An insurance company alleges the owners of the former Boardwalk Apartments committed fraud in claims they submitted after a deadly 2005 fire destroyed one building at the west Lawrence complex.
The allegations from State Auto Property and Casualty Insurance Company of Ohio come as part of a lawsuit the Boardwalk owners filed in January claiming State Auto should have paid an additional $1 million in claims to cover business income losses due to the fire.
But attorneys for State Auto allege Boardwalk owners “purposefully delayed” rebuilding the burned building.
“Specifically, State Auto alleges Boardwalk razed its entire apartment complex, including buildings unaffected by the fire, and constructed a new and different apartment complex,” Robert Cockerham, a State Auto attorney wrote in a motion. “While Boardwalk is free to do with its apartment complex what it wants, it is fraud for Boardwalk to claim losses connected with its business decision to build an entirely new apartment complex as losses connected with the fire damage to (one building).”
A new complex, Tuckaway Apartments at Frontier, in 2010 and 2011 replaced the former Boardwalk complex, which is north of Sixth Street and Lawrence Avenue.
Three Boardwalk residents, Nichole Bingham, Yolanda Riddle and Jose Gonzalez, died in the Oct. 7, 2005, early morning fire, and a jury later convicted another resident, Jason Allen Rose, who is now 26, of aggravated arson, three counts of involuntary manslaughter and other charges. Rose is serving a 10-year sentence in prison.
Boardwalk’s attorneys have said State Auto’s fraud claims are baseless, as attorney Stacey M. Bowman argued in a motion earlier this month that Boardwalk’s owners rebuilt the building destroyed in the fire within a time frame the parties agreed upon.
“Boardwalk alleged that it timely notified State Auto of its election to rebuild and that State Auto led Boardwalk to believe it was evaluating the business income and replacement cost claims by asking Boardwalk to provide information and documents related to the claims,” Bowman wrote.
U.S. District Judge Julie Robinson is handling the lawsuit. A trial is currently scheduled for August 2013.