The Louisiana Supreme Court will hear arguments Feb. 26 to decide whether homeowner insurance policies cover water damage done to thousands of south Louisiana properties when the levees broke after Hurricane Katrina.
Joseph Sher, a 91-year-old Holocaust survivor and resident of New Orleans’ uptown area, sued Lafayette Insurance Co. after the insurer denied most of his claims by saying they were caused by “flood” and therefore not covered by his hazard policy.
Sher won a jury verdict in state Civil District Court in New Orleans that put the firm on the hook for the cost of repairs to his house.
Lafayette took the case to the state 4th Circuit Court of Appeal.
On the key question of whether the water from levee breaches constituted a “flood,” the 4th Circuit judges ruled 3-2 that the word “flood” in Sher’s policy was ambiguous. The panel majority said that when doubt about the meaning of a policy exists, the court must find against the issuer of the policy.
The company is now appealing to the state Supreme Court.
The state appeal court decision appears to conflict with a federal appeals court ruling in a different case. In August three Texas judges on the 5th U.S. Circuit Court of Appeals said flatly that a flood is a flood, regardless of what causes it. Manmade failure of the levees didn’t change the basic fact that a flood “is precisely what occurred in New Orleans in the aftermath of Hurricane Katrina, the 5th Circuit said in a decision now on appeal to the U.S. Supreme Court.
Lawyers for homeowners trying to win flood-damage compensation from their insurers say the 4th Circuit’s opinion on a question of state law supersedes the federal appeals court’s decision.
Others say it would take a ruling from the state Supreme Court to force the federal courts to reverse their interpretation of Louisiana law.
Information from: The Times-Picayune,
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