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Attorney general asks time in Bissell case; Will defend state agency against Amherst suit

The State Attorney General's Office is researching claims from the Town of Amherst that a state agency engaged in deceptive business practices that cost the town more than $23 million in judgments from a personal injury case.

What is known in Amherst as the Bissell case is shorthand for a 10-year-old legal nightmare for town leaders and taxpayers. It pits the town against the wealthy New York State Insurance Fund, which has refused to pay the town a dime in claims despite multiple legal judgments in the town's favor.

"We just want our money so we can pay our bonds off," said Town Attorney E. Thomas Jones.

The State Attorney General's Office, which represents all state agencies, has asked for more time to properly defend the State Insurance Fund against the town's latest allegations of deceit and conspiracy.

The town has been engaged in two lawsuits involving the Bissell case -- one against the owners of a now-defunct roofing company and one against the agency that insured them. Aside from demanding reimbursement for personal injury claims against the town, Amherst is now also charging the State Insurance Fund with the "deceptive acts and unlawful practices."

Last week, the Attorney General's Office responded to the charge by asking the New York State Court of Claims for more time to look into the town's charges.

"The severity of these new allegations requires an investigation by this office, and a complete and thorough investigation by the agency involved," wrote Assistant Attorney General Ellen S. Mendelson.

Town officials were initially excited by the letter, under the mistaken impression that the State Attorney General's Office was launching an investigation into wrongdoing by the insurance fund. Supervisor Barry Weinstein drafted a resolution last week saying the board "enthusiastically supports the investigation."

But the AG's Office clarified for a News reporter that no such investigation is occurring.

Spokeswoman Jennifer Givner said Mendelson's letter simply represents a request for more time to look into the matter as part of defense preparations for the State Insurance Fund.

"We represent the State Insurance Fund in this defensive litigation," she said.

Understanding the complexity of the Bissell case requires both patience and legal wit.

In February 2002, the town had contracted with Lockport-based McGonigle and Hilger Roofing Co. to check for a roof leak at St. Mary of the Angels Motherhouse in Amherst State Park, which the town maintains. The company sent Peter E. Bissell, a Sanborn resident.

During his inspection, he fell from a ladder and was partially paralyzed, but he was still able to feel excruciating pain in his limbs.

Multiple lawsuits followed his accident. The town ended up paying $23.4 million to the Bissell family in 2008. The town's insurance carrier covered $10 million, but the town had to borrow $13.4 million to pay for the rest.

The town was liable because of the state's Scaffold Law, which holds property owners responsible for any injury to workers occurring on their property regardless of fault.

But two courts later held that the roofing company was ultimately responsible for Bissell's injuries. Despite these court judgments, the officers of McGonigle and Hilger Roofing did not require their insurance company -- the State Insurance Fund -- to cover the claim.

Instead, the State Insurance Fund offered to pay a lawyer to represent and indemnify the company's officers, absolving them of financial risks if they resisted the town's attempts to collect money from the state agency.

Thus, the town is now alleging that the State Insurance Fund engaged in "conspiracy" and "collusion" by encouraging the roofing company owners to frustrate the town's collection efforts, said Joe DiMarie, the lawyer handling the matter on the town's behalf.

In December, State Supreme Court Justice Paula L. Feroleto ruled that the officers of the roofing company, Arthur Hilger and Sally Bisher, are personally liable to pay the $23.4 million judgment and must compel the State Insurance Fund to cover that cost.

Weinstein called the campaign to collect money from the State Insurance Fund the town's "No. 1 priority." He said he would still like the Attorney General's Office to formally investigate.

But if it won't, Weinstein said, "then we'll have to find someone else who will."

The town has also received support from Assemblyman Raymond Walter, R-Amherst, and Assembly Minority Leader Brian Kolb, R-Canandaigua, both of whom have sent letters to the president of the State Insurance Fund demanding compliance with court orders.