A decision by a Texas appellate court last week breathed new life into litigation against a public adjuster that is accused of conspiring with a roofing contractor and attorneys to scam homeowners by charging exorbitant and unnecessary fees.
The 5th District Court of Appeals in Dallas ruled that plaintiffs can move forward with their suit against National Claims Negotiators without waiting for arbitration against the attorneys who allegedly participated in the scheme to be resolved.
The 5th District agreed with the trial court that the attorneys were accused of a separate set of misdeeds. “Issues that are not the subject of arbitration need not be stayed until the arbitration is concluded,” the appellate panel said.
Mark Ticer, an attorney for the homeowners, said the lawsuit filed in 2016 has effectively been on hold since the trial court ruled that two of the plaintiffs — Juan Guerra and Juan Deltoro — would have to arbitrate their complaints against the attorneys they hired to pursue their insurance claims.
Ticer said the appellate court ruling will allow him to finally pursue certification of a class of plaintiffs to pursue separate litigation against National Claims Negotiators. He said it doesn’t matter that the attorneys involved in the scheme may have the deepest pockets.
“There’s a bigger issue here about ripping people off,” Ticer said. “We are going to get money in the end from somebody, somehow.”
National Claims Negotiators, based in Mansfield, Texas, says on its website that it has licenses throughout the United States. “We receive a small percentage of what we recover for you once the claim is settled. If we do not recover anything further for you, we have no fee!,” the company says.
The lawsuit filed by Ticer says that homeowners got roped into a scheme when representatives for House of Tomorrow — formerly known as Lambcorp — knocked on doors and told homeowners that they repair their roof and take care of all of work involved in filing an insurance claim.
The roofing company brought in NCN, which promised to file the claim for 10% of the amount recovered. When the insurer denied the claim, NCN referred the homeowners to an attorney to file a lawsuit on the homeowner’s behalf. The attorneys insisted that the homeowners sign agreements that allowed them to deduct a 30 percent contingency fee and a 10 percent fee for NCN’s estimating services, as well as paying the roofing company.
Guerra said he never got a new roof after he handed over an initial insurance payment to Lambcorp and hired the San Antonio law firm of Speights and Worrich to pursue additional payments from his insurer.
Steven Badger, an insurance defense attorney and partner with the Zelle law firm in Dallas, said schemes as described in Ticer’s lawsuit are common in Texas, which does not regulate roofing contractors.
“After every spring hail storm, Texas has to deal with the ‘two Chucks in a truck’ contractors who show up and knock on doors trying to get jobs,” he said in an email.
“Some are reputable and do a great job. Unfortunately, others are crooks, who either do substandard work or simply collect initial insurance checks and disappear. It happens after every storm. And these homeowners have nowhere to turn for help.”
Badger said he represented more than 100 minority and elderly homeowners who were victims of a scheme to steal $500,000 in insurance proceeds.
“We were able to get a judgment against the roofing contractor, but not surprisingly the contractor is out of business and has no assets,” he said. “These poor people will never see a dime of their money.”
Ticer said such schemes persuaded state lawmakers to pass the “Blue Tarp Law” in 2017. That bill reduced the interest rate that insurers have to pay when they are found to have wrongfully denied a claim to 10 percent from 18 percent.
Ticer said he will continue to pursue a lawsuit against the attorneys who he accuses of colluding with National Claims Negotiators and House of Tomorrow.
About the photo: Contractors working for the Corps of Engineers and the Federal Management Agency installing temporary plastic “blue roofs” on housing damaged by Hurricane Ike. The repairs prevent further loss to homeowners untill permanent repairs can be made. Leif Skoogfors/FEMA
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