Judge rules against Lacka­wan­na County again in amphitheater insurance case

April 28--A judge rejected Lacka­wan­na County's latest bid to obtain almost $1.63 million in insurance money for the Pavilion at Montage Mountain roof collapse eight years ago.

Judge Carmen D. Minora, who originally ruled against the county in November, said he was right then to conclude:

--The county's insurance broker at the time, Joseph Durkin, had the authority to cancel the insurance policy more than two months before the roof collapsed on Feb. 14, 2007, and actually canceled the policy.

--The insurance company's failure to follow proper policy cancellation procedures did not matter.

County lawyers argued that Mr. Durkin lacked authority to cancel the policy and the insurance company did not cancel the policy properly.

The insurance company was the Housing and Redevelopment Insurance Exchange, run by insurance executive Chuck Volpe.

In the November ruling, Judge Minora concluded Mr. Durkin started the policy cancellation process on Dec. 1, 2006, because he and the county's insurance coordinator, Dominick Verrastro, wrongly believed the pavilion was sold as part of the county's sale of the Montage Ski Resort on Nov. 6, 2006.

The judge found then that Mr. Durkin told Mr. Verrastro to cancel the policy, which happened Jan. 15, 2007. On March 5, 2007, Mr. Durkin also refunded his $7,680.52 commission on the policy with the refund dating back to Dec. 1, 2006, the date that he returned the insurance policy to Housing and Redevelopment Insurance Exchange, a sure sign the cancellation process began then.

Housing and Redevelopment Insurance Exchange also refunded the county $56,336 in premiums using the Dec. 1 date.

The company issued a cancellation notice to the wrong entity, the Lackawanna County Montage Mountain Ski Area, which does not exist as a legal entity, and the wrong reason for cancellation, a sale of the amphitheater that did not happen, the judge said. Mr. Verrastro also used the wrong policy number in letters he wrote regarding the cancellation, but the judge ruled all those facts do not matter because the county, through Mr. Durkin, started the cancellation process Dec. 1.

In his latest ruling, the judge said the rulings in previous court cases cited by the county as precedents do not apply in this case. In one instance, the judge chastised county lawyers for citing a 1936 case that had an insurance company starting the policy cancellation process, unlike the county case.

"This 1936 case is clearly not applicable to the facts in our case and the citation of it as such is quite disturbing to this court and counsel's obligation of candor to the tribunal," Judge Minora said.

Attorney Don Frederickson, the county solicitor, said the commissioners remain undecided about whether to appeal the judge's ruling to Commonwealth Court.

The case actually became a bit of a political football in 2013, when Mr. Volpe successfully sought the creation of a commission to study replacing the county's three-commissioner government with an executive-council form. A lawyer for the commissioners accused Mr. Volpe of pursuing the government change to get the county to drop its lawsuit trying to obtain the $1.6 million in insurance money. Mr. Volpe denied the charge. His efforts to change the form of county government failed.

Contact the writer:

bkrawczeniuk

@timesshamrock.com

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