Insurer seeks to avoid claims in blaze

logicMay 2, 2012

For those who are tempted to play the no permit game, realize that insurance companies can refuse to honor a claim that results from misrepresentation..or a number of other reasons. ALWAYS read the fine print..consult an attorney if you have to...but don't make the mistake of assuming it will be OK. This was a horrendous made even more so, by a cocky contractor assuming he was above the law.

Read on:

STAMFORD -- An insurance company covering the contractor overseeing renovations at the Shippan Avenue house consumed by a fatal fire on Christmas wants a judge to release it from defending lawsuits and paying claims related to the inferno.

The Utica First Insurance Co. claims it would not have issued insurance coverage to contractor Michael Borcina and his company, Tiberias Construction, had he not made several alleged misrepresentations about the type of work he did and the size of his business, according to the lawsuit. Utica First Insurance filed the lawsuit earlier this month in New York Supreme Court. This week, insurance company lawyers included Madonna and Matthew Badger and the estates of the five fire victims as defendants.

Attorneys for the insurance company want a judge to declare that Utica First Insurance is not obligated to provide coverage for Borcina or pay claims from the victims' relatives arising from the fire.

At the time of the fire, Borcina was overseeing renovations at Madonna Badger's 116-year-old house on Shippan Avenue. He was staying over at the house Christmas Eve when a fire ripped through the three-story home, killing Badger's three daughters and her parents early Christmas morning. Borcina and Madonna Badger escaped the fire, which was so intense that the heat drove Stamford firefighters from the house during several rescue attempts.

Police and fire officials described the blaze as accidental and said no criminal charges were anticipated. An initial investigation revealed Borcina cleaned out the fireplace shortly after 3 a.m., placed the embers in a bag and left them inside a newly constructed mudroom or just outside in an enclosed trash bin.

"We are very disappointed that the insurance company has gone to court to try and get out of its legal obligations under its policies," said David Grudberg, an attorney with Carmody & Torrance in New Haven, representing Borcina. "We have just recently received the lawsuit and will respond appropriately in court."

Matthew Badger's attorney, Richard Emery, told The Associated Press on Thursday that he has to examine the insurance company's claim.

"But at first blush, it certainly seems that the insurance company is trying to wiggle out of their responsibility to compensate Borcina's victims," Emery said.

Emery added that he was considering filed a lawsuit against Borcina "and a lot of other people that we believe are responsible for what occurred."

According to the insurance company's lawsuit, Borcina applied for commercial liability insurance as an artisan contractor in 2007 and completed several surveys about the nature of his work and business. The type of insurance Borcina received was meant for small businesses and placed restrictions on the size of projects and earnings, according to Utica First Insurance's website.

The insurance company accused Borcina of falsely reporting his payroll numbers, his gross annual receipts and whether it worked on projects exceeding $500,000.

The lawsuit comes as Stamford State's Attorney David Cohen, the head prosecutor at state Superior Court in Stamford, weighs whether to file criminal charges related to the fire. Cohen did not immediately return phone calls for comment Thursday. Cohen has been reviewing an investigation into the fatal fire since late January.

Stamford Police Capt. Richard Conklin said investigators met with prosecutors last week, and Cohen told them he was still weeks away from releasing his findings.

Alan Scott Pickel, a private attorney in Stamford who handles insurance claims for fire and accident victims, said the lawsuit, if successful, would leave Borcina and his company exposed to handle claims and lawsuits without insurance coverage.

"If somebody brings a claim against him he's going to be out on his own," Pickel said.

In February, Matthew Badger, the estranged husband of Madonna Badger, became the administrator for the estates of his deceased daughters -- 9-year-old Lily and 7-year-old twins Sarah and Grace -- a prerequisite of filing a potential wrongful death lawsuit over the fatal fire.

Wade E. Johnson, the younger brother of Madonna Badger, became the administrator for the estate of his parents, Lomer and Pauline Johnson, according to the lawsuit.

The lawsuit is one of several pending against Borcina. The contractor owes nearly $100,000 in legal judgments from two projects in Manhattan and upstate Connecticut. According to a source familiar with the lawsuits, one of the former clients tried serving Borcina with legal documents during his hospital stay following the Shippan Avenue fire, in which he suffered burns and smoke inhalation.

Borcina also faces lawsuits from two more recent clients in Manhattan and Long Island. The complaints, filed over projects from the past two years, seek nearly $75,000.

-- The Associated Press contributed to this report.

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The above article doesn't appear to relate to non permitted work that you mention?? If you see it, fine for you...

    Bookmark   May 2, 2012 at 6:40PM
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It does as it is an example of misrepresentation. Insurance companies will look for ANY loophole to deny a claim.....especially if the action results in a fire or other damage. In this case, its misrepresentation...if you live in an area that requires permits for work done, and you do not obtain them,and property damage and/or loss of life results from shoddy renovations, don't assume that your insurer will gladly pay out despite the fact that you failed to abide by the law in making certain that the renovations were done to code as there could be a huge price to pay.

Point is, research the policy.

    Bookmark   May 3, 2012 at 1:15AM
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"An insurance company covering the contractor..."

This has anything to do with a homeowner's policy how?

Business insurance is a far different thing tan homeowner's insurance.

Business in insurance is not regulated nearly as tightly since it is assumed to be between two equals, a businesses and an insurance company. Each should have attorneys available to look out for their interests and to negotiate policy terms.

Homeowner's insurance is between a business and a single consumer/customer.
The customer takes what the company offers, with little to no ability to alter terms.
You take what is offered or find another company.

Everyone should read their homeowner's policy thoroughly.
They have gotten better over the years (more plain English) but are still a complicated document.

As the author of the contract, any ambiguity goes against the insurance company.
They want to cover every issue clearly and to their benefit.

    Bookmark   May 3, 2012 at 8:55AM
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As the others have said, this is not about homeowners insurance. It's about a contractor's insurance where he may have explicitly lied about his business scope.

Plus, it's only saying that the insurance company is ATTEMPTING to refuse the claim. Get back to us when there is an actual judgement made.

    Bookmark   May 3, 2012 at 9:16AM
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You make a valid point about working with a contractor who will obtains the proper permits and does professional work. However in this case I don't see the connection. There is no mention of the contractor not having the required permits.

The contractor had insurance, but it appears he misrepresented his business in order to pay a lower premium. I can see a homeowner asking if the contractor has insurance, but I don't see how a homeowner could ever verify if the insurance coverage is valid for that type of business.

I saw this story on the local news. This is a very sad tradegy for this family.

    Bookmark   May 3, 2012 at 2:29PM
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The issue of permits is quite muddy. There were a number of earlier articles stating he had no permits as he was not legally able to work in CT as his license to do so had expired. Same for NY.

However, the same articles mentioned that that the building inspectors had inspected the house a few months earlier and that there were no violations(e.g. smoke detectors not being in place)although that was later said to be the case (smoke detectors disconnected and stored in the garage)at the time of the actual fire. How did they miss the fact that he had no permits and no legal right to perform the work in CT when doing an inspection?

That brings us to the the demolition of the house the next day, before it could be inspected to determine cause...and that demolition was ordered by the building department in Stamford...that apparently inspected the work of an unlicensed contractor with no permits and did not find that to be a violation.

That provides a bit more detail, but again, as far as insurance is concerned,regardless if it is for a business or a home, the point is to NOT assume anything. Read the policy and make certain of your coverage...period.

greg2010, as you seem to be very interested in the outcome,follow the story on your own.
You may learn even more.

    Bookmark   May 9, 2012 at 5:46PM
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Dad of Stamford Fire Victims Plans to Sue
by Anthony Buzzeo

STAMFORD, Conn. � Matthew Badger has filed a notice of intent to sue the city of Stamford for negligence in connection with the Christmas morning fire that took the lives of his daughters Sarah, Grace and Lilly.

The notice was delivered to the Town Clerk�s office Friday, May 4, by Badger�s lawyer. The Shippan Avenue home destroyed by fire was owned by Badger�s estranged wife, Madonna, who was one of the two survivors of the blaze.

The notice names the city's director of operations Ernie Orgera, City Engineer Louis Casolo, Assessor Francis Kirwin and Building Official Robert DeMarco for their or their office�s part in allowing the girls to be in the home at the time of the fire.

"[Badger] suffered damages as a consequence of the aforementioned parties� negiligence, carelessness, and actions, including but not limited to the wrongful death of the children on December 25, 2011," the notice said.

The notice points to several actions by the city that might have led to the deaths, including the wrongful issuance of permits to Michael Borcina and/or Tiberias Construction Inc., and to Michael Foley and/or Foley�s Fine Carpentry Inc.

It also alleges that city officials either did not inspect the construction enough or did so carelessly, failure to follow up on inspections despite the home's being in unsafe condition for the children, and for allowing the children to live in the house without working smoke detectors and a fire alarm system.

The notice described the demolition of the home the day after the fire as "intentional spoliation of evidence."

By Tuesday afternoon, Town Clerk Donna Loglisci said she had not yet received the actual suit.

Messages have been left for both Joseph Capalbo II, director of Legal Affairs for Stamford, and Richard Emery, Badger�s attorney.

    Bookmark   May 9, 2012 at 5:49PM
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He may get 'go away money' based on the cost to defend the nuisance suite.

    Bookmark   May 10, 2012 at 10:19AM
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