Insurance Company Won’t Pay San Bernardino County Settlement With Colonies Developer [Redlands Daily Facts, Calif.]


Insurance Company Won’t Pay San Bernardino County Settlement With Colonies Developer [Redlands Daily Facts, Calif.]

September 10—Two years later San Bernardino County settled with Rancho Cucamonga developer Jeff Burum and his Partner Colonies investor group, the county insurance company says it doesn’t want to pay for the multi-million settlement agreement.

The settlement “arose from the willful or intentional acts of the county, its district attorneys or investigators,” the 22-page complaint, filed on behalf of Ironshore Specialty Insurance Co.partly bed.

In a complaint filed August 29 in United States District Court, Ironshore asked a judge to declare that the company is not responsible for paying the $69 million settlement, reached in 2020 after Burum and others sued the county for malicious lawsuits related to a 2006 settlement following a dispute over flood control ponds in the Colonies development in Uplands.

In his complaint, Ironshore argues that the 2011 lawsuits were the result of a “conspiracy to retaliate against Colonies II claimants in a decades-long dispute over land and water rights in Highlands, Californiaculminating in a malicious pursuit of Burum” and others.

And that, according to Ironshoremeans that the company is not obligated to pay for the settlement.

San Bernardino Countyfor his part, does not give up without a fight.

“The county is aware of the lawsuit and intends to engage in a vigorous defense,” the county spokesperson said. David Wert wrote in an emailed statement.

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It’s the latest twist in a 20-year legal battle between the county and the Colonies developers:

* In 2002, Colonies Partners LLC sued the county after the county said it would direct runoff from the newly constructed Highway 210 extension into flood control ponds on Colonies properties. After years of legal battles, the county settled in 2006, agreeing to pay developers $102 million.

* In 2011, former Chairman of the Supervisory Board Bill Postmus pleaded guilty to 10 counts related to the settlement of the settlements and his subsequent tenure as county assessor, including conspiracy to accept a bribe, conflict of interest, embezzlement public and requesting and receiving bribes.

* In 2011, the District Attorney’s Office Charged Burum, former county supervisor Paul Bianeand Mark Kirkformer chief of staff of a former supervisor Gary Ovitas well as the former assistant evaluator Jim Erwinwith 29 charges related to the Settlement Colonies, including conspiracy, bribery, conflict of interest, embezzlement of public funds, forgery and perjury.

* In 2017, Burum, Biane and Kirk were acquitted of all charges. Prosecutors later dropped all charges against Erwin. Jurors described the trial as a “mess”.

* In 2020, Burum and his partners sued the county for malicious prosecution. Later that year, the county agreed to settle with them for $65 million. (The rest $4 million mentioned in the Ironshore costume was paid to Biane and Kirk.)

No matter what happens with his costume, Ironshore ain’t on the hook for the full $69 million regulation. County policy with the company is for the above payments $52.5 millionwhich means that the company would pay $16.5 million for settlement.

In his complaint, Ironshore notes that “the insurance does not apply to any ‘claim’ or ‘suit’ against (the county) for: Any liability arising out of criminal, fraudulent, dishonest or malicious acts or omissions committed by or at the direction of of the insured.”

Ironshore refers to the California Insurance Code, which states that insurers are “not liable for any loss caused by the willful act of the insured.” But Section 533, which the argument cites, also states that an insurer is “not exonerated by the negligence of the insured, or of the insured’s agents or others,” potentially putting the county in the position of arguing that the 2020 Settlements Settlement was due to negligence by the District Attorney’s Officenot “deliberate conduct”.

The policy also indicates that it will not cover lawsuit settlements to which Ironshore did not agree. According to the company’s complaint, the county did not seek or obtain written consent from Ironshore before accepting the settlement.

Burum declined to comment for this story. He and the other 2020 settlement plaintiffs have already been paid, according to Wert.

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