Diamond homeowner sues insurer for coverage after illegal well damage

Gail Williams

Following the eruptions of the illegally dug natural gas well in the Diamond Housing Scheme, on the East Bank of Demerara (EBD), a neighbouring resident is suing her insurance company for in excess of $35 million, which she says it refuses to pay as coverage for damage to her house.

Gail Williams claims that her Lot 1199 Section ‘A’ Great Diamond, EBD property, which has been rendered uninhabitable because of the repeated explosions from the well, is covered under her insurance policy with the Guyana and Trinidad Mutual Fire Insurance Company Limited (GTM), though the company is claiming otherwise.  

For what she said are structural and other damage to her building’s foundation, Williams is claiming against her insurance company the full limit of her policy, which is pegged at $35,800,000.

A long crack can be seen along the upper section of Gail Williams’ home.

She wants the court to specifically order GTM to pay her the maximum insurance payout, less any lawful deductions, under and in respect of her policy.

Additionally, she is seeking damages in excess of $100,000 against the company for breach of contract in so far as it has refused to honour her claim under the policy.

Apart from these reliefs, however, she is also seeking interest thereon in accordance with the Law Reform/Miscellaneous Provisions Act, court costs and all other orders which the court deems just to grant.

Williams argues in her statement of claim that the $35.8 million insurance policy she has with GTM is for coverage to her building against perils, including but not limited to “explosion, riot and strike, malicious damage, civil commotion, aircraft and vehicle damage and flood.”

In court documents seen by this newspaper, Williams said that as a result of an attempt by the property owner immediately east of her residence to dig an approximately 150-ft well, at a depth of about 130-ft he encountered a gas pocket of methane and other gases, which caused an explosion.

Williams said that since the initial digging on June 14th of this year to when she filed her action on Monday, flammable and dangerous gases filled the air at her property as did mud and water.

She said that the latter two elements erupted hundreds of feet into the air, causing damage to her building, yard, fence and the general environs of her property and resulting in her foundation being structurally compromised.

She added that her property has since been left with wide 2 to 4-inch cracks. Williams said that her house has “been badly damaged to the extent that it is unfit for human habitation.”

The well was reportedly dug by Diamond resident Soownauth ‘Water Man’ Gorakh in the yard of his Sixth Street home for domestic purposes.

Gorakh had claimed via a statement issued by the Region Four administration that he and his wife, Tulabhaduree, had attempted to dig the well after experiencing water troubles.

Refusal to conduct inspection

Williams claims in the action that GTM initially refused to even inspect and assess the

Cracks along the fence of Gail Williams’ property

damage to her house, which she said she reported immediately following the initial explosion on June 14th.

She contends that the company’s agent, whom she identified as Peter Bryan, along with other officials of GTM also refused to issue her with a claim form to make and lodge a valid claim under her policy.

According to her, the insurance company proffered a number of excuses, including that the time to lodge a claim had expired during the time she was being given excuses for not being given a claim form.

Williams opined that the company’s position from her first report of damage, even before its officials finally decided to visit her residence, had always been that an event such as the one complained about never occurred in Guyana and as a result it would not be processing her claim.

She said that when the company did dispatch an agent in late October to do the inspection after her many pleas, she was told that a subsequent visit would be made as they “did not appreciate the extent of the damage.”

She, however, said it was obvious from that first inspection, with no other following, that GTM, through Bryan, had formed a negative conclusion of her claim.

Noting that she has always paid her monthly premiums, never missing a single payment and honouring all her obligations under her insurance policy, Williams was peeved that notwithstanding her many pleas, her insurance company refused to allow her to make a claim for the damage to her house.

She said that the company, in so doing failed, to honour its obligations to her in accordance with her insurance policy as it contends that the explosions caused by the digging of the well do not fall within the scope of perils that she is insured against.

Williams said that several contractors and engineers have estimated the cost of repairs to be $75,000,000 to $100,000,000 to restore her property to its condition before the explosions.

Noting that her house, which is now declared as being unfit for human habitation, is valued $120,000,000, Williams said in her statement of claim that she has had to resort to renting.

She is contending that the damage to her house is within the scope and range of perils insured against under her insurance policy.

Her case is yet to be assigned to a judge for hearing.

Representing Williams is attorney Eusi Anderson.

Following its first eruption, the illegally dug well has since erupted again on at least two occasions.

After the initial June 14th explosion, the well had been finally capped on July 26th, and the authorities were waiting for the cement to be properly cured before applying the finishing touches.

However, in the wee hours of August 15th, the well erupted once more, sending a mixture of gas, sand, clay and water more than 50 feet into the air.

The Guyana Geology and Mines Commission (GGMC) subsequently said that work had commenced on clearing the clogged pipe, which at that point had contributed to a second eruption.

Mitchell Prince, Senior Petroleum Technologist of the GGMC, had explained that the pipe which was being used to control the flow of gas became compromised with clay and other materials, which eventually clogged it. After it was blocked, gas started to emit from various parts of the yard in which the well was dug.

The GGMC then subsequently drilled a relief well to control the emissions from the initial well. The well erupted again last Saturday.

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