The city of Hollister is embroiled in a legal battle to get
insurance money for a building at the Hollister Airport that burned
down almost two years ago.
Hollister – The city of Hollister is embroiled in a legal battle to get insurance money for a building at the Hollister Airport that burned down almost two years ago.
City Manager Clint Quilter said the Monterey Insurance Company has not paid for the rebuilding of Building 25 that burned down in November of 2002. There is no dollar amount attached to the suit, which is taking pace this week in the Monterey County Superior Court, he said.
“It’s a suit to make them perform under the policy,” Quilter said.
Instead of paying for the complete rebuilding of the building, which is what the city claims the policy requires the company to do, the insurance company only offered to pay for the demolition and clean up costs, said City Councilman Tony LoBue.
The attorney for the Monterey Insurance Company, Irene Yesowitch, did not return phone calls to her office Wednesday.
Building 25 was a 60-year-old building that was used as a storage facility and meeting place for several organizations and businesses. It burned down accidentally from an overheated light bulb hanging over combustible material, fire officials have said.
Several months after the fire, the city demolished the building because the fire destroyed everything. In early 2003, the city began haggling with the insurance company over how much it would cover, LoBue said.
LoBue said the company’s insurance brokers believed the building was fated for destruction anyway, which is why it declined to cover everything the city wanted it to.
“Somebody at the staff level decided the building wasn’t worth anything and we were going to demolish it anyway, so there was no reason for them to pay replacement costs,” he said.
Only the city council can decide whether to demolish a city building, and although it was old and probably would have been demolished sometime in the future, the council had not made any decisions to tear down the building before the fire, LoBue said.
“The city council never once voted or discussed the demolition of that building,” he said. “They should be paying the bill.”
After almost two years of haggling with the company over the bill, the city finally decided several months ago to take the company to court, according to Geri Johnson, deputy city clerk.
City Attorney Elaine Cass, who has been trying to negotiate with the company, was unavailable for comment.
If a judge decides the company must pay the city, Councilman Robert Scattini said the money will be used to rebuild the building so it can be rented to businesses, which would generate money for the city.
“We’ve been paying insurance on that building for God knows how long. We should get something out of it,” Scattini said. “We expect to get a reasonable amount. That’s what you pay insurance for.”
The judge should render a decision by Friday or early next week, and much of what the council decides to do about rebuilding the structure will be determined by the outcome of the case, said Mayor Tony Bruscia.
“The building was very old, and there’s a big difference between what the building was worth and what would replace what’s there,” he said. “That’s important to distinguish.”
Erin Musgrave covers public safety for the Free Lance. Reach her at 637-5566, ext. 336 or [email protected]
