A number of homeowners with damaged property from the Murdock Canal break have decided to file lawsuits after hearing that they will be compensated for only half of the damage caused by the May 22 flood.
Suits will be filed against Admiral Insurance Co., the insurance company for the owner and operator of the canal; the Bureau of Reclamation; the Provo River Water Users Association; and individual members of the canal board.The water users association owns and operates the canal under a contract with the Bureau of Reclamation.
Mayor Kenneth McMillan estimated that the flood caused almost $800,000 in damage - $500,000 to private property and $300,000 to public property.
The homeowners group met Saturday for the last time to discuss options.
"As a group we've done as much as we can," said Jim Dain. "Now it's up to each one of us to decide what we want to do - if we want to take what they offer, continue to negotiate on our own or get our own attorney."
Admiral Insurance has offered a 50 percent settlement, and the Provo River Water Users Association has said it will not interfere in the claims settlement process.
Homeowners hoped the water users association would make up for what the insurance company didn't pay, but in a letter sent to the homeowners group last week the association said it will take no action because the settlement had been referred to the insurance company for final resolution.
The homeowners sent a letter to the insurance company last week asking for a settlement of 90 percent of the actual depreciated losses.
The insurance company made the 50 percent offer because it claims not to be liable for the flood, because the canal did not break from neglect.
An engineering report for the city says the canal bank broke because of animal burrows and an unusual high flow of water.
About 15 of the 35 homeowners announced Saturday that they will
file lawsuits. The rest haven't decided whether to sue or settle.
Randy Childs, a city councilman and a damaged-home owner, said the city will sue if the insurance company and water users association do not come up with a good offer.
"Litigation is a no-win alternative for everyone," said Teresa Griffin, owner of a damaged home. "I'm having a hard time because my character says not to sue. We are all law-abiding citizens who don't go out and sue people."
Childs said: "Even if we settle, it doesn't mean the crusade is over."
But Griffin said many homeowners with big losses have no choice but to sue. Homeowners insurance doesn't cover flood damage unless the insured lives on a flood plain. Lindon may have looked like a flood plain in May, but in reality it is not.
Homeowners like Charlie Boyer, who lost a $180,000 home because of structural damage, say there is no way they can accept a 50 percent settlement.
"I can't afford to pay for that damage. I'd rather subsidize an attorney," he said.
Boyer, a retired electrician, just finished remodeling his home in December.
With the 50 percent settlement offer, homeowner Neb Miller said he believes the insurance company is only trying to break the group down. He said his damage was minimal and he probably could settle with the insurance company but, "it's more the principal to me. They act like we have no intelligence at all. We just want to be treated fairly."
Miller said that when the canal broke May 22, Ken Gillman, president of the Provo River Water Users Association, told the news media that the homeowners would be treated fairly and had no worries because they would be compensated for the damages.
"It's their water, their ditch and their rodents, why should we have to pay?" Miller said.