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Arbitration decision ending lengthy Amherst legal fight over $3 million

A nearly 17-year, multimillion-dollar legal saga in the Town of Amherst is near its end.

A court-appointed arbitration panel last week divided up $3.13 million that Amherst and its insurance carrier had battled over since 2013, the last vestige of a judicial fight that dated to a serious workplace injury on town property in 2002.

Under the arbitrators' ruling, if both sides accept the decision, Amherst would collect just under $1.9 million and Granite State Insurance Company would receive just under $1.3 million.

Town Attorney Stanley Sliwa said the town is weighing its options, and still believes it is entitled to an additional $270,000, but is optimistic it can reach a final resolution of the case with attorneys for Granite.

The dispute stemmed from a 2002 accident in Amherst State Park on Mill Street, where a roofer, Peter Bissell of Sanborn, fell from a ladder and broke his neck while inspecting a roof leak at the St. Mary of the Angels Motherhouse in the park.

After numerous lawsuits, Bissell eventually was awarded $19.6 million, but the town paid out $23.4 million, including accrued interest.

The town’s insurance carrier, Granite, covered $10 million of the judgment – its policy limit – and the town borrowed $13.4 million to pay for the rest.

A lengthy battle followed to get this money back from the roofer’s insurance carrier, the New York State Insurance Fund.

In 2013, the state insurance agency agreed to pay out $31 million. Granite recouped its $10 million and the town received $17.8 million, including more than $4 million in interest from the years the case was in court.

Still at issue, however, was the last $3.13 million in interest. Both Granite, a subsidiary of AIG, and the town said it was theirs.

In January 2015, a State Supreme Court justice ruled the money belonged to Amherst, but Granite appealed. By 2017, the State Court of Appeals decided that an arbitration panel should settle the case once and for all.

Court: Arbitrator should decide if Amherst or insurance firm gets $3 million

That three-member panel last week ruled the town wasn't entitled to all the remaining $3.1 million and the money's distribution was rightly subject to arbitration.

The town, in its submission to the arbitrators, had sought $1.9 million. Instead, the panel found the town should receive $1.86 million, including interest, the cost of borrowing the money it used to pay off its original share of the award and unpaid attorneys' fees. Granite receives $1.27 million to recover the interest on its original $10 million payment.

The Town Board discussed the implications of the ruling in a closed-door executive session on Monday.

Both parties have 90 days to file an objection to the arbitrators' decision, Sliwa said. Amherst must place the money in its self insurance fund and can't apply it to its general fund, he said.

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