Mold causes a difference of opinion between old friends

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Monday, June 25, 2001

Mold causes a difference of opinion between old friends

Chesney and Hunter will face each other in court if mold suits go to trial

By Elder

Caller-Times

Gongora/Caller-Times

Todd Hunter (left) and Brent Chesney are on opposing sides of the mold

issue. Hunter is a lawyer representing insurance companies and Chesney, also

a lawyer, will represent the families affected by the fungus.

Brent Chesney and Todd Hunter go way back. But a fungus may be coming

between them.

Chesney, a city councilman, ran Hunter's 1988 legislative campaign, and

later became his chief of staff.

When Hunter retired from his seat in the state House of Representatives

in 1996 to become a lobbyist, Chesney spent some years working at his

friend's law firm, helping him lobby for insurance companies. In 1999,

Chesney left Hunter's law firm when he first ran for City Council.

Now the two are on opposite sides of a mold mess that has spread all over

Corpus Christi.

" I never thought I would be going up against him, " Chesney said.

Also a local attorney, Chesney represents clients with mold infested

homes. Some of his clients plan to file lawsuits against insurers who have

been slow to pay for their mold cleanup bills.

Local attorneys and realtors estimate hundreds of local families have

been forced out of their homes because of mold. Some molds, which hide under

floorboards and behind walls, are considered a health hazard.

Hunter's law firm, Hunter & Handel, represents insurance companies. Both

attorneys are digging in for a big fight.

Insurance companies have filed a request with the Texas Department of

Insurance to have mold coverage removed from homeowner policies. Insurance

companies contend that the premiums Texas homeowners pay on their policies

don't cover the cost of mold removal. The department has yet to approve that

request and is holding hearings on the matter. If insurance companies are

successful in getting mold excluded from coverage, it won't affect existing

claims.

Hunter isn't so sure insurance companies are responsible for all mold

problems.

" We need to get a clarification, " Hunter said. " If there is mold, who

should pay for it? Is it the insurance companies who are at fault, builders,

materials, or is it anybody's fault? "

Texas homeowner policies currently include coverage for a loss caused by

mold or other fungi if the loss is the direct result of a covered peril,

such as a burst pipe. But the fight begins when homeowners have failed to

repair equipment that could cause a leak.

Insurance companies estimate the cost for mold investigations can go as

high as $10,000 and removal can cost another $30,000.

" It's not like checking a car fender, " Hunter said. " You're dealing with

certified industrial hygienists, remediation experts, possibly doctors. The

cost to inspect and investigate is more expensive than companies charge for

the insurance policies and it's not good business to be in a losing

position. "

Hunter isn't disputing that insurance companies should pay for mold

cleanup if it's covered in an existing policy.

But insurance companies are showing some reluctance to pay out expensive

mold claims, Chesney said. While insurance companies are footing the

relocation bill for some of Chesney's clients who have left their homes,

they haven't been swift in cleaning up his clients' properties, he said. His

clients don't want to live in hotels and rental properties, he said.

While he said he hopes to mediate problems before they land in the

courtroom, insurers might not leave him and other attorneys a choice.

And juries sympathize with so-called mold refugees, he said.

" It is a very emotional issue, " Chesney said. " Some people say, 'They're

living in hotels, how much are they really suffering?' If you talk to the

families, they break your heart. They don't want to live in hotels. They

just want to get back into the house. This is a very emotional issue for

jurors because it is a terrible thing to get kicked out of your homes. "

Hunter was co-counsel for Farmers Insurance Group this month when a jury

in state court in Austin awarded a family $32.1 million in a case involving

allegedly extensive mold damage in their Dripping Springs house. The jury

ruled that Farmers Insurance Group had failed to properly address the

family's claim, among other things.

Farmers Insurance officials, in a written statement, said the fight may

not be over.

" We heard the jury's verdict. That verdict, in effect, answers to a

series of questions based on the evidence the jury was permitted to see. It

is now up to the court to enter a judgment in this case. Once that is done,

we will review that judgment and if an appeal is necessary we are confident

we will prevail. "

The expenses to clean up mold are higher than the premiums paid by

policyholders, Hunter said. The public also needs to be educated about mold.

Not all mold is toxic, he said and the sight of mold should not cause

homeowners to panic.

" There needs to be a clarified understanding of mold and what is bad and

what is not bad, " said Hunter, who has spoken at seminars where all sides of

the mold melee are represented.

" If everybody is represented in the matter, then a good public policy can

be formed, " Hunter said.

While Chesney and Hunter go way back, neither plans to go easy on each

other in the courtroom.

" They are a hard-nosed law firm that cuts me no slack, personal

relationship or not, and vice versa, " Chesney said.

Hunter said mold won't damage his friendship with Chesney.

" We can be friends outside the courtroom but fight for our clients inside

the courtroom, " he said.

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