Hurricane Isabel Task Force. A supplemental payment in the amount of $2,926.35 was recommended by the Task Force for an increase in the cleaning allowance. You also received $26,095 for demolition benefits under your Increased Cost of Compliance (ICC) claim. The supplemental claim documents show that your original dwelling at 1581 square feet was replaced with a larger structure at 2,200 square feet. Costs attributed to the increased square footage are considered an upgrade which is not covered under the SFIP. You have been paid for all covered damages as a result of the flood event including a portion of the foundation after the inspection of the dwelling by a structural engineer. *4 Further, your waiver resulted in a comprehensive review of your claim by a FEMA Insurance Examiner. After further review, the Insurance Examiner found no basis to set aside the original findings. Id. Plaintif failed to demonstrate she met any of the criteria used to determine whether to grant a waiver. First, she failed to demonstrate any additional damages she sought were actually covered by her SFIP. Second, she did not submit detailed line-item documentation of uncompensated damages caused directly by flooding to her original structure, but instead took a formulaic approach based on the cost per square foot of a substantially improved home to calculate her loss. Accordingly, after another comprehensive re-
view of the claim, FEMA determined no further compensation was warranted. Id. Plaintiff's waiver application was denied for a multitude of reasons, but primarily because she failed to document any physical loss by or from flood covered under her SFIP for which she did not receive full compensation for. IV. Plaintiffs Assertions In her Opposition (Document 677 at pages 16 to 20), Plaintiff raises several contentions which do not appear to be directly stated in the waiver application. Plaintiff faults Bellmon Adjusters, Inc for using what she contends is the controversial Marshall and Swift residential estimating program and disagrees with the values found by the application of that program. Plaintiff also asserts that the report she obtained from McCon Engineering, Inc should have been given more weight since it was clear as to the cause, effect and damage sustained by Ms. McCall's home. Id at page 18. Plaintiff believes that the estimate submitted on her behalf by William McCubbin Community Builders for $117,820 should have been accepted as the basis for payment. Plaintiff faults Mr. Charles Mikell, the General Adjuster and NFIP Servicing Agent for not accepting the reports she supplied but instead hiring an engineer from a firm, G & A Engineering Consultants, LLC from Dallas, Texas. Plaintiff believes this was an effort by FEMA to find a way to lowball payment to Ms McCall. Id at page 19. Plaintiff made the decision to build a new structure and contracted with C & D Sherman Homes. She now seeks $67,491.77 in her motion for summary judgment. Id at page 50. V. Special Master's Analysis FN2
FN2. In their Oppositions at Document No. 677 at Pages 3 to 9, Group Five Plaintiffs have raised what they term to be twentyfour common issues that the Court has previously considered or resolved in con-
sideration of prior groups. To the extent that these issues are not further cited in the individual Plaintiffs' discussion of their particular cases, the Special Master will not specifically address these issues in this Report and Recommendation, but will incorporate and rely on the Court's prior rulings on these issues (see Documents 594, 596, 597 and 679) and the previously-filed Memorandum on Role of the Special Master and Report and Recommendation of the Special Master on General Issues Raised by Plaintiffs and Defendants (Document 563). As FEMA correctly notes it its reply(Document 688), the Plaintiff's waiver application was based entirely on the square footage formula based on the cost of new construction which Plaintiff asserts should set the amount paid to her when it is applied to the square footage of the house that is replaced. This formula has been repeatedly rejected by FEMA, the Special Master, and the court in its memorandum opinions. See, e.g. Memorandum Opinion on Group 3 Householders, Document No. 693 (August 3, 2011). As is demonstrated in Part III above, FEMA has explained in Plaintiff's denial letter and in the affidavit filed with this court why Plaintiff's claim can not be granted. Little more needs to be said. *5 Plaintiff has attempted in her opposition to recast the claim, now suggesting that it was not fair for FEMA to seek out another engineering opinion rather than accepting the one Plaintiff obtained. Plaintiff sees this as an attempt to low ball claimants and relies on the fact that the firm that performed the review is from Texas. The report done however is signed by a Maryland professional engineer and it appears quite comprehensive and detailed. FEMA 000123 to 000137. It is mere speculation by Plaintiff to suggest that there is anything irregular about the process followed. It is FEMA's province to decide what evidence it needs to evaluate a claim and the fact that it was not satisfied to
rely solely on the Plaintiff's engineering report does not demonstrate that the denial of the waiver was arbitrary or capricious or an abuse of discretion. Likewise, Plaintiff's suggestions that Bellmon Adjusters, Inc.'s use of the Marshall and Swift estimating program is not appropriate is an argument that has also been rejected previously in other cases that have been reviewed since the charge remains only an accusation with no expert analysis or proof to support it. VI. Recommendation of the Special Master After a review and a consideration of the matter and the arguments presented by the parties, it is the recommendation of the Special Master that the Defendants' Motion for Partial Summary Judgment affirming FEMA's determination of Plaintiff's waiver application be granted; and it is further recommended that Plaintiff's Motion for Summary Judgment be denied. D.Md.,2011. Moffett v. Computer Sciences Corp. Slip Copy, 2011 WL 3439299 (D.Md.) END OF DOCUMENT
Only the Westlaw citation is currently available. United States District Court, D. Maryland, Southern Division. Thomas L. MOFFETT, II, et al., Plaintiffs, v. COMPUTER SCIENCES CORPORATION, et al., Defendants. Civil Action No. 8:05CV01547. Aug. 4, 2011. Donald W. Marcari, Frank D. Lawrence, III, Marcari Russotto and Spencer, Chesapeake, VA, Martin H. Freeman, Freeman and Freeman PC, Rockville, MD, for Plaintiffs. Arthur F. Fergenson, Ansa Assuncao LLP, Holly Drumheller Butler, DLA Piper US LLP, Jason Daniel Medinger, Allen F. Loucks, Office of the United States Attorney, Steven Michael Klepper, Kramon and Graham PC, James D. Skeen, Skeen and Kauffman LLP, Brett Anthony Buckwalter, Niles Barton and Wilmer LLP, Baltimore, MD, Jay I. Morstein, Owings Mills, MD, Tyler Brian Raimo, Computer Sciences Corporation, Falls Church, VA, Darren Seth Wall, Department of Homeland Security, Federal Emergency Management Agency, Arlington, VA, Robert H. King, Jr., Sonnenschein Nath and Rosenthal LLP, Chicago, IL, Kirk Robert Ruthenberg, SNR Denton US LLP, Steuart H. Thomsen, Sutherland Asbill and Brennan LLP, Scott Nathan Auby, W. Neil Eggleston, Debevoise and Plimpton LLP, Elizabeth Treubert Simon, Pamela Anne Bresnahan, Vorys Sater Seymour and Pease LLP, Washington, DC, Gerald Joseph Nielsen, Nielsen Law Firm LLC, Metairie, LA, Peter F. Axelrad, Council Baradel Kosmerl and Nolan PA, Annapolis, MD, Patricia McHugh Lambert, Steven B. Schwartzman, Hodes, Pessin & Katz, P.A., Towson, MD, Craig Russell Blackman, Samuel J. Arena, Jr., Stradley Ronon Stevens and
Young LLP, Philadelphia, PA, Edward J. Hutchins, Jr., Stacey Ann Moffet, Eccleston and Wolf PC, Hanover, MD, William J. Hickey, Law Offices of William J. Hickey LLC, Rockville, MD, Debra Anne Nelson, William Lowell Mundy, Mundy and Nelson, Huntington, WV, James Hilton Crosby, Crosby Saad LLC, Mobile, AL, William Gerald Gandy, Wilson Elser Moskowitz Edelman and Dicker, McLean, VA, Bradish J. Waring, Mary Legare Hughes, Nexsen Pruet LLC, Charleston, SC, for Defendants. REPORT AND RECOMMENDATION CONCERNING WAIVER CLAIM OF JOANNE McKENZIE DENNIS M. SWEENEY, Special Master. *1 This constitutes the Report and Recommendation to the Court concerning the waiver claim of Joanne McKenzie pursuant to Part 1.f of the Memorandum Order of the Court (Document 467). In preparing this report, the Special Master reviewed the motions, memoranda, affidavits and exhibits provided in connection with the process specified in the Memorandum Order. As necessary, the Special Master also reviewed other documents that are part of the Court filings in this case. The Special Master was also provided by the Federal Emergency Management Agency (FEMA) the computer disc of the appropriate documents of record for this claim, as specified in Part 1.a of the Memorandum Order. In this case, the documents consist of 183 pages labeled FEMA000001 to 000183. I. Background Plaintiff's property located at 2800 7th Street, Baltimore, Maryland was insured by Harleysville under policy number 0157643502 with a coverage limit of $85,000.00 for her building with a $5,000.00 deductible. See FEMA000005 and FEMA000109. Plaintiff did not maintain any contents coverage. Id.
On September 19, 2003, Hurricane Isabel struck the Middle Atlantic States, including Maryland, which caused flooding resulting in damage to Plaintiff's home. See FEMA000141. Plaintiff reported her loss to FEMA and on September 20, 2003, an independent adjuster inspected the loss. Id. and FEMA000109. On September 24, 2003, Plaintiff was issued a $10,000.00 advance payment. See FEMA000120 and FEMA000121. On October 31, 2003, the independent adjuster completed his estimate on Plaintiff's loss and issued his report. See FEMA000141 through FEMA000155. The report noted that the building was constructed in 1984. See FEMA000141. The exterior water height was measured at 42 inches and the interior water height was measured at six inches. Id. The Independent Adjuster concluded Plaintiff should be paid $38,506.99 in actual cash value after application of the $5,000.00 deductible and an additional $5,894.27 for recoverable depreciation, if eligible. See FEMA000155. Plaintiff submitted an affidavit to receive overhead and profit on her claim, which totaled $23,004.72. Id. and FEMA000160. Plaintiff stated that a licensed General Contractor would complete the repairs to receive payment. See FEMA000160. If the work was not done by a licensed General Contractor, Plaintiff agreed to reimburse Harleysville. Id. On November 15, 2003, Plaintiff submitted a Proof of Loss for the $38,506.99 for the actual cash value of her loss and a Statement as to Full Cost of Repair or Replacement in the amount of $5,894.27 for the recoverable deprecation portion of her claim. See FEMA000130 and FEMA000132. On December 8, 2003, Plaintiff was paid $28,506.99 in addition to the previously paid $10,000.00 advance referenced above. See FEMA000116. On April 29, 2004, Plaintiff was paid the $5,894.27 in recoverable depreciation. See
FEMA000118. *2 Plaintiff did not request a review by the Hurricane Isabel Task Force. See FEMA000104. II. Waiver Claim and Denial On December 3, 2007, this Court permitted Plaintiffs to submit applications for waivers to FEMA. See Doc. No. 196 and Doc. No. 197, Order of December 4, 2007. On February 25, 2008, Plaintiff submitted to FEMA a document entitled PLAINTIFF JOANNE MCKENZIE'S INDIVIDUAL APPLICATION FOR WAIVER OF PROOF OF LOSS REQUIREMENTS. The waiver application requested that FEMA compensate Plaintiff an additional $41,493.01. See FEMA000005. FEMA denied the request in a letter dated July 31, 2008. See FEMA000103 to 000104. III. Reasons for Waiver Denial The reasons for the denial of the Waiver Claim are found at 1423 of the Supplemental Declaration of Karen Christian for the Claim of Joanne FN1 McKenzie Document 6402. It states: FN1. Ms. Christian also relied on the Declaration filed by Kim Berger of Harleysville which is of record in this case. Document 3122. Plaintiff's shortfall was based on her assertion that it cost her $35,256.00 in materials and $50,000.00 in labor to rebuild her former structure. Id. Plaintiff deducted her claimed payment of $38,506.99 from the total cost to rebuild to arrive at her claimed shortfall amount. First, Plaintiff failed to include the payment of $5,894.27 in her calculation, which reduces the claimed shortfall by that amount. Plaintiff was actually paid a total of $44,401.26 ($10,000.00, $28,506.99 and $5,894.27). Second, Plaintiff now claims she repaired the home herself with the help of thirty eight family members, friends and co-workers. As noted above, Plaintiff submitted an affidavit certifying
the use of a licensed General Contractor to receive Overhead and Profit. See FEMA000160. Plaintiff agreed to reimburse Harleysville the profit amount in the event she did not use a licensed General Contractor. There is no evidence in the file that the services of Norman Anderson were used for the reconstruction of her home. Harleysville can require Plaintiff reimburse it for the overhead and profit payment it issued. See FEMA000155. Third, Plaintiff provided a number of invoices, and receipts without explaining how the claimed expenses related to any direct physical loss by or from the six inches of floodwater that entered the interior of her structure. Further, the documentation submitted included repairs, which would be considered improvements or upgrades, which are not covered under the SFIP. See FEMA000104. Fourth, Plaintiff seeks $50,000.00 for her Estimated labor calculation of 38 workers over 5 months. See FEMA000005 and FEMA000028. There is no precision in this so called estimate. There is simply no explanation or itemization for this extraordinary labor expense. Plaintiff is not entitled to compensation for this labor since labor, including overhead and profit, was included in the independent adjuster's estimate. Finally, Plaintiff was paid a total of $44,401.26 based on actual physical loss caused by or from flood as detailed in the independent adjuster's final report. Plaintiff's shortfall calculation lacks any explanation of how this amount is insufficient based on her SFIP. *3 When reviewing Plaintiffs' waiver application, the Administrator evaluated the facts and circumstances relating to the request. See FEMA000103 and FEMA000104. Specific to this case, the Administrator considered the following whether: 1. Policy holder demonstrated additional damages
exist that are covered by the SFIP; 2. Policy holder submitted appropriate documentation supporting the additional compensation being requested; and 3. Policy holder provided a reasonable explanation for the delay in submitting the POL. Id. In the letter providing FEMA's determination on Plaintiff's waiver application, the Administrator stated: ... you claim your repair damages exceeded the payment received as a result of the flooding. To support the amount claimed, you provided documentation and estimates for the repair of your home. The bids and invoices you submitted for improvements and upgrades to the structure are not covered by the SFIP. Your claim was originally reviewed by an independent adjuster, but there is not a record that the Hurricane Isabel Task Force was ever involved in the claim review. Also, there is no indication that you provided your Write Your Own Company, Harleysville Insurance with supplemental claim documents. All reviews of your claim conclude the carrier's estimate of damage was accurate Further, your waiver resulted in a comprehensive review of your claim by a FEMA Insurance Examiner. After further review, the Insurance Examiner found no basis to set aside the original findings. Id. Plaintiff's waiver application does not meet the criteria for approval. First, she failed to demonstrate any additional damages she sought were actually covered by her SFIP. Second, she did not submit detailed line-item documentation supporting the particular additional amounts being sought were for covered damages, but instead
submitted a collection of unexplained invoices, estimates and receipts along with an estimated claim of $50,000.00 for labor performed by friends, family and co-workers. Accordingly, after another comprehensive review of the claim, FEMA determined no further compensation was warranted. Id. Plaintiff's waiver application was denied for a multitude of reasons, but primarily because she failed to document any physical loss by or from flood covered under her SFIP for which she did not receive full compensation for. IV. Plaintiffs' Assertions Plaintiff in her Opposition (Document 677) at page 24 reduced her shortfall calculation to $29, 706.73 agreeing with FEMA that certain items should not have been included. Plaintiff argues that the house was rebuilt with the help of 38 family, friends and co-workers who volunteered their time, and she claims that the value of their time which she estimates at $50,000 should be recognized by FEMA. Id at 24. Plaintiff believes that it was not appropriate for FEMA to question the overhead and profit affidavit that stated she was using a licensed general contractor simply because the contractor was a family member and she was using other family, friends and co-workers to actually do the work. Plaintiff also believes that she provided sufficient invoices and receipts to support her claim and that they were sufficiently tied to the SFIP requirements. Plaintiff claims that it should have been abundantly obvious to anyone reviewing Ms. McKenzie's claim that, if her materials were $35,992.62 and she was only paid $44, 401.26, she would be left with roughly $8,400.00 available to pay contractors. Plaintiff believes that since the work required for contracting was $50,882 based on her calculations that she should be compensated accordingly. V. Special Master's Analysis FN2
have raised what they term to be twentyfour common issues that the Court has previously considered or resolved in consideration of prior groups. To the extent that these issues are not further cited in the individual Plaintiffs' discussion of their particular cases, the Special Master will not specifically address these issues in this Report and Recommendation, but will incorporate and rely on the Court's prior rulings on these issues (see Documents 594, 596, 597 and 679) and the previously-filed Memorandum on Role of the Special Master and Report and Recommendation of the Special Master on General Issues Raised by Plaintiffs and Defendants (Document 563). *4 In the denial of the waiver claim, FEMA explained why it denied the request for labor costs for Plaintiff's family, friends and co-workers who it is alleged provided labor for rebuilding the home. FEMA states: Plaintiff seeks $50,000.00 for her Estimated labor calculation of 38 workers over 5 months. See FEMA000005 and FEMA000028. There is no precision in this so called estimate. There is simply no explanation or itemization for this extraordinary labor expense. Plaintiff is not entitled to compensation for this labor since labor, including overhead and profit, was included in the independent adjuster's estimate. Plaintiff in its opposition for the first time sets out a method of calculation based on an estimated number of hours worked per week and calculating the wages at the then prevailing minimum wage. FEMA still rejects the calculations because it fails to explain what work was actually performed, how the work was performed, how the work was attributable to a direct loss by or from the flood and why it was only an estimate. FEMA Reply(Document 688) at page 11. The Special Master agrees with FEMA that the effort in the waiver application to
FN2. In their Oppositions at Document No. 677 at Pages 3 to 9, Group Five Plaintiffs
claim $50,000 for labor was insufficient and it was not error for FEMA to refuse to accept this claim. Plaintiff's documentation of this claim was non existent in the waiver application. Plaintiff has now suggested that an average number of hours be used for the 38 people involved and the wages be pegged at the minimum wage. These are new arguments and were not made in the waiver application and even if they had, it would not have been error for FEMA to refuse to accept these vague and unsubstantiated representations. As to Plaintiff's claims for overhead and profit, these claims are refuted by FEMA's Reply (Document No.688) which states: Third, Plaintiff argues FEMA improperly denied her waiver application because her claim for overhead and profit was for work performed by family, friends and co-workers and not a licensed general contractor. Id. at 22 and 23. Plaintiff claims she did use a licensed general contractor, Norman Anderson, to perform reconstruction work at her home and that he was a member of Plaintiff's friends and family who assisted her in rebuilding her home. Id. According to Plaintiff, much of the work performed by Plaintiff and her family was performed under Mr. Anderson's guidance. Id. This is another new argument that was not presented in Plaintiff's waiver application that should be disregarded. Nevertheless, Plaintiff is not entitled to overhead and profit for work done by friends and family even if performed under the guidance of a family member or friend who happens to be a licensed general contractor. Overhead and profit represents the normal industry mark-up for using a general contractor. FEMA allows for a 10% increase to the claim when a home repair will require three or more trades, e.g., plumber, roofer, and electrician. Dwyer v. Fidelity National Property and Casualty Insurance Company, 2011 U.S.App. LEXIS 10038 at *3, 2011 WL 1835268 (5th Cir.2011). Moreover, the NFIP Adjuster Claims Manual, (Change 1January 1, 2004) provides that overhead and profit is warranted only if a general contractor has
been hired to make repairs. (emphasis added). In this case, Plaintiff's failure to specifically use a licensed general contractor warrants a denial of her claim for overhead and profit. Even if Mr. Anderson provided guidance on the reconstruction work, Plaintiff provided no explanation on how much he billed Plaintiff or if he anticipated payment for his work. Further, Plaintiff provided no explanation of exactly what work he assisted with, or how he oversaw the repairs that would enable FEMA to determine if his work was covered under the SFIP. *5 Id at pages 11 and 12. The Special Master finds this analysis persuasive and adopts it. As to other issues raised, the Special Master finds that in Part III above, FEMA adequately explains why it denied the waiver claim filed by Plaintiff. The Special Master finds that the denial was neither arbitrary or capricious nor an abuse of discretion. VI. Recommendation of the Special Master After a review and a consideration of the matter and the arguments presented by the parties, it is the recommendation of the Special Master that the Defendants' Motion for Partial Summary Judgment affirming FEMA's determination of Plaintiff's waiver application be granted; and it is further recommended that Plaintiff's Motion for Summary Judgment be denied. D.Md.,2011. Moffett v. Computer Sciences Corp. Slip Copy, 2011 WL 3439314 (D.Md.) END OF DOCUMENT
Only the Westlaw citation is currently available. United States District Court, D. Maryland, Southern Division. Thomas L. MOFFETT, II, et al., Plaintiffs, v. COMPUTER SCIENCES CORPORATION, et al., Defendants. Civil Action No. 8:05CV01547. Aug. 4, 2011. Donald W. Marcari, Frank D. Lawrence, III, Marcari Russotto and Spencer, Chesapeake, VA, Martin H. Freeman, Freeman and Freeman PC, Rockville, MD, for Plaintiffs. Arthur F. Fergenson, Ansa Assuncao LLP, Holly Drumheller Butler, DLA Piper U.S. LLP, Jason Daniel Medinger, Allen F. Loucks, Office of the United States Attorney, Steven Michael Klepper, Kramon and Graham PC, James D. Skeen, Skeen and Kauffman LLP, Brett Anthony Buckwalter, Niles Barton and Wilmer LLP, Baltimore, MD, Jay I. Morstein, Owings Mills, MD, Tyler Brian Raimo, Computer Sciences Corporation, Falls Church, VA, Darren Seth Wall, Department of Homeland Security, Federal Emergency Management Agency, Arlington, VA, Robert H. King, Jr., Sonnenschein Nath and Rosenthal LLP, Chicago, IL, Kirk Robert Ruthenberg, SNR Denton U.S. LLP, Steuart H. Thomsen, Sutherland Asbill and Brennan LLP, Scott Nathan Auby, W. Neil Eggleston, Debevoise and Plimpton LLP, Elizabeth Treubert Simon, Pamela Anne Bresnahan, Vorys Sater Seymour and Pease LLP, Washington, DC, Gerald Joseph Nielsen, Nielsen Law Firm LLC, Metairie, LA, Peter F. Axelrad, Council Baradel Kosmerl and Nolan PA, Annapolis, MD, Patricia McHugh Lambert, Steven B. Schwartzman, Hodes Pessin and Katz PA, Towson, MD, Craig Russell Blackman, Samuel J. Arena, Jr., Stradley Ronon Stevens and Young
LLP, Philadelphia, PA, Edward J. Hutchins, Jr., Stacey Ann Moffet, Eccleston and Wolf PC, Hanover, MD, William J. Hickey, Law Offices of William J. Hickey LLC, Rockville, MD, Debra Anne Nelson, William Lowell Mundy, Mundy and Nelson, Huntington, WV, James Hilton Crosby, Crosby Saad LLC, Mobile, AL, William Gerald Gandy, Wilson Elser Moskowitz Edelman and Dicker, McLean, VA, Bradish J. Waring, Mary Legare Hughes, Nexsen Pruet LLC, Charleston, SC, for Defendants. REPORT AND RECOMMENDATION CONCERNING WAIVER CLAIM OF DALE AND GEORGIA POLING DENNIS M. SWEENEY, Special Master. *1 This constitutes the Report and Recommendation to the Court concerning the waiver claim of Dale and Georgia Poling pursuant to Part 1.f of the Memorandum Order of the Court (Document 467). In preparing this report, the Special Master reviewed the motions, memoranda, affidavits and exhibits provided in connection with the process specified in the Memorandum Order. As necessary, the Special Master also reviewed other documents that are part of the Court filings in this case. The Special Master was also provided by the Federal Emergency Management Agency (FEMA) the computer disc of the appropriate documents of record for this claim, as specified in Part 1.a of the Memorandum Order. In this case, the documents consist of 606 pages labeled FEMA000001 to 000606. I. Background Plaintiffs' property located at 8808 Hinton Avenue, Baltimore, Maryland, was insured by Harleysville Mutual Insurance Company (Harleysville) under Policy Number 014951242001, with a coverage limit of $190,000.00 for their structure subject to a $1,000.00 deductible. See FEMA000005 and FEMA000120. The home was constructed in 1960. See FEMA000120.
On September 18, 2003, Hurricane Isabel struck the Middle Atlantic States, including Maryland, which caused flooding resulting in damage to Plaintiffs' home. See FEMA000311. An independent adjuster, Mike Maroney, from SIMSOL Insurance was assigned to adjust the loss. See FEMA000311 and FEMA000312. On October 10, 2003, an advance payment of $7,500.00 was issued by Harleysville. See FEMA000441. On December 22, 2003, Harleysville issued an additional advance payment of $20,000.00. See FEMA000439. As part of their claim, Plaintiffs submitted a proposal dated November 3, 2003, from Rolyn Construction Corporation to repair their home. See FEMA000190 through FEMA000195 and FEMA000215 through FEMA000223. Rolyn's total repair proposal was $96,077.44. See FEMA000222. The estimate included upgrades and replacement of items that were not a direct physical loss by or from flood. As noted below, Plaintiffs conceded that the Rolyn estimate was inflated. Plaintiffs provided another proposal from Rolyn Construction Corporation in support of their Increased Cost of Compliance (ICC) claim. See FEMA000358 through FEMA000363. The total for this estimate was $57,566.95. See FEMA000363. The policy limit for ICC-related improvements is $30,000.00, which Plaintiff was paid in full by Harleysville. See FEMA000005. On December 30, 2003, Plaintiffs submitted a Proof of Loss prepared by their public adjuster totaling $80,850.48. See FEMA000303. On January 7, 2004, the independent adjuster issued his closing report see FEMA000311 through FEMA000328noting that the exterior water line measured 53 to 54 inches and the interior water height was 28 to 29 inches. See FEMA000311 and FEMA000312. He also noted that Plaintiffs' public adjuster was uncooperative.
The detailed report concluded the actual cash value of the required repairs to Plaintiffs' home was $69,545.22, with an additional $8,871.50 available under the replacement cost provision of the SFIP. *2 On January 8, 2004, Plaintiffs submitted a Proof of Loss based on the independent adjuster's estimate (See FEMA000320) for a total of $69,545.22. See FEMA000080. In addition, Plaintiffs submitted a Statement as to Full Cost to Replace or Repair for the replacement cost totaling $8,871.50. See FEMA000300. On January 18, 2004, Plaintiffs released their public adjuster. See FEMA000424. Interestingly, Plaintiffs accused their public adjuster of inflating prices for repairs in the adjustment sent to Harleysville and inflating overhead and profit to 20% each instead of 10% each. Id. On January 29, 2004, Harleysville rejected Plaintiffs' December 30, 2003, Proof of Loss. See FEMA00014. The letter also summarized the claim payments and deductions to that point: Total Covered Damages$70,545.22 minus a $27,500.00 advance payment, $638.00 for policy reformation, and the $1,000.00 deductible resulting in a remaining payment of $41,407.22. Id. Plaintiffs requested a review of their claim by the Hurricane Isabel Task Force (Task Force). See FEMA000240. On April 17, 2004, a general adjuster conducted a re-inspection of the loss and reviewed the Rolyn Construction Corporation estimate which Plaintiffs provided. See FEMA000481. The general adjuster recommended an additional payment of $7,401.38 actual cash value. Id. On April 24, 2004, the Task Force completed its review of Plaintiffs' claim. Id. The Task Force agreed with the general adjuster and allowed for a supplemental claim amount of $7,401.38 for the detached garage, increasing unit costs and correcting repair from sheetrock to plaster. Id. Plaintiffs were
contacted and a negotiated settlement amount of $10,230.94 was agreed to. Id. On May 6, 2004, in accordance with the terms of the offer to settle their claim made by the Task Force, Plaintiffs returned a Proof of Loss for $10,230.94. See FEMA000258. On May 17, 2004, Harleysville issued payment to the plaintiffs for the $10,230.94. See FEMA000411. As of May 20, 2004, Plaintiffs were paid a total FN1 of $88,647.66 for the damage to their building ($7,500.00 on October 13, 2003; $20,000.00 on December 23, 2003; $638.00 for policy reformation; $41,407.22 on January 29, 2004; $8,871.50 on April 23, 2004; and $10,230.94 on May 17, 2004). See FEMA000450. In addition, Plaintiffs were paid $30,000.00 under the ICC provision of their SFIP. FN1. The final compensation amount exceeded the $80,850.48 listed as the net claim on Plaintiffs' December 30, 2004 Proof of Loss (See FEMA000303). Plaintiffs requested a second Task Force review of their claim. See FEMA000227. On October 5, 2004, FEMA informed Plaintiffs that the $88,009.66 payment for their structure plus the $30,000.00 in Increased Cost of Compliance compensation fully compensated them for their loss. Id. II. Waiver Claim and Denial On December 3, 2007, this Court permitted Plaintiffs to submit applications for waivers to FEMA. See Doc. No. 196 and Doc. No. 197, Order of December 4, 2007. On February 25, 2008, Plaintiffs submitted to FEMA a document entitled PLAINTIFFS DALE AND GEORGIA A. POLING'S INDIVIDUAL APPLICATION FOR WAIVER OF PROOF OF LOSS REQUIREMENTS. The waiver application requested that FEMA compensate Plaintiffs an additional $100,990.34. See FEMA000005. FEMA denied the request in a letter dated August 18, 2008. See FEMA000111 to 000112.
III. Reasons for Waiver Denial *3 The reasons for the denial of the Waiver Claim are found at 2026 of the Supplemental Declaration of Karen Christian for the Claim of FN2 Dale and Georgia Poling . Document 6452. It states: FN2. Ms. Christian also relied in her review on the documents submitted by Harleysville Mutual Insurance Company with this court. Document No. 3122. Plaintiffs were compensated for direct physical loss caused by or from flood with application of the proper coverages and exclusions of the SFIP. Plaintiffs' claimed shortfall is based on their claim that the cost to repair their home was $222,841.64 without any detailed itemization or explanation of how the newly claimed expenses related to the flood. See FEMA000092. Plaintiffs' waiver application lacked any detail for a meaningful comparison to the estimates provided by Harleysville and the Task Force upon which Plaintiffs were compensated. See FEMA000424. Plaintiffs simply deducted their claimed repair expenses of $222,841.64 from the payments made by Harleysville, which were $88,009.66 for their structure, and $30,000.00 for Increased Cost of Compliance compensation, plus their $1,000.00 deductible to arrive at their shortfall. $222,841.64 is well in excess of their first Proof of Loss based on the estimate from Rolyn Construction Corporation submitted by Plaintiffs' Public Adjuster that Plaintiffs complained was inflated. See FEMA000424. Further, Plaintiffs fail to explain why the proposal from Rolyn Construction Corporation that they provided as part of their claim for the damage to their building and the Increased Cost of Compliance part of their claim was now insufficient. When reviewing Plaintiffs' waiver application,
the Administrator evaluated the facts and circumstances relating to the request. See FEMA000111 and FEMA000112. Specific to this case, the Administrator considered the following whether: 1. Policy holder demonstrated additional damages exist that are covered by the SFIP; 2. Policy holder submitted appropriate documentation supporting the additional compensation being requested; and 3. Policy holder provided a reasonable explanation for the delay in submitting the POL. In the letter providing FEMA's determination on Plaintiffs' waiver application, the Administrator stated: ... you claim your flood damages exceeded the amount paid by your Write Your Own company, Harleysville Insurance Company. To support the amount claimed, you provided an estimate/contract from the contractor who performed the repairs. The estimate is not specific and does not adequate detail the repairs made. Without more information it cannot be determined if the repair costs are for covered flood damages or upgrades and improvements to the property. Some improvements were found in the itemization list. Improvements and upgrades are not covered by the SFIP. It also appears that you incurred additional expenses in excess of the $30,000 maximum amount of coverage you received for the Increased Cost of Compliance claim. These costs cannot be paid under your flood insurance coverage. Your claim was originally reviewed by an independent adjuster, the Hurricane Isabel Task Force, and the National Flood Insurance Program's General Adjuster. Their recommendations resulted in two supplemental payments. All subsequent reviews of your claim concluded that no further payment was due.
*4 Further, your waiver resulted in a comprehensive review of your claim by a FEMA Insurance Examiner. After further review, the Insurance Examiner found no basis to set aside the original findings. Id. Plaintiffs' waiver application does not meet the criteria for approval. First, they failed to provide evidence there was any uncompensated damages covered by their SFIP. Second, they did not submit detailed line-item documentation supporting the particular additional amounts being sought, but instead made a request for supplemental compensation without any explanation of how their newly claimed damages were a direct physical loss caused by or from flood with application of the SFIP's coverages and exclusions. Accordingly, after another comprehensive review of the claim, FEMA determined no further compensation was warranted. Id. Plaintiffs' waiver application was denied for a multitude of reasons, but primarily because they failed to document any physical loss by or from flood covered under their SFIP for which they did not receive full compensation for. IV. Plaintiffs' Assertions The Plaintiffs assert that FEMA should have accepted the documentation submitted by Chesapeake Home Builders who repaired the home. Document 677 at pages 43 to 50. Plaintiffs reject FEMA's assertions that the documentation was insufficient to show that the repairs met the criteria of the SFIP. The Plaintiffs point to the original contract for $118,000 from Chesapeake Home Builders, Id at pages 43 to 45, and to a supplemental contract for $20,000. Id at page 45. Plaintiffs argue that both the original contract and the supplemental contract contain no upgrades and that compensation should have been allowed. Id. Plaintiffs do agree that their shortfall calculation needs to be restated due to failure to back out
the payments due for elevation of their home that was paid to contractors. In their Opposition, Plaintiffs now restate their shortfall calculations to indicate a revised shortfall of $80,155.98. Of this amount, the Chesapeake Home Builders contract and addendum account for a shortfall of $49,990.34. Plaintiffs also note that there are differences in the damage estimates of Mike Maroney (see FEMA 000546000555) and that of Rolyn Corporation (see FEMA 000567 to 000583) and that in any event the estimates omitted compensable damages and some omissions were because the damage could not be determined at the time. Plaintiffs contend that if the two damage estimates are compared and omissions are added in that additional money is due to them. Id at 47. Plaintiffs also raise the fact that the administrative record as filed with the court contains seven pages of documentation that do not pertain to the Polings or their claim. While these documents were flagged as not being in the appropriate file by FEMA's counsel, Plaintiffs assert that this mistake shows deficiencies in the review by FEMA and further call all such documents, sworn to be correct and true, into serious question, at least to the point that no presumption of accuracy should be afforded. Id at 49. Plaintiffs seek to have their motion for summary judgment granted in the amount of $80,155.98. V. Special Master's Analysis FN3
corporate and rely on the Court's prior rulings on these issues (see Documents 594, 596, 597 and 679) and the previously-filed Memorandum on Role of the Special Master and Report and Recommendation of the Special Master on General Issues Raised by Plaintiffs and Defendants (Document 563). *5 FEMA argues that Plaintiffs' current claim should be put into context. Plaintiffs originally submitted a Proof of Loss with the assistance of their own public adjuster where the amount of $80,850.48 was claimed. Plaintiffs were granted not only this amount but a total amount of $88,647.66 after the Hurricane Isabel Task Force review. FEMA argues that Plaintiffs were actually paid more than they requested. It was only when the waiver process was provided that Plaintiffs presented another claim for an additional $80,155.98. FEMA in the declaration of Ms. Christian, see Part III above, explains why it was not persuaded by the waiver submission made by the Plaintiffs: Plaintiffs' waiver application lacked any detail for a meaningful comparison to the estimates provided by Harleysville and the Task Force upon which Plaintiffs were compensated. See FEMA000424. Plaintiffs simply deducted their claimed repair expenses of $222,841.64 from the payments made by Harleysville, which were $88,009.66 for their structure, and $30,000.00 for Increased Cost of Compliance compensation, plus their $1,000.00 deductible to arrive at their shortfall. $222,841.64 is well in excess of their first Proof of Loss based on the estimate from Rolyn Construction Corporation submitted by Plaintiffs' Public Adjuster that Plaintiffs complained was inflated. See FEMA000424. Further, Plaintiffs fail to explain why the proposal from Rolyn Construction Corporation that they provided as part of their claim for the dam-
FN3. In their Oppositions at Document No. 677 at Pages 3 to 9, Group Five Plaintiffs have raised what they term to be twentyfour common issues that the Court has previously considered or resolved in consideration of prior groups. To the extent that these issues are not further cited in the individual Plaintiffs' discussion of their particular cases, the Special Master will not specifically address these issues in this Report and Recommendation, but will in-
age to their building and the Increased Cost of Compliance part of their claim was now insufficient. In FEMA's response, FEMA examines nine contentions made by the Plaintiffs now and why they are not compensable. Reply at pages 24 to 26. It appears to the Special Master that FEMA's explanations for why more damages were not provided in the waiver process are reasonable and in compliance with the way that FEMA has applied and interpreted the SFIP that is applicable in this case. FEMA also contends that the arguments now made about the comparison between the Rolyn Corporation and the Mike Maroney's estimates are new arguments not presented in the waiver application and should not be considered since they are being brought up for the first time in Plaintiffs' Opposition rather than in the waiver application process. The Special Master agrees with FEMA that these arguments are new ones and should not be considered at this stage. Finally, Plaintiffs suggestion that the inclusion of seven pages of records that do not belong in the administrative record in what was filed in this case demonstrates that FEMA review process was inadequate or done in bad faith is not convincing and do not form a basis in the Special Master opinion for a recommendation that the Court refuse to affirm FEMA's determinations. After a review of this matter, the Special Master does not find that FEMA's determination on the waiver claim is either arbitrary, capricious or an abuse of discretion. VI. Recommendation of the Special Master *6 After a review and a consideration of the matter and the arguments presented by the parties, it is the recommendation of the Special Master that the Defendants' Motion for Partial Summary Judgment affirming FEMA's determination of Plaintiff's waiver application be granted; and it is further re-
Only the Westlaw citation is currently available. United States District Court, D. Maryland, Southern Division. Thomas L. MOFFETT, II, et al., Plaintiffs, v. COMPUTER SCIENCES CORPORATION, et al., Defendants. Civil Action No. 8:05CV01547. Aug. 4, 2011. Donald W. Marcari, Frank D. Lawrence, III, Marcari Russotto and Spencer, Chesapeake, VA, Martin H. Freeman, Freeman And Freeman P.C., Rockville, MD, for Plaintiffs. Arthur F. Fergenson, Ansa Assuncao LLP, Holly Drumheller Butler, DLA Piper U.S. LLP, Jason Daniel Medinger, Allen F. Loucks, Office of the United States Attorney, Steven Michael Klepper, Kramon and Graham P.C., James D. Skeen, Skeen and Kauffman LLP, Brett Anthony Buckwalter, Niles Barton and Wilmer LLP, Baltimore, MD, Jay I. Morstein, Owings Mills, MD, Tyler Brian Raimo, Computer Sciences Corporation, Falls Church, VA, Darren Seth Wall, Department of Homeland Security, Arlington, VA, Robert H. King, Jr., Sonnenschein Nath and Rosenthal LLP, Chicago, IL, Kirk Robert Ruthenberg, SNR Denton U.S. LLP, Steuart H. Thomsen, Sutherland Asbill and Brennan LLP, Scott Nathan Auby, W. Neil Eggleston, Debevoise and Plimpton LLP, Elizabeth Treubert Simon, Pamela Anne Bresnahan, Vorys Sater Seymour and Pease LLP, Washington, DC, Gerald Joseph Nielsen, Nielsen Law Firm LLC, Metairie, LA, Peter F. Axelrad, Council Baradel Kosmerl and Nolan P.A., Annapolis, MD, Patricia Mchugh Lambert, Steven B. Schwartzman, Hodes Pessin and Katz P.A., Towson, MD, Craig Russell Blackman, Samuel J. Arena, Jr., Stradley Ronon Stevens and Young LLP, Philadelphia, PA, Edward
J. Hutchins, Jr., Stacey Ann Moffet, Eccleston and Wolf P.C., Hanover, MD, William J. Hickey, Law Offices of William J. Hickey LLC, Rockville, MD, Debra Anne Nelson, William Lowell Mundy, Mundy and Nelson, Huntington, WV, James Hilton Crosby, Crosby Saad LLC, Mobile, AL, William Gerald Gandy, Wilson Elser Moskowitz Edelman and Dicker, McLean, VA, Bradish J. Waring, Mary Legare Hughes, Nexsen Pruet LLC, Charleston, SC, for Defendants. REPORT AND RECOMMENDATION CONCERNING WAIVER CLAIM OF THOMAS MOFFETT DENNIS M. SWEENEY, Special Master. *1 This constitutes the Report and Recommendation to the Court concerning the waiver claim of Thomas Moffett pursuant to Part 1.f of the Memorandum Order of the Court (Document 467). In preparing this report, the Special Master reviewed the motions, memoranda, affidavits and exhibits provided in connection with the process specified in the Memorandum Order. As necessary, the Special Master also reviewed other documents that are part of the Court filings in this case. The Special Master was also provided by the Federal Emergency Management Agency (FEMA) the computer disc of the appropriate documents of record for this claim, as specified in Part 1.a of the Memorandum Order. In this case, the documents consist of 448 pages labeled FEMA000001 to 000448. I. Background Plaintiff's property located at 40549 Old Berton Beach Road, Leonardtown, Maryland, was insured by Nationwide Mutual Fire Insurance Company (Nationwide) under Policy Number 5000737576, with a coverage limit of $163,400.00 on his structure and $55,100.00 on his contents, each subject to a $500.00 deductible. See FEMA000346. The policy was effective August 19, 2003 through August 19, 2004. Id.
On September 19, 2003, Hurricane Isabel struck the Middle Atlantic States, including Maryland, which caused flooding resulting in damage to Plaintiff's home. See FEMA000331. An independent adjuster from American Frontline, Inc., was assigned to adjust the loss. FEMA000240. On September 29, 2003, Plaintiff requested a $10,000.00 advance payment on his claim. See FEMA000243. On October 7, 2003, Nationwide issued the requested $10,000.00 advance payment. See FEMA000285. On January 9, 2004, the independent adjuster completed his estimate on Plaintiff's loss and issued his report. See FEMA000297 through FEMA000299 and FEMA000409 through FEMA000423. The report noted that the building was constructed in 1968. See FEMA000297. The exterior water height was measured at 43 inches and the interior water height was measured at 11 inches and up to 43 inches in the attached garage. Id. The independent adjuster concluded Plaintiff should be paid $60,586.32 in actual cash value for the structure damage after application of the $500.00 deductible, and an additional $6,927.74 for recoverable depreciation, if eligible. See FEMA000409. In addition, the independent adjuster concluded Plaintiff's contents loss was $27,677.96 after application of the $500.00 deductible. See FEMA000423. Accordingly, Plaintiff was provided a Proof of Loss for $88,264.28, which he signed on January 13, 2004. See FEMA000028. In addition, Plaintiff was provided a Statement as to Full Cost of Repair or Replacement for the $6,927.74, which he signed on January 13, 2004. See FEMA000030. In addition to the $10,000.00 advance, Nationwide issued the following payments to Plaintiff: $27,677.96 for Plaintiff's contents claim on February 3, 2004 (See FEMA000281), $48,586.32 for Plaintiff's structure claim on February 3, 2004 (See FEMA000284), $1,623.00 for Plaintiff's structure
claim on March 11, 2004 (See FEMA000283), and $6,927.74 for the recoverable depreciation portion of Plaintiff's claim on June 30, 2004 (See FEMA000031). *2 Plaintiff was paid a total of $94,815.02. The difference between the amount claimed by Plaintiff on his timely Proof of Loss and the amount paid by Nationwide was $377.00 ($94,815.02 minus ($88,264.28 for the structure plus $6,927.74 recoverable depreciation)). Plaintiff's property was not properly rated, which resulted in Plaintiff owing Nationwide additional premiums. See FEMA000327. $377.00 was deducted from the payments to Plaintiff to account for the premium shortage. Id. and FEMA000282. On February 11, 2004, Nationwide acknowledged Plaintiff's intent to file an Increased Cost of Compliance (ICC) claim and the receipt of a Substantial Damage letter submitted on Plaintiff's behalf by the Department of Land Use and Growth Management of St. Mary's County. See FEMA000019. Initially, it was determined that Plaintiff's home was located in a Zone B and ineligible for any ICC compensation. Id. On February 24, 2004, Plaintiff received a letter demonstrating that the Zone determination was in error and that he was eligible for ICC compensation. See FEMA000110. On January 11, 2005, the independent adjuster issued a report noting that Plaintiff requested ICC compensation, but that Plaintiff had indicated he was not prepared to begin his ICC claim. See FEMA000331. On September 10, 2005, the adjuster sent a letter to Plaintiff advising him that if he wanted to pursue his ICC claim, he was going to have to provide the required documentation and that he had two years from the date of loss to complete the work. See American Frontline, Inc., letter dated September 10, 2005, Doc. No. 2917. On March 10, 2006, Nationwide issued a letter to Plaintiff advising that his ICC claim had been open in excess of two years, and that under Section
III(D)(5)(e), Plaintiff only had two years to complete the Increased Cost of Compliance measures. See FEMA000027. Nationwide thereupon closed Plaintiff's ICC claim. Id. Plaintiff did not pursue the ICC claim, and he never submitted a Proof of Loss for payment under that provision of his SFIP. See FEMA000120. Plaintiff requested a review of his claim by the Hurricane Isabel Task Force (Task Force). See FEMA000186. On July 12, 2004, the Task Force completed its review of Plaintiff's claim. See FEMA000184. The Task Force allowed for a supplemental claim amount of $12,390.01, and allowing additional compensation for floor joists, wall sheathing, sub-flooring, wall paneling and an exterior door. Id. Plaintiff was not satisfied. Id. Plaintiff never submitted the Proof of Loss that was provided by the Task Force and did not receive this additional payment of $12,390.01. See FEMA000120. II. Waiver Claim and Denial On December 3, 2007, this Court permitted Plaintiffs to submit applications for waivers to FEMA. See Doc. No. 196 and Doc. No. 197, Order of December 4, 2007. On February 25, 2008, Plaintiff submitted to FEMA a document entitled PLAINTIFF THOMAS L. MOFFETT, II'S INDIVIDUAL APPLICATION FOR WAIVER OF PROOF OF LOSS REQUIREMENTS. The waiver application requested that FEMA compensate Plaintiff an additional $125,762.94. See FEMA000005. FEMA denied the request in a letter dated August 18, 2008. See FEMA000080 to 000081. III. Reasons for Waiver Denial *3 The reasons for the denial of the Waiver Claim are found at 1725 of the Supplemental Declaration of Karen Christian for the Claim of Thomas Moffett. Document 6412. It states: Plaintiff's shortfall calculation is utterly unsound. The Proposal from Lincoln Contractors, Inc. includes, at a minimum, $32,500.00
(Demolition) in Increased Cost of Compliance expenses, which has a policy limit of $30,000.00. FN1 See FEMA00068. The Proposal is not sufficiently detailed to determine if any other Increased Cost of Compliance expenses are included. Plaintiff also made a significant mathematical error by deducting the payments from Nationwide totaling $67,137.06 plus his $500.00 deductible from the $214,500.00 to arrive at a shortfall of $95,762.94, but then adding an additional $30,000.00 for the Increased Cost of Compliance expenses that were already included in the $214,500.00. See FEMA000067. This error results[in] a duplication of the Increased Cost of Compliance expense and an extra $30,000.00 included in the shortfall. FN1. Increased Cost of Compliance as defined under 44 C.F.R. 61 App. A(1) at Art. III(D)(1) are activities such as elevation, floodproofing, relocation or demolition (or any combination of these activities). The policy limit for Increased Cost of Compliance activities is $30,000.00 Further, Plaintiff's inclusion of any Increased Cost of Compliance compensation in his shortfall is improper because he never followed up on or submitted a proper Proof of Loss for this type of compensation. See FEMA000331 and FEMA000120. The remainder of Plaintiff's shortfall calculation is based on a proposal from Lincoln Contractors to demolish his home and rebuild it at a cost of $214,500.00. Plaintiff was compensated for direct physical loss caused by or from flood with application of the proper coverages and exclusions of the SFIP. Plaintiff's shortfall disregards the actual damage caused by the flood and is based solely on building a new upgraded home. Plaintiff's shortfall calculation lacks any explanation of how the compensation provided by Nationwide was insufficient to repair his original structure under the terms of his SFIP.
Of note, Plaintiff provided a repair estimate from the same contractor totaling $90,678.75, which is substantially less than the reconstruction estimate of $214,500.00. See FEMA000258 and FEMA000259. The estimate was not sufficiently detailed to conduct a side by side comparison with the independent adjuster's detailed estimate and nearly 2/3 of the estimate was labor costs ($59,700.00 for labor and $30,978.75 for materials). Nevertheless, it demonstrates Plaintiff's home was repairable. When reviewing Plaintiffs' waiver application, the Administrator evaluated the facts and circumstances relating to the request. See FEMA000118 and FEMA000119. Specific to this case, the Administrator considered the following whether: 1. Policy holder demonstrated additional damages exist that are covered by the SFIP; 2. Policy holder submitted appropriate documentation supporting the additional compensation being requested; and 3. Policy holder provided a reasonable explanation for the delay in submitting the POL. Id. *4 In the letter providing FEMA's determination on Plaintiff's waiver application, the Administrator stated: ... you claim your flood damages necessitated the demolition of your dwelling and are requesting payment of the full policy limits of your building coverage. You did not pursue a claim for Increased Cost of Compliance coverage with your Write Your Own Company, Nationwide Insurance. To support the amount claimed, you provided an estimate for the demolition of your structure and construction of a new foundation. Your claim was originally reviewed by an independent adjuster and subsequently reviewed by the Hurricane Isabel
Task Force. A supplemental estimate for additional building damages was prepared in the amount of $12,390.01. However, you were not in agreement with the amount and did not sign a proof of loss. All reviews of your claim concluded the supplemental offer of payment for building damages was accurate. Further, your waiver resulted in a comprehensive review of your claim by a FEMA Insurance Examiner. After further review, the Insurance Examiner found no basis to set aside the original findings. To the extent you will accept the supplemental adjustment of $12,390.01, previously offered to you, FEMA is willing to waive the time in which to file a POL for that amount only. Otherwise your request for a waiver of the time period within which to file a POL is denied. Id. As previously noted, the SFIP is not a valued policy, which means there is no set amount of compensation in the event of a total loss. Id. at Section II(B)(28). The SFIP only provides compensation for the lesser of the policy limit, the replacement cost of the damaged part of the dwelling with materials of like kind and quality, or the amount actually spent to repair or replace the damaged part of the dwelling. Id. at Section VII(V)(2)(a). Plaintiff's Proposal (See FEMA000068) is clearly based on an upgraded, modernized structure without regard to the actual physical loss caused by or from the flood with application of the coverages and exclusions found within his SFIP. Plaintif's waiver application does not meet the criteria for approval. First, he failed to provide evidence there was any uncompensated damages covered by his SFIP. Second, he did not submit detailed line-item documentation supporting the
particular additional amounts being sought, but instead submitted a Proposal to demolish and rebuild his home for $214,500.00. The Proposal included Increased Cost of Compliance expenses for which Plaintiff never completed a Proof of Loss to be eligible to receive. Accordingly, after another comprehensive review of the claim, FEMA determined no further compensation was warranted. Id. Plaintiff's waiver application was denied for a multitude of reasons, but primarily because he failed to document any physical loss by or from flood covered under his SFIP for which he did not receive full compensation for. IV. Plaintiffs' Assertions *5 Plaintiff asserts that he is entitled to payment of the ICC claim given that he never relinquished his request for ICC payment and in fact paid $4,117.00 in additional insurance premiums when it was noted that his property was not properly rated as a zone B location. These payments would have entitled him to be eligible for the ICC payment upon application which Plaintiff contends he did pursue. Opposition (Document 677) at page 26. Plaintiff also contends that he was eligible for at least the initial $15,000 ICC payment which was never made. Id at page 27. He argues that failure to make this payment prevented him from proceeding with the repairs he desired to make and to this date he has not been able to make the repairs or rebuild. Mr. Moffett claims that he is also entitled to receive $12,390.01 and that FEMA has indicated that to receive the payment he must relinquish his other claims in this case a condition which he believes is not in accordance with the law or prior statements by FEMA. Id at page 29. Plaintiff also claims that FEMA was in error in rejecting the report of Bob Taylor Engineering which concluded that a new foundation system was needed and concluding that a proposal from Lincoln Contractors, Inc for repair of the existing home for $90,678.75 could not be accepted.
Plaintiff also noted that St. Mary's county government found the property to be substantially damaged. Id at page 32. Plaintiff notes that to this day he lives in a small apartment built, with the inadequate compensation provided him on his flood claim, atop his garage. Id. He has not been able to pursue further reconstruction due to lack of funds. He believes that FEMA continues to stonewall him. Id. Plaintiff seeks the remainder of his flood claim under Coverage A of the SFIP and payment in full of his ICC claim under Coverage D. Plaintiff's motion for summary judgment seeks a total of $95,726.94. V. Special Master's Analysis FN2
FN2. In their Oppositions at Document No. 677 at Pages 3 to 9, Group Five Plaintiffs have raised what they term to be twentyfour common issues that the Court has previously considered or resolved in consideration of prior groups. To the extent that these issues are not further cited in the individual Plaintiffs' discussion of their particular cases, the Special Master will not specifically address these issues in this Report and Recommendation, but will incorporate and rely on the Court's prior rulings on these issues (see Documents 594, 596, 597 and 679) and the previously-filed Memorandum on Role of the Special Master and Report and Recommendation of the Special Master on General Issues Raised by Plaintiffs and Defendants (Document 563). At first reading, Plaintiff's claim for the ICC payments appears to have merit since he did take early action to make the claim and it appears he would have been eligible if he had proceeded to repair his home. There was a zoning error and Plaintiff was found to be eligible to submit an ICC
claim after he paid additional premiums. As FEMA notes in its reply, the independent adjuster in January, 2005 issued a report noting that Plaintiff requested ICC compensation, but Plaintiff at that time indicated that he was not prepared to begin his ICC claim. In September, 2005, the adjuster sent a letter to Plaintiff advising him that if he wanted to pursue the ICC claim he would need to provide the required documentation and warned the Plaintiff that he had only two years from the date of the loss to complete the work. Again in March, 2006, Plaintiff was again advised of the two year deadline and did not follow up and the ICC portion of the claim was closed. FEMA position is stated in its Reply memorandum (Document 688) at page 14 as follows: *6 Plaintiff was given over two years to actually submit a Proof of Loss along with supporting documentation for an Increased Cost of Compliance claim and he never pursued it. Plaintiff's lengthy arguments in his Opposition are meritless and contrary to the actual facts related to this claim. Plaintiff contends in his Opposition that: It was wholly improper for FEMA and Nationwide to err in denying Mr. Moffett his ICC claim because his property was miss-zoned, deny him ICC coverage, correct the zoning problem, bill him for additional premiums to ensure the ICC claim is active, accept the additional premiums and then deny to pay him the rightful monies due him. See Plaintiffs' Opposition, Doc. No. 677 at 27. As the facts demonstrate, this is not an accurate statement. Plaintiff's Increased Cost of Compliance claim was not denied because of a zoning error, but because he never pursued the claim. When evaluating the application for the waiver, FEMA considered the relevant factors and whether Plaintiff was entitled to compensation under the Increased Cost of Compliance provision of his SFIP. See Karen Christian Declaration, Doc. No. 6412 at 21. Increased Cost of Compliance compensation
is not provided as compensation for the direct physical loss caused by or from the flood, which is provided under Coverage A. It is also not an entitlement. It is provided to assist a policy holder to comply with State or Local floodplain management laws or ordinances which affect the repair or reconstruction of a damaged home. See 44 C.F.R. 61, App. A(1), Art. III(D)(1). Plaintiff concedes he has not repaired or reconstructed his home within two years of the loss as required for this form Increased Cost of Compliance compensation. See Plaintiffs' Opposition, Doc. No. 677 at 32. In the context of the full record, the Special Master cannot conclude that FEMA's decision in the waiver application to deny the ICC claim was either arbitrary or capricious or an abuse of discretion. The two year deadline has long past and Plaintiff was not in the process of rebuilding when the waiver application was filed nor had the proper documentation been supplied. In this context, FEMA determination must be upheld even though it is unfortunate that it appears that if Plaintiff had proceeded with construction within the two year period the ICC claim would and should have been paid. Plaintiff has also disagreed with FEMA about how they evaluated the report from Bob Taylor Engineering and the proposal from Lincoln Contractors, Inc. to demolish and rebuild the house. FEMA and its adjusters did review these reports and either disagreed with the conclusions or found them insufficient to meet the requirements of the SFIP. As FEMA notes in its Reply(Document 688) at page 15, the Lincoln Contractors, Inc. proposal was for a new upgraded structure without regard for the coverages and exclusions found within Plaintiff's SFIP. Using this proposal to calculate the loss, is similar to relying on the cost of new construction formula approach that has been discredited in this litigation. As is shown in Part III above, FEMA's explanation for why this waiver claim was denied is fully explained. *7 The parties seem to agree that Plaintiff can
obtain the $12,390.01 which was also acknowledged in the August 18, 2008 waiver determination letter. They appear to disagree over how the payment should be made. Plaintiff seeks to have FEMA simply forward a check to his counsel to satisfy this claim. FEMA demands that a Proof of Loss be filed by the Plaintiff for this amount and that as part of that filing that Plaintiff must also sign a settlement agreement terminating his involvement in this litigation and extending any release not only to FEMA but to Nationwide. FEMA also demanded that Plaintiff act on this demand within 30 days of it filing its Reply. See Document 688 at page 17. The Special Master believes that it is beyond the scope of the delegation given to him to determine whether FEMA may condition the payment of the $12,390.01, which would be otherwise due to Plaintiff, upon Plaintiff agreeing to release FEMA and Nationwide from all other claims in this litigation including those not included within the waiver claim review. In the view of the Special Master this is an issue that should be taken up by the U.S. District Court perhaps after receiving briefs from the parties on the issue. As to all other issues presented, the Special Master believes that FEMA was not arbitrary or capricious in the denial of the waiver application nor did FEMA abuse its discretion in denying the waiver application. VI. Recommendation of the Special Master After a review and a consideration of the matter and the arguments presented by the parties, it is the recommendation of the Special Master that the Defendants' Motion for Partial Summary Judgment affirming FEMA's determination of Plaintiff's waiver application be granted except as to the claim for the $12,309.01 which the Special Master recommends be reviewed by the U.S. District Court as to the matter and terms by which FEMA will make the payment; and it is further recommended that Plaintiff's Motion for Summary Judgment be denied.
Only the Westlaw citation is currently available. United States District Court, D. Maryland, Southern Division. Thomas L. MOFFETT, II, et al., Plaintiffs, v. COMPUTER SCIENCES CORPORATION, et al., Defendants. Civil Action No. 8:05CV01547. Aug. 4, 2011. Donald W. Marcari, Frank D. Lawrence, III, Marcari Russotto and Spencer, Chesapeake, VA, Martin H. Freeman, Freeman and Freeman P.C., Rockville, MD, for Plaintiffs. Arthur F. Fergenson, Ansa Assuncao LLP, Holly Drumheller Butler, DLA Piper U.S. LLP, Jason Daniel Medinger, Allen F. Loucks, Office of the United States Attorney, Steven Michael Klepper, Kramon and Graham P.C., James D. Skeen, Skeen and Kauffman LLP, Brett Anthony Buckwalter, Niles Barton and Wilmer LLP, Baltimore, MD, Jay I. Morstein, Owings Mills, MD, Tyler Brian Raimo, Computer Sciences Corporation, Falls Church, VA, Darren Seth Wall, Department of Homeland Security, Arlington, VA, Robert H. King, Jr., Sonnenschein Nath and Rosenthal LLP, Chicago, IL, Kirk Robert Ruthenberg, SNR Denton U.S. LLP, Steuart H. Thomsen, Sutherland Asbill and Brennan LLP, Scott Nathan Auby, W. Neil Eggleston, Debevoise and Plimpton LLP, Elizabeth Treubert Simon, Pamela Anne Bresnahan, Vorys Sater Seymour and Pease LLP, Washington, DC, Gerald Joseph Nielsen, Nielsen Law Firm LLC, Metairie, LA, Peter F. Axelrad, Council Baradel Kosmerl and Nolan P.A., Annapolis, MD, Patricia Mchugh Lambert, Steven B. Schwartzman, Hodes Pessin and Katz P.A., Towson, MD, Craig Russell Blackman, Samuel J. Arena, Jr., Stradley Ronon Stevens and Young LLP, Philadelphia, PA, Edward
J. Hutchins, Jr., Stacey Ann Moffet, Eccleston and Wolf P.C., Hanover, MD, William J. Hickey, Law Offices of William J. Hickey LLC, Rockville, MD, Debra Anne Nelson, William Lowell Mundy, Mundy and Nelson, Huntington, WV, James Hilton Crosby, Crosby Saad LLC, Mobile, AL, William Gerald Gandy, Wilson Elser Moskowitz Edelman and Dicker, McLean, VA, Bradish J. Waring, Mary Legare Hughes, Nexsen Pruet LLC, Charleston, SC, for Defendants. REPORT AND RECOMMENDATION CONCERNING WAIVER CLAIM OF MARY ANN MARKS DENNIS M. SWEENEY, Special Master. *1 This constitutes the Report and Recommendation to the Court concerning the waiver claim of Mary Ann Marks pursuant to Part 1.f of the Memorandum Order of the Court (Document 467). In preparing this report, the Special Master reviewed the motions, memoranda, affidavits and exhibits provided in connection with the process specified in the Memorandum Order. As necessary, the Special Master also reviewed other documents that are part of the Court filings in this case. The Special Master was also provided by the Federal Emergency Management Agency (FEMA) the computer disc of the appropriate documents of record for this claim, as specified in Part 1.a of the Memorandum Order. In this case, the documents consist of 309 pages labeled FEMA000001 to 000309. I. Background Plaintiff's property located at 909 Oakdene Road in Baltimore, Maryland, was insured through the National Flood Insurance Program (NFIP) by and through a Standard Flood Insurance Policy (SFIP) issued by Allstate Insurance Company (Allstate), in its capacity as a Write Your Own (WYO) Program participating insurance company, pursuant to the National Flood Insurance Act of 1968, as amended (the NFIA 42 U.S.C.
4001, et seq.). Id. Allstate issued Plaintiff's SFIP Number 0803965433 with a coverage limit of $250,000.00 for her building and $55,100.00 in contents coverage, each with a separate $1,000.00 deductible. See FEMA000005 and FEMA000075. On September 19, 2003, Hurricane Isabel struck the Middle Atlantic States, including Maryland, which caused flooding resulting in damage to Plaintiff's home. See FEMA000109. On September 20, 2003, Plaintiff reported her loss to FEMA. Id. An independent adjuster was assigned to assist the insured with the loss as a courtesy only per SFIP Article VII(J)(5), (7) and (8). Id. Plaintiff submitted Proofs of Loss for, and was actually paid, $132,051.03 by Allstate for building damages and the full policy limits of $30,000.00 in Increased Cost of Compliance (ICC) benefits. See Exhibit A2 at Document 6372 which is the Raske FN1 Dec., Doc. No. 3962. Plaintiff's waiver application contends she was paid $159,126.85, but Allstate's records do not reflect this total. FN1. In her Declaration in this matter, Ms. Christian relied on the previously led Declaration of Jason Raske who was a Flood Field Manager for the Allstate National Catastrophe Team and who conducted the review of this le for Allstate, the WYO carrier on this claim. The Declaration was led as Document No. 3962 in this litigation. Plaintiff submitted Proofs of Loss for, and was paid $31,218.68 for her damaged contents by Allstate. Id. and FEMA000005. The total amount paid to Plaintiff by Allstate for damages to the building, her contents, and Increased Costs of Compliance efforts was $193,269.71. See Raske Dec., Doc. No. 3962. Plaintiff did not submit a timely, signed and sworn Proof of Loss meeting the requirements of
Article VII(J) of her SFIP for any amounts greater than the $193,269.71 that she was paid by and through Allstate, and Plaintiff has not produced documentation to support a greater claim payment. II. Waiver Claim and Denial On December 3, 2007, this Court permitted Plaintiffs to submit applications for waivers to FEMA. See Doc. No. 196 and Doc. No. 197, Order of December 4, 2007. On February 25, 2008, Plaintiff filed a document entitled PLAINTIFF MARY ANN MARKS' INDIVIDUAL APPLICATION FOR WAIVER OF PROOF OF LOSS REQUIREMENTS. In this document, Plaintiff indicates that she will furnish documents to support her request for a waiver at some point in the future. See FEMA 000006. Plaintiff stated that her total losses were in excess of $195,000.00. Id. FEMA denied the request for a waiver of the proof of loss requirements in a letter dated July 31, 2008. See FEMA000055 to 000056. III. Reasons for Waiver Denial *2 The reasons for the denial of the Waiver Claim are found at 1217 of the Supplemental Declaration of Karen Christian for the Claim of Mary Ann Marks. Document 6372.It states: On July 31, 2008, the Federal Insurance Administrator denied Plaintiff's request for a waiver of the proof of loss requirements, and one of the reasons given by the Administrator for the denial is the failure on the part of Plaintiff to include documentation supporting her claim for additional benefits. See FEMA000055 and FEMA000056. In Plaintiff's shortfall calculation it is also stated that Plaintiff (and her counsel) are still awaiting documentation to prove her request. See FEMA000015. Furthermore, based upon the waiver request submitted, it is not possible to determine what amounts are being sought by Plaintiff. Nowhere does Plaintiff specifically state the total dollar amount expended in repairing the structure. Instead, Plaintiff states that it was in excess of
$195,000.00. See FEMA000005. In this waiver application, Plaintiff asserts she is owed an additional $4,873.15 under her building coverage for the total repair costs, but unexplainably, Plaintiff also asserts on that same page of her waiver request that the building shortfall is $8,086.00. Id. Finally, Plaintiff asserts she is owed an additional $22,882.00 for damaged contents in her home. Id. When reviewing Plaintiffs' waiver application, the Administrator evaluated the facts and circumstances relating to the request. See FEMA000055 and FEMA000056. Specific to this case, the Administrator considered the following whether: 1. Policy holder demonstrated additional damages exist that are covered by the SFIP; 2. Policy holder submitted appropriate documentation supporting the additional compensation being requested; and 3. Policy holder provided a reasonable explanation for the delay in submitting the POL. Id. In the letter providing FEMA's determination on Plaintiff's waiver application the Administrator stated the following: ... you have not demonstrated additional covered damage exists for which you have not been paid. Specifically, you claim your actual damages for personal property were greater than your policy limits and exceeded the amount paid by your Write Your Own company, Allstate Insurance (Allstate). You also received the maximum amount payable under the Increased Cost of Compliance coverage from Allstate. To support the amount of your supplemental claim, you provided calculations of the difference between your expenditures and amount paid. No verifiable documentation was submitted to substanti-
ate the additional claimed damages. Your claim was originally reviewed by an independent adjuster and subsequently reviewed by the Hurricane Isabel Task Force. All reviews of your claim concluded the carrier's evaluation was accurate. Further, your waiver request resulted in a comprehensive review of your claim by a FEMA Insurance Examiner. After further review, the Insurance Examiner found no basis to set aside the original findings. *3 Id. Plaintif failed to demonstrate she met any of the criteria used to determine whether to grant a waiver. First, she failed to demonstrate any additional damages she sought were actually covered by her SFIP. Second, she did not submit any documentation of uncompensated damages caused directly by flooding. Accordingly, after another comprehensive review of the claim, FEMA determined no further compensation was warranted. Id. Plaintiff's waiver application was denied for a multitude of reasons, but primarily because she failed to document any physical loss by or from flood covered under her SFIP for which she did not receive full compensation. IV. Plaintiffs Assertions In Plaintiff's Opposition, Document 678, there is no argument made about why Plaintiff Mary Ann Marks's claim for waiver should have been granted and no discussion of her particular claim and its circumstances is included. Plaintiff does ask the court to grant her summary judgment in the amount of $27,775.15. Id. at page 50. V. Special Master's Analysis FN2
FN2. In their Oppositions at Document No. 677 at Pages 3 to 9, Group Five Plaintiffs have raised what they term to be twentyfour common issues that the Court has
previously considered or resolved in consideration of prior groups. To the extent that these issues are not further cited in the individual Plaintiffs' discussion of their particular cases, the Special Master will not specifically address these issues in this Report and Recommendation, but will incorporate and rely on the Court's prior rulings on these issues (see Documents 594, 596, 597 and 679) and the previously-filed Memorandum on Role of the Special Master and Report and Recommendation of the Special Master on General Issues Raised by Plaintiffs and Defendants (Document 563). FEMA in its Reply, Document 688 at pages 7 to 8, summarizes the status of this claim: Mary Ann Marks (Plaintiff) is mentioned in the introductory paragraph and in the conclusion of the Opposition filed on behalf of the Group Five Plaintiffs. She simply demands FEMA compensate her $27,775.15. Plaintiff provides no argument in support of her claim and by silence concedes FEMA's determination on her waiver application was not arbitrary, capricious or contrary to law. Plaintiff failed to submit documents to support her waiver application and stated she was ... currently gathering documentation for costs and intends to submit in due course. See FEMA000005. As this Court recently noted there is no reason why a Plaintiff should not have been prepared to submit a fully articulated claim to FEMA in a waiver application. See Memorandum Opinion of July 1, 2011 at 6. Plaintiff failed to prosecute her claim for a long time and dismissal is clearly warranted. FEMA summary is correct and in the Special Master's view Plaintiff has shown no basis for the grant of her motion for summary judgment or denial of FEMA's Supplemental Motion for Summary Judgment. Plaintiff has had years to document her claim and has simply failed to do so. There is no indication of arbitrary or capricious action in denying the waiver claim, nor is there any abuse of discre-
tion shown. VI. Recommendation of the Special Master After a review and a consideration of the matter and the arguments presented by the parties, it is the recommendation of the Special Master that the Defendants' Motion for Partial Summary Judgment affirming FEMA's determination of Plaintiff's waiver application be granted; and it is further recommended that Plaintiff's Motion for Summary Judgment be denied. D.Md.,2011. Moffett v. Computer Sciences Corp. Slip Copy, 2011 WL 3439337 (D.Md.) END OF DOCUMENT
Only the Westlaw citation is currently available. United States District Court, D. Maryland. Thomas L. MOFFETT, II, et al., Plaintiffs, v. COMPUTER SCIENCES CORPORATION, et al., Defendants. Civil No. PJM 051547. Aug. 3, 2011. MEMORANDUM OPINION PETER J. MESSITTE, District Judge. [OPINION ON SUMMARY JUDGMENT AS TO CLAIMS OF GROUP 3 HOUSEHOLDERS.] *1 The Court adopts and incorporates by reference its Opinion With Respect to Plaintiffs' Generic Objections to the Reports and Recommendations of the Special Master, filed on February 17, 2011 [Paper No. 596]. It now considers the Group 3 Plaintiffs' Objections (Exceptions) to Reports and Recommendations of the Special Master. 20) Folderauer FN1
2003, Plaintiff submitted a claim for $24,043 for building damage and $5,000 for insured contents. Plaintiff was paid $24,043 for the building and the maximum allowed under the contents provision for personal property ($5,000). On or about February 22, 2008, Plaintiff asked for an additional $26,957 under building coverage. In addition to the generic objections common to all Plaintiffs, which the Court overruled in its Opinion of February 17, 2011 [Paper No. 596], Plaintiff excepts to the Master's findings that he is not entitled to an additional payment of $26,957, the difference between his latest estimated cost of repair for his building, $52,000 (less a $1,000 deductible), and the $24,043 he in fact received for such damage. Plaintiff claims that he was not fully compensated for the full cost to repair his home, including septic repairs, damage to vehicles, soil contamination, and damage to a shed, fence, and gazebo. He claims he personally expended $30,000 worth of labor to fully repair his home and that the SFIP payments he has received do not cover the entirety of these labor costs. FEMA's position is that the individual components of Plaintiff's claim, including repairs to Plaintiff's septic system, vehicles, soil, shed, fence, and gazebo, are not covered by SFIP's structural damage provision; that Plaintiff has provided no documentation or evidence demonstrating that he actually performed $30,000 for labor or that the cost of his repairs actually exceeded the payments he has received; and that Plaintiff has provided no explanation whatsoever for his failure to submit documentation four years after the Proof of Loss submission deadline expired. The Court has considered the Master's rationale and, concludes de novo, both on the facts and the law, that he is correct.
FN1. As with Group 1 and Group 2 Plaintiffs, the Court will refer only to the surname of the first householder on a given claim if more than one name appears on a single claim. Throughout, monetary inventory amounts here have been rounded to the nearest dollar. As to Plaintiff Folderauer, the Special Master has submitted a 10page Report and Recommendation, finding that FEMA's denial of his claim was not arbitrary and capricious. Plaintiff's policy limit for flood damage was $84,000 for his building and $5,000 for its contents, both subject to a $1,000 deductible. In December
In his review of the record, the Master concluded that Plaintiff has failed to prove that any component of his claim is entitled to further coverage under the SFIP, including the failure to provide detailed records to support the $30,000 for labor charges. Without such records, FEMA was not required to accept Plaintiff's simple assertion that he performed that amount of labor. Moreover, the Master found that the compensation Plaintiff received already ($24,043) included a component for the labor necessary to make covered repairs. The Court agrees with the Master's finding that Plaintiff has not demonstrated that he is entitled to further coverage for repairs covered by SFIP that were not originally compensated. *2 FEMA was neither arbitrary nor capricious in handling Plaintiff Folderauer's claim. 21) Godlewski The parties have advised the Court that they have reached a settlement with respect to the only contested issue in the case, i.e ., the payment of $63,705. Accordingly, the Court will dismiss the action as to Plaintiff Godlewski. 22) Goodman As to Plaintiff Goodman, the Special Master has submitted a 13page Report and Recommendation, finding that FEMA's denial of her claim was not arbitrary and capricious. Plaintiff's policy limit for flood damage was $80,000 for her building, subject to a $1,000 deductible. She did not have a policy covering damage to the contents of her building. Plaintiff was ulFN2 timately paid $33,829 for the building damage. FN3 FN2. Plaintiff claims she was paid $33,629, and uses this figure to calculate her claimed shortfall. According to the record, the verified payments made to Plaintiff total $33,829. FN3. In addition, Plaintiff received the
$30,000 maximum due under the Increased Cost of Compliance (ICC) provision of the policy. In addition to the generic objections common to all Plaintiffs, which the Court overruled in its Opinion of February 17, 2011 [Paper No. 596], Plaintiff excepts to the Master's findings that she is not entitled to an additional payment of $45,371, the difference between the policy limit for flood damage to her building (less the $1,000 deductible) and the $33,629 she claims she received for such damage. Plaintiff says she had to demolish her old home and build a new one at a cost of over $285,000 and that she is entitled to reimbursement for the cost of the new home. Plaintiff calculates the value of the claimed reimbursement by multiplying the total square footage of the old home by the costper-square-foot to construct the new home. Because her policy limit for building damage ($80,000) amounts to less than the discounted replacement value of her home, she says she is entitled to receive the full policy limit for damage to her original home. FEMA argues, inter alia, that Plaintiff has not demonstrated that the damages she seeks were covered by SFIP and did not provide detailed lineitem documentation of repairs for damage allegedly caused by the flood, but instead used a formulaic approach based on the square-footage cost of a substantially-improved new home. Indeed, FEMA claims that the new home, which is three times the size of the old one, required code and material upgrades, neither of which is covered by SFIP. The Court has considered the Master's rationale and, concludes de novo, he is right both on the facts and the law. The Master concluded that Plaintiff failed to provide a specific basis for why she is entitled to additional funds under SFIP. The Master noted that Plaintiff's claim is based entirely on a square-foot-
age formula that the Court has previously rejected in its Opinion of February 17, 2011 [Paper No. 596] as to the Group 1 Plaintiffs, particularly the section of the Court's opinion addressing Plaintiff Bonner 's claims. As the Court has stated, FEMA is permitted to reject, as unscientific, methods for calculating losses it finds are not accepted by industry or those that do not take into account the coverage and exclusions provisions of the SFIP. The square footage for construction formula proposed by Plaintiff, unscientific or not, was not a formula FEMA was obliged to accept. *3 Absent a showing that she is entitled to additional funds based on a specific provision of the SFIP, the Court rejects Plaintiff's claim that she is entitled to recover the replacement value of her home as calculated by a formula that uses the value of Plaintiff's substantially-improved new home. In response to FEMA's request for itemization of repairs for damage covered under SFIP, Plaintiff points to the administrative record. However, as the Master noted, Plaintiff made no showing that the original adjustment that FEMA relied on in making its payout determination was incorrect or otherwise not in accord with the law. Additionally, while the administrative record contains ample documentation in the form of invoices, receipts, and cancelled checks, all that these appear to do is to itemize Plaintiff's costs in constructing her new home. They do not, as required under the SFIP, demonstrate that the costs of repairs were necessitated by direct physical loss from or by flood damage. Though Plaintiff's decision to rebuild her home may have been a reasonable one, FEMA is under no obligation to compensate her for her choice to rebuild, rather than repair. Plaintiff, in the alternative, claims that she should receive $19,929, the difference between the Replacement Cost Value (RCV) of her home, as determined by the adjuster, and the amount she received. However, the Master noted that since Plaintiff did not have a valued policy under SFIP, her policy coverage was limited to actual physical
loss. Therefore, FEMA's decision to only provide coverage for the costs of repairs of actual damage, and to deny coverage based on the replacement value of the home, was reasonable. In sum, FEMA's decision was neither arbitrary nor capricious. 23) Greenhawk As to Plaintiff Greenhawk, the Master has submitted an 11page Report and Recommendation, finding that FEMA's denial of his claim was not arbitrary and capricious. Plaintiff's policy limit for flood damage to his building was $202,700, with a deductible of $1,000. FN4 He was paid $54,796 for such damage. Plaintiff's insurance policy also included a policy limit of $30,000 under the ICC provision. FN4. The policy limit of $202,700 was under Coverage A of Plaintiff's policy. Plaintiff initially requested $59,419 in his waiver application, but later realized that this request reflected mathematical errors and included expenses that he had already been paid for under the initial $54,796 payment. Plaintiff agrees that all monies due under Coverage A of the policy have been paid in full. In addition to the generic objections common to all Plaintiffs, which the Court overruled in its Opinion of February 17, 2011 [Paper No. 596], Plaintiff (1) excepts to the Master's findings that he is not entitled to an additional payment of $30,000, the maximum due under the ICC provision of the policy, and (2) argues that the Master has no authority to advise Plaintiff how to collect a payment under his ICC coverage. Plaintiff claims that he spent $35,730 on postloss demolition, elevation, relocation, and floodproofing work, which entitles him to the maximum amount under the ICC provision. The ICC provision of his policy covers these types of expenses if
certain conditions are met, including the location of the home in a designated Special Flood Hazard Area and evidence that the repair costs exceeded 50 percent of the home's replacement cost. According to Plaintiff, the town administrator evaluated Plaintiff's home following Hurricane Isabel and estimated that the damage to the home was more than 50 percent of the home's value. In addition, Plaintiff objects to the Master's finding that Plaintiff did not assert an ICC claim at the time FEMA denied the waiver application. *4 FEMA argues, inter alia, that Plaintiff failed to meet any of the criteria for granting a waiver; failed to demonstrate that the claimed costs on the waiver application exceeded the payments Plaintiff received from the insurer; and, because he failed to submit a Proof of Loss under the ICC provision at the time of the damage, failed to preserve the right to file an ICC claim on his waiver application. FEMA also argues that, in any case, Plaintiff does not qualify for the ICC compensation because the costs of the repairs to Plaintiff's home do not meet the 50 percent threshold and the town administrator's evaluation to the contrary does not affect the terms of the SFIP. Finally, FEMA argues that Plaintiff's revised calculations suggest that he has in FN5 fact been overpaid by $20,766. FN5. The total cost of repairing Plaintiff's home, as reported by Plaintiff in his waiver application, was $84,715. FEMA subtracted the $35,730 post-loss costs from the total reported cost because they were not covered by that provision of the policy and arrived at $48,985. FEMA subtracted two other claimed costs because they were deemed nonallowable$10,500 for window replacement and $4,456 for electrical wiringand arrived at $34,030 as the maximum potential total eligible costs to repair Plaintiff's house. Given that Plaintiff was initially paid $54,796 for flood damage, FEMA argues that he was overpaid by $20,766. FEMA, however, does not appear
to be seeking to recover the alleged overpayment. The Court has considered the Master's rationale and, concludes de novo, both on the facts and the law, that it is in agreement with him. Even though Plaintiff presented costs related to elevation of the building when he sought to recover $59,419 in shortfall under Coverage A of the policy, he never filed a claim under the ICC provision before he submitted his waiver application. Therefore, the Court agrees with the Master that FEMA's denial of his waiver application did not amount to a denial of the merits of any potential ICC claims. Indeed, in its letter denying the waiver, FEMA informed Plaintiff that he should pursue any ICC claims through his insurer, not through the waiver process. FEMA's denial of any ICC claim in the waiver process cannot have been arbitrary or capricious because at the time of the requested waiver, no ICC claim had been properly presented to FEMA. The Court concludes that Plaintiff has not met his burden to show that FEMA should have allowed his claim. FEMA was neither arbitrary nor capricious in handling Plaintiff Greenhawk's claim. 24) Hallanan As to Plaintiff Hallanan, the Special Master has submitted an 11page Report and Recommendation, finding that FEMA's denial of her claim was not arbitrary and capricious. Plaintiff's policy limit for flood damage to her building was $119,000. The policy limit for the ICC provision under the policy was $30,000. Plaintiff's insurer issued checks amounting to $71,121 for flood damage and $30,000 for the ICC provision, amounting to a total of $102,121. Plaintiff claims she spent over $372,000 to demolish and rebuild her dwelling; a home, as it happens, that ended up being more than double the square footage of the original structure. In her waiver application, Plaintiff claims she is entitled to $45,879,
FN6
relying on a formula based on the square footage cost of building a new home and applying it to the square footage of the pre-existing home. FN6. Plaintiff initially requested $85,518 in her waiver application but later realized that the $85,518 request did not account for the $39,639 in checks already issued by the insurer but not cashed by her. In addition to the generic objections common to all Plaintiffs, which the Court overruled in its Opinion of February 17, 2011 [Paper No. 596], Plaintiff excepts to the Master's findings that she is not entitled to an additional payment of $45,879, the difference between the policy limit for flood damage to her building (less a $1,000 deductible) and the $71,121 in payments her insurance provider authorized. *5 In addition to disputing FEMA's rejection of the square footage cost formula for constructing her new dwelling, Plaintiff also says she provided sufficiently specific and adequate documentation as to the building costs. FEMA's position is that Plaintiff failed to submit a detailed line-item documentation of damages caused directly by or from flooding to her building, relying instead on an unscientific formula to calculate the replacement cost of her new dwelling. Although Plaintiff submitted nine pages of itemized costs with her waiver application, FEMA noted that the costs were based on the square footage formula and were therefore an insufficient basis on which to grant the waiver request. Finally, in its Reply [Paper No. 633], FEMA acknowledged Plaintiff's request that the uncashed checks should be reissued and stated that it would forward the request to FN7 Plaintiff's insurer. FN7. Plaintiff stated that as of July 5, 2011, she has yet to receive the reissued checks. See Plaintiff's Objections to Special Master's Report [Paper No. 682].
The Court concludes de novo that the Master is correct both on the facts and the law. Plaintiff's waiver claim was based on the square footage formula based on new construction. As the Court stated in its Opinion of February 17, 2011 [Paper No. 596] as to the Group 1 Plaintiffs, particularly the section of the Court's opinion addressing Plaintiff Bonner 's claims, FEMA is permitted to reject as, unscientific, those methods for calculating losses it finds are not accepted by industry or that do not take into account the coverage and exclusions provisions of the SFIP. The square footage for construction formula proposed by Plaintiff, unscientific or not, was not a formula FEMA was obliged to accept. FEMA was neither arbitrary nor capricious in handling Plaintiff Hallanan's claim and the Court FN8 adopts the Master's recommendation. FN8. The Court notes that the Master conditioned his recommendation on FEMA's assertion that it will promptly issue the checks already due Plaintiff. The Court also conditions its findings on FEMA's fulfillment of this commitment. 25) Healan As to Plaintiff Healan, the Special Master has submitted a 12page Report and Recommendation, finding that FEMA's denial of her claim was not arbitrary and capricious. Plaintiff's policy limit for flood damage to her building was $185,900. She was paid $45,285 for FN9 such damage (after a $1,000 deductible). FN9. In addition, Plaintiff received $28,795 under the ICC provision of the policy. In addition to the generic objections common to all Plaintiffs, which the Court overruled in its Opinion of February 17, 2011 [Paper No. 596], Plaintiff excepts to the Master's findings that she is not entitled to an additional payment of $139,615,
the difference between the policy limit for flood damage to her building (less a $1,000 deductible) and the $45,285 in payments her insurance provider authorized. Plaintiff claims she spent $278,277 to partially demolish and rebuild her dwelling and to remodel FN10 the remaining section of the home. FN10. Plaintiff initially reported a cost of $441,168 in her waiver application but later realized that these calculations were incorrect. Regardless, both figures exceeded Plaintiff's policy limit, so she requested a waiver for the sum of $139,615. Plaintiff takes issue with the estimates of overhead and profit costs prepared by FEMA operatives; disputes FEMA's rejection of the square footage cost formula for constructing her new dwelling; and contends that she provided sufficiently specific and adequate documentation as to the building costs. She also argues that she should not be held responsible for the construction company's failure to supply her with line-item documentation of its work. *6 FEMA says that Plaintiff failed to demonstrate that any additional damages she sought were actually covered by her SFIP and failed to submit a detailed line-item documentation of damages caused directly by flooding to her building, relying instead on an unscientific formula to calculate the replacement cost of her new dwelling. The Court concludes de novo, both on the facts and the law, that it is in agreement with the Master. FEMA is not required to adopt the square footage formula Plaintiff used to calculate her loss. As the Court has already stated in its Opinion of February 17, 2011 [Paper No. 597] as to the Group 1 Plaintiffs, particularly the section of the Court's opinion addressing Plaintiff Bonner 's claims, FEMA is permitted to reject as unscientific those methods for calculating losses it finds are not ac-
cepted by industry or that do not take into account the coverage and exclusions provisions of the SFIP. The square footage for construction formula proposed by Plaintiff, unscientific or not, was not a formula FEMA was obliged to accept. In any case, as the Master noted, Plaintiff's shifting estimate of the costs of constructions has made it difficult to assess her claim, which in any event finds insufficient support in the record. Further, although it is unfortunate that Plaintiff's construction company may not have supplied her with the type of information FEMA required for the waiver application, it was Plaintiff's burden to obtain that information from the contractor and submit it to FEMA. The Court finds that Plaintiff has not met her burden to show that FEMA should have allowed her claim. FEMA was neither arbitrary nor capricious in handling Plaintiff Healan's claim. 26) Helmer As to Plaintiff Helmer, the Master has submitted an 11page Report and Recommendation finding that FEMA's denial of his claim was neither arbitrary nor capricious. Plaintiff's policy limit for flood damage to his building was $220,200, subject to a $2,000 deductible. His contents were insured up to $61,700, subject to a $1,000 deductible. Plaintiff was paid $93,996 for his building loss and $34,761 for his FN11 contents loss. FN11. Plaintiff does not dispute his claim for contents loss and seeks no additional compensation under that coverage. In addition to the general objections common to all Plaintiffs, which the Court rejected in its Opinion of February 17, 2011 [Paper No. 596], Plaintiff excepts to the Master's findings that he is not entitled to additional coverage for damage to FN12 his building in the amount of $88,758. FN12. Plaintiff initially requested $92,758 but subtracted $4,000 after acknowledging
that roof repairs are not compensable under his policy. Plaintiff asserts that there was no consistency or uniformity in the way repairs to his property were adjusted and compensated. In particular, he points to the manner in which his custom kitchen repairs were adjusted, saying, in connection with the bid of Kenwood Kitchens, Inc., that FEMA should have allocated more money for the damage to the kitchen. Plaintiff asserts that the Master was wrong in upholding FEMA's decision not to have done so. He also asserts that he is entitled to recover for light fixtures, gutter repair, and general demolition. *7 FEMA says Plaintiff failed to demonstrate any additional damages he sought were actually covered by his SFIP; did not submit detailed lineitem documentation of uncompensated damages caused directly by or from flooding to their original structure; and failed to establish that he proceeded in good faith or give a reasonable explanation for the delay in submitting his request. The Master is right both on the facts and the law. The Court finds, as did the Master, that it was well within FEMA's discretion to rely on the estimate provided by the independent adjuster, Bellmon Adjusting, rather than the one submitted by Plaintiff. Moreover, FEMA was correct in finding that Plaintiff's claim included items that simply were not compensable under the SFIP, given the evidence Plaintiff submitted to support the waiver request and given that the water in Plaintiff's house only reached a height of 29 inches on the exterior and 24 to 28 inches in the interior. Lastly, there is no indication that FEMA's handling of Plaintiff's waiver claim was inconsistent with the way other similarly situated claims have been handled. Remand is not appropriate in this case. FEMA was neither arbitrary nor capricious in handling Plaintiff's claim.
27) Hinefelt As to Plaintiff Hinefelt, the Special Master has submitted a 7page Report and Recommendation, finding that FEMA's denial of her claim was not arbitrary and capricious. Plaintiff's policy limit for flood damage to her building was $86,600. She was paid $41,917 for such damage. Plaintiff also received a $30,000 payment under the ICC provision of the policy. In addition to the generic objections common to all Plaintiffs, which the Court overruled in its Opinion of February 17, 2011 [Paper No. 596], Plaintiff excepts to the Master's findings that she is not entitled to an additional payment of $33,744, the difference between the total repair costs (less a $1,000 deductible) and the payments she received for flood damage and the ICC provision ($41,917 and $30,000, respectively). Plaintiff claims she spent a total of $106,661 to repair her property. She informed FEMA in her waiver application in February 2008 that she had hundreds of receipts to support the claimed costs and would submit those documents to the agency. She claims she was not notified of or provided an opportunity for supplying additional information, and therefore disputes FEMA's denial of her waiver for insufficient documentation. She submits that FEMA's stated reasoning for denying her claim amounts to an after-the-fact basis for denial of her claim. FEMA argues that Plaintiff failed to meet any of the criteria for granting a waiver; failed to provide sufficient documentation of the repair costs; and failed to explain how any uncompensated losses meet the SFIP criteria. On de novo review, the Court cannot disagree with the Master. The Master found, and so does the Court, that Plaintiff in fact had full opportunity to supply information to FEMA as part of the waiver process
but failed to do so. Otherwise, the administrative record shows a detailed and comprehensive adjustment of Plaintiff's claim by FEMA and its determination appears consistent with how it applies the SFIP to claims. *8 The Court concludes that FEMA was neither arbitrary nor capricious in handling Plaintiff Hinefelt's claim. 28) Horne As to Plaintiff Horne, the Master has submitted a 14page Report and Recommendation and a 2page Supplemental Report finding that FEMA's denial of his claim was not arbitrary and capricious. Plaintiff's policy limit for flood damage to his building was $81,000, subject to a $1,000 deductible. He was paid $36,217 under the building proviFN13FN14 sion. FN13. In addition, Plaintiff received the maximum $30,000 due under the ICC provision of the policy. FN14. Until recently, Plaintiff spent considerable time denying or not recalling whether he actually received compensation for claims totaling $6,619, but after the Master issued his report, Plaintiff advised through counsel that, in fact, the check had been received, endorsed, and deposited into his bank account. The Court overrules Plaintiff's generic objections common to all Plaintiffs, which the Court rejected in its Opinion of February 17, 2011 [Paper No. 596]. Unscrambling Plaintiff's somewhat confusing history of claims, Plaintiff presumably excepts to the Master's finding that he is not entitled to the difference between the $80,000 policy limit for damage to his building and the $36,217 he received (after application of the $1,000 deductible), i.e., $42,783.
Plaintiff contends that the conclusions of his appraiser should have been accepted over those of the adjuster selected by FEMA. FEMA argues that it comes too late in the day for Plaintiff to argue that his appraiser's estimates should prevail over those of FEMA's adjuster and, in any case, that FEMA could fairly rely on its adjuster's estimates, and further that Plaintiff failed to itemize precisely which physical losses were directly caused by or from the one to two inches of flood water that entered his home; employed an improper method of calculating his damages, i.e., multiplying the square footage of his original structure by the cost per square foot of the new, upgraded structure; failed to take into account SFIP's coverage limits or exclusions; and failed to establish that he proceeded in good faith or that he gave a reasonable explanation for the delay. Again the Court concludes de novo, both on the facts and the law, that the Master has it right. As to Plaintiff's argument based on differences between his appraiser's and the adjuster's calculations, that argument was not made in the waiver application and as such FEMA was not obligated to review it. Nor is it obliged to deal with it at this late stage in the proceedings. In any event, FEMA's reliance on its own adjuster's estimates was not unreasonable. Beyond that, Plaintiff's waiver application was solely based on the square foot formula for new construction, which FEMA has consistently rejected and the Court has consistently sustained. The square footage for construction formula proposed by Plaintiff is not a formula FEMA was obliged to accept. The Court concludes that FEMA was neither arbitrary nor capricious in its handling of Plaintiff's claim. 29) Jackson As to Plaintiff Jackson, the Special Master has submitted a 10page Report and Recommendation, finding that FEMA's denial of her claim was not ar-
bitrary and capricious. Plaintiff's policy limit for flood damage was $185,000 for her building and $60,000 for her contents, both subject to a $500 deductible. Plaintiff was paid $123,620 for the building and $18,208 for FN15 personal property. FN15. In addition, Plaintiff received the $30,000 maximum due under the ICC provision of the policy. *9 In addition to the generic objections common to all Plaintiffs, which the Court overruled in its Opinion of February 17, 2011 [Paper No. 596], Plaintiff excepts to the Master's findings that she is not entitled to an additional payment of $60,880, the difference between the policy limit for flood damage to her building (less a $500 deductible) and the $123,620 she in fact received for such damage. Plaintiff claims she had to demolish her old home and build a new one at a cost of $720,088. Plaintiff says that she is entitled to reimbursement for the cost of the new home. She calculates the value of the claimed reimbursement by multiplying the total square footage of the old home (897 sq. ft.) by the cost-per-square-foot to construct the new home ($296) and subtracting the previously-received ICC compensation of $30,000 to arrive at a replacement valuation of $235,543. Because her policy limit for building damage ($185,000) is less than the discounted replacement value of her home, she claims she is entitled to receive the full policy limit for damage to her original home. FEMA argues that Plaintiff did not demonstrate that the damages sought were specifically covered by SFIP; did not provide detailed line-item documentation of repairs for damage caused by the flood, using a formulaic approach based on the square-footage cost of a substantially-improved new home; and did not provide reasonable explanations for the delay in filing her claim. FEMA additionally claims that Plaintiff was overcompensated for the damage to her building due to an earlier
miscalculation of the replacement cost, and that this overpayment of $15,531 would offset any claimed FN16 underpayment. FN16. It appears that FEMA is not seeking reimbursement for the alleged overpayment. The Court has considered the Master's rationale and, concludes de novo, both on the facts and the law, that it agrees with him. The Master concluded that Plaintiff failed to provide a specific basis for why she is entitled to additional funds under SFIP. He noted that her claim is based on a square-footage formula that the Court has previously rejected as to all Plaintiffs. The square footage for construction formula proposed by Plaintiff is not a formula FEMA was obliged to accept. Absent a showing that Plaintiff is entitled to additional funds based on a specific provision of SFIP, the Court rejects Plaintiff's claim that she is entitled, generally, to recover the replacement value of her home, as calculated by a formula based on the value of Plaintiff's substantially-improved new home. The Court concludes that FEMA was neither arbitrary nor capricious in handling Plaintiff Jackson's claim. 30) Jasinski As to Plaintiff Jasinski, the Special Master has submitted a 10page Report and Recommendation, finding that FEMA's denial of her claim was not arbitrary and capricious. Plaintiff's policy limit for flood damage was $135,000 for her building, subject to a $2,000 deductible. She was paid $74,415 for damage to her FN17 building caused by the flood. FN17. In addition, Plaintiff received the $30,000 maximum due under the ICC provision of the policy.
*10 In addition to the generic objections common to all Plaintiffs, which the Court overruled in its Opinion of February 17, 2011 [Paper No. 596], Plaintiff excepts to the Master's findings that she is not entitled to an additional payment of $25,525 under her building coverage, namely the difference between the $100,032 she alleges was the cost of FN18 repair (less a $2,000 deductible) and the $72,507 she says she received for such damage FN19 . FN18. This figure does not account for $30,000 in costs that have already been paid under the ICC provision of Plaintiff's policy. FN19. The Master noted that Plaintiff omitted a payment of $1,843 in her calculation of what she received, but there also appears to be a discrepancy of approximately $64 between the amount Plaintiff claims she received and the amount FEMA claims she received, less the $1,843 payment. What accounts for the discrepancy is uncertain, but it does not affect the Court's ultimate finding. Initially, Plaintiff claims she was awarded $1,843 plus $461 in depreciation but she is unsure about receiving a check for $1,843 and says she does not know how to obtain the $461. FEMA says that Plaintiff was issued a check for $1,843. It further says that Plaintiff will receive the additional payment of $461 in recoverable depreciation if she contacts her insurer and requests that amount. As to the requested supplemental payment for the full cost of repair to Plaintiff's home, FEMA argues that Plaintiff did not include any documentation with her waiver application and has failed to indicate whether she believes her insurer failed to pay for specific covered items or whether she simply disagrees with the amount of coverage provided by her insurer. The Court has considered the Master's Report
and, concludes de novo, both on the facts and the law, that it is in agreement with him. The Master concluded that FEMA in fact did pay Plaintiff the $1,843 she was owed. As to Plaintiff's request for supplemental funds to cover the alleged cost of repair to her home, the Master found that Plaintiff failed to comply with her obligation under SFIP to submit full documentation supporting her claim for additional funds by identifying specific costs of repair entitled to coverage. The Court agrees with the Master's analysis and concludes, as did he, that FEMA's denial of Plaintiff's FN20 waiver claim was not arbitrary and capricious. FN20. This finding is contingent on FEMA's payment of the $461 in recoverable depreciation. A separate ORDER will be entered implementing these decisions. D.Md.,2011. Moffett v. Computer Sciences Corp. Slip Copy, 2011 WL 3423384 (D.Md.) END OF DOCUMENT
Only the Westlaw citation is currently available. United States District Court, D. Maryland. Thomas L. MOFFETT, II, et al., Plaintiffs v. COMPUTER SCIENCES CORPORATION, et al., Defendants. Civil No. PJM 051547. July 1, 2011. Donald W. Marcari, Frank D. Lawrence, IIIMarcari RussottoAnd Spencer, Chesapeake, VA, Martin H. Freeman, Freeman and Freeman PC, Rockville, MD, for Plaintiffs. Arthur F. Fergenson, Ansa Assuncao LLP, Holly Drumheller Butler, Dla Piper U.S. LLP, Jason Daniel Medinger, Office Of The United States Attorney, Steven Michael Klepper, Kramon And Graham PC, Skeen And Kauffman LLP, James D. Skeen, Brett Anthony Buckwalter, Niles Barton And Wilmer LLP, Baltimore, MD, Jay I. Morstein, Owings Mills, MD, Tyler Brian Raimo, Computer Sciences Corporation, Falls Church, VA, Darren Seth Wall, Department Of Homeland Security, Arlington, VA, Robert H. King, Jr., Sonnenschein Nath And Rosenthal LLP, Chicago, IL, Kirk Robert Ruthenberg, Snr Denton U.S. LLP, Steuart H. Thomsen, Sutherland Asbill and Brennan LLP, Scott Nathan Auby, Debevoise And Plimpton LLP, W Neil Eggleston, Debevoise And Plimpton LLP, Elizabeth Treubert Simon, Pamela Anne Bresnahan, Vorys Sater Seymour And Pease LLP, Washington, DC, Gerald Joseph Nielsen, Nielsen Law Firm LLC, Metairie, LA, Peter F. Axelrad, Council Baradel Kosmerl And Nolan PA, Annapolis, MD, Craig Russell Blackman, Samuel J. Arena, Jr., Stradley Ronon Stevens And Young LLP, Philadelphia, PA, Edward J. Hutchins, Jr., Stacey Ann Moffet, Eccleston And Wolf PC, Hanover, MD, William J. Hickey, Law Offices Of William J.
Hickey LLC, Rockville, MD, Debra Anne Nelson, William Lowell Mundy, Mundy And Nelson, Huntington, WV, James Hilton Crosby, Crosby Saad LLC, Mobile, AL, William Gerald Gandy, Wilson Elser Moskowitz EdelmanAnd Dicker, Mclean, VA, Bradish J. Waring, Mary Legare Hughes, Nexsen Pruet LLC, Charleston, SC, Steven B. Schwartzman, Patricia Mchugh Lambert, Hodes, Pessin & Katz, P.A., Towson, MD, for Defendants. MEMORANDUM OPINION PETER J. MESSITTE, District Judge. [OPINION ON SUMMARY JUDGMENT AS TO CLAIMS OF GROUP 2 HOUSEHOLDERS.] *1 The Court adopts and incorporates by reference its Opinion With Respect to Plaintiffs' General Objections to the Reports and Recommendations of the Master, filed on February 17, 2011 (Document No. 597). It now considers the Group 2 Plaintiffs' Objections (Exceptions) to Reports and Recommendations of the Special Master. 11) Deaver FN1
FN1. As with Group 1 Plaintiffs, the Court will refer only to the name of the first householder on a given claim if more than one name appears on a single claim. Throughout, monetary inventory amounts here have been rounded to the nearest dollar. As to Plaintiff Deaver, the Special Master has submitted a 13page Report and Recommendation, finding that FEMA's denial of her claim was not arbitrary and capricious. Plaintiff's policy limit for flood damage to her building was $67,300. Plaintiff was paid $38,809 for such damage. In addition to the generic objections common
to all Plaintiffs, which the Court overruled in its Opinion of February 17, 2011 (Paper [596] ), Plaintiff excepts to the Master's findings that she is not entitled to an additional payment of $26,491, the difference between the policy limit for flood damage to her building (less a $1,000 deductible) and the $39,809 she in fact received for such damFN2 age. FN2. Plaintiff was paid the policy limit for damaged contents of the property, $14,800. Plaintiff claims she spent a total of $83,631 to repair her property and submitted a multi-page contract with estimates and addenda. She disputes the validity of the inspections and estimates prepared by FEMA operatives, as well as their qualifications; claims that full repairs for such items of plastering were necessary even for plaster above the water damage level; and contends that she was sufficiently specific and provided adequate documentation as to unreimbursed damages. FEMA argues, inter alia, that Plaintiff failed to identify what portion or portions of the SFIP she desired waived; submitted the same documentation she submitted previously which had been reviewed and rejected previously; sought recovery for some items either not covered by the SFIP or which duplicated overhead and profit already compensated, the latter claim in any case being well above the industry standard; and failed to provide line item identification of physical losses caused by flood. The Court has considered the Master's rationale and, concludes de novo, both on the facts and the law, that it is in agreement with the Master. In his review of the record, the Master could not find where Plaintiff had identified specific items that had not been covered under the SFIP but which should have been, and the Court, in its own review, has been similarly unable to do so. Moreover, insofar as Plaintiff attempted to show, for the first time in her opposition to FEMA's determination, that plastering and siding were spe-
cified items, the Master found and here, too, the Court agrees, that this came too late, since agency action had already been taken. Other than her disagreement with FEMA's determinations, Plaintiff has not demonstrated either the invalidity of the conclusions of FEMA's investigators or cost estimators. The Court would yet again remind, as stated in its Opinions as to the Group 1 Plaintiffs, that the SFIP is not a private insurance policy subject to equitable glosses. It covers losses that private insurance does not cover and can fairly limit its coverage strictly to repairing losses covered by flood, even if, as to a given item that includes portions not damaged by flood, total repair of the item is reasonable. *2 The Court concludes that FEMA was neither arbitrary nor capricious in handling Plaintiff Deaver's claim. 12) Dickey As to Plaintiff Dickey, the Master has submitted a 13page Report and Recommendation, finding that FEMA's denial of her claim was not arbitrary and capricious. Plaintiff's policy limit for flood damage to her building was $135,000. She was paid $53,718 for FN3 such damage. FN3. In addition, Plaintiff received the $30,000 maximum due under the Increased Cost of Compliance (ICC) provision of the policy. In addition to the generic objections common to all Plaintiffs, which the Court overruled in its Opinion of February 17, 2011 [Paper No. 596], Plaintiff objects to the Master's findings that she is not entitled to an additional payment of $80,282, the difference between the policy limit for flood damage to her dwelling (less a $1,000 deductible) and the $53,718 she received for such damage. Plaintiff claims she spent a total of $174,527 to
demolish and rebuild the dwelling on its original footprint. She contends that she had no choice but to rebuild because a new structure was the only safe and economical alternative to repairing and elevating her home. She initially requested $21,133 in her waiver application, using a formula based on the square footage cost of building a new home and applying it to the square footage of the pre-existing home. Plaintiff later realized that the $21,133 request did not reflect the correct square footage of the dwelling and arrived at a substantially higher figure, $142,969, in her second set of calculations. FN4 Because that figure exceeded her policy limit, Plaintiff then requested a waiver for the sum of $80,282. FN4. Plaintiff arrived at her the second estimate of the cost of damages by taking the claimed total cost of the new home ($174,527) and subtracting the ICC payment ($30,000), arriving at $144,527. She then divided that figure by the square footage of the new home (1,816 square feet), arriving at a cost of $79.56 per square foot. Plaintiff then multiplied the square footage cost by the square footage of the original dwelling (1,797 square feet) and arrived $142,969, as the cost to restore the original home to its pre-flood condition. Plaintiff takes issue with the estimates of replacement costs prepared by FEMA operatives; disputes FEMA's rejection of the square footage cost formula for constructing her new dwelling; and contends that she provided sufficiently specific and adequate documentation as to the building costs. FEMA argues, inter alia, that Plaintiff failed to demonstrate that any additional damages she sought were actually covered by her SFIP; failed to submit a detailed line-item documentation of damages caused directly by flooding to her dwelling, using instead an unscientific formula to calculate the replacement cost of her new dwelling; and failed to establish that she proceeded in good faith and with reasonable explanation for the delay.
The Court has considered the Master's rationale and concludes de novo, both on the facts and the law, that it is in agreement with the Master. FEMA is not required to adopt the formula Plaintiff used to calculate her loss. Rather, the agency may use other methods and formulas. In FEMA's judgment, the formula Plaintiff puts forth is contrary to the SFIP. In any case, as the Master noted, Plaintiff failed to offer any expert opinion or evidence that would support the use of the formula she proposed. The Court finds Plaintiff has not met her burden to show that FEMA should have allowed her claim. As it stated in its Opinion of February 17, 2011 [Paper No. 597] as to the Group 1 Plaintiffs, particularly the section of the Court's opinion addressing Plaintiff Bonner' s claims, FEMA is permitted to reject as unscientific those methods for calculating losses it finds are not accepted by industry or that do not take into account the coverage and exclusions provisions of the SFIP. The square footage for construction formula proposed by Plaintiff, unscientific or not, was not a formula FEMA was obliged to accept. *3 The Court concludes that FEMA was neither arbitrary nor capricious in handling Plaintiff Dickey's claim. 13) Dieux As to Plaintiff Dieux, the Master has submitted a 13page Report and Recommendation, finding that FEMA's denial of her claim was not arbitrary and capricious. Plaintiff's policy limit for flood damage to her FN5 dwelling was $76,300. Plaintiff was paid $68,621 for such damage. Additionally, Plaintiff received $15,000 under the ICC provision of the policy, under the policy limit of $30,000 FN5. Plaintiff disputes the amount of the policy limit and claims that it is $107,000, not $76,300. Because the Court holds that
Plaintiff has failed to show how her claimed shortfall was covered under the SFIP, the amount of the policy limit is immaterial. In addition to the generic objections common to all Plaintiffs, which the Court overruled in its Opinion of February 17, 2011 [Paper No. 596], Plaintiff objects to the Master's findings that she is not entitled to a shortfall payment of $52,379, which is the total of (1) the difference between the policy limit Plaintiff claims is accurate ($107,000) and the $68,621 she received for such damage (amounting to a claim of $37,379 owed, after the $1,000 deductible), plus (2) the remaining $15,000 available under the ICC provision of the policy. Plaintiff claims that she spent a total of $465,521 to demolish her dwelling and build a new structure on the original footprint. Plaintiff initially submitted a waiver application for an additional $44,457 but later, for the first time in her Opposition [Paper No. 556], took the position that these calculations were incorrect and requested a payment of $52,379. Plaintiff disputes the validity of the estimates for replacement costs prepared by FEMA operatives and claims that FEMA's review of her claim has been lackluster and deficient. FEMA argues, inter alia, that Plaintiff failed to demonstrate that any additional damages that she sought were actually covered by their SFIP and that she submitted no new documentation explaining how the additional uncompensated items were covered under the SFIP. The Court has considered the Master's rationale and concludes de novo, both on the facts and the law, that it is in agreement with the Master. In his review of the record, the Master found, and so does the Court, that Plaintiff had not identified with specificity in her waiver application the additional damages that she claimed were not paid
but were clearly due under the SFIP. Plaintiff now agrees that her original waiver application was deficient and has asked the Master and the Court to accept the new shortfall itemization set forth in her Oppositionone that was not reviewed by FEMA in the administrative process. As the Master notes, and the Court concurs, there is no reason why Plaintiff should not have been prepared to submit a fully articulated claim to FEMA in her waiver application. In addition, Plaintiff still does not provide the necessary level of specificity in the new shortfall itemization and otherwise fails to show how the claim made is covered under the SFIP. She has not met her burden to show that FEMA should have allowed her waiver claim. The Court concludes that FEMA was neither arbitrary nor capricious in handling Plaintiff's claim. 14) Dolgow *4 In a 13page Report and Recommendation, the Master found nothing arbitrary or capricious as to FEMA's denial of this Plaintiff's waiver application. Plaintiff had a $125,000 policy limit for flood damage to building property and a $30,000 limit for damage to personal property, both subject to a $500 deductible. She was paid $21,051 for building damage and $0 for personal property damage. In addition, she also received a net $13,266 advance payFN6 ment on an ICC claim. FN6. The current status of the ICC claim is unclear from court filings. The fact that the $13,266which comprised a $15,000 payment less $1,734 for underpayment of premiumswas an advance payment might suggest that Plaintiff is due the rest of the $30,000. However, in its Reply to Plaintiff's Opposition to Summary Judgment, FEMA takes the position that Plaintiff had two years from the date of the loss to complete the work, and since she has demolished and not rebuilt her home,
she actually needs to reimburse FEMA the $15,000 ICC payment. While it does appear that Plaintiff may owe the amount of the advance to FEMA, insofar as FEMA believes that an overpayment is due the Court will leave it to FEMA to pursue the matter independently of this lawsuit. In addition to generic objections common to all Plaintiffs, which the Court rejected in its Opinion of February 17, 2011 [Paper No. 596], Plaintiff excepts to the Master's findings that FEMA did not act arbitrarily in rejecting her contents claim. She claims that she is entitled to an additional $103,449 for building damage and $28,703 for contents damage. Plaintiff says FEMA did not adequately consider portions of engineering reports indicating the extent and source of damage to her foundation and that FEMA erred in deciding that the damage to the foundation caused by mold should not be covered. Plaintiff also claims personal property damage and has submitted an inventory list of cost estimates. FEMA's position is that the foundation damage to Plaintiff's real estate predated the flooding damage and that she failed to mitigate the mold damage after the floodwaters receded. FEMA also argues that Plaintiff's contents damage claim was not adequately supported, that items for which she sought coverage were discarded before they could be inspected, and that required documentation was never submitted. Moreover, Plaintiff's claim was unsigned and unsworn. FEMA also noted that Plaintiff had no basis for seeking a waiver at all, since she had already submitted a timely Proof of Loss for additional building and contents damages to the company through which she purchased the flood insurance, a request which was rejected. The Court has considered the Master's findings and concludes de novo, both on the facts and the law, that it is in agreement with the Master. The Court finds, as did the Master, that
Plaintiff's contents damage was insufficiently documented. She disposed of her damaged personal property before an insurance adjuster could inspect it, in violation of the SFIP, and did not provide receipts as an alternative method of proof. While she said she disposed of the property out in order to mitigate her mold problem because it took the insurance adjuster 10 days to come to inspect it, she never informed her insurance company about this, nor did she request an expedited inspection. Lastly, Plaintiff's contents claim, while setting forth cost estimates, was accompanied by neither photos nor receipts. The Master also found that, while there were differing expert viewpoints as to the extent of the flooding and whether or not the flooding had caused damage to the foundation of Plaintiff's dwelling, FEMA considered those issues and reached its determination in a careful manner which specifically included review of the reports prepared by Plaintiff's experts. Indeed, the Court considers the level of review in this case extraordinary, with multiple engineers and insurance adjusters examining the damage. The Master found that FEMA's conclusion that Plaintiff failed to mitigate the mold was similarly reasonable, and the Court agrees. *5 The Court concludes that there was sufficient evidence on the record to support FEMA's denial of Plaintiff's waiver application. 15) Fenton The Master has submitted an 11page Report and Recommendation finding that FEMA's denial of Fenton's building damage claim was not arbitrary and capricious but recommending that this Plaintiff's ICC claim be remanded to FEMA for redetermination. Plaintiff's policy limit for flood damage to his building was $70,000, subject to a $1,000 deductible. FEMA paid out $51,014 for such damage. In addition to generic objections common to all plaintiffs which the Court rejected in its Opinion of
February 17, 2011 [Paper No. 596], Plaintiff objects to the Master's finding that he is not entitled to an additional payment of $17,987, the difference between the policy limit for damage to his building (less the $1,000 deductible) and the $51,014 paid by FEMA. He also asserts that he is entitled to the $30,000 policy limit for ICC because the first floor of his house was elevated. In addition to his ICC claim, Plaintiff maintains that the shortfall he claims for building damage was well supported because he submitted proof of all costs associated with the replacement of his home. He argues that FEMA acted in bad faith by ignoring his invitation to inspect his photos showing hurricane damage to his home and the repair and compliance work done. FEMA counters that Plaintiff did not adequately demonstrate that the building damage work was covered by his policyfor example, that the material used was of like kind and qualityand otherwise provided no evidence there was remaining building damage not covered by the $51,014 already paid. FEMA also argues that the mere fact that Plaintiff incurred further expense upgrading and rebuilding his home does not automatically entitle him to additional compensation. As to the ICC claim, FEMA originally denied the claim because Plaintiff never provided a copy of the local ordinance to support his contention that the structure needed to be elevated. However, FEMA now concedes that it will pay the ICC claim if sufficient documentation is provided. Otherwise the Court has considered the Master's findings and reasoning and concludes de novo that it is in agreement with him. Plaintiff's shortfall itemization was insufficiently specific to show coverage under the SFIP. FEMA had no obligation to review Plaintiff's photos at his invitation; rather, the burden was on Plaintiff to show he was entitled to further compensation.
As to Plaintiff's ICC claim, given FEMA's concession that it will consider documentation for that portion of Plaintiff's claim, that particular matter is remanded to FEMA for redetermination. The Court concludes that FEMA was not arbitrary and capricious and did not abuse its discretion when it denied Plaintiff's additional building damage claim of $17,987. The Court remands Plaintiff's ICC claim to FEMA for a redetermination consistent with the agency's representations to this Court. FN7 If FEMA ultimately denies the ICC claim, that denial will be subject to further judicial review. FN7. Plaintiff has advised the Court that he is already working with FEMA to conclude the ICC claim payment. 16) Ferguson FN8
FN8. Ferguson has passed away and his claim is being pursued by Reginald McNeely, administrator of Ferguson's estate. *6 As to Plaintiff Ferguson, the Master has submitted a 12page Report and Recommendation finding that FEMA's denial of his claim was not arbitrary and capricious. Plaintiff's policy limit for flood damage was $150,000 for his building and $10,000 for its contents, each subject to a $1,000 deductible. Plaintiff was paid $24,906 for the building damage and $10,000 for personal property damage. In addition to the generic objections common to all Plaintiffs, which the Court rejected in its Opinion of February 17, 2011 [Paper No. 596], Plaintiff excepts to the Master's findings that he is not entitled to an additional payment of $45,622, the difference between the total cost to repair his home (less a $1,000 deductible) and the $24,906 he in fact received for such damage. Plaintiff claims he spent a total of $71,528 to repair his home and submitted a waiver application
FN9 with invoices and cost estimates for the repairs. Plaintiff claims that he is entitled to coverage for damage to the foundation of his home, the stairs and landing leading into his basement, the crawlspace of his home, and the foundation of his garage. FN9. Plaintiff originally claimed he spent a total of $121,200 to repair his home. In response to FEMA's denial of his waiver application, Plaintiff revised his original claim by eliminating certain items and adding detail to others. FEMA argues, inter alia, that Plaintiff failed to identify specific damage covered by SFIP in his original waiver application; sought extensive coverage for damage to his basement, which receives only limited coverage under the SFIP; improperly revised his claim to add specificity and new grounds for coverage after the original waiver application was denied (e.g. in his original claim, Plaintiff never mentioned foundation or structural damage); and, in his revised claim, relied on new evidence, including a County inspection report, that was insufficient to prove structural damage covered by the policy, and which, among other things, was not restricted to damage caused by flooding. The Court has considered the Master's rationale and concludes de novo, both on the facts and the law, that it is in agreement with the Master. By revising the amount and specificity of his claim, Plaintiff substantially recast his original waiver application, introducing new claims and theories that were not articulated in the original application for waiver. Though Plaintiff claims the original waiver application contained an overview of his expenses and that the revision added specificity only available after the development of the administrative record, the Court finds that the revisions are too substantial to be allowed at this late stage in the proceeding. Moreover, as the Master noted, critical information contained for the first time in Plaintiff's revised claim, such as the County inspec-
tion report, appears to have been available to him at the time he filed his original waiver application. As to FEMA's decision to deny the original waiver application, the Master found, and the Court agrees, that the application for waiver and the attachments submitted with it in 2008 failed to include sufficient proof of entitlement to coverage. Since Plaintiff failed to show that he was entitled to further compensation under the policy, FEMA did not act arbitrarily or capriciously in denying the waiver claim. *7 The Court concludes that FEMA was neither arbitrary nor capricious in handling Plaintiff's claim. 17) Fiterman As to Plaintiff Fiterman, the Master has submitted an 11page Report and Recommendation finding that FEMA's denial of their claim was not arbitrary and capricious. Plaintiff's policy limit for flood damage to his building was $221,000 and $29,000 for contents, each subject to a $1,000 deductible. Plaintiff was paid $146,542 under the building coverage proviFN10 sion and $16,371 for contents. FN10. Plaintiff also received $15,000 under the ICC provision of his policy. In addition to the generic objections common to all Plaintiffs, which the Court rejected in its Opinion of February 17, 2011 [Paper No. 596], Plaintiff excepts to the Master's findings that he is not entitled to an additional payment of $73,458, the difference between the policy limit for his building (less a $1,000 deductible) and the FN11 $146,542 he in fact received for such damage. FN11. Plaintiff initially sought a $85,087 shortfall, but adjusted it to $73,458. Plaintiff claims that the flood damage to his house and the subsequent breaking of a 300gallon oil tank on the property made restoration im-
possible. Plaintiff believes he is entitled to recover the full policy limit because the house replacement cost plus the oil remediation costs exceed the policy limit. He claims that FEMA did not adequately account for the damage done and the dangers posed by oil contamination. FEMA argues, inter alia, that it did consider the entirety of the damages caused by the flooding and the oil contamination when it awarded compensation to repair Plaintiff's home. It notes that Plaintiff provided estimates for the full cost of repairing the storm damage and remediating the oil contamination that, in fact, totaled less than the amount he actually received. Because SFIP only covers the cost of repair and remediation, FEMA argues, Plaintiff is not entitled to recover the full value of his home simply because he chose to demolish the house instead of repair it. The Court has considered the Master's rationale and, concludes de novo, both on the facts and the law, that it is in agreement with the Master. FEMA gave careful consideration to the damages caused not only by the flooding but also the oil contamination. Though Plaintiff obtained opinions from independent experts as to the oil contamination damage, FEMA was not required to accept these opinions, given that they conducted their own review and concluded otherwise. Finally, while Plaintiff's decision to demolish his house and relocate may have been reasonable, that did not require FEMA to alter its evaluation methodology, which, according to the narrow limits of the SFIP, was properly confined to assessing the cost of repair damages directly caused by the flood. The Court concludes that FEMA was neither arbitrary nor capricious in handling Plaintiff's claim. 18) Gagnon As to Plaintiff Gagnon, the Master has submitted an 11page Report and Recommendation finding that FEMA's denial of her claim was not arbit-
rary and capricious. *8 Plaintiff's policy limit for flood damage to her building was $246,300 and $76,200 for contents, both subject to a $500 deductible. Plaintiff was paid $149,698 under the building coverage provision and $66,548 under the contents coverage provision. In addition to the generic objections common to all Plaintiffs, which the Court rejected in its Opinion of February 17, 2011 [Paper No. 596], Plaintiff excepts to the Master's findings that she is not entitled to coverage for damage to contents in her garage in the amount of $9,152, and for damage to her pool house in the amount of $56,509. Plaintiff submits that the attached garage and pool house were covered by the SFIP. In addition, she rejects FEMA's claim that she was overcompensated $80,000 as a result of an adjuster's error. FN12 Plaintiff further alleges that her application for waiver was sufficiently detailed and claims that FEMA refused to accept her invitation to review pictures during the review process. Lastly, Plaintiff notes that FEMA failed to state specifically which items are not covered under the SFIP. FN12. A FEMA insurance examiner concluded that Plaintiff was overcompensated by over $80,000. See Doc. No, 3172. In response, FEMA argues, inter alia, that Plaintiff failed to demonstrate that any additional damages she sought were actually covered by her SFIP, e.g., under the terms of her SFIP, her pool house was not a covered item under the flood policy for her home; did not submit any documentation explaining how the alleged additional uncompensated items were covered under the SFIP; did not file a Proof of Loss seeking additional damages on her flood claim as required by her policy; and was actually overpaid $80,000 on her Hurricane Isabel-related flood claim. The Court has considered the Master's rationale
and, concludes de novo, both on the facts and the law, that for the most part it is in agreement with the Master. The Court finds, as did the Master, the Plaintiff's pool house is not part of the new house merely because it was connected to the main house by an elevated walkway. The presence of the walkway makes no difference. Not only is Plaintiff's argument unpersuasive, it was not even made in the waiver application, but was presented for the first time in Plaintiff's Opposition to FEMA's determination after the waiver application was submitted. Although the Master agreed with FEMA that Plaintiff was overpaid by more than $85,000 because the pool house was not covered by the SFIP, since FEMA has indicated that it will take no action to recoup this amount, the Court finds it unnecessary to decide the issue. The Master also noted, as does the Court, that the contents of the garage for which further payment is sought were not mentioned in the waiver application or in the shortfall itemization. The Court concludes that FEMA was neither arbitrary nor capricious in handling Plaintiff's claim. 19) Gielner As to Plaintiff Gielner, the Master has submitted an 11page Report and Recommendation finding that FEMA's denial of his claim was not arbitrary and capricious. *9 Plaintiff's policy limits for flood damage to his building was $84,000 and $30,000 for contents damage, both subject to a $5,000 deductible. Plaintiff was paid $43,176 for building damage and FN13 $24,665 for contents. FN13. In addition, Plaintiff received the maximum $30,000 due under the ICC provision of the policy. In addition to the generic objections common to all Plaintiffs, which the Court rejected in its
Opinion of February 17, 2011 [Paper No. 596], Plaintiff excepts to the Master's findings that he is not entitled to an additional payment of $35,824, the difference between the policy limit of $84,000 for flood damage to his building (minus the $5,000 deductible) and the payment of $43,176 he received for such damage. Plaintiff contends that he spent a total of $126,979 to demolish his house and rebuild on the original footprint. He claims he had no option but to rebuild. In fact, he alleges that he was told by both FEMA and Baltimore County officials that they were not able to repair his house because to elevate the existing structure would destroy the building entirely. He also disputes the validity of the inspections and estimates prepared by FEMA operatives, as well as their qualifications; denies that his formula for calculating damages based on square footage is unscientific; complains about FEMA's failure to solicit more information from him once his waiver application was submitted, and says FEMA failed to recognize that the claim at issue is only for Coverage A of the SFIP. FEMA argues, inter alia, that Plaintiff has not demonstrated that any additional damages he seeks were actually covered by his SFIP; failed to submit a detailed line-item documentation of uncompensated damages caused directly by flooding to his original building, relying instead on an unscientific formula to calculate his loss; and failed to establish that he proceeded in good faith and with reasonable explanation for the delay in submitting his application. The Court has considered the Master's rationale and, concludes de novo, both on the facts and the law, that it is in agreement with the Master. FEMA has consistently rejected the square footage method put forth by Plaintiff to calculate his losses, and the Court has sustained FEMA's position throughout. The Court agrees that Plaintiff had the right to demolish his damaged house and erect a new one if he so chose but, given the restricted cov-
erage of the SFIP, there is no reason why FEMA should be obliged to accept or fund Plaintiff's deFN14 cision. FN14. Plaintiff says he relied on statements made by FEMA officials to the effect that the house must be replaced. No evidence supporting this claim accompanied Plaintiff's waiver application since the claim was presented for the first time in Plaintiff's opposition to FEMA's Motion for Summary Judgment. Even if the statements attributed to FEMA agents had been made (though the precise words and context would obviously be significant), there is no way that statements such as those could expand the scope of SFIP's coverage. As stated in the Court's Opinions as to the Group 1 Plaintiffs, particularly the section addressing Plaintiff Bonner' s claim, the SFIP is a government program that specifically covers losses that private insurance does not cover. As such it can fairly choose to limit its coverage strictly to the cost of repairing losses caused directly by flood. The Court concludes that FEMA was neither arbitrary nor capricious in handling Plaintiff's claim. A separate order will be entered implementing these decisions. D.Md.,2011. Moffett v. Computer Sciences Corp. Slip Copy, 2011 WL 2634312 (D.Md.) END OF DOCUMENT
Only the Westlaw citation is currently available. United States District Court, D. Maryland, Southern Division. Thomas L. MOFFETT, II, et al., Plaintiffs, v. COMPUTER SCIENCES CORPORATION, et al., Defendants. Civil Action No. 8:05CV01547. June 26, 2011. Donald W. Marcari, Frank D. Lawrence, III, Marcari Russotto and Spencer, Chesapeake, VA, Martin H. Freeman, Freeman and Freeman PC, Rockville, MD, for Plaintiffs. Arthur F. Fergenson, Ansa Assuncao LLP, Holly Drumheller Butler, DLA Piper US LLP, Jason Daniel Medinger, Office of the United States Attorney, Steven Michael Klepper, Kramon and Graham PC, James D. Skeen, Skeen and Kauffman LLP, Brett Anthony Buckwalter, Niles Barton and Wilmer LLP, Baltimore, MD, William Gerald Gandy, Wilson Elser Moskowitz Edelman and Dicker, McLean, VA, Darren Seth Wall, Department Of Homeland Security, Federal Emergency Management Agency, Arlington, VA, James Hilton Crosby, Crosby Saad LLC, Mobile, AL, Robert H. King, Jr., Sonnenschein Nath and Rosenthal LLP, Chicago, IL, Jay I. Morstein, Owings Mills, MD, Craig Russell Blackman, Samuel J. Arena, Jr, Stradley Ronon Stevens and Young LLP, Philadelphia, PA, Kirk Robert Ruthenberg, SNR Denton US LLP, Steuart H. Thomsen, Sutherland Asbill and Brennan LLP, Scott Nathan Auby, W. Neil Eggleston, Debevoise and Plimpton LLP Elizabeth Treubert Simon, Pamela Anne Bresnahan, Vorys Sater Seymour and Pease LLP, Washington, DC, Gerald Joseph Nielsen, Nielsen Law Firm LLC, Metairie, LA, Peter F. Axelrad, Council Baradel Kosmerl and Nolan PA, Annapolis, MD,
Edward J. Hutchins, Jr, Stacey Ann Moffet, Eccleston and Wolf PC, Hanover, MD, Patricia McHugh Lambert, Steven B. Schwartzman, Hodes Pessin and Katz PA, Towson, MD, William J. Hickey, Law Offices of William J. Hickey LLC, Rockville, MD, Tyler Brian Raimo, Computer Sciences Corporation, Falls Church, VA, Debra Anne Nelson, William Lowell Mundy, Mundy and Nelson, Huntington, WV, Bradish J. Waring, Mary Legare Hughes, Nexsen Pruet LLC, Charleston, SC, for Defendants. REPORT AND RECOMMENDATION CONCERNING WAIVER CLAIM OF LINDA KALB FN1 FN1. John and Matthew Kalb are also named Plaintiffs, but did not participate in the waiver application process. This Report and Recommendation covers all waiver claims of the Kalbs and may use the singular or plural of Plaintiff at various points. DENNIS M. SWEENEY, Special Master. *1 This constitutes the Report and Recommendation to the Court concerning the waiver claim of Linda Kalb pursuant to Part 1.f of the Memorandum Order of the Court (Document 467). In preparing this report, the Special Master reviewed the motions, memoranda, affidavits and exhibits provided in connection with the process specified in the Memorandum Order. As necessary, the Special Master also reviewed other documents that are part of the Court filings in this case. The Special Master was also provided by the Federal Emergency Management Agency (FEMA) the computer disc of the appropriate documents of record for this claim, as specified in Part 1.a of the Memorandum Order. In this case, the documents consist of 312 pages labeled FEMA000001 to 000312. I. Background Plaintiff's property located at 2807 4th Street,
Baltimore, Maryland, was insured by American Bankers Insurance Company (American Bankers) under Policy Number 3021353300 with a coverage limit of $70,000.00 for her building with a $500.00 deductible. See FEMA000067. Plaintiff did not maintain any contents coverage. Id. On September 18, 2003, Hurricane Isabel struck the Middle Atlantic States, including Maryland, which caused flooding resulting in damage to Plaintiff's home. Id. On September 22, 2003, Plaintiff reported her loss to American Bankers, and on October 1, 2003, American Bankers retained Sam Miller an independent adjuster from Sweet Claim Service, Inc. to inspect her property. See FEMA000147 and FEMA000148. Mr. Miller investigated the loss, assessed the damage, created a stick-by-stick report of the damages to Plaintiff's property, and concluded the actual cash value of Plaintiff's loss was $37,948.19, after application of the $500 deductible. See FEMA000147 and FEMA000173. Plaintiff was provided a copy of the report and supporting documents. See FEMA000155. Plaintiff was not entitled to the replacement cost value of her loss because she was under-insured as to the full value. The full replacement value of her entire home was $136,176.18 and Plaintiff maintained only $70,000.00 in coverage. Per the SFIP, a policy holder is entitled to replacement cost when the amount of insurance is 80% or more of the full replacement cost of the structure. See 44 CFR 61, App. A(1) at Art. V(1)(a)(2). Plaintiff's structure was only insured up to approximately 52%. Plaintiff was provided with a Proof of Loss for the adjusted amount. See FEMA000149. Plaintiff signed and submitted this Proof of Loss in the total amount of $37,948.19. See FEMA00001. On October 2, 2003, American Bankers issued an advance payment to Plaintiff totaling $7,500.00, but this check was voided and reissued on November 19, 2003. See FEMA000134 and FEMA000137. On
November 4, 2003, American Bankers issued a check for $30,448.19, which was the balance of the amount requested on Plaintiff's Proof of Loss. See FEMA000141. *2 Plaintiff requested review of her claim by the Hurricane Isabel Task Force (Task Force). Plaintiff stated: We could not afford to pay a contractor so we are doing all of the repair work ourselves. We have not included labor costs in our estimates. See FEMA000189. On July 27, 2004, the Task Force concluded its review of Plaintiff's claim and allowed for the following: Insured had 33" interior water in risk and states water wicked to over 4', making replacement of sheetrock and wall insulation to 8' necessary. Allowed these items to 8', adjusted price for subflooring and sheetrock, allowed for replacement of cable TV jack omitted from adjuster's estimate in living room, and allowed to replace the kitchen countertop. Recommended supplemental claim of $3,691.30 RCV, less $162.29 non-recoverable deprecation for a new claim and payment of $3,529.10. See FEMA000194. On August 27, 2004, Plaintiff submitted a signed Supplemental Proof of Loss for $3,529.10, the amount authorized by the Task Force. See FEMA000079. On August 30, 2004, American Bankers issued a check for $3,529.10, payment in full on Plaintiff's Supplemental Proof of Loss. See FEMA000077. Plaintiff was paid a total actual cash value amount of $41,477.29. II. Waiver Claim and Denial On February 25, 2008, Plaintiff submitted to FEMA a document entitled PLAINTIFF LINDA KALB'S INDIVIDUAL APPLICATION FOR WAIVER OF PROOF OF LOSS REQUIREMENTS. FEMA denied the request in a letter dated July 31, 2008. See FEMA00065 to 00066.
III. Reasons for Waiver Denial The reasons for the denial of the Waiver Claim are found at 1218 of the Supplemental Declaration of Karen Christian for the Claim of Linda Kalb (Document 6142). It states: Plaintiff's Shortfall Itemization includes a line item labeled L.M.S. Carpentry, Inc. contract (L.M.S.), which is an estimate of $43,794.00 to repair Plaintiff's home. See FEMA000018. There is no evidence that the undated, unsigned document from L.M.S. is a contract. See FEMA000019 and FEMA000020. In addition, Plaintiff stated in her Task Force review request that we are doing all of the repair work ourselves. See FEMA000189. Finally, it does not include any unit breakdowns, which makes determining pricing differences, actual cash value versus replacement cost calculations, determining measurement differences, and excluding noncovered items impossible. Plaintiff's waiver application fell woefully short of the documentation necessary to determine whether Plaintiff was entitled to any additional compensation. On July 31, 2008, FEMA denied Plaintiff's waiver request and provided her with the following explanation: ... you claim your flood damages necessitated repairs exceeding the amount paid by your Write Your Own carrier, American Bankers Insurance Company. To support the amount claimed, you provided an estimate for the required repairs. However, your estimate does not provide a unit cost breakdown. Without specific details it could not be determined if there are pricing and/or measurement differences of if non-covered items are included in the estimate. Your claim was originally reviewed by an independent adjuster and subsequently reviewed by the Hurricane Isabel Task Force that recommended a supplemental payment of $3,529.10. *3 Further, your waiver request resulted in a
comprehensive review of your claim by a FEMA Insurance Examiner. After further review, the Insurance Examiner found no basis to set aside the original findings. See FEMA000066. In other words, Plaintiff's claim was reviewed in detail by different reviewers on multiple occasions. There was no evidence of uncompensated damages resulting from the flood. Plaintiff's waiver application failed to identify any specific damages directly caused by the flood for which she did not receive full compensation. Every item Plaintiff lists on her shortfall was considered and properly adjusted. Plaintiff's shortfall is based on a contract that is not sufficiently detailed in order to conduct any meaningful analysis and a list of items that were already included in the original estimate provided by the adjuster. See FEMA000005 and FEMA0000018 through FEMA000020. For example, the following items listed on Plaintiff's shortfall are itemized with appropriate compensation provided on the adjuster's report: furnace, heater, A/C at FEMA000156 and FEMA000166, pellet stove at FEMA000162, kitchen cabinets, countertop at FEMA000163 through FEMA000164, and refrigerator, oven and dishwasher at FEMA000164. American Bankers' adjustment and the subsequent Task Force review were based on covered direct physical losses caused by or from the flood in accordance with the SFIP. See 44 CFR 61, App. A(1) at Section II(B)(12). The SFIP only allows for replacement of materials with like kind and quality of existing materials. Id . at Section VII(K)(3)(a). Plaintif's waiver application does not meet the criteria for approval. First, she failed to demonstrate any additional damages she sought were actually covered by her SFIP. Second, she did not submit any new documentation explaining how
the additional uncompensated items were damaged by the flood or covered under her SFIP. Accordingly, on July 31, 2008, after a comprehensive review of the claim, Plaintiff's waiver application was denied because Plaintiff failed to show that she was entitled to further compensation under her policy. See FEMA000065 through FEMA000066. IV. Plaintiffs' Assertions FN2 Plaintiffs assertions of error in the waiver denial are found in the Plaintiffs' Opposition (Document 646 at pages 13 to 16). Plaintiffs note that they signed a POL and were paid $37,948.19 (see FEMA 000143). Plaintiffs contend that they could not find contractors to perform the work they wanted done due to the extensive damage and the low estimate that had been provided to them. Document 646 at 14. The review by the Hurricane Task Force provided an additional $3,529.10 but the sum was viewed as inadequate to accomplish what Plaintiffs believed was needed to bring their home to full repair. They contend that they spoke to local contractors and the amounts provided would still not pay for the repairs needed to get the Kalbs' home back to its pre-flood condition. Id. The Plaintiffs believe that the pictures of the house, and the detailed list of damages to the property along with the estimates they provided should have convinced FEMA to pay more. They note that they paid a total of $65, 513.48 to repair their home. Id. at 15. FN2. Plaintiffs are denominated in the Opposition as John and Linda Kalb. See footnote 1 supra. *4 The Plaintiffs take issue with the assertion that they did not provide a sufficient unit cost breakdown and that FEMA had enough information to pay the claim. Plaintiffs particularly disagree with FEMA's refusal to accept the estimates of L.M.S. Carpentry Inc. of $43,794. They believe the documentation provided is of the type that is usually and customarily provided in the construc-
tion industry. They state in their Opposition at page 15: It must be remembered that many contractors provide little or not documentation. To reject it out of hand continues to confirm that FEMA is acting arbitrarily and capriciously in its decision regarding the Kalbs. Plaintiffs seek summary judgment in the amount of $23,536.19. Document 646 at page 39. V. Special Master's Analysis FN3
FN3. In their Oppositions at Document No. 646 at Pages 3 to 9, Group Four Plaintiffs have raised what they term to be twentyfour common issues that the Court has previously considered or resolved in consideration of prior groups. To the extent that these issues are not further cited in the individual Plaintiffs' discussion of their particular cases, the Special Master will not specifically address these issues in this Report and Recommendation, but will incorporate and rely on the Court's prior rulings on these issues (see Documents 594,596 and 597) and the previously filed Memorandum on Role of the Special Master and Report and Recommendation of the Special Master on General Issues Raised by Plaintiffs and Defendants (Document 563). It appears to the Special Master that the concerns raised by the Plaintiffs were reviewed by FEMA in its original handling of the claim, in the review by the Hurricane Isabel Task Force and in the waiver process. The review by the Task Force lead to an additional amount being provided with an explanation for the adjustment. There is clearly a difference of opinion between the Plaintiffs and FEMA about how much documentation should be required to support a claim with Plaintiffs believing that they have provided enough and FEMA contending that the estimates provided did not meet its
standards and did not convince FEMA that more compensation should be provided. As FEMA notes in its Reply (Document 647) at pages 5 to 7, it considered all the information presented, but did find the L.M.S. Carpentry Inc estimates wanting in detail and not sufficient for its purposes and additionally questions the relevance of it since L.M.S. Carpentry, Inc. apparently did not in fact do the work. It is FEMA's position that Plaintiff's shortfall is clearly not based on actual expenses since Plaintiff has now conceded that L.M.S. Carpentry did not perform any of the work. Id at 6. It appears that Plaintiff did the work on her own. FEMA also faults Plaintiff for failing to adjust the shortfall to the actual cash value of the loss since Plaintiff's structure was only insured up to approximately 52% of its value. The Special Master sees no basis here for finding what FEMA did in this case meets the standards of being arbitrary or capricious or an abuse of discretion. FEMA considered all the evidence submitted by Plaintiff. They reviewed it and pointed out the deficiencies. When the case was reviewed by the Hurricane Isabel Task Force the amounts provided were increased based on a re-evaluation of the claim and acceptance of some of Plaintiff's arguments. As in many other cases already reviewed it can be difficult for a property owner to support a claim with contractor's estimates when FEMA is looking for evidence that is of the type provided by a professional insurance adjustor. This is obviously frustrating especially when a claim is trying to be proven years after the flood, but it is within FEMA discretion to require the level and detail of proof that it deems necessary to implement its SFIP as long as it is treating similarly siturated claimants equally. FEMA approach here seems consistent with how it handled other claims of a similar nature that have been reviewed by the Special Master. The rationale for the waiver denial as set out above in Part III is detailed and specific and appears to be in conformance with how other claims are adjusted.
FEMA denial of the waiver does not appear to the Special Master to be either arbitrary, capricious or an abuse of discretion. VI. Recommendation of the Special Master *5 After a review and a consideration of the matter and the arguments presented by the parties, it is the recommendation of the Special Master that the Defendants' Motion for Partial Summary Judgment affirming FEMA's determination of Plaintiff's waiver application be granted; and it is further recommended that Plaintiff's Motion for Summary Judgment be denied. D.Md.,2011. Moffett v. Computer Sciences Corp. Slip Copy, 2011 WL 2552465 (D.Md.) END OF DOCUMENT
Only the Westlaw citation is currently available. United States District Court, D. Maryland, Southern Division. Thomas L. MOFFETT, II, et al., Plaintiffs, v. COMPUTER SCIENCES CORPORATION, et al., Defendants. Civil Action No. 8:05CV01547. June 26, 2011. Donald W. Marcari, Frank D. Lawrence, III, Marcari Russotto and Spencer, Chesapeake, VA, Martin H. Freeman, Freeman and Freeman PC, Rockville, MD, for Plaintiffs. Arthur F. Fergenson, Ansa Assuncao LLP, Holly Drumheller Butler, DLA Piper US LLP, Jason Daniel Medinger, Office of the United States Attorney, Steven Michael Klepper, Kramon and Graham PC, James D. Skeen, Skeen and Kauffman LLP, Brett Anthony Buckwalter, Niles Barton and Wilmer LLP, Baltimore, MD, Jay I. Morstein, Owings Mills, MD, Tyler Brian Raimo, Computer Sciences Corporation, Falls Church, VA, Darren Seth Wall, Department of Homeland Security, Arlington, VA, Robert H. King, Jr, Sonnenschein Nath and Rosenthal LLP, Chicago, IL, Kirk Robert Ruthenberg, SNR Denton U.S. LLP, Steuart H. Thomsen, Sutherland Asbill and Brennan LLP, Scott Nathan Auby, Neil W. Eggleston, Debevoise and Plimpton LLP, Elizabeth Treubert Simon, Pamela Anne Bresnahan, Vorys Sater Seymour and Pease LLP, Washington, DC, Gerald Joseph Nielsen, Nielsen Law Firm LLC, Metairie, LA, Peter F. Axelrad, Council Baradel Kosmerl and Nolan PA, Annapolis, MD, Patricia Mchugh Lambert, Steven B. Schwartzman, Hodes Pessin and Katz PA, Towson, MD, Craig Russell Blackman, Samuel J. Arena, Jr, Stradley Ronon Stevens and Young LLP, Philadelphia, PA, Edward J. Hutchins, Jr, Stacey Ann Moffet, Eccle-
ston and Wolf PC, Hanover, MD, William J. Hickey, Law Offices of William J. Hickey LLC, Rockville, MD, Debra Anne Nelson, William Lowell Mundy, Mundy and Nelson, Huntington, WV, James Hilton Crosby, Crosby Saad LLC, Mobile, AL, William Gerald Gandy, Wilson Elser Moskowitz Edelman and Dicker, Mclean, VA, Bradish J. Waring, Mary Legare Hughes, Nexsen Pruet LLC Charleston, SC, for Defendants. REPORT AND RECOMMENDATION CONCERNING WAIVER CLAIM OF EDWARD JONES DENNIS M. SWEENEY, Special Master. *1 This constitutes the Report and Recommendation to the Court concerning the waiver claim of Edward Jones pursuant to Part 1.f of the Memorandum Order of the Court (Document 467). In preparing this report, the Special Master reviewed the motions, memoranda, affidavits and exhibits provided in connection with the process specified in the Memorandum Order. As necessary, the Special Master also reviewed other documents that are part of the Court filings in this case. The Special Master was also provided by the Federal Emergency Management Agency (FEMA) the computer disc of the appropriate documents of record for this claim, as specified in Part 1.a of the Memorandum Order. In this case, the documents consist of 353 pages labeled FEMA000001 to 000353. I. Background Plaintiff purchased a Standard Flood Insurance Policy (SFIP or Policy), Policy Number FLD1051962, from Selective Insurance Company of the Southeast (Selective) to insure his residence located at 8813 Hinton Avenue, Millers Island, Maryland (the insured structure) from damage caused by flooding. See FEMA000005. Plaintiff's structure was insured up to $121,000.00, and his contents were insured up to $27,600.00 each with a deductible of $500.00. Id.
On September 19, 2003, Hurricane Isabel struck the MidAtlantic States, including the eastern coast of Maryland, causing damage along the coast including the insured structure owned by Plaintiff. See FEMA000249. Plaintiff's policy was effective June 30, 2003 through June 30, 2004 and was covered at the time of the loss. See FEMA000091. On or about September 19, 2003, Plaintiff contacted his insurer and notified it of his loss. See FEMA000351. Plaintiff included in his waiver application a Proof of Loss dated November 3, 2003 for $96,357.95 ($68,757.95 for the structure loss and $27,600.00 for the contents) with an annotation: *Does not include emergency svcs. See FEMA000032. It is FEMA position that this proof of loss is not valid for reasons stated by Karen Christian in her Supplemental Declaration (Document 6132) at 7. On December 26, 2003, Plaintiff submitted a contents Proof of Loss for $27,600.00, his policy limits for contents. See FEMA000205. The Proof of Loss sought a net amount of $13,800.00 because Plaintiff was issued an advance payment of $13,800.00 on October 24, 2003. See Doc. No. 3182 at 95. In addition, Plaintiff submitted a Proof of Loss for $86,717.64 ($59,117.64 for the building loss and $27,600.00 for the contents loss). See FEMA000340. On or about January 27, 2004, a General Adjuster, Frank Ward, for the NFIP Bureau and Statistical Agent provided a report because Selective and Plaintiff were unable to come to an agreement on the claim. See FEMA000183. Plaintiff's Public Adjuster and the General Adjuster reviewed the damage. See FEMA000249. The house was a postFIRM structure and certain restrictions applied to their potential compensation. *2 On February 20, 2004, Moses Robles, an independent adjuster, completed a building estimate based on the input he received from Mr. Ward. See FEMA000128. Mr. Robles found Plaintiff's actual
cash value loss was $40,744.84 with an additional $4,407.90 in recoverable depreciation (a total of $44,652.74). Id. On March 19, 2004, Plaintiff submitted a Proof of Loss for a total net claim of $67,844.84 ($40,244.84 for the building loss and $27,600.00 for the contents loss). See FEMA000111. On May 3, 2004, Selective paid Plaintiff $40,244.84 for the actual cash value of his loss. See Doc. No. 3182 at 96. In addition, a separate check was issued on that date for the recoverable depreciation in the amount of $4,407.90. These payments were in accordance with Mr. Robles' adjustment (FEMA000128). Finally, on that same date, Selective issued a payment for the balance of Plaintiff's contents claim totaling $13,800.00. See Doc. No. 3182 at 96. In addition Plaintiff was paid $30,000.00 under the Increased Cost of Compliance provision of his SFIP. See FEMA000005. Plaintiff does not disagree with the payment amounts listed above. Id. On August 4, 2004, the Hurricane Isabel Task Force completed its review of the claim. See FEMA000225. The Task Force could not reach Plaintiff's Public Adjuster and closed the file. Id. The Task Force did not recommend any changes to the previous assessment of $44,652.74 for Plaintiff's structure damage and $27,600.00 for Plaintiff's contents. On September 22, 2004, and October 5, 2004, FEMA sent letters to Plaintiff notifying him that the Task Force concurred with Selective and that no additional payments were warranted. See FEMA000087 and FEMA000090. II. Waiver Claim and Denial On December 3, 2007, this Court permitted Plaintiffs to submit applications for waivers to FEMA. See Doc. No. 196 and Doc. No. 197, Order of December 4, 2007. On or about February 25, 2008, Plaintiff submitted to FEMA a document entitled PLAINTIFF EDWARD JONES' INDIVIDU-
AL APPLICATION FOR WAIVER OF PROOF OF LOSS REQUIREMENTS. See FEMA000001 through FEMA000079. FEMA denied the request in a letter dated July 31, 2008. See FEMA000080 to 000081. III. Reasons for Waiver Denial The reasons for the denial of the Waiver Claim are found at 2028 of the Supplemental Declaration of Karen Christian for the Claim of Edward Jones (Document 6132). It states: Plaintiff stated in his waiver application that he spent a total of $70,911.38 repairing his home, not including elevation, which resulted in a shortfall of $25,758.64. See FEMA000005. Plaintiff's shortfall itemization is based upon receipts, invoices and estimates, which include inflated costs, items not damaged by flood and uncompensable items such as $6,469.21 for GoodmanGableGould Co. (private adjusters) (See FEMA000048). Further, Plaintiff's itemization is not sufficiently detailed to separate Increased Cost of Compliance expenses from building expenses. Plaintiff simply takes the total of all his expenses and deducts $30,000.00. *3 The bulk of the shortfall is based upon the $88,378.17 Z Contracting contract, which includes significant upgrades. See FEMA000048. The contract includes line items for the construction of an expanded second floor over the garage that did not exist prior to the flood and a new deck. See FEMA000147. The contract includes other line items not physically damaged by the nine inches of water that entered Plaintiff's home including removal of the existing garage roof, framing of the second floor, roofing, wall cabinets, countertops, removing all wiring to meet local electrical codes, and the installation of a 16 feet by 20 feet deck with steps. See FEMA000049. Plaintiff was compensated for damages caused by direct physical loss by or from flood with application of the SFIP coverage limits and exclu-
sions. Plaintiff's shortfall itemization is based upon a significantly upgraded structure with no explanation of how the claimed items are related to the nine inches of water that entered Plaintiff's home. Plaintiff presented no evidence challenging the repair estimates provided by Selective or the Task Force. When reviewing Plaintiff's waiver application, the Administrator evaluated the facts and circumstances relating to the request. See FEMA000080 and FEMA000081. Specific to this case, the Administrator considered the following whether: 1. Policy holder demonstrated additional damages exist that are covered by the SFIP; 2. Policy holder submitted appropriate documentation supporting the additional compensation being requested; and 3. Policy holder provided a reasonable explanation for the delay in submitting the POL. Id. Further, the SFIP has a policy limit of $30,000.00 for Increased Cost of Compliance expenses and Plaintiff's method of calculating his shortfall based on his total expenses makes it impossible to separate out the actual Increased Cost of Compliance expenses. In the letter providing FEMA's determination on Plaintiff's waiver application, the Administrator stated: ... you claim your flood damages exceeded the payment received from your Write Your Own Company, Selective Insurance Company. To support the amount claimed, you provided an itemization of the additional building items. The main estimate appears to be a bid for constructing a living area over the attached garage.
This is related to your Increased Cost of Compliance (ICC) claim for which you received payment in the amount of $30,000, the maximum amount of coverage available. The construction cost exceeded the ICC monies paid and cannot be included in the original claim. Your claim was originally reviewed by an independent adjuster and subsequently, the National Flood Insurance Program's General Adjuster who made the recommendations to your Write Your Own carrier, Selective Insurance Company to adjust the estimate. The file review reflects that the adjustment was included in the final settlement. *4 You requested a review of your claim by the Hurricane Isabel Task Force. They advised you of the limited coverage due to SFIP provisions for a post-FIRM elevated structure in a Special Flood Hazard Area. All reviews of your claim concluded the carrier's final evaluation was accurate. Further, your waiver request resulted in a reinspection of your claim by a FEMA Insurance Examiner. After further review, the Insurance Examiner found no basis to set aside the original findings. See FEMA000080 and FEMA000081 Plaintif failed to demonstrate he met the criteria used to determine whether to grant a waiver. First, he failed to demonstrate any additional damages he sought were actually covered by his SFIP. Second, his shortfall itemization included non-compensable items, such as the public adjuster's fee and significant upgrades to his home without consideration of the fact that only nine inches of water entered his home. Accordingly, after another comprehensive review of the claim by the Task Force, FEMA determined no further compensation was warranted. Id. Plaintiff's waiver application was denied for a
multitude of reasons, but primarily because he failed to document any physical loss by or from flood covered under his SFIP for which he did not receive full compensation for. IV. Plaintiffs' Assertions and FEMA's Position Plaintiff seeks summary judgment in the amount of $14,464.90. Document 646 at page 39. While Plaintiff argued many alleged deficiencies with the way the claim was handled and adjusted (Id at pages 9 to 12), he appears to limit his claim at this juncture to the amounts still claimed to be due on a timely submitted Proof of Loss that was not subject to the waiver request. As Plaintiff states: FEMA admits that Mr. Jones submitted a Proof of Loss on which he was not paid in full. It admits, Plaintiff has an outstanding timely submitted Proof of Loss that should proceed on its own merits, and that Plaintiff did trigger the limited waiver of Sovereign Immunity for the amount claimed and not paid on his timely submitted Proof of Loss'. That said, the Proof of Loss in the amount of $86,717.64 should be reconsidered and the shortfall amended to reflect the difference after removing payments for contents coverage and previous payments for structure damage, for a revised shortfall of $14,464.90. As set forth in FEMA's motion, pargraph (sic) 2: Plaintiff did not require a waiver to challenge the unpaid portion of his timely submitted POL (Document 646 pages 12 to 13). FEMA's final position is set out in its Reply (Document 647 at pages 4 to 5) where it states: As provided in FEMA's Partial Motion for Summary Judgment and cited in Plaintiff's Opposition: Plaintiff did not require a waiver to challenge the unpaid portion of his timely submitted POL. Id. Plaintiff amends his shortfall from $25,758.64 (See FEMA000005) to $14,464.90, which reflects the difference between the amounts he was paid and the amount he claimed on his timely submitted Proof of Loss. Id. Based on Plaintiff's concession, the revised shortfall amount does not require a waiver since that amount was submitted as part of a timely
Proof of Loss. *5 FEMA asserts that without waiving any defenses or agreeing that Plaintiff is entitled to any additional compensation, the partially disallowed portion of Plaintiff's timely filed Proof of Loss should be allowed to proceed against Selective Insurance Company of the Southeast, Plaintiff's Write Your Own insurance carrier, limited to the amended shortfall amount of $14,464.90. V. Special Master's Analysis FN1
FN1. In their Oppositions at Document No. 646 at Pages 3 to 9, Group Four Plaintiffs have raised what they term to be twentyfour common issues that the Court has previously considered or resolved in consideration of prior groups. To the extent that these issues are not further cited in the individual Plaintiffs' discussion of their particular cases, the Special Master will not specifically address these issues in this Report and Recommendation, but will incorporate and rely on the Court's prior rulings on these issues (see Documents 594,596 and 597) and the previously filed Memorandum on Role of the Special Master and Report and Recommendation of the Special Master on General Issues Raised by Plaintiffs and Defendants (Document 563). It appears that the parties are in accord on the following: (1) that the shortfall claim is now limited to $14,464.90; (2) that the claim did not require a waiver to pursue since it was timely made prior to the waiver process being used. With this agreement, the Special Master believes that the matter before the Special Master can and should be resolved in the following fashion. As explained in earlier cases, the Special Master does not have the authority to recommend that Summary Judgment for the $14,464.90 or for any amount be granted to the Plaintiff; thus it will be recommended that the Plaintiff's request for that relief should be denied.
As FEMA notes and as Plaintiff apparently agrees, the assertion of the claim for the $14,464.90 is independent of the waiver claim process and can be pursued by Plaintiff without the grant of any waiver by FEMA. The Special Master's authority is limited to review of the waiver claim denials and given the status of this matter, the Special Master can not determine that the denial of the waiver claim was arbitrary, capricious or an abuse of discretion since it was not the mechanism for Plaintiff to pursue the claim now being asserted. The Special Master will therefore recommend that the Defendants' Motion for Partial Summary Judgment be granted as to the denial of the waiver claim with the condition as FEMA states in its Reply (Document 647 at page 5) that the claim will be allowed to proceed against Selective Insurance Company of the Southeast, Plaintiff's Write Your Own insurance carrier, limited to the amended shortfall amount of $14,464.90. VI. Recommendation of the Special Master After a review and a consideration of the matter and the arguments presented by the parties, it is the recommendation of the Special Master that the Defendants' Motion for Partial Summary Judgment affirming FEMA's determination of Plaintiff's waiver application be granted with the condition that the claim will be allowed to proceed against Selective Insurance Company of the Southeast, Plaintiff's Write Your Own insurance carrier, limited to the amended shortfall amount of $14,464.90; and it is further recommended that Plaintiff's Motion for Summary Judgment be denied. D.Md.,2011. Moffett v. Computer Sciences Corp. Slip Copy, 2011 WL 2552478 (D.Md.) END OF DOCUMENT
Only the Westlaw citation is currently available. United States District Court, D. Maryland, Southern Division. Thomas L. MOFFETT, II, et al., Plaintiffs, v. COMPUTER SCIENCES CORPORATION, et al., Defendants. Civil Action No. 8:05CV01547. June 26, 2011. Donald W. Marcari, Frank D. Lawrence, III, Marcari Russotto and Spencer, Chesapeake, VA, Martin H. Freeman, Freeman and Freeman PC, Rockville, MD, for Plaintiffs. Gerald Joseph Nielsen, Nielsen Law Firm LLC, Metairie, LA, Peter F. Axelrad, Council Baradel Kosmerl and Nolan PA, Annapolis, MD, for Defendants. REPORT AND RECOMMENDATION CONCERNING WAIVER CLAIM OF JOEL G. KELLEY DENNIS M. SWEENEY, Special Master. *1 This constitutes the Report and Recommendation to the Court concerning the waiver claim of Joel G. Kelley pursuant to Part 1.f of the Memorandum Order of the Court (Document 467). In preparing this report, the Special Master reviewed the motions, memoranda, affidavits and exhibits provided in connection with the process specified in the Memorandum Order. As necessary, the Special Master also reviewed other documents that are part of the Court filings in this case. The Special Master was also provided by the Federal Emergency Management Agency (FEMA) the computer disc of the appropriate documents of record for this claim, as specified in Part 1.a of the Memorandum Order. In this case, the documents consist of 329 pages labeled FEMA000001 to 000329. I. Background Plaintiff purchased a Standard Flood Insurance
Policy (SFIP or Policy), Policy Number 3000180896, directly from FEMA to insure his residence and contents located at 4504 Todd Point Lane, Baltimore, MD 21219 (insured structure) against damage caused by flooding. See FEMA000123. This is known as a NFIP Direct-side policy. Plaintiff's policy was in effect from June 14, 2003 to June 14, 2004. See FEMA000123. Plaintiff's structure was insured up to $127,500.00, and his contents were insured up to $30,500.00, each with a deductible of $1,000.00. See FEMA000142. On September 18, 2003, Hurricane Isabel struck the MidAtlantic States, including Maryland, which caused flooding resulting in damage to Plaintiff's residence. Plaintiff timely notified FEMA that he had suffered the flood loss of September 18, 2003. See FEMA000203. FEMA hired an independent adjuster, Jeremy W. Smith from Bellmon Adjusters Inc., to investigate Plaintiff's loss. See FEMA000158. The independent adjuster inspected the exterior of the structure, conducted a room-by-room inspection of the interior, took photographs, and adjusted the loss. See FEMA000158199. The adjuster noted the water height to the exterior of the structure was between 34 to 36 inches, and the water height to the interior was 18 inches. See FEMA000169. The adjuster estimated the covered damage to the insured structure to be $48,511.36 (full cost of repair ($56,287.80), less depreciation ($6,776.44) less deductible ($1,000.00)). See FEMA000172. The adjuster also inspected Plaintiff's personal contents and prepared an itemized inventory of Plaintiff's damaged contents. See FEMA000183 through FEMA000194. The adjuster's inventory lists 217 types of items. Id. For each item type, the adjuster identified the quantity, the age, the replacement cost, the depreciation of the item, and finally the actual case value for each itemthe amount covered under the SFIP. Id. The adjuster estimated Plaintiff's contents damage to be $12,697.68(recovery costs ($20,022.44), less depreciation ($6,324.7) and the deductible ($1000.00)). See
FEMA000194. On or about October 28, 2003, Plaintiff submitted to FEMA a timely Proof of Loss for both building and contents loss in accordance with the loss estimates provided by the adjuster for a total of $61,209.04 ($48,511.36 for the building loss and $12,697.68 for the contents loss). See FEMA000298. On November 7, 2003, FEMA paid Plaintiff $48,511.36 for his building loss. See FEMA000027. On November 7, 2003, FEMA paid Plaintiff $12,697.68 for his contents loss. See FEMA000028. *2 On or about October 28, 2003, Plaintiff also submitted a Building Replacement Cost Proof of Loss for FN1 $6,031.94. See FEMA000300. On June 24, 2004, FEMA paid Plaintiff an additional $6,031.94 for replacement costs for his structure. See FEMA000029. FN1. Under Plaintiff's SFIP, he is entitled to replacement cost because his insured structure is a single family dwelling that is his principal residence, and was insured for more than 80% of its full replacement costs. See 44 C.F.R. Pt. 61, App. A(1), Art. VII(V)(a) (2003). Replacement costs mean the insurer will pay replacement costs after application of the deductible and without deduction for depreciation, but not more than the least of the following amounts: (1) The building limit of liability ...; (2) The replacement cost of that part of the dwelling damaged, with materials of like kind and quality and of like use; or (3) the necessary amount actually spent to repair or replace the damaged part of the dwelling for like use. Id. Art. VII(V)(a)(2) (emphasis added). On or about March 14, 2004, Plaintiff submitted to FEMA a Proof of Loss for Increased Cost of Compliance (ICC) as his insured structure was flooddamaged and the cost to repair exceeded 50% of the asFN2 sessed value of his structure. See FEMA000026 and FEMA000024. FEMA paid Plaintiff $30,000.00, policy limits, for the ICC coverage. See FEMA000031 and FEMA000032.
FN2. In support of his ICC claim, Plaintiff submitted to FEMA a letter from the Baltimore County Department of Permits and Development Management to Plaintiff stating it has been determined that the cost to repair exceeds 50% of the assessed value of your home. As a result, any reconstruction must comply with certain local building codes. See FEMA000023. On or about April 13, 2004, Plaintiff submitted to FEMA a request to have his claim reviewed by the Hurricane Isabel Task Force (Task Force). See FEMA0000119. The Task Force reviewed the claim and determined additional coverage could be added for subflooring and sheetrock and recommended an additional payment of $2,323.11. See FEMA000120 through FEMA000122. As a result of the Task Force review, on July 16, 2004, Plaintiff submitted to FEMA a Proof of Loss in the amount of $2,323.11. See FEMA000268. On July 21, 2004, FEMA paid Plaintiff an additional $2,323.11 for his building loss. See FEMA000030. II. Waiver Claim and Denial On or about February 22, 2008, Plaintiff submitted to FEMA a document entitled PLAINTIFF JOEL G. KELLEY'S INDIVIDUAL APPLICATION FOR WAIVER OF PROOF OF LOSS REQUIREMENTS. See FEMA000001 through FEMA000107. Plaintiff sought a waiver of the Proof of Loss requirement to recover an additional $74,699.64 ($61,976.09 for his structure and $12,723.33 for his contents). See FEMA000005. FEMA denied the request in an undated letter; see FEMA000108 to 000109. III. Reasons for Waiver Denial The reasons for the denial of the Waiver Claim are found at 2332 of the Supplemental Declaration of Karen Christian for the Claim of Joel G. Kelley (Document 6152). It states: Plaintiff's insured structure was built in 1942 and was approximately 950 sq. ft. See FEMA000033 and FEMA000168. Plaintiff replaced his insured struc-
ture with a 1,892 square foot new upgraded home. Id. To identify the additional amount claimed, i.e., structure shortfall, Plaintiff subtracted the amount of money FEMA paid him by the amount he alleges it would have cost him to replace the same square footage of home with a new building(new construction cost of $119,842.50 less FEMA payment $56,866.41 $259,400.00 $700.00 $260,100.00 $30,000.00 $230,100.00 1824 $126.12 950 FN3. The square footage identified in Plaintiff's formula (950 sq. ft.) conflicts with the square footage identified in Plaintiff's ap$119,842.50 $56,866.41 $62,976.09
equals shortfall of $61,976.09). Id. Specific to Plaintiff's request for additional structure coverage, Plaintiff included the following formula for identifying how he calculated his structure shortfall:
Turpin, Wachter & Associates, Incorporated contract + (pre-construction labor) = Total cost of new home ICC$ $received = Total cost minus ICC costs / SQUARE FOOTAGE OF NEW HOME price per square foot * 3 Original square footage of home praisal (744 sq. ft.). See FEMA000095.
Cost to restore original home to pre-flood condition NFIP compensation 4 = Shortfall square feet in the old insured structure. See FEMA000032 through FEMA000059 (Plaintiff's Construction Contract). Plaintiff's waiver does not include photographs, reports, or evidence demonstrating the flood resulted in a total loss of the building. Indeed, the adjuster's report demonstrates Plaintiff's structure was repairable. Plaintiff's waiver does not include any photographs, reports, evidence, or itemized list identifying additional flood damage to the insured structure not covered by FEMA's payment.
FN4. The shortfall identified in Plaintiff's Shortfall itemization is $1,000.00 more than the amount requested in his waiver application. Compare FEMA000005 with FEMA000033. *3 See FEMA000033. Plaintiff's formula includes upgrades and items not present in the original structure and simply computes the cost per square foot to build the new, larger and upgraded structure and applies it to the number of
Plaintiff's method of calculating his damages based on the cost of constructing a new upgraded structure is fundamentally flawed because it does not take into account any of the SFIP's coverage limits or exclusions. Further, Plaintiff simply deducts the $30,000.00 in ICC compensation from their grand total. See FEMA000033. Plaintiff's shortfall itemization makes it impossible to separate out the compensable ICC expenses. Specific to Plaintiff's waiver application to provide additional coverage for contents, Plaintiff provided a list of contents with their replacement cost, which is not recoverable under the SFIP because the SFIP only pays actual cash value for damage to contents. See FEMA000060 through FEMA000070. Plaintiff's list includes many of the items for which FEMA paid. Compare FEMA00060 through FEMA000070 (Plaintiff's list) with FEMA000071 through FEMA000081 (Adjuster's list). To identify only a few examples, for contents in the sunroom, FEMA paid Plaintiff actual cash value for the following: blue velvet sofa, Sharp TV, surfeit sofa cover, books, and Realistic AM/FM/Tape Deck, yet these and the other items are listed in Plaintiff's shortfall inventory with full replacement costs. See FEMA000060 and FEMA000071. Plaintiff does not dispute the actual cash value of these items, but instead appears to be asking for coverage beyond that provided by Art. VII, Section V(2)(e) of the SFIP. Moreover, Plaintiff's Contents Shortfall includes items that if damaged would not be covered under contents coverage and, instead, are covered under building coverage such as: a 10 yard enclosure; siding; central air; roof; duct work; fire place; fiberglass insulation, crawl space vents; wood treatment; plumbFN5 ing; and duct work. See FEMA000063; 000065; see also 44 C.F.R. Pt. 61, App. A(1), Art. III, Coverage A. Plaintiff's Content Shortfall also includes items expressly excluded by the SFIP such as: soil; decks; patios; walkways; seawalls; and underground tanks. See FEMA000063 and FEMA000065.; see also 44 C.F.R. Pt. 61, App. A(1), Art. IV.
FN5. Moreover, Plaintiff did not provide documentation and there is no evidence demonstrating that these items were in fact damaged by flood and payable under his building coverage. FEMA denied Plaintiff's waiver for both building and contents coverage because Plaintiff failed to demonstrate he suffered damage for which FEMA failed to pay him and failed to provide documentation supporting his request for additional payment. FEMA000108 through FEMA000109. Specifically, FEMA stated: *4 Your request for a supplemental claim includes additional costs you have incurred to construct a new dwelling which is larger than the original structure.... Also, upgrades are not covered by the SFIP. With respect to the supplemental claim for personal property, the list provided is written at replacement cost and the SFIP allows only actual cash value. The [content] list also included many building items ... Items such as the deck and room were claimed but did not incur damage by the flood event. The patio, sidewalk, seawall and soil are not covered by the SFIP. The adjuster was in possession of your contents list when he prepared the estimate for the personal property. There is no justification to issue an additional payment. Id. Accordingly, after another comprehensive review of their claim, FEMA determined no further compensation was warranted. Id. Plaintiff's waiver application was denied for a multitude of reasons, but primarily because he failed to document any physical loss by or from flood covered under his SFIP for which he did not receive full compensation for. IV. Plaintiffs' Assertions Plaintiff's assertions are found in the Plaintiffs' Opposition (Document 646) at pages 16 to 19. Plaintiff takes exception with how Ms. Christian characterizes the October 6, 2004 substantial damage letter that was submitted with the ICC claim and her and FEMA's failure to give it more credence in considering the damage
done to house for purposes of Part A coverage. Id at 16. Plaintiff also finds fault with Ms. Christian's comments about whether or not a Proof of Loss claim was actually submitted. Id. Plaintiff also contends that Ms. Christian's references to the square footage of the home at 950 square feet differs from other figures which report the square footage at 1,022 square feet. Plaintiff position remains that he believes that the square footage of his home was the same 950 square feet that Ms. Christian found. Id at 17. Plaintiff notes several errors that he made in his submissions that result in revisions of his shortfall amounts and that some items that should have been under Coverage A were listed under Coverage B. Id at 1718. Despite these errors, Plaintiff believes FEMA should readjust the claim and find the claims meritorious. Id at 18. Plaintiff also asserts that there may be an issue about the decks and walkways as to whether they should be covered, but does not cite to the evidence for that assertion. Id. Plaintiff also takes exception to Ms. Christian position about how the ICC claim and the Coverage A claim are resolved believing that FEMA did not give appropriate weight to some 53 pages of documents submitted with the claim. Finally, Plaintiff believes the contents claim should be allowed since Mr. Kelley was given a form that called for replacement cost rather than actual cash value. It is asserted that FEMA's rejection of the claim was arbitrary and capricious. *5 Plaintiff seeks $66,794.64 in his motion for summary judgment. Document 646 at page 39. V. Special Master's Analysis FN6
common issues that the Court has previously considered or resolved in consideration of prior groups. To the extent that these issues are not further cited in the individual Plaintiffs' discussion of their particular cases, the Special Master will not specifically address these issues in this Report and Recommendation, but will incorporate and rely on the Court's prior rulings on these issues (see Documents 594,596 and 597) and the previously filed Memorandum on Role of the Special Master and Report and Recommendation of the Special Master on General Issues Raised by Plaintiffs and Defendants (Document 563). Plaintiff's waiver application was based on the square foot cost for new construction formula which this court has rejected. See FEMA000033. That appeared to be the main if not exclusive basis for the waiver claim as to Part A coverage and was what FEMA directed itself to in explaining why it denied the waiver claim. Understandably, with that claim rejected by the U.S. District Court (Document 597 at pages 8 and 9), Plaintiff now attempts to recast the claim to point out other errors that in many cases are being raised for the first time in the current filings. Many of the arguments are quibbles with how Ms. Christian characterizes her position or basic disagreement with FEMA's position on matters such as the relationship between ICC claims and Part A coverage claims. The Special Master does not believe that these matters merit additional discussion with this claim and relies on what has previously been said on these issues. See footnote 6 supra. As to the contents claims, FEMA's position as stated in their Reply memorandum (Document 647 at page 8) is convincing to the Special Master especially that the SFIP only pays for actual cash value for damage to contents. See SFIP, Section VII, V(2). The Special Master also agrees with FEMA that Plaintiff has not shown that the allowance of items under the contents coverage provision was either arbitrary or capricious or an abuse of discretion.
FN6. In their Oppositions at Document No. 646 at Pages 3 to 9, Group Four Plaintiffs have raised what they term to be twenty-four
There is no evidence of a credible nature that the deck and walkways should be covered under the SFIP and were damaged in the flood. See FEMA's Reply at 8. The reasons for the waiver denial given by Karen Christian in this case were unusually detailed and specific and show that the concerns raised by the Plaintiff and squarely put before FEMA at the time of the waiver application were carefully considered and dealt with by reasonable explanations that were in conformance with the SFIP and the way FEMA has handled other claims of a similar nature. FEMA was not required to do more in evaluating a waiver claim. VI. Recommendation of the Special Master After a review and a consideration of the matter and the arguments presented by the parties, it is the recommendation of the Special Master that the Defendants' Motion for Partial Summary Judgment affirming FEMA's determination of Plaintiff's waiver application be granted; and it is further recommended that Plaintiff's Motion for Summary Judgment be denied. D.Md.,2011. Moffett v. Computer Sciences Corp. Slip Copy, 2011 WL 2559597 (D.Md.) END OF DOCUMENT
Only the Westlaw citation is currently available. United States District Court, D. Maryland, Southern Division. Thomas L. MOFFETT, II, et al., Plaintiffs, v. COMPUTER SCIENCES CORPORATION, et al., Defendants. Civil Action No. 8:05CV01547. June 26, 2011. Donald W. Marcari, Frank D. Lawrence, III, Marcari Russotto and Spencer, Chesapeake, VA, Martin H. Freeman, Freeman and Freeman PC, Rockville, MD, for Plaintiffs. Arthur F. Fergenson, Ansa Assuncao Llp, Holly Drumheller Butler, Dla PiperUS Llp, Jason Daniel Medinger, Allen F. Loucks, Office of the United States Attorney, Steven Michael Klepper, Kramon and Graham Pc, James D. Skeen, Skeen and Kauffman Llp, Brett Anthony Buckwalter, Niles Barton and Wilmer Llp, Baltimore, MD, Jay I. Morstein, Owings Mills, MD, Darren Seth Wall, Department of Homeland Security, Arlington, VA, Tyler Brian Raimo, Computer Sciences Corporation, Falls Church, VA, Robert H. King, Jr, Sonnenschein Nath and Rosenthal Llp, Chicago, IL, Kirk Robert Ruthenberg, Snr DentonUS Llp, Steuart H. Thomsen, Sutherland Asbill and Brennan Llp, Washington, DC, Gerald Joseph Nielsen, Nielsen Law Firm Llc, Metairie, LA, Peter F. Axelrad, Council Baradel Kosmerl and Nolan Pa, Annapolis, MD, Patricia Mchugh Lambert, Steven B. Schwartzman, Hodes, Pessin & Katz, P.A., Towson, MD, Craig Russell Blackman, Samuel J. Arena, Jr, Stradley Ronon Stevens and Young Llp, Philadelphia, PA, Edward J. Hutchins, Jr, Stacey Ann Moffet, Eccleston and Wolf Pc, Hanover, MD, William J. Hickey , Law Offices of William J. Hickey Llc, Rockville, MD, Debra Anne Nelson, William Lowell Mundy,
Mundy and Nelson, Huntington, WV, James Hilton Crosby, Crosby Saad Llc, Mobile, AL, for Defendants. REPORT AND RECOMMENDATION CONCERNING WAIVER CLAIM OF WILLIAM AND KELLY KENNEY DENNIS M. SWEENEY, Special Master. *1 This constitutes the Report and Recommendation to the Court concerning the waiver claim of William and Kelly Kenney pursuant to Part 1.f of the Memorandum Order of the Court (Document 467). In preparing this report, the Special Master reviewed the motions, memoranda, affidavits and exhibits provided in connection with the process specified in the Memorandum Order. As necessary, the Special Master also reviewed other documents that are part of the Court filings in this case. The Special Master was also provided by the Federal Emergency Management Agency (FEMA) the computer disc of the appropriate documents of record for this claim, as specified in Part 1.a of the Memorandum Order. In this case, the documents consist of 445 pages labeled FEMA000001 to 000445. I. Background Plaintiffs purchased a Standard Flood Insurance Policy (SFIP or Policy), Policy Number 6004754617, from The Standard Fire Insurance Company (Standard Fire) to insure their residence located at 3 Arundel Place, Glen Burnie, Maryland (insured structure) from damage caused by flooding. See FEMA000005. Plaintiffs' structure was insured up to $180,000.00, and their contents were insured up to $20,000.00, with both forms of coverage having a deductible of $1,000.00. Id. On September 18, 2003, Hurricane Isabel struck the MidAtlantic States, causing damage along the coast of Maryland, including to the insured structure owned by Plaintiffs. See
FEMA000291. Plaintiffs' policy was effective August 27, 2003, through August 27, 2004, and thus, the insured structure was covered at the time of the loss. See FEMA000279. On September 19, 2003, Plaintiffs notified Standard Fire of their loss, alleging their insurance structure was damaged by the flooding caused by Hurricane Isabel. See FEMA000111. On or about September 21, 2003, Plaintiffs were contacted by an adjuster, Steven Taylor, who was assigned by Standard Fire to investigate Plaintiffs' loss. See FEMA000290 to 000292. On September 23, 2003, Standard Fire erroneously issued a $15,000 .00 advance check for the damage to Plaintiffs' structure, which was voided and later reissued in the amount of $5,000.00 for the contents loss. See FEMA000113. On September 24, 2003, Standard Fire issued a $5,000.00 advance check for Plaintiffs' contents loss. See FEMA000119. The adjuster inspected the exterior of the structure, conducted a room-by-room inspection of the interior, took photographs, and adjusted the loss. See FEMA000198 to 000216. The adjuster identified $95,468.50 in actual cash value-covered flood damages after applying the $1,000.00 deductible, plus contents loss in excess of the policy maximum of $20,000.00. See FEMA000317. On January 12, 2004, Plaintiffs submitted a Proof of Loss through their adjuster for a new claim of $125,705.41. See FEMA000251. This Proof of Loss was annotated, The insured reserves the right to amend this Proof as facts and circumstances become know. Id. It is FEMA's position that this caveat effectively nullified the Proof of Loss, because in its view an SFIP Proof of Loss must be for an unqualified amount certain. *2 On April 6, 2004, Plaintiffs submitted a request to have their claim reviewed by the Hurricane Isabel Task Force (Task Force). See FEMA000030 to 000031.
On April 19, 2004, Plaintiffs submitted a new Proof of Loss without any annotation for a net claim of $115,468.50$95,468.50 for the structure and $20,000.00 for the contents. See FEMA000038. This Proof of Loss was untimely because it was submitted beyond the 120day extended period in which to file a Proof of Loss. A waiver requested was submitted on behalf of Plaintiffs, which was approved to allow Standard Fire to issue payment for the amount claimed on the Proof of Loss. See FEMA000185. On April 28, 2004, FEMA received a letter from Plaintiffs addressed to the Federal Insurance Administrative requesting that their claim be closed. FEMA000032. On May 6, 2004, Standard Fire issued a check in the amount of $106,902.57 ($95,468.50 for the actual cash value of the loss, and $11,434.07 for the recoverable depreciation). See FEMA000116. In addition, Standard Fire issued a check for $15,000.00 for the balance of Plaintiffs' contents claim. See FEMA000115. On May 20, 2004, FEMA confirmed receipt of Plaintiffs' letter to not reopen their claim for Task Force review, and closed their claim. See FEMA000102. On October 20, 2004, Standard Fire issued to Plaintiffs an advance of $15,000.00 under the Increased Cost of Compliance (ICC) provision of their SFIP. Subsequently, on January 7, 2005, Standard Fire issued the final payment of $15,000.00 under the ICC coverage. FEMA000112. Plaintiffs were paid a new replacement cost total of $106,902.57 for their structure loss, $20,000.00 for their contents loss, and $30,000.00 under the ICC provision of their SFIP. Plaintiffs agree with these totals. FEMA000005. II. Waiver Claim and Denial On December 3, 2007, this Court permitted
Plaintiffs to submit applications for waivers to FEMA. See Doc. No. 196 and Doc. No. 197, Order of December 4, 2007. On or about February 25, 2008, Plaintiffs submitted to FEMA a document entitled PLAINTIFFS WILLIAM AND KELLY KENNEY'S INDIVIDUAL APPLICATION FOR WAIVER OF PROOF OF LOSS REQUIREMENTS. See FEMA000001 to 000096. FEMA denied their request in a letter dated July 31, 2008. See FEMA000097 to 000098. III. Reasons for Waiver Denial The reasons for the denial of the Waiver Claim are found at 2130 of the Supplemental Declaration of Karen Christian for the Claim of William and Kelly Kenney (Document 6162). It states: Plaintiffs claimed a shortfall of $26,156.83. See FEMA000005. Plaintiffs contend they had to tear down their old home and replace it with new construction. Id.. Plaintiffs alleged they spent in excess of $134,059.40 to build their new home plus $30,000.00 for elevation. Id. Plaintiffs contend at FEMA000006 that they spent in excess of $158,094.55 to build their new home. Plaintiffs calculated their shortfall by subtracting the cost of the new structure with upgrades from the structure loss and Increased Cost of Compliance payments they received from Standard Fire ($164,059.40(30,000+ $106,902.50)). See FEMA000045. *3 Plaintiffs state they received a letter from Anne Arundel County indicating their residence was substantially damaged. See FEMA000005 and FEMA000006. Of note, the Residential Substantial Damage Estimator the County based their substantial damage letter on the replacement cost of the structure, which was $95,620.27 with an actual cash value of $84,145.84 and the computed damages to the home were $64,849.67. See FEMA000014. Plaintiffs were paid in excess of the County's estimate to replace the entire structure.
Plaintiffs' method of calculating their damages based on the cost of constructing a new upgraded structure is fundamentally flawed because it does not take into account any of the SFIP's coverage limits or exclusions. Further, Plaintiffs simply deduct the $30,000.00 in Increased Cost of Compliance compensation from their grand total. See FEMA000045. Plaintiffs' shortfall itemization makes it impossible to separate out the compensable Increased Cost of Compliance expenses. Plaintiffs' home was repairable. The adjuster's estimate was based on covered direct physical damages by or from flood in accordance with the coverage limits and exclusions found within the SFIP. See FEMA000198 through FEMA000216. The flood water measured 45 inches on the exterior and the interior water height was 36 inches. See FEMA000291 and FEMA000292. When reviewing Plaintiffs' waiver application, the Administrator evaluated the facts and circumstances relating to the request. See FEMA000097 and FEMA000098. Specific to this case, the Administrator considered the following whether: 1. Policy holder demonstrated additional damages exist that are covered by the SFIP; 2.Policyholdersubmittedappropriatedocument-tation supporting the additional compensation being requested; and 3. Policy holder provided a reasonable explanation for the delay in submitting the POL. Id. The SFIP only covers direct physical loss caused by or from flooding. Plaintiffs' shortfall calculation to replace their 63 year old building ( See FEMA000014) was based on the construction cost of a new upgraded dwelling, which included items not damaged by the flood (i.e., the roof) along with code and material upgrades. The
SFIP excludes coverage for upgrades and requires the use of material that is of like kind and quality. See Exhibit A at 16 and 17. The SFIP has a policy limit of $30,000.00 for Increased Cost of Compliance expenses and as noted above, Plaintiffs method of calculating their shortfall makes it impossible to separate out those expenses. In the letter providing FEMA's determination on Plaintiffs' waiver application, the Administrator stated: ... you claim your damages necessitated the demolition of your dwelling as a result of the flooding and request full payment of your building policy limit. To support the amount claimed, you provided an estimate for the replacement of your home. Your claim was originally reviewed by an independent adjuster, engineer, and subsequently reviewed by the Hurricane Isabel Task Force. You received payment from your Write Your Own Company, Travelers Insurance Company, for all covered flood damages as well as the full amount of coverage under the Increased Cost of Compliance claim for demolition of the insured structure. The documentation you submitted includes upgrades to the structure, which are not covered by the SFIP such as roofing materials, gutters, and foundation elements as well as material for building items not damaged by the flood. All reviews of your claim concluded your estimate does not support additional payment. *4 Further, your waiver resulted in a comprehensive review of your claim by a FEMA Insurance Examiner. After further review, the Insurance Examiner found no basis to set aside the original findings. See FEMA0000098. Plaintiffs failed to demonstrate they met the criteria used to determine whether to grant a waiver. First, they failed to demonstrate any additional damages them sought were actually
covered by their SFIP. Second, their line-item shortfall calculation was based on the cost of constructing a new home and not uncompensated damages caused directly by flooding to their original structure. Accordingly, after another comprehensive review of their claim, FEMA determined no further compensation was warranted. Id. Plaintiffs' waiver application was denied for a multitude of reasons, but primarily because they failed to document any physical loss by or from flood covered under their SFIP for which they did not receive full compensation for. IV. Plaintiffs' Assertions Plaintiffs make their claims in the Plaintiffs Opposition (Document 646) at pages 19 to 25. Plaintiffs are concerned that FEMA rejected the conclusions of Bafitis & Associates, Inc. which concluded that the storm surge and the impact from wave action had inflicted substantial and serious damage to the house. Id at 20. Bafitis recommended to the Plaintiffs that the dwelling should be removed and replaced. Id at 21. Plaintiffs did receive an estimate from Restoration and Construction Services, Inc. to repair the house for the amount of $143,336.98. Id. Plaintiffs also received a substantial damage letter from Anne Arundel County that indicated damages to the Kenney home at 99.48% of the adjusted tax assessed value of $95,620.27. Id. Plaintiffs acknowledge that the WYO's structural consultant, National Forensic Consultants reviewed the damage also and disagreed with the Bafitis report and particularly the contention that wave and surge damage occurred to the home. Id at 22. Plaintiffs believe that if in fact the damages observed were pre-existing of the flood as National Forensic Consultants concluded that the damage would have been noted on the standard home inspection when Plaintiffs purchased the home three weeks before the flood. Id at 23. Plaintiffs believe that the cost to replace rather than to rebuild was the more prudent and cost effective approach especially given the cost of repairs. Id. Plaintiffs also
point out errors they claim were made in the waiver denial letter about the amounts claimed and whether in fact the Hurricane Isabel Task Force reviewed the claim or whether the Plaintiffs withdrew their request for review before it was completed. Plaintiffs point to these problems to support its contention that there was an absence of any real review at all ... Id at 24. At page 25 of the Opposition (Document 646), Plaintiffs substantially revise their shortfall claim so that it is reduced now to the amount of $8,636.05. Plaintiffs now seek this amount in their motion for summary judgment. Document 646 at page 39. V. Special Master's Analysis FN1
Plaintiffs' method of calculating their damages based on the cost of constructing a new upgraded structure is fundamentally flawed because it does not take into account any of the SFIP's coverage limits or exclusions. Further, Plaintiffs simply deduct the $30,000.00 in Increased Cost of Compliance compensation from their grand total. See FEMA000045. Plaintiffs' shortfall itemization makes it impossible to separate out the compensable Increased Cost of Compliance expenses. Apparently now realizing that their original arguments will not be successful with the court, Plaintiffs have recast their claim to argue matters not specifically made in the waiver application. They argue that the Bafits report should have been accepted by FEMA and that they should have rejected the contrary report from National Forensic Consultants. This choice of which report or expert to accept is for the agency to make. Their choice does not appear to be arbitrary or capricious or an abuse of discretion. As for the report of the home inspector who would have looked at the house before the flood, FEMA notes that the report was never made part of the record of these proceedings and the issue itself was raised for the first time in Plaintiffs' Opposition. This argument of Plaintiffs was not part of the waiver claim and is not convincing in any event. Plaintiffs assert that it was an appropriate for them to move to replace the home rather than rebuild it. This may well be the case but it does not change the way that FEMA adjusts claim where it looks to the standards of the SFIP which looks only to the physical damage caused by the flood waters and which excludes any upgrades and which allows only $30,000 for the Increased Cost of Compliance, an amount that Plaintiffs did receive in this case. Plaintiffs claims that FEMA's handling of the waiver review was defective in not being complete or comprehensive enough are arguments that the court has rejected and the Special Master sees no reason to revisit them in the consideration of this
FN1. In their Oppositions at Document No. 646 at Pages 3 to 9, Group Four Plaintiffs have raised what they term to be twentyfour common issues that the Court has previously considered or resolved in consideration of prior groups. To the extent that these issues are not further cited in the individual Plaintiffs' discussion of their particular cases, the Special Master will not specifically address these issues in this Report and Recommendation, but will incorporate and rely on the Court's prior rulings on these issues (see Documents 594,596 and 597) and the previously filed Memorandum on Role of the Special Master and Report and Recommendation of the Special Master on General Issues Raised by Plaintiffs and Defendants (Document 563). *5 This is another case where Plaintiffs original waiver claim was based on the cost of the new building. See FEMA 000005 and 000045. FEMA has rejected that analysis and the Special Master and the court in prior rulings has sustained FEMA position that the SFIP requires a different calculus to be made. FEMA's position is well articulated in the Supplemental Declaration of Karen Christian as is set out above in Part III. As stated there:
claim. Plaintiffs have recast their claim at this stage to now claim $8,636.05 which FEMA notes is a reduction of the claimed shortfall in the waiver application by over 75%. This reduction should be welcomed by FEMA but they are correct in their contention that this shows that Plaintiffs did not present a consistent theory supported by evidence in the waiver claim application. The denial of the waiver claim made by FEMA for the reasons stated by it in the Supplemental Declaration of Karen Christian (Document 6162) was not arbitrary, capricious or an abuse of discretion. The arguments now made by Plaintiffs in the Opposition do not persuade the Special Master that FEMA's determination to deny the waiver is one that should be reversed by this court or remanded back to FEMA for further proceedings. VI. Recommendation of the Special Master *6 After a review and a consideration of the matter and the arguments presented by the parties, it is the recommendation of the Special Master that the Defendants' Motion for Partial Summary Judgment affirming FEMA's determination of Plaintiff's waiver application be granted; and it is further recommended that Plaintiff's Motion for Summary Judgment be denied. D.Md.,2011. Moffett v. Computer Sciences Corp. Slip Copy, 2011 WL 2559604 (D.Md.) END OF DOCUMENT
Only the Westlaw citation is currently available. United States District Court, D. Maryland, Southern Division. Thomas L. MOFFETT, II, et al., Plaintiffs, v. COMPUTER SCIENCES CORPORATION, et al., Defendants. Civil Action No. 8:05CV01547. June 26, 2011. Donald W. Marcari, Frank D. Lawrence, III, Marcari Russotto and Spencer, Chesapeake, VA, Martin H. Freeman, Freeman and Freeman PC, Rockville, MD, for Plaintiffs. Arthur F. Fergenson, Ansa Assuncao LLP, Holly Drumheller Butler, DLA Piper U.S. LLP, Jason Daniel Medinger, Office of the United States Attorney, Steven Michael Klepper, Kramon and Graham PC, James D. Skeen, Skeen and Kauffman LLP, Brett Anthony Buckwalter, Niles Barton and Wilmer LLP, Baltimore, MD, Jay I. Morstein, Owings Mills, MD, Tyler Brian Raimo, Computer Sciences Corporation, Falls Church, VA, Darren Seth Wall, Department of Homeland Security, Arlington, VA, Gerald Joseph Nielsen, Nielsen Law Firm LLC, Metairie, LA, Peter F. Axelrad, Council Baradel Kosmerl and Nolan PA, Annapolis, MD, Patricia McHugh Lambert, Steven B. Schwartzman, Hodes Pessin and Katz PA, Towson, MD, Steuart H. Thomsen, Sutherland Asbill and Brennan LLP, Scott Nathan Auby, W. Neil Eggleston, Debevoise and Plimpton LLP, Elizabeth Treubert Simon, Pamela Anne Bresnahan, Vorys Sater Seymour and Pease LLP, Washington, DC, Craig Russell Blackman, Samuel J. Arena, Jr., Stradley Ronon Stevens and Young LLP, Philadelphia, PA, Edward J. Hutchins, Jr., Eccleston and Wolf PC, Hanover, MD, Stacey Ann Moffet, Eccleston and Wolf PC, Hanover, MD, William J. Hickey, Law Offices of
William J. Hickey LLC, Rockville, MD, Debra Anne Nelson, William Lowell Mundy, Mundy and Nelson, Huntington, WV, James Hilton Crosby, Crosby Saad LLC, Mobile, AL, William Gerald Gandy, Wilson Elser Moskowitz Edelman and Dicker, McLean, VA, Bradish J. Waring, Mary Legare Hughes, Nexsen Pruet LLC, Charleston, SC, for Defendants. REPORT AND RECOMMENDATION CONCERNING WAIVER CLAIM OF MICHAEL KONDYLAS DENNIS M. SWEENEY, Special Master. *1 This constitutes the Report and Recommendation to the Court concerning the waiver claim of Michael Kondylas pursuant to Part 1.f of the Memorandum Order of the Court (Document 467). In preparing this report, the Special Master reviewed the motions, memoranda, affidavits and exhibits provided in connection with the process specified in the Memorandum Order. As necessary, the Special Master also reviewed other documents that are part of the Court filings in this case. The Special Master was also provided by the Federal Emergency Management Agency (FEMA) the computer disc of the appropriate documents of record for this claim, as specified in Part 1.a of the Memorandum Order. In this case, the documents consist of 44 pages labeled FEMA000001 to 000044. I. Background Plaintiff purchased a Standard Flood Insurance Policy (SFIP or Policy), Policy 90RA93929, from State Farm Fire and Casualty Company (State Farm) to insure his residence located at 8909 Millers Island Road, Baltimore, Maryland (insured structure) from damage caused by flooding. See FEMA000019. Plaintiff's Policy was in effect from January 16, 2003 through January 16, 2004. Id. Plaintiff's structure was inFN1 sured for $117,000 with a deductible of $500. See FEMA000031.
FN1. Plaintiff claims his policy limit was $188,800.00 (See FEMA00005), but FEMA asserts that the actual policy limit was $117,000.00. On September 18, 2003, Hurricane Isabel struck the MidAtlantic States, including Maryland, which caused flooding resulting in damage to Plaintiff's property. On September 27, 2003, Plaintiff notified State Farm of the loss. See FEMA000016. An adjuster inspected the structure on September 30, 2003 and determined Plaintiff's net loss after application of his $500.00 deductible was $531.55. See FEMA000032. On October 23, 2003, Plaintiff submitted a Proof of Loss for the $531.55. See FEMA000024. On October 24, 2003, State Farm issued a check for $531.55, which was payment in full on Plaintiff's only timely submitted Proof of Loss. See FEMA000021. Plaintiff did not seek any review by the Hurricane Isabel Task Force. See FEMA000015. II. Waiver Claim and Denial On December 3, 2007, this Court permitted Plaintiffs to submit applications for waivers to FEMA. See Doc. No. 196 and Doc. No. 197, Order of December 4, 2007. On or about February 22, 2008, Plaintiff submitted to FEMA a document entitled PLAINTIFF MICHAEL AND DONNA KONDYLAS' INDIVIDUAL APPLICATION FOR WAIVER OF PROOF OF LOSS REQUIREMENTS. See FEMA000001 through FEMA000013. FEMA denied the request in a letter dated October 28, 2008. See FEMA000014 to 000015. III. Reasons for Waiver Denial The reasons for the denial of the Waiver Claim are found at 1219 of the Supplemental Declaration of Karen Christian for the Claim of Michael Kondylas (Document 6172). It states: Plaintiff's waiver application did not include
any documentation such as receipts, invoices or estimates to support his supplemental claim. Plaintiff states the total to repair his original home was $11,529.00. See FEMA000012. Plaintiff applied his deductible and payment from State Farm to arrive at a claimed structure shortfall of $10,997.45. Id. Plaintiff stated he would submit documentation to support this claim in due course. See FEMA00005. *2 Plaintiff's shortfall itemization included a handwritten document with line items totaling $11,529.00 without any explanation of how the flood damage related to the claimed items or what the claimed amounts were based on. See FEMA00013. Plaintiff never submitted to FEMA any other supporting documents to support his waiver application. When reviewing Plaintiff's waiver application, the Administrator evaluated the facts and circumstances relating to the request. See FEMA000014 and FEMA000015. Specific to this case, the Administrator considered the following whether: 1. Policy holder demonstrated additional damages exist that are covered by the SFIP; 2. Policy holder submitted appropriate documentation supporting the additional compensation being requested; and 3. Policy holder provided a reasonable explanation for the delay in submitting the POL. Id. In the letter denying Plaintiff's waiver application, the Administrator stated: ... you claim your damages exceed the flood damages determined by your carrier, State Farm Fire and Casualty Company (State Farm)
as a result of the flooding. You did not submit a request to the Hurricane Isabel Task Force to review your claim to determine if you were owed an additional payment for the damage to your building. However, the investigation conducted by State Farm clearly documents the damage to your structure was confined to the enclosed lower level, which had been finished and was used as living space. Although the damages were extensive, the structure is a postFIRM elevated building and subject to coverage limitations as outlined in the Standard Flood Insurance Policy. This was explained to you by the State Farm adjuster and in their letter issued on October 18,2003. The adjustment prepared by State Farm paid for only the covered damages for which you received payment in the amount of $531.55. Further, your waiver request resulted in a comprehensive review of your claim by a FEMA Insurance Examiner. The documents provided by your attorney do not support a supplemental payment since they do not contain new information and consist of upgrades to the property and non-covered items. The Insurance Examiner found no basis to set aside the original findings. See FEMA000015. Plaintif failed to demonstrate he met any of the criteria used to determine whether to grant a waiver. First, he failed to demonstrate any additional damages he sought were actually covered by his SFIP. Second, he did not submit detailed line-item documentation of uncompensated damages caused directly by flooding to his original structure. Accordingly, after another comprehensive review of the claim, Plaintiff's waiver application was denied because Plaintiff had not shown in his waiver application that he was entitled to further compensation under his policy. Id.
IV. Plaintiffs' Assertions Plaintiff's sole contention is contained in Document 646 where the full statement is as follows: *3 Mr. Kondylas supplied the itemization of his shortfall with his Individual Application for Waiver of the POL Requirements (see FEMA 000013 and 000014) to FEMA on February 25, 2008. FEMA's denial letter of October 28, 2008 mentioned nothing about the need to supply still further supporting documentation. The first time FEMA has denied payment of the shortfall on the ground that such additional information was needed was in their March 28, 2011 Motion for Summary Judgment (Doc. 617). This amounts to a new, afterthe-fact basis for rejecting his claim, contrary to the Court's admonition. Plaintiff seeks $10,997.45 in his motion for summary judgment. Document 646 at page 40. V. Special Master's Analysis FN2
FN2. In their Oppositions at Document No. 646 at Pages 3 to 9, Group Four Plaintiffs have raised what they term to be twentyfour common issues that the Court has previously considered or resolved in consideration of prior groups. To the extent that these issues are not further cited in the individual Plaintiffs' discussion of their particular cases, the Special Master will not specifically address these issues in this Report and Recommendation, but will incorporate and rely on the Court's prior rulings on these issues (see Documents 594,596 and 597) and the previously filed Memorandum on Role of the Special Master and Report and Recommendation of the Special Master on General Issues Raised by Plaintiffs and Defendants (Document 563). FEMA's reasons for denying the waiver claim as set out in Part III above are reasonable and in accord with the SFIP. Plaintiffs have failed to show or
explain how the determination made was arbitrary, capricious or an abuse of discretion. It was Plaintiff's obligation to supply the information and documents necessary to support his claim. As Karen Christian states in Part III above in explaining the reasons for the waiver denial: Plaintiff's waiver application did not include any documentation such as receipts, invoices or estimates to support his supplemental claim. Plaintiff states the total to repair his original home was $11,529.00. See FEMA000012. Plaintiff applied his deductible and payment from State Farm to arrive at a claimed structure shortfall of $10,997.45. Id. Plaintiff stated he would submit documentation to support this claim in due course. See FEMA00005. Plaintiff's shortfall itemization included a handwritten document with line items totaling $11,529.00 without any explanation of how the flood damage related to the claimed items or what the claimed amounts were based on. See FEMA00013. At the time the waiver application was made it was necessary for Plaintiffs to fully support the waiver claim and not rely on the possibility in submitting other documents in due course. It was not incumbent on FEMA to provide additional opportunities for the submission of further documentation when Plaintiff failed to submit satisfactory support in the waiver claim itself. The documentary deficiencies in this claim are more that adequately stated in FEMA Reply Memorandum (Document 647) at page 11 and do not need to be further stated here. VI. Recommendation of the Special Master After a review and a consideration of the matter and the arguments presented by the parties, it is the recommendation of the Special Master that the Defendants' Motion for Partial Summary Judgment affirming FEMA's determination of Plaintiff's waiver application be granted; and it is further re-
Only the Westlaw citation is currently available. United States District Court, D. Maryland, Southern Division. Thomas L. MOFFETT, II, et al., Plaintiffs, v. COMPUTER SCIENCES CORPORATION, et al., Defendants. Civil Action No. 8:05CV01547. June 26, 2011. REPORT AND RECOMMENDATION CONCERNING WAIVER CLAIM OF CHRISTINE LEE DENNIS M. SWEENEY, Special Master. *1 This constitutes the Report and Recommendation to the Court concerning the waiver claim of Christine Lee pursuant to Part 1.f of the Memorandum Order of the Court (Document 467). In preparing this report, the Special Master reviewed the motions, memoranda, affidavits and exhibits provided in connection with the process specified in the Memorandum Order. As necessary, the Special Master also reviewed other documents that are part of the Court filings in this case. The Special Master was also provided by the Federal Emergency Management Agency (FEMA) the computer disc of the appropriate documents of record for this claim, as specified in Part 1.a of the Memorandum Order. In this case, the documents consist of 399 pages labeled FEMA000001 to 000399. I. Background Plaintiff purchased a Standard Flood Insurance Policy (SFIP or Policy), Policy Number 3007993888, from Omaha Property and Casualty Insurance Company (Omaha) to insure her residence located at 205 Canal Street, Grasonville, Maryland (insured structure) from damage caused by flooding. See FEMA000172. Plaintiff's structure was insured up to $114,000.00 with a de-
ductible of $1,000.00. Id. Plaintiff did not maintain contents coverage. Id. On or about September 18, 2003, Hurricane Isabel struck the coast of Maryland, causing damage along the coast, including to the insured structure owned by Plaintiff. See FEMA000172. Plaintiff's policy was effective September 30, 2002, through September 30, 2003, and was therefore covered at the time of the loss. See FEMA000172. On September 19, 2003, Plaintiff contacted her insurer, Omaha, and advised them of her loss, alleging her insured structure was damaged by the flooding caused by Hurricane Isabel on September 18, 2003. See FEMA000230. On September 19, 2003, Plaintiff was contacted by an independent who was assigned by Omaha to investigate Plaintiff's loss. See FEMA000205 through FEMA000227 and FEMA000337 through FEMA000344. On or about September 23, 2003, the adjuster inspected the exterior of the structure, conducted a room-by-room inspection of the interior, took photographs, and adjusted the loss. Id. The adjuster identified $20,895.18 in replacement-cost covered flood damages after applying the $1,000.00 deductible. See FEMA000170. On October 22, 2003, Plaintiff submitted a signed and notarized Proof of Loss for the $20,895.18. See FEMA000383. On October 28, 2003, Omaha issued Plaintiff a check for the Proof of Loss in the amount of $20,895.18. See FEMA000240. On December 30, 2003, Omaha issued Plaintiff a supplemental check in the amount of $4,607.69 for building damage. See FEMA000044 through FEMA000045. On or about June 14, 2004, Plaintiff requested review of her claim by the Hurricane Isabel Task Force (Task Force)see FEMA000248 through FEMA000249because there was not enough money to fix her house. Id. Specifically, Plaintiff had an issue with a cracked slab and with interior
damage which was not compensated in her prior Proof of Loss. Id. *2 On July 26, 2004, the Task Force concluded its initial review. Id. The Task Force concluded that a supplemental payment in the amount of $33,624.99 was in order to reimburse for floor structure, flooring covering, moldings, drywall, insulation to ceiling, cabinets, doors, and painting. FEMA000142. The Task Force, however, conducted a subsequent review on August 2, 2004, and revised the amount of the supplemental payment to $32,099.82. FEMA000248. The Task Force reviewed the supplemental determination with Plaintiff who agreed with the supplemental amount, and a Proof of Loss for $32,099.82 was provided. Id. and FEMA000251. On August 3, 2004, Omaha issued a check for a total of $32,099.82, which was the amount authorized by the Task Force. See FEMA000297. Omaha reissued another check for the same amount on September 1, 2004, to correct a payee error on the check. See FEMA000296. Omaha paid Plaintiff a total of $27,859.20 for Increased Cost of Compliance coverage (ICC), and Plaintiff is not seeking any additional ICC funds. See FEMA000004 through 000005. Plaintiff was paid in full on every Proof of Loss she submitted to Omaha. II. Waiver Claim and Denial On December 3, 2007, this Court permitted Plaintiffs to submit applications for waivers to FEMA. See Doc. No. 196 and Doc. No. 197, Order of December 4, 2007. On or about February 25, 2008, Plaintiff submitted to FEMA a document entitled PLAINTIFF CHRISTINE LEE'S INDIVIDUAL APPLICATION FOR WAIVER OF PROOF OF LOSS REQUIREMENTS. See FEMA000001 through FEMA00009. FEMA denied the request in a letter dated July 31, 2008. See FEMA000099 to 000100. III. Reasons for Waiver Denial
The reasons for the denial of the Waiver Claim are found at 1826 of the Supplemental Declaration of Karen Christian for the Claim of Christine Lee (Document 6202). It states: Plaintiff claimed a shortfall of $55,397.31. See FEMA000005. Plaintiff claims she had to remove and replace the old home and build new. Id. The cost of the new home exceeded $160,000. Id. Plaintiff determined her shortfall by using a formulaic calculation that took the square footage of the original structure and multiplied it by the cost per square foot of the new upgraded dwelling resulting in a replacement valuation of policy limits ($114,000.00) minus the prior Omaha payments ($57,602.69structure and $27,859.20ICC) for a claimed shortfall of $55,397.31. Id. Plaintiff's formulaic Shortfall Itemization was based completely on the cost of her new upgraded home. See FEMA00005. Plaintiff's itemization did not actually include any itemization that could be used for a meaningful comparison to the adjuster's estimate. Id. Plaintiff's method of calculating her damages by taking the square footage of her original structure and multiplying it by the cost per square foot of the new upgraded structure does not take into account any of the SFIP's coverage limits or exclusions. *3 Plaintiff presented no evidence requiring her to demolish her home and never challenged the repair estimates provided by Omaha and the Task Force. Plaintiff's sole focus was on receiving her policy limits. When reviewing Plaintiffs' waiver application, the Administrator evaluated the facts and circumstances relating to the request. See FEMA000099 and FEMA000100. Specific to this case, the Administrator considered the following whether:
1. Policy holder demonstrated additional damages exist that are covered by the SFIP; 2. Policy holder submitted appropriate documentation supporting the additional compensation being requested; and 3. Policy holder provided a reasonable explanation for the delay in submitting the POL. Id. The SFIP only covers direct physical loss caused by or from flooding. The3 Plaintiff's formulaic shortfall calculation to replace her 25 year old building (See FEMA000111) was based on the square footage cost of a new upgraded dwelling, which included code and material upgrades. The SFIP excludes coverage for upgrades and requires the use of material that is of like kind and quality. See Exhibit A at 16 and 17. Further, the SFIP has a policy limit of $30,000.00 for Increased Cost of Compliance expenses and Plaintiff's formula makes it impossible to separate out these expenses. In the letter providing FEMA's determination on Plaintiffs waiver application, the Administrator stated: ... you identified settlement damage to the slab after your residence was demolished and rebuilt. You did not provide any substantiating evidence that this damage resulted from the Isabel flood event. Additionally, damage caused by settlement is not covered by the SFIP. Please refer to V. Exclusions C. 16 for clarification. Your claim was originally reviewed by an independent adjuster and subsequently reviewed by the Hurricane Isabel Task Force. All reviews of your claim concluded the foundation problem was not caused by the Hurricane Isabel flood event. ***** Further, your waiver resulted in a compre-
hensive review of your claim by a FEMA Insurance Examiner. After further review, the Insurance Examiner found no basis to set aside the original findings. See FEMA 000100. Plaintif failed to demonstrate she met any of the criteria used to determine whether to grant a waiver. First, she failed to demonstrate any additional damages she sought were actually covered by her SFIP. Second, she did not submit detailed line-item documentation of uncompensated damages caused directly by flooding to her original structure, but instead took a formulaic approach based on the cost per square foot of a substantially improved home to calculate her loss. Accordingly, after another comprehensive review of the claim, FEMA determined no further compensation was warranted. Id. Plaintiff's waiver application was denied for a multitude of reasons, but primarily because she failed to document any physical loss by or from flood covered under her SFIP for which she did not receive full compensation. IV. Plaintiff's Assertions *4 Plaintiff argues that FEMA is incorrect when it states that Plaintiffs waiver application was based on the cost of a new upgraded home. Plaintiff claims that FEMA did not correctly construe the filing and that she was relying on a contract from Riverwest Construction Corporation to rebuild her existing home at the same square footage. Plaintiffs Opposition at page 32. Because of FEMA's misreading of the claim, Plaintiff also claims that Ms Christian's declaration confuses her arguments about how the ICC expenses should be factored in because of the initial miscalculation about the supposed formulaic argument that Ms. Christian perceived the Plaintiff to be making. Id. at 33. Plaintiff argues that Plaintiff did not use a square footage formula and nor did she fail to present itemized documentation associated
with the cost covered under Coverage A of her SFIP or under her ICC claim. Id. As a result, Plaintiff seeks $55,397.31 by summary judgment. Document 646 at page 40. V. Special Master's Analysis FN1
FN1. In their Oppositions at Document No. 646 at Pages 3 to 9, Group Four Plaintiffs have raised what they term to be twentyfour common issues that the Court has previously considered or resolved in consideration of prior groups. To the extent that these issues are not further cited in the individual Plaintiffs' discussion of their particular cases, the Special Master will not specifically address these issues in this Report and Recommendation, but will incorporate and rely on the Court's prior rulings on these issues (see Documents 594,596 and 597) and the previously filed Memorandum on Role of the Special Master and Report and Recommendation of the Special Master on General Issues Raised by Plaintiffs and Defendants (Document 563). In its Reply (Document 647) at page 1617, FEMA states the following about the allegations that FEMA and Ms. Christian did not make the correct decision on the waiver: While FEMA concedes that it mistakenly argued Plaintiff's usage of the formulaic calculation for a new upgraded dwelling in support of its motion, the underlying principle is exactly the same and the end result is also the same. The Riverwest contract was for a new upgraded structure without regard for actual physical loss by or from flood and without application of the coverages and exclusions found within the SFIP. The formula based claims fail because they disregard actual physical loss by or from flood and do not apply the coverages and exclusions found within the SFIP. As stated in the Court's February 17, 2011 Opinion, the formula lacks specificity as to what direct physical dam-
ages were caused by or from the flood, i.e., were covered by the SFIP. See Judge Messitte's Memorandum Opinion of February 17, 2011, Doc. No. 597 at 8 and 9. Plaintiffs waiver application request is based solely upon taking the cost to rebuild a new upgraded home at the same square footage, subtracting ICC benefits of $27,859.20, and then asserting that she was entitled to receive her claimed policy limits of $114,000.00 because the remaining estimated cost to rebuild ($160,000.00) exceeded her coverage limits. See FEMA000078. Indeed, Plaintiff did even less to support her claim than those individuals relying upon the persquare-footage cost to rebuild. The SFIP is a single risk policy and only provides insurance coverage against direct physical loss by or from flood. 44 C.F.R. Pt. 61, App. A(1), Section II(12). It is the policyholder's burden to prove her losses and provide sufficient documentation. See 44 C.F.R. Pt. 61, App. A(1), Section VII(J). As noted by the Court, the burden is on the insured to demonstrate that additional work should be compensated consistent with the SFIP requirements. FEMA is not obliged to search the policy in an effort to discover the basis for further payments of a claim. See Judge Messitte's Memorandum Opinion of February 17, 2011. Doc. No. 597 at 2. Plaintiff, like the formula based plaintiffs, disregarded the coverages provided by her SFIP with applications of the appropriate exclusions. *5 Plaintiff's evidence/argument is insufficient to prove FEMA's determination on her waiver application was arbitrary, capricious or contrary to law. Accordingly, the Special Master should recommend summary judgment in favor of Defendants on her claim. The Special Master has considered the arguments made by the Plaintiff and reviewed the materials pertaining to the Riverwest Construction Corporation contract. See FEMA 00005 and FEMA 000078000091. In light of FEMA concession that it misconstrued the argument made by Plaintiff, the Special Master has considered whether it should re-
commend that the waiver claim should be remanded to FEMA for a redetermination of the waiver claim and a new determination be made on the waive claim. After a review, the Special Master has concluded that a remand based on the current record would not result in any change more beneficial to the Plaintiff given the fact that the documentation submitted by Plaintiff including the Riverwest contract would not be considered a basis for FEMA to grant a waiver claim. This is based not only on what FEMA's counsel has stated in the Reply, but how FEMA has construed similar submissions made by other Plaintiffs in this review process. The Special Master thus concludes that the denial of the waiver claim in this case was not arbitrary or capricious or an abuse of FEMA's discretion. VI. Recommendation of the Special Master After a review and a consideration of the matter and the arguments presented by the parties, it is the recommendation of the Special Master that the Defendants' Motion for Partial Summary Judgment affirming FEMAs determination of Plaintiff's waiver application be granted; and it is further recommended that Plaintiff's Motion for Summary Judgment be denied. D.Md.,2011. Moffett v. Computer Sciences Corp. Slip Copy, 2011 WL 2559616 (D.Md.) END OF DOCUMENT

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2011 Thomson Reuters. No Claim to Orig. US Gov. Works.

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Raised by Plaintiffs (Document 563).

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