Christmas Presents

Christmas Presents
                Antigua                Keeping with the festive season here are two presents coming to people in different places of the country.  One is a break for victims of insurance penny pinching and humiliation in post-Katrina New Orleans.  The other proves the value of good, affordable housing as the first units of housing come on line in Paterson, New Jersey thanks to the hard work of Ismene Spiliotis, Pedro Rivas, Damaris Rostan, and many others.

Fifth Circuit Court of Appeals rules that insurers can be held responsible for mental anguish

Posted by Rebecca Mowbray, The Times-Picayune December 26, 2008 4:20PM

In a rare win for policyholders in an appellate court, the Fifth U.S. Circuit Court of Appeals said this week that insurers can be held responsible for mental anguish damages when they show bad faith in paying claims.

The decision upheld a ruling from federal court in New Orleans in the case of Marrero homeowner Dale Dickerson, who was forced to live his bathtub refinishing shop and take showers under a cold garden hose while standing on a wooden pallet in an unheated room for a year and a half while fighting Lexington Insurance Co., a unit of AIG, for proper payment of his Hurricane Katrina claim.

A three-judge panel upheld U.S. District Court Judge Carl Barbier’s finding that Lexington acted in bad faith for dragging out payment of Dickerson’s claim without reason and should be held responsible for inflicting unnecessary stress on Dickerson’s life. Bad faith means that an insurer was abitrary and capricious in its claims-handling, and failed to pay without probable cause.

In its ruling, the court accepted Dickerson’s daughter’s testimony that her father had become withdrawn and short-tempered as proof of his deteriorating psyche without testimony of a mental health professional.

Randy Maniloff, an insurance coverage defense attorney in Philadelphia who is writing a reference book on insurance law, predicted that the ruling on mental anguish damages would make it easier for homeowners with small claims to find attorneys to take their cases, because the prospect of a mental anguish damage award could make it worth their while. At the same time, the idea that mental anguish can be proved without going to the doctor lowers the factual burden to prove stress that’s worthy of penalties.

Maniloff posited that perhaps this case went in favor of policyholders because the Fifth Circuit had the benefit of all of the facts in the case that had been ascertained at the July 2007 trial in light of Louisiana law rather than being asked to review insurance contract interpretations made in the course of litigation.

"The Fifth Circuit has been no friend to policyholders," Maniloff said. "It’s hard to overturn factual findings."

Lexington Insurance did not return a phone call and e-mail seeking comment.

Maniloff predicted that the Fifth Circuit’s ruling would be the end of the case on mental anguish, for Lexington would be wasting its time to try appeal to the U.S. Supreme Court. "I think they’re out of options," he said.

Soren Gisleson, the New Orleans attorney who represented Dickerson and who is head of the Louisiana Association for Justice’s insurance section, was overjoyed at having a homeowner win stand up on appeal. "It’s a huge, decisive resolution of important hurricane issues," he said.

Plaintiffs attorneys around the city immediately started incorporating the Dickerson ruling into their briefs in pressing for mental distress damages against other insurance companies.

Maniloff said that the case should be a reminder to insurers to pay the portion of a claim that is settled while they work with homeowners on portions of the claim that are still in dispute.

"The case demonstrated the lesson that insurers need to treat their disputed and undisputed claims separately, and pay the undisputed portion, and then have a legitimate argument over the disputed portion," Maniloff said. "Insurance companies get themselves in trouble when they don’t pay."

Comprising the three-judge appeals panel were Carolyn Dineen King, who was appointed by President Jimmy Carter; Judge Patrick E. Higginbotham, who was appointed by President Ronald Reagan; and Judge Jacques L.Wiener, Jr., who was appointed the President George H.W. Bush.

Barbier, the judge presiding over the Dickerson trial, was appointed by President Bill Clinton.

Affordable housing part of nonprofit’s development

Tuesday, December 23, 2008
Last updated: Tuesday December 23, 2008, 3:39 PM

BY ALEXANDER MACINNES

STAFF WRITER, Herald News

PATERSON — The elderly woman on Straight Street did not have time to talk in the Monday morning cold, but she wanted information from a stranger about finding a new home.

"I need a place," she said, after asking about the new building just half a block away.

That building is the 40-unit affordable housing project built by the New Jersey ACORN Housing Corp., a nonprofit that chose Paterson to construct its first housing development. The converted paper mill on Straight Street will officially open in February, but the group is now taking applications for what appears to be highly coveted housing in the city’s downtown area.

So far, for each apartment, the group has received 10 applicants — all seeking units that feature 11-foot ceilings, new kitchens, hardwood floors, video security and huge windows that offer sweeping views of Paterson. The demand for these units, which also feature energy-efficient technologies and off-street parking, is even more intense, considering the rents — $720 for a one-bedroom, $850 for a two-bedroom and $960 for a three-bedroom.

"They’re paying double these (rents) for apartments that are in shambles," said Tara Benigno, manager of the building at 114 Straight St.

The $16 million project targets low-income residents, families that make between $24,685 and $50,750, according to information from ACORN. Many of those who have applied are either on public assistance, homeless or living in apartments that are deteriorating.

"They don’t have places to live and if they do, the apartments are very small and the rents are very high," Benigno said.

ACORN, which stands for the Association of Community Organizations for Reform Now, is a grassroots social justice organization that works on behalf of issues such as affordable housing, immigration reform and voter registration.

The group received funding for the building, which sits on the edge of the 1st Ward, through the New Jersey Housing and Mortgage Finance Agency’s low-income tax credit program and $2.3 million in grants for energy efficient construction.

With a median family income of $38,225 — about half the median family income for New Jersey — and a 92 percent occupancy rate for rental units, according to the U.S. Census Bureau’s 2007 estimates, officials from ACORN thought Paterson was the best place to start building in New Jersey.

"They’re really happy with this place," said Myriam Hernandez, an organizer with New Jersey ACORN, about the residents. "They’re really concerned with housing."

Asked if there was a comparable building in Paterson that offers those amenities and construction, Councilman at Large Ken Morris Jr. said: "Yeah, market-rate housing."

"I think they’re going to set a new benchmark for the type of affordable units we’d like to see in the city," said Morris, who is chairman of the council’s Community Development Committee.

The group is still accepting applications. For more information, call 718-246-8080 or e-mail Benigno at tabenigo@gmail.com.

Reach Alexander MacInnes at 973-569-7166 or macinnes@northjersey.com.

PATERSON — The elderly woman on Straight Street did not have time to talk in the Monday morning cold, but she wanted information from a stranger about finding a new home.

Myriam Hernandez, left, and Tara Benigno lead a tour of renovated apartments at 114 Straight St. in Paterson. The living spaces are part of an affordable housing project by New Jersey ACORN Housing Corp.

"I need a place," she said, after asking about the new building just half a block away.

That building is the 40-unit affordable housing project built by the New Jersey ACORN Housing Corp., a nonprofit that chose Paterson to construct its first housing development. The converted paper mill on Straight Street will officially open in February, but the group is now taking applications for what appears to be highly coveted housing in the city’s downtown area.

So far, for each apartment, the group has received 10 applicants — all seeking units that feature 11-foot ceilings, new kitchens, hardwood floors, video security and huge windows that offer sweeping views of Paterson. The demand for these units, which also feature energy-efficient technologies and off-street parking, is even more intense, considering the rents — $720 for a one-bedroom, $850 for a two-bedroom and $960 for a three-bedroom.

"They’re paying double these (rents) for apartments that are in shambles," said Tara Benigno, manager of the building at 114 Straight St.

The $16 million project targets low-income residents, families that make between $24,685 and $50,750, according to information from ACORN. Many of those who have applied are either on public assistance, homeless or living in apartments that are deteriorating.

"They don’t have places to live and if they do, the apartments are very small and the rents are very high," Benigno said.

ACORN, which stands for the Association of Community Organizations for Reform Now, is a grassroots social justice organization that works on behalf of issues such as affordable housing, immigration reform and voter registration.

The group received funding for the building, which sits on the edge of the 1st Ward, through the New Jersey Housing and Mortgage Finance Agency’s low-income tax credit program and $2.3 million in grants for energy efficient construction.

With a median family income of $38,225 — about half the median family income for New Jersey — and a 92 percent occupancy rate for rental units, according to the U.S. Census Bureau’s 2007 estimates, officials from ACORN thought Paterson was the best place to start building in New Jersey.

"They’re really happy with this place," said Myriam Hernandez, an organizer with New Jersey ACORN, about the residents. "They’re really concerned with housing."

Asked if there was a comparable building in Paterson that offers those amenities and construction, Councilman at Large Ken Morris Jr. said: "Yeah, market-rate housing."

"I think they’re going to set a new benchmark for the type of affordable units we’d like to see in the city," said Morris, who is chairman of the council’s Community Development Committee.

Myriam Hernandez, left, and Tara Benigno lead a tour of renovated apartments at 114 Straight St. in Paterson. The living spaces are part of an affordable housing project by New Jersey ACORN Housing Corp.
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