“To me, this was always much more than just a business issue. This was a personal issue to me. Getting the law straight was really one of the critical parts of my recovery and I’m relieved that has now happened.
“The overwhelming feeling I have right now is relief that our children and grandchildren, and everybody else who had to suffer like we’ve all suffered since Hurricane Katrina, will not be stuck with the harsh law, the incorrect law that was previously created and has now been corrected by our Mississippi Supreme Court.”
Chip Merlin has written a series of 3 posts on Corban which address all the fine points of the decision. This is from Part 2:
This ruling confirms State Farm’s Wind/Water Protocol is the wrong test under Mississippi law because it improperly shifted the burden upon the policyholder to prove that the wind caused the damage rather than the insurer having to prove that the damage was excluded. Corban undermines the Fifth Circuit reversal of Judge Senter in Broussard vs. State Farm and as I suggested in Broussard’s Bad Faith Decision Impaired by the Mississippi Supreme Court.
There is one important mistake the Court did make in its decision when it held:
With respect to the “named perils” coverage of “Coverage C – Personal Property,” the Corbans are required to prove, by a preponderance of the evidence, that the “direct physical loss” to the property described in Coverage C was caused by wind.
There is no named peril of “wind.” Policies have always required the policyholder to prove damage by the named peril of “windstorm.” In insurance lore and law, there is a big distinction. The most significant for Katrina victims is that a hurricane is a “windstorm.” The policyholder can easily prove that.
The AP story on Corban is carried by the Clarion Ledger and Mobile Press-Register. WLOX’s report is here and was the first to include reaction from PR at USAA, which predictably tries to spin things a different way. (Aye aye Admiral)
A question that comes to my mind is whether Leonard has continued applicability in Louisiana and Texas? The decision certainly ranks as one of Edith Jones’ worst in terms of plain ignorance of established legal principal. Thanks to Corban, the problems with Leonard are fixed in Mississippi.