The Hagerstown company acted in bad
faith and without legal justification in suing the Earl S.
Bell family of Sixes Bridge Road, according to Circuit Court
Judge Mary Ann Stepler.
In a 29-page opinion issued last week,
Judge Stepler said the insurance company harassed and
attempted to intimidate the family while delaying and
obstructing their legitimate casualty claims.
The dispute began Feb. 4, 1998. when a
wind storm damaged Mr. Bell's barn so badly that it had to be
rebuilt, according to court documents. Within two months, Mr.
Bell submitted a loss claim of $119,795.
Mr. Bell said that under Frederick
County regulations a building would be required for
rebuilding. That would substantially increase costs because
the county requires footings under all load-bearing walls.
Breatherís adjuster, Jim Hardy,
appraised the loss at $30,240. A building permit was not
included. The Bells' appraiser, Allan H. White, set repair
cost at $119,795. Brethren obtained an outside appraiser, P H.
Drayer Co., which determined loss at $69,240 without a
Meanwhile, Mr. Bell obtained a letter
from Tim Goodfellow, a county development review planner, Who
said that since the Bells were not involved in farming and no
agricultural activities occurred in the Barn - used mainly to
store cars - the rebuilt structure would be required to have
footings and reinforcements in the walls, as required b y
In response, Brethren rejected Mr.
Bell's proofs of loss and offered a final settlement of
$21,953. Mr. Bell filed a complaint with the Maryland
Insurance Administration. Shortly after the complaint was
filed, Brethren sent written notice to Bell that his claims
were rejected and both his insurance policies were canceled.
Brethren said Bell had made "material
misrepresentations" to Brethren.
Both Judge Stepler and the Maryland
Court of Special Appeals determined -that Mr. Bell had not
made any statement that constituted a misrepresentation
actionable in a court of law.
Mr. Bell then requested an
"extraordinary remedy," the awarding of attorney's
fees, because Brethren acted in unjustified or bad faith.
Judge Stepler said Brethrenís lawsuit was based on the
premise that no building permit was needed. In fact, both of
the insurance company's appraisers ignored the need for a
permit. Judge Stepler said it was significant that the second
insurance appraiser's figure "was more than twice the
original estimate calculated by their own adjuster."
Judge Stepler also found it
significant that Brethrenís final offer, $21,953, was $8,287
less than Mr. Hardy's "original low ball estimate and
$47,287 less than Drayer's external estimate. Brethren
submitted to Bell no basis for this. stark deviation."
The next significant issue uncovered
by Judge Stepler dealt with Mr. Bell's complaint to the
Maryland Insurance Administration. Within two weeks of being
notified MIA was investigating, Brethren filed a declaratory
judgment action which 'Judge Stepler said, "suspended any
further investigation by MIA into Brethrenís questionable
Judge Stepler said the MIA can- not
intervene in declaratory judgment cases.
"This court," she wrote,
"is under no illusion that Brethren knew exactly what
impact filing a declaratory judgment in the circuit court
would have on MIA's pending investigation. There is little
doubt that this move by Brethren was in bad faith.
"It was a strategic move done for
the improper reason of avoiding and or delaying further
investigation by the MIA and delaying any payment to Bell for
Judge Stepler dismissed Brethrenís
complaint about the need for a permit by saying, "It is a
well-established legal principle that the circuit court is not
a proper forum for the interpretation or determination of
She also dismissed Brethrenís second
amended complaint, which alleged material misrepresentations
but offered no evidence supporting those claims.
Judge Stepler said there was 41
significant evidence in support of the fact that Brethren
filed its second amended complaint without substantial
"The court notes that fraud and
misrepresentation are intentional torts. We are under no
illusion that Brethren was aware of Bell's position
(Lieutenant Colonel, U.S. Air Force) as well as the possible
implications bringing such an action would bring to a man in
Mr. Bell's attorney, Owen D. Keegan of
Arlington, Va., said the allegations of wrongdoing made
against Lt. Col. Bell created problems within the service due
to the nature of the officer's Work
Judge Stepler said, "Brethren's
actions do merit the assessment of both costs and attorney's
fees. The court does find that the fees requested are fair and
Attempts to reach Brethren attorney
Jeffrey Wothers Were unsuccessful.