Executive Summary 08/28/2018
EXECUTIVE SUMMARY
Recommendation to authorize legal action, up to and including the filing of suit against the
County's property insurance carriers and insurance broker, to pursue partial reimbursement of
the costs incurred for the debris removal from roadways and medians,due to Hurricane Irma.
OBJECTIVE: To initiate legal action, up to and including the filing of suit against the County's
property insurance carriers and insurance broker, to recover partial costs incurred for the debris removal
from roadways and medians due to Hurricane Irma, under the County's property insurance policy.
CONSIDERATIONS: On September 10, 2017, Collier County was hit by Category 4 Hurricane Irma.
The hurricane caused destruction to public infrastructure and left significant debris on County roadways
and medians. To ensure safe passage and the normalization of operations, the County utilized debris
removal companies to clear the roadways and medians throughout the County. The Risk Management
Department submitted a claim to the County's property insurers requesting partial reimbursement for the
removal costs incurred. The insurers responded that the costs were not reimbursable under the policy
because roadways and medians were not"insurable locations,"as set forth in the schedule of values in the
policy. There is however language within the policy that supports an interpretation that roadways are
insurable locations and therefore the costs should be reimbursed. As ambiguities exist within the policy,
and under Florida law ambiguities are normally interpreted in favor of the insured and against the insurer,
it is in the County's best interest to pursue legal action to seek recovery. In addition, it was represented to
County staff,through the insurance broker, who assisted in the policy selection for the County,that debris
removal coverage for roadways was provided for under the subject policy and a reimbursable cost.
The insurance carriers that would be named in the legal action are:
• Underwriters at Lloyds-Policy N17NA05930
• Underwriters at Lloyds-Policy N 17NA05910
• Landmark American Insurance Company-Policy LHT399859
• Westchester Surplus Lines Insurance Company-Policy D37353607 010
• Arch Specialty Insurance Company- Policy ESP 0049087-05
• Underwriters at Lloyds-Policy N17NA05920
The insurance broker is Insurance and Risk Management Services,Inc.
The County would utilize the services of Attorney Gregory Woods in any legal action, pursuant to the
terms of the current retainer agreement with Mr. Woods.
Approval of the following documents by the County Manager is subject to formal ratification by the
Board of County Commissioners. If the decision by the County Manager is not ratified by that Board,the
document(s) shall be enforceable against Collier County only to the extent authorized by law in the
absence of such ratification by that Board.
FISCAL IMPACT: The retention agreement with Attorney Greg Woods is attached as back-up. The
estimated legal expense is estimated in the range from $20,000 to $35,000, if the parties primarily rely on
legal construction of the Policy Terms. If, however, the Defendants are concerned about the potential
precedential effect of an adverse decision in this matter and engage in aggressive evidentiary discovery,
including numerous depositions,the expected range may increase to $80,000 to $110,000, or higher. The
potential recovery, should the County receive a favorable ruling for reimbursement for the debris
removal,would be up to$10,000,000.00.
08/28/2018
GROWTH MANAGEMENT IMPACT: There is no growth management impact associated with this
item.
LEGAL CONSIDERATIONS: This item is has been reviewed by the County Attorney, is approved as
to form and legality, and requires a majority vote for Board approval. -JAK
RECOMMENDATION: That the Board of County Commissioners authorize the initiation of legal
action against the County's Property Insurance carriers and broker, if needed, to pursue recovery of the
reimbursable portion of the County's costs incurred for Irma debris removal from County roadways and
medians.
PREPARED BY:
Jeff Walker,Director of Risk Management
Kevin L.Noell,Assistant County Attorney
Jeffrey A. Klatzkow, County Attorney
ATTACHMENT(S)
1.Retention Agreement (PDF)
08/28/2018
COLLIER COUNTY
Board of County Commissioners
Item Number: 16.K.1
Doc ID: 6554
Item Summary: Recommendation to authorize legal action, up to and including the filing of suit
against the County's property insurance carriers and insurance broker,to pursue partial reimbursement of
the costs incurred for the debris removal from roadways and medians, due to Hurricane Irma.
Meeting Date: 08/28/2018
Prepared by:
Title: Legal Assistant/Paralegal—County Attorney's Office
Name: Virginia Neet
08/28/2018 2:35 PM
Submitted by:
Title: County Attorney—County Attorney's Office
Name: Jeffrey A. Klatzkow
08/28/2018 2:35 PM
Approved By:
Review:
Office of Management and Budget Valerie Fleming Level 3 OMB Gatekeeper Review Completed 08/28/2018 2:50 PM
Budget and Management Office Mark Isackson Additional Reviewer Completed 08/28/2018 2:54 PM
County Attorneys Office Jeffrey A. Klatzkow Level 3 County Attorneys Office Review Completed 08/28/2018 3:10 PM
County Manager's Office Leo E.Ochs Level 4 County Manager Review Completed 08/28/2018 3:38 PM
Board of County Commissioners MaryJo Brock Meeting Pending 08/28/2018 9:00 AM