On June 18 a lawsuit was filed by Ascension Parish Government (APG) and Kenneth Matassa as plaintiffs seeking reimbursement of the latter’s legal fees incurred to defend a 2017 bribery indictment. Named defendants are the insurance company from which APG secured a policy and the agent who brokered the deal. Plaintiffs (the only reason for APG’s inclusion is so taxpayers can foot the bill) seek “$181,829.12, plus legal interest…(and) $363,658.24, as penalty for Berkley Insurance Company’s breach of its statutory duty of good faith and fair dealing.”
The initial amount represents Matassa’s criminal defense legal fees, less $50,000 representing the “retained limits deductible.” Thus, Matassa’s criminal fees and expenses totaled $231,829.12. Matassa was charged via Bill of Indictment along with Olin Berthelot in March 2017. He was acquitted after a two-day trial on July 10-11, 2018.
Coincidentally, the case was allotted to the same judge who presided over Matassa’s criminal trial which commenced one year ago tomorrow.
NOTE: The deductible is half that reported by Pelican Post in an earlier piece and a reduction from the deductible in earlier policies. We regret the error.
The amount generated at a recent high-end can shake has not been publicized…
Maybe some curious council member can ask for a total when Matassa’s new lawyers, Roedel Parsons, comes up for a $260,000 contract increase at tonight’s Finance Committee meeting. We digress.
The suit alleges a “Breach of Contract” by defendants with regard to two policies of insurance in effect, the first from March 1, 2017 though March 1, 2018, after which the second went into effect. Plaintiffs assert Matassa’s legal expenses are covered since “he was an elected official acting solely in the performance of his official duties as Parish President” during the July 27, 2016 meeting with a candidate for Gonzales City Council and phone calls over the next two days.
On March 10, 2017, Matassa was indicted on a charge of violating La R.S. 18:1461.5(4)(a) of the Louisiana Election Code (hereafter the ‘Indictment’). The Indictment arose out of Matassa’s performance of his official functions as Ascension Parish President; the investigation and subsequent criminal charges brought against Matassa resulted from a meeting Matassa had with a candidate for Gonzales City Council wherein Matassa allegedly offered employment with the Parish to the candidate in exchange for withdrawing his candidacy. Meeting with prospective officials of municipalities within Ascension Parish, including the City of Gonzales, is among the duties and responsibilities Matassa performs regularly as Parish President, as is assisting the Parish in filling employment vacancies with qualified Parish residents.”
The petition does not mention…
or any other candidate(s) for Gonzales City Council with whom Matassa met (other than the alleged bribery target).
A claim for “legal fees and expenses” was filed with defendant, Berkley Insurance Company, on October 16, 2018 according to the petition. On December 12, 2018 Berkley advised it was “denying the claim” because “the March 10, 2017 indictment constituted a ‘claim first made’ under the 2017 policy.’ According to Berkley the claim for payment of Matassa’s legal expenses was required to have been both made and reported during the 2017 Policy Period, i.e. between March 1, 2017 and March 1, 2018.”
The insurance policies include the following provision:
The insurer will indemnify the insured for damages the insured becomes legally obligated to pay and/or claim expenses in excess of the retained limit because of a claim first made against the insured and reported to the insurer during the policy period…for any wrongful act taking place on or subsequent to the retroactive date specified in the Declarations and prior to the end of the policy period.”
Was Matassa “legally obligated to pay” Lewis Unglesby $231,829?
Coverage does not apply to:
“Any claim alleging, based upon, arising out of or attributable to any dishonest, fraudulent, criminal or malicious act, error or omission, or any intentional or knowing violation of the law by an insured; however the insured shall be reimbursed for the reasonable claim expenses incurred in such claim if the insured is not found liable for such act, error, omission or violation.”
Confused? That’s because the coverage envisions a third-party claimant seeking damages from an insured, Matassa in this bizarre scenario, for injurious acts he committed to the harm of such a third-party.
The $362,658 claim asserted against Berkley hinges on the insurer’s alleged “failure to pay the amount due APG and Matassa within sixty (60) days after February 1, 2019 when Berkley received written proof of Matassa’s loss, was arbitrary, capricious, and without probable cause, and also a breach of Berkley’s (statutory) duty of good faith and fair dealing.” How is any amount due to Ascension Parish Government which was added as party plaintiff so that taxpayers would be on the hook for Matassa’s new attorneys?
On March 21 the Parish Council went into Executive Session to discuss doubling Roedel Parsons’ retainer, from $100,000 to $200,000. Tonight the Council, convened as Finance Committee, will consider Agenda Item No. 8:
Amendment No. 2 to Legal Services Contract with Roedel Parsons Koch Blache Balhoff & McCollister to amend the scope of services to include ACUD#1, ACUD#2, Parish Utilities of Ascension, West Ascension Drainage, Personnel Matters and General Legal Services for an additional amount of $260,000.00, for a total contract not to exceed amount of $460,000.00 (Ken Dawson, CAO).
How much of that increase is due to Roedel Parsons’ representation of Matassa in his efforts to recoup criminal legal fees? Will any of the 11 members even ask the question?
The claim against Harry Robert Insurance Agency is predicated upon the following assertion:
At the time of the Indictment, Robert had a Contract for Professional Services with APG for the procurement and maintenance of insurance covering all operations of APG. Under the Scope of Services of the 2017 Robert Contract, Robert’s obligations to APG included, but were not limited to: make all contact with agents and insurance companies which provide coverage, review and direct all claims to appropriate channels; and document all claims. Robert’s obligation to “document all claims” included the original claim notice.
Robert failed to notify Berkley of the Indictment prior to the expiration of the 2017 Policy. In fact, the claim for Matassa’s legal expenses was not reported to Berkley until October 16, 2018…Robert’s failure to notify Berkley of the Indictment prior to the March 1, 2018 expiration date of the 2017 Policy was a breach of Robert’s duties and obligations to APG…This breach of contract by Robert was the sole cause of Berkley’s denial of coverage of the claim for Matassa’s legal expenses.