Latest Round in WTC Claims Dispute

Both sides fired off some heavy salvoes in the ongoing dispute over the amount of the recovery to be paid for the destroyed WTC towers.

Lawyers for Silverstein Properties, the master leaseholder, filed a motion for summary judgment before U.S. District Judge John S. Martin in Manhattan federal court, asserting their view that two incidents occurred, and therefore they are entitled to recover for the loss of both towers.

The court also heard arguments from the other side led by Harvey Kurzweil, representing Traveler Indemnity, that urged it to find there was only one occurrence not two. Kurzweil argued that, had the 1993 attack on the WTC succeeded, it would have been one occurrence, and the fact that this time terrorists used two airplanes to accomplish the same task did not alter the fact that only one attack occurred.

“Insurance coverage should not depend on precise tools that terrorists use,” Kurzweil told the court according to Dow Jones Newswire. Silverstein’s lawyer, Herbert Wachtell, however, asserted that the attack by the second plane had caused far greater damage than would have been the case if only one attack had occurred.

Ironically, at least as far as Kurzweil is concerned, one of the major questions the court is now faced with is which binding form the parties used to agree to cover the WTC, as formal policies were still being written when the attacks took place. (See IJ Website “International,” May 13). Silverstein’s lawyers have asserted that a form prepared by Travelers was used, which apparently supports a broader interpretation of the term “occurrence” than the “WilProp” form, prepared by Willis, which Swiss Re’s lawyers have asserted was used.

Judge Martin made no ruling on the Silverstein motion for summary judgment, and likewise postponed ruling on Swiss Re’s motion to sever any connection between Willis and Silverstein on the grounds that the broker is being pressured to support the Silverstein version of event ( See IJ Website “International” May 9). He scheduled the next court date for May 30, and also indicated he would consider the request of several insurers to extend the discovery phase of the case, which is now set for trial in September. If he grants the request, the trial would not start until early 2003.

Topics Claims