Warning - Mold Claims Spread To Cars

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Warning - Mold Claims Spread To Cars

By Hays

National Underwriter Online News Service, May 3, 12:23 p.m. EST

The case of a man who says he suffered debilitating illness caused by a

leaky utility vehicle demonstrates that insurers' exposure to mold damage

claims extends beyond homeowners coverage, an insurers trade group is

cautioning.

" Mold claims may arise from any property that can support mold, especially

property that is subject to water damage, " a bulletin from the Alliance of

American Insurers warned.

In the reported case the claimant is suing an auto dealer and vehicle

manufacturer.

The Alliance advisory comes as insurers throughout the nation are seeking to

limit their exposure after seeing a surge of mold-related illness claims

related to water-damaged homes--primarily in Texas and California.

In the auto case referred to by the Alliance, Greene v. General Motors

Corporation, Watauga County Superior Court in North Carolina was the venue.

According to the Alliance, the complaint filed in March by Everett

Greene and wife Amy V. Greene alleged that they bought a 1999 Cadillac

Escalade in 2000 and shortly after buying it they noticed a foul odor in the

car and discovered moisture in the carpets. The Escalade was returned to the

dealership, Mack Brown Inc., several times and the dealership attempted to

repair water leaks over the next year, without success.

The Greenes also alleged that soon after purchasing the Escalade, Mr. Greene

began suffering a number of health problems, including fatigue, migraine

headaches lasting 12-15 hours, ear aches, loss of ability to taste, body

tremors, dizziness, loss of memory, confusion, irregular urination, sinus

problems, and respiratory problems.

General Motors said the suit was filed after they asked to inspect the

vehicle and get medical details.

After being examined by a specialist, it was determined that mold and yeast

were growing in Mr. Greene's sinuses. Testing of the Greene's home, tour

bus, church, and the Escalade revealed that mold was growing only in the

Escalade. Mr. Greene underwent multiple surgical procedures in an effort to

rid himself of the mold growing in his sinuses and remains under his

doctor's care.

In their action, the Greenes accused GMC and Mack Brown of unfair or

deceptive trade practices, breach of contract, negligence, fraud and

infliction of emotional distress.

GMC was sued also for breach of warranty and punitive damages. It was

alleged that the manufacturer concealed design defects that cause water

intrusion problems with this model of the Escalade.

A total compensatory damage figure was not specified, but $200,000 in

medical expenses were claimed. The suit alleged that Mr. Greene is totally

disabled and Ms. Greene suffered loss of consortium.

" While allegations made in a complaint only give one side of the case, this

is a reminder that mold claims are not restricted to structures on real

property, " the Alliance said.

Gentry at Mack Brown said he had no contact information, but that the

legal issues are being handled by lawyers provided Century Insurance.

Jay Cooney, director of legal communications at General Motors Corporation

released a statement that:

" Contrary to the assertions of Mr. Greene's lawyers, there is not a

widespread problem with this vehicle. Of the more than 87,000 Cadillac

Escalades sold since October 1998, GM is not aware of any other lawsuit like

this one involving the Escalade.

" We understand that Mr. Greene's attorneys are suggesting that the mere

existence of a Technical Service Bulletin from GM indicates that a problem

exists. This bulletin was issued to provide information that could assist

dealers in the proper service of a vehicle if a customer commented on water

entering the rear-compartment area of the vehicle. All the bulletin proves

is that GM cares about the service its customers receive by providing

helpful information to our dealers.

" We also understand that Mr. Greene is claiming that he suffered health

problems due to exposure to mold. When lawyers contacted us before the

lawsuit was filed, we requested information regarding his claim.

GM specifically asked for the opportunity to inspect Mr. Greene's Escalade

and for medical information related to his alleged health problems. Mr.

Greene's lawyers answered these reasonable requests by filing a lawsuit and

publishing an inflammatory press release. "