Judge Senter completes his appraisal – Order says Nationwide on wrong side with objection to Lewis O’Leary

Lewis O’Leary is known to SLABBED readers as the  Plaintiff’s appraiser in Kuehn v State Farm.  Consequently, we took note of Nationwide’s objection to O’Leary as the appraiser in a commercial property case and have been following  Sunquest Properties v Nationwide for some time.

Unlike State Farm’s “experts” in Bossier, Mr. O’Leary is qualified to offer testimony under related Mississippi law. Nonetheless, Nationwide wanted to get in the on the act and the “bright lights” of Nationwide legal filed a Motion to Strike Lewis O’Leary as Plaintiffs’ “Competent and Impartial” Appraiser.

… ample evidence of Mr. O’Leary’s partiality renders him unqualified to serve as a “competent and impartial appraiser,” as required by the appraisal clause in Plaintiffs’ policy. Simply put, a person who has been paid to work for several years on the development of a claim and continues to be paid to support that claim, is not sufficiently “impartial” to pass judgment of any kind upon that claim. Yet this is precisely what Plaintiffs suggest in nominating Mr. O’Leary as their purportedly “impartial” appraiser.

Judge Senter ruled on the Motion last week and Nationwide came out on the wrong side:

Nationwide’s objection to O’Leary’s participation in the appraisal is not based on any allegation of incompetency…

…Nationwide’s challenge to O’Leary’s participation in the appraisal is based upon O’Leary’s having already formed opinions concerning the part of the damage done by wind. Nationwide has not demonstrated how this could affect the opinion O’Leary will form of the total damages from all causes (covered causes and excluded causes). Nor
has Nationwide offered any justification for O’Leary’s exclusion based upon his having a pecuniary interest in the outcome of the appraisal.

Although experts in many fields are engaged to give testimony in litigated matters and experts who become witnesses go to great pains to appear impartial and objective, they are employed to highlight the aspects of the evidence favorable to the party who hires them and to explain how the established facts fit within their employer’s theory of the case. Experts are expected to testify on behalf of their employer to establish the most favorable facts and theories the truth will allow. So are appraisers. As a practical matter, it is nearly impossible for any expert witness or appraiser engaged in a litigated matter to be completely unaffected by his having accepted employment by one side or the other…

There is no evidence in the record to support a finding that O’Leary has any pecuniary interest in the outcome of the appraisal. His having accepted employment as an expert prior to the appraisal, in and of itself, demonstrates no impartiality greater than that which necessarily flows from his having accepted employment by one of the parties to a litigated matter. O’Leary’s prior employment as an expert on the issue of covered damages is insufficient, in my view, to prohibit the plaintiffs from selecting him as their representative in the appraisal of all storm damage to the covered property.

Nationwide’s motion to exclude O’Leary from participation in the appraisal will therefore be denied. An appropriate order will be entered.Finally, in order for the record to be complete, Plaintiffs will be given leave to file the affidavit of Lewis O’Leary.

Interestingly, in his affidavit, O’Leary points out he has been involved in two Nationwide claims on damage from Hurricane Ike without objection from the Company.  Katrina must be really special – wonder why!

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