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Insurers sue owners of property where Oak Knoll fire started

Insurance companies seek compensation for $1.7 million in payouts after 2010 blaze
 Posted: 2:00 AM November 10, 2012

Insurance companies that paid about $1.7 million to six homeowners who were victims of the August 2010 Oak Knoll fire are suing the owners of the property where the fire started and a real estate company, seeking compensation for those payouts.

The complaint alleges that before to the fire was started by John Thiry, a homeless man, the property's owners were notified by nearby residents and business owners that vagrants were camping in the field frequently and were observed starting fires and smoking cigarettes in the midst of overgrown brush and weeds.

According to the complaint, which was filed in Jackson County Circuit Court on behalf of the plaintiffs Allstate, Unigard, Valley Property & Casualty and Federal insurance companies, the vacant field behind the Arco gas station on Ashland Street where the fire started was in violation of state and city codes. The suit alleges the property owners allowed a "dangerous accumulation of waste and overgrown brush to occur on the subject property that created an extreme fire hazard."

Hawkins Family Trust, Joyce and Daryl Hawkins, and Robert S. Peterson own the property, according to online property records.

"We denied all of the allegations," said Klamath Falls-based attorney Jim Wallan, who is representing the property owners. "We asserted affirmative defenses to the complaint."

Wallan would not comment further on the litigation.

The lawsuit also alleges that John L. Scott Real Estate in Medford, and its broker, Linda Frazier, were responsible for maintaining the property, because the real estate company was marketing it for the owners, who live in the Bay Area.

City of Ashland codes require that vegetation, grass and shrubbery less than a quarter-inch in diameter and more than 4 inches high be cut if it poses a fire hazard.

"We're not hired to police properties for vagrants. We don't maintain properties. The only thing we are employed to do is market a property," said Jim Rimley, principle broker for John L. Scott's Medford office. "It (the lawsuit) is totally facetious. It's a fishing expedition from the insurance companies; they're just looking for money."

Frazier, who was assigned to sell the property, declined to comment on the lawsuit.

Court records show the defendants are currently waiting for responses from the plaintiffs to counterclaims filed last week.

Seattle-based attorney Eric C. Hanson, who is representing the plaintiffs, did not return telephone messages left Friday at his office.

Rimley said Frazier and the real estate company are planning to file a motion for summary judgment, seeking dismissal from the lawsuit.

According to the complaint, Allstate Insurance company paid $218,179 to Patricia Faria, whose residence was destroyed in the Oak Knoll blaze.

Valley Property & Casualty Insurance Company paid $181,262 to Liza Christian, whose home of 31 years burned to the ground in the flames, according to the complaint; the company also paid $493,678 to Oak Knoll resident Lois Brewer.

Unigard Insurance Company paid $351,319 to home owner David Gustafson, and Federal Insurance company paid $503,574 to Robert and Gary Pederson, the claim states.

All of the residents lived in the 800 block of Oak Knoll Drive, according to the complaint.

Pushed by high winds, the fast-moving grass fire destroyed 11 houses on Oak Knoll Drive on Aug. 24, 2010.

According to fire official at the time, within about 5 minutes of the fire starting in the vacant field, it had jumped across Washington Street and engulfed a large barn and a trailer, and minutes later jumped Interstate 5 near the Oak Knoll subdivision.

The state had charged Thiry, 42, with 10 counts of recklessly endangering another and 14 counts of reckless burning related to the blaze, which caused more than $3 million in property damage. But the charges were dropped after a judge ruled the state did not prove Thiry was consciously aware of the damage that could occur from his actions.

Thiry was released from jail on Dec. 9, 2011, and still is homeless, living in Ashland.

Reach Daily Tidings reporter Sam Wheeler at 541-499-1470 or email

Correction: This headline has been changed to accurately reflect the facts of the story.

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