Protecting Your Property

If you live anywhere near Cairo, NY and you travel through the Town of Cairo on Main Street you can see 2 great examples of property rights issues. (We will deal with the second in Part II.) The first is pictured below this column. If you look at the picture, you will see a photograph of a now condemned property in the middle of Cairo. I have added white lines to show the destroyed concrete wall which was the only protection this property had from the adjoining stream. If you look at the concrete wall that meets the bridge you will see that it tappers down to the protective wall. While I could not confirm this, based upon my experience this wall, when built was constructed to protect to the 100 year flood plain level. As you can see, it never made the 100th year.

 

As you all know, last year we had 2 large floods, the last of which overflowed the protective wall, taking down the protective wall and the existing building supports.
Some obvious questions are;

1. Who’s liability is it?
2. What could have been done to protect the building?
3. What other lessons can we take from this example.

I think that the answers are so important that we will devote the bulk of this newsletter (blog) to those answers. Lets start with the 1st and easiest question. The liability is the owners (unless the owner can prove negligence of either the town, county and/or state. We will discuss this later). We can assume that the property owner had insurance to cover this loss. One question is whether or not the property was insured to the full “cost of replacement”. It has been my experience that many properties in Greene county are under insured  In many cases this is either due to the property owner owning the property so long that they simply have not kept up with reconstruction costs. In other cases it is because the owner has an “Actual Cash Value” policy. While this sounds good, it actually is a bad policy to have on an investment property. Actual Cash Value actually means that the insurance company will pay you the actual cash value minus the depreciated value. This means that if you owned the property for a long time they will deduct the depreciated amount and you will not get back enough money to rebuild. Not good idea. Therefore one smart thing to do is to make sure that you are covered with a policy that will actually pay you the real replacement value of your property.

Now lets looks at what the owner might have done to protect themselves a little better. As I have said, while the protective wall is so close to the stream, the possibility of this becoming a problem was always a possibility. Had this been my property that would have meant adding some protection. In this case it would have meant either an additional wall above the existing wall, or a less expensive solution, a steel and concrete pier rather then the wooden one which was used.

Let's take away from this one of my favorite laws… Murphy's Law. What can go wrong will go wrong. While we all have insurance for the ultimate protection from catastrophe but we need to do our due diligence to make sure we have the proper policy and we should look at our “risks” and attempt to decrease our exposures. Good Luck. As usual, if you need help, just call or write.