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By George Romain, Esq.
Insurance company claim adjusters beware: Daubert is about to call on you. A recent US Supreme Court ruling in Kumho Tire Co v. Charmichale, S Ct. (1999) instructs that the Daubert standards for admitting scientific testimony apply to all expert testimony, including testimony based on technical and other specialized knowledge. The ruling is expected to have major ramifications in the area of arson investigation. Most notably, the ruling renders moot the issue of whether fire investigation is scientific and subject to the Daubert standards. Claims adjusters should now expect that all expert testimony on origin and cause is prone to cross-examination under Daubert. The Court’s expansion of Daubert means that the adjuster will need to assume a more active role in overseeing the investigation of suspicious fires. That is, the adjuster should require that the retained experts and investigators adhere strictly to the Guide for Fire and Explosion Investigations (NFPA 921), particularly with respect to new, developing areas of fire and explosion investigation. 1) Whether the theory or technique can be and has been tested. 2) Whether the theory or technique has been subject to peer review and publication. 3) Whether the theory or technique has a known or potential rate of error and 4) Whether the theory or technique has attained general acceptance in the pertinent scientific community.
Prior to Kumho Tire Co v. Charmichale, there was a general consensus among the legal community that the Daubert standards applied strictly to scientific testimony, because that was the nature of the expertise there at issue. Such a narrow view of the Daubert Court’s decision meant that cause and origin testimony could still be admitted under arguably less rigorous standards, such as the general acceptance test followed by most state courts. Under that test, which Daubert did away with at the federal level, evidence may be admitted when the scientific principle on which it rests has gained general acceptance in its particular field.
In 1992 the National Fire Protection Association issued NFPA 921 as a guide to investigating the cause and origin of fires and explosions. The guide is now in its third edition (1998) and includes a new test on fuel gas systems in buildings, and the impact of fuel gases on fires and explosion investigation. It also includes new text regarding the uses of canine-detection teams. Although NFPA 921 is technically a guide, it is recognized nationwide as an authoritative source on the methodology of fire investigations. The arson investigator or expert who fails to consider the guides’ criteria runs the risk of having his/her findings and testimony impeached at trial.
Given the expansion of Daubert and the significance of NFPA 921, the claims adjuster needs to be more discerning about who he selects for his arson investigation team. The adjuster should be weary of any prospective arson investigator or expert who place little or no value on the guide, or who strays from the guide’s recommended methodology. At a minimum, the adjuster should require that the investigation of any suspicious fire loss claim follow the guide’s basic method of fire investigation. (NFPA, line 21, S2.4). The guide recommends use of a scientific method and five major steps from inception through final analysis. Scientific method is defined as the systemic pursuit of knowledge involving the recognition and formulation of a problem, the collection of data for observation and experiment and the formulation and testing of the hypothesis. (S 1-3 {Definitions}). The five steps are: 1. Notifying the investigator of the incident, discussing what the investigator’s style will be and formulating goals of the investigation (S 2-4.1). 2. 2. Planning the conduct of the investigation, including examining what tools, equipment and personnel (both laborers and experts) will be needed (S 2-4.2). 3. Thorough examination of the accident scene, including scene inspection, scene documentation, through photography and diagramming, and witness interviews (S 2-4.3). 4. Collecting and presenting evidence (S 2-4.4) and, 5. Developing an incident scenario or failure analysis that explains the origin, cause, fire spread and responsibility for the incident(S 2-4.5).
With these recommendations in mind, the claims adjuster and investigator should be sensitive to those areas of the investigation where the potential for error is most prevalent. For example, with respect to collecting and preserving evidence, the guide provides a specific protocol depending on what type of evidence is being collected (S 9-6.1.1). Liquid and solid accelerant evidence containment is limited to four types: metal cans, glass jars, special evidence bags and plastic evidence bags. On the other hand, different methods are permitted for collecting gaseous samples. (S 9-5.4). The arson investigator needs to know which container is most appropriate for the type of evidence that is being collected. And both the arson investigator and the adjuster need to ensure that physical evidence, once collected, is stored in a secured location. Physical evidence should not pass from one person to another without some system which tracks chain of custody. The guide provides an example of a form that should be used. (Figure 9-9). Larger multi-party investigations should be conducted pursuant to agreed-upon consensus among the parties on what the investigation will entail (S 16-3).
Because arson investigation is an ever-developing field, NFPA 921 provides claims adjusters, investigators, experts and attorneys new insight regarding the interpretation of evidence and use of emerging methods in determining cause and origin. For example, when it was previously thought that the presence of certain types of char signified the use of an accelerant, indication of accelerant or fire growth rate based on the appearance of char alone is now dissuaded (S 4-5.5). The same can be said with respect to spalling (i.e the chipping or pitting of concrete or masonry surfaces). While it was once thought that the spalling of concrete at a fire scene was a positive indicator of a liquid accelerant-involved fire, it is now recognized that spalling can occur from sources other than fire, such as rusting or reinforcing steel or freezing of water in concrete voids. Thus, the guide now advises that the presence of ignitable liquids does not normally cause spalling beneath the surface of the liquid. (S 4-7.1).
With respect to emerging investigative techniques into cause and origin, added emphasis is being placed on the use of canine detection teams. Studies show that properly trained dogs are capable of detecting accelerants in amounts too small to register on laboratory tests. However, the reliability of investigative technique is still being debated and some courts, consistent with the view of NFPA 921, will not admit dog-sniff evidence in the absence of corroborating laboratory analysis. (See S 9-5.3.4). And even where canine alerts can be validated through laboratory analysis, the investigator should be ready to answer questions concerning the dog’s training and won-loss ratio.
Adjusters also now need to make sure that their investigators have a basic understanding of building fuel gas systems and the appliances and equipment that utilize them. If it is determined that a fuel gas system influenced the way a building burned, an analysis should ensue as to the manner by and extent to which the system participated in the origin or cause of the fire or explosion. (S 19-9). Such an analysis is important not only to rule out the possibility of arson but also to determine whether the systems participation in the fire or explosion was influenced by any type of negligence or defect which should be passed along to the insured or some third party.
Because the admission of origin and cause testimony will probably face heightened scrutiny in the state and federal courts, it is more important now than before that claims adjusters, arson investigators and attorneys work together when assigned to a suspicious claim of property loss due to fire. The selection of a fire investigator or expert by claims adjusters and attorneys will require that the prospective applicant be trained in the latest investigative techniques. For example, the Bureau of Alcohol, Tobacco and Firearms (ATF) offers advanced Origin and Cause and courtroom techniques classes and a Certified Fire Investigator Program. Claims adjusters, attorneys and fire investigators must be aware of new developments in incendiary cause and origin evidence if they intend to meet cross-examination under Daubert.
In addition, in projecting the litigation costs for proving arson, greater consideration should be given to retaining a scientific expert to explain the physics of combustion (e.g., the characteristics of fire behavior under certain controlled and non-controlled conditions). Such added testimony may avert the pitfall of having no expert testimony on cause and origin should the arson investigator’s testimony fall under Daubert. While it is probable that added effort and money will be required in preparing and proving cases of arson, the insurance industry’s continued effort in surmounting the evidentiary rigors of Daubert will be required in order to deter the threat of heightened insurance premiums posed by arson.
In conclusion, although it is unlikely that the claims adjuster will be called to provide expert testimony at trial, adjusters will have to take on the added responsibility of seeing the arson investigation through its successful conclusion. In that regard, Daubert is now calling on claims adjusters, investigators and attorneys alike, to share in the gate keeping function of the trial judge.
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George Romain is an attorney with the firm of Berger Kahn. He can be reached at (310) 821-9000.
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