Oct 31, 2006 2:56 pm US/Eastern
Judge: WTC Insurers Won't Have To Pay Extra
Says They Only Owe Pre-9/11 Costs
NEW YORK (AP) ―
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Insurance companies won't have to pay extra for the Freedom Tower, a judge ruled.
AP
Insurance companies helping to foot the bill for the World Trade Center complex won't have to spend an extra $700 million to make the buildings "bigger and better," a judge ruled Tuesday.
U.S. District Judge Harold Baer said the insurance companies will owe developer Larry Silverstein only what it costs to rebuild the World Trade Center as it was before the Sept. 11, 2001 terrorist attacks.
Through a series of court cases, it has been determined that the insurers may owe Silverstein as much as $4.6 billion.
The companies had estimated that improvements to the site would add another $700 million. The judge said it's virtually impossible to come up with an exact figure because the new buildings will involve entirely different designs than the old ones. But whatever the added figure might be, the companies won't have to pay it, he said.
Silverstein was in the midst of securing $3.5 billion in insurance coverage when the 110-story twin towers were hit by two hijacked airplanes on Sept. 11.
Afterward, he tried to collect $7 billion, saying that each of the hijacked airplanes constituted a separate terrorist attack and entitled him to two insurance payouts.
Two juries determined he was entitled only to an extra $1.1 billion because different insurance policies carried different wording regarding what would constitute multiple events capable of requiring an insurance payouts.
The judge said if the parties had intended to let Silverstein "build a bigger and better building and thereby recover an additional $700 million, it stretches credulity to suggest they would not have made this understanding explicit."
(© 2006 CBS Broadcasting Inc. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed. The Associated Press contributed to this report.)
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