HOW Distribution to Builders

Eligible home builders who were members and owners of the Home Owners Warranty Insurance Company (HOW) are set to receive a distribution of their capital contributions made to HOW before the company was placed in receivership by the commonwealth of Virginia. Notices of claims have been mailed to builders. After that, there could be a substantial HOW surplus that will be distributed to the members and owners.

The notice of claims forms are complicated to fill out and the risk of builders not receiving their fair share is significant. They must be returned to the Receiver by January 12, 2009. Many builders no longer have the data and other information necessary to fill out the forms. Of greater concern is that the Receiver is using a mailing list from 1995! If a builder has moved and does not receive the form, the claims may be extinguished.

It is Cureton Clark’s intention to let every builder know about this situation so they are in a position to get their money back. The law firm is reaching out to individual builders and to industry associations to alert them to the problem of the aging lists and the difficulty with the forms. The firm also will maximize their clients’ recoveries and assure that claims are properly presented and paid. They have assembled a team of litigators and Virginia-based government affairs lawyers to represent the builders. The team includes prominent Virginia government relations attorney Meade Spotts of Spotts Fain of Richmond, VA, and New Jersey based Cureton Clark. Jerry Cureton is a nationally recognized class action attorney who has also represented builders for many years.

Below is a list of issues that you should address in assessing whether or not you are eligible to either receive a capital contribution or recover a surplus distribution thereafter.

If you have any questions, please contact Jerry Cureton or Gina Zippilli at 856-824-1001.

How Distribution Summary
Former HOW builders need to know about the details of the potential claims they have to capital contributions and an ultimate surplus distribution.

Are You Eligible?
The Receiver has published detailed criteria for builders to be eligible. Essentially, though, you had to be a HOW builder when HOW was put into receivership in 1994, or had been a HOW builder for at least 5 consecutive years and left HOW shortly before HOW went into receivership. The details are set forth in the Order Approving Plans of Liquidation dated June 13, 2005.

How Do I File a Claim?
You must file a proof of claim with the Receiver. Those builders deemed eligible by the Receiver should have received a notice from the Receiver. The Receiver is working off lists of builders that date back to the last year of HOW’s operation (1994-1995).

When is the Proof of Claim Due?
January 12, 2009

What if I Didn’t Get Notice From the Receiver?
If you did not receive a notice of proof of claim, then either the Receiver does not believe you are eligible, or the Receiver mailed the notice to your former address. The Receiver is using a mailing address from 1995. Builders who don’t get notice, and who don’t timely file a proof of claim, will be barred. If you did not get a notice, and believe you should be eligible to file a claim, you need to act now to assemble the facts to present to the Receiver.

What if I Had More Than One Company?
Each company you had that was listed with HOW should be eligible. However, we have seen instance where that is not the case, and we may have to dispute eligibility with the Receiver.

How Do I Figure Out the Amount of my Claim?
Capital contributions are returned based on your capital account at HOW. We believe that the Receiver has this information. The distribution of the surplus is subject to a complex formula based on the premiums you paid and your loss experience (claims paid out).

If You Have Questions or Concerns, Please Contact: Jerald R Cureton (jcureton@curetonclark.com) or Gina Zippilli (gzippilli@curetonclark.com) at 856-824-1001.