Settlement Is $1 1/2 Million Short of Claims : Farmers May Sue Navy for Fire Damage

A dozen avocado and citrus growers who suffered crop and property damages totaling $2.4 million in a fire caused by military maneuvers on Camp Pendleton last summer may sue the Navy for failing to fully reimburse them for their losses.

Cary Thompson, an attorney representing the growers, said court action “is looking like a strong possibility” because the Navy’s offer of reimbursement--issued this week, 13 months after the blaze--is about one-third the total amount requested by the farmers.

“To put it mildly, they came in a little low,” said Thompson, a Los Angeles lawyer whose father was among the growers suffering crop losses. “Everyone is very, very disappointed. To make us wait so long and then come in with figures like this is really infuriating.”

Alex Rigopolous, who has been unable to replant his groves because of money problems due to crop losses, put it more bluntly.

“It is completely absurd,” said Rigopolous, a self-employed insurance man who had planned to retire with his wife on their De Luz property and live off income from fruit sales. “They are not even treating us like human beings. I’ve been sick about it for two days.”

Lt. Cmdr. Kevin Mukri, a spokesman for the Navy’s Office of Information in Washington, declined to discuss details of the settlement offers because “it would be inappropriate, considering this matter may end up in litigation.”

He did, however, note that the Navy’s appraisals were “bound by applicable state laws” and that the Navy has “little latitude in these matters.”

The growers’ troubles started on a searing hot day last July when routine artillery shelling on the Marine base caused a fire that swept through this rural pocket northeast of Fallbrook. Raging for two days across 8,425 acres, the blaze destroyed several homes, a renowned cactus nursery and thousands of fruit trees.

In addition to crop and tree losses, the fire melted irrigation pipes, destroyed farm equipment and ruined water pumps and electrical systems. And the once-lush hillsides were left scarred with row after row of eerily charred trees resembling skeletons.

Following the fire, the growers hired an independent appraiser to estimate the value of their damages and submitted claims for reimbursement to the Navy. In addition to the immediate losses, the appraiser estimated the value of future fruit production for the seven years it will take newly planted trees to reach maturity on the fire-ravaged land.

Then, the farmers waited while the Navy evaluated the claims and hired its own appraiser to come up with damage estimates. After several months had dragged by, the growers amended their claims upward because the price of avocados had risen.

Finally, the Navy’s Judge Advocate General’s Office in Washington issued a letter this week announcing the amounts the government planned to offer as reimbursement for the fire, which Camp Pendleton authorities admit was started by the shelling.

Thompson said the total amount of compensation the Navy offered the growers was $820,000, far short of the $2.4 million in claims submitted. The individual offers ranged from about 15% to about 55% of the amounts sought.

“I expected a somewhat lower figure, but this was just totally out of line,” said Roger Milner, who owns 40 acres in De Luz and lost thousands of pounds of Oriental persimmons and avocados for damages totaling $173,000. The Navy offered Milner, who said he was forced to sell his home to raise money for limited replanting, about $86,000 in compensation.

Rigopolous, whose losses included 35 acres of citrus and avocado trees, entered a claim for about $450,000; the Navy offered him $123,000. Thompson’s father, Bill, also estimated his losses at $450,000 and was offered $142,000 by the Navy.

According to attorney Thompson, the disparity in settlement figures stems from a different measurement of losses used by the Navy and the growers. The appraiser hired by the property owners calculated damages based on the actual “replacement value” of the losses, or “the amount it would take to make a given farmer whole again,” Thompson said.

The growers assumed the Navy was using a similar measurement. But instead, the military’s appraiser used another formula known as the “dimunition test.” Under that approach, the value of the land is calculated before and after the fire and the owner is compensated for the difference.

“The trouble with the dimunition test is that it doesn’t take into consideration the fact that people like my father and Alex, who putter around their land and aren’t really serious farmers, may not want to sell and start over somewhere else,” Thompson said. “It just isn’t a very fair way to measure losses for someone who isn’t growing strictly for profit.”

Moreover, Thompson said it is “unfathomable” that the Navy, which knew six months ago that the growers had used a different formula to calculate the losses, “would sit on the claims and not bother to tell us they were assessing damages using a different measure.”

But even using the “dimunition” formula employed by the Navy, “their figures are way off. It’s just bad faith all around,” Thompson said.

Thompson said he plans to send a letter to Navy officials outlining his objections to the figures and suggesting that they reconsider. And next week, he will meet with the 12 growers to discuss strategy.

From the beginning, the De Luz growers were eager to keep the matter out of court because litigation means more delays, along with attorneys’ fees. But now their sentiments are changing.

“I hate to fight in court, because it will drag on three years, and even if we win, we will be losers,” said Rigopolous, who had hoped to replant for next season using Navy compensation money. “But we have to fight. We cannot be treated this way.”

Milner agreed, and charged that the Navy was being “penny-wise and dollar foolish” in forcing a court confrontation.