Tips for Disaster Survivors




  • RICE (San Diego)
  • WITCH CREEK (San Diego)
  • GUEJITO (San Diego)
  • CANYON (Malibu)
  • GRASS VALLEY (Lake Arrowhead)

Community Assisting Recovery, Inc., CARe, a 501c3 nonprofit organization dedicated to guiding survivors through the disaster recovery process, reminds you to take immediate action to avoid losing legal rights against the utility due to statute of limitation deadlines.

We know from our substantial experience in disaster recovery that most losses are underinsured and do not come close to having enough money for a full economic recovery following a disaster. If you have documentation that establishes that your losses exceed what your insurer paid, or you had no insurance, we recommend that you consider taking immediate legal action given the impending statutes of limitation. Some potential claims may have expired. October 21, 2010 is the absolute deadline which would foreclose any possibility of recourse against the utility after which time there would be no further recourse.


An attorney contingency fee agreement is a contract where the attorney receives as payment a percentage of your settlement.  The attorney does not get paid if he/she loses your case.  Some agreements can be very confusing.  Read the fee agreement carefully as it may have hidden costs.  Be careful.

CAUTION IF the attorney fees are based on GROSS instead of NET of your settlement money.

  • Fees based on GROSS will always cost you more in attorney fees.
  • GROSS means you are also paying attorney fees on the costs the attorney decides to incur on your case. (Beside filing, expert and witness fees, and photocopying, this could include travel and lodging costs.)
  • GROSS means the attorney has no incentive to keep costs down. The attorney gets a percentage on every dollar spent. The more he/she spends, the more you pay in actual attorney fees.
  • You want an attorney fee agreement based on the NET settlement!
  • Fees on NET mean YOU GET MORE money! See EXAMPLE below.
  • Under GROSS, every dollar of costs, your attorney pockets 25 to 40 cents in addition. You pay more!
  • Under GROSS, an attorney makes more for him/herself by running up costs. You pay more!

CAUTION IF the attorney asks you for “up front” money in exchange for a fee percentage reduction.

  • Asking you for money to litigate your claim could mean the attorney is underfunded or does not have enough confidence in winning your case to use his/her money for your costs.
  • Be sure the law firm has the money and qualified staff to finance and withstand multi-million dollar complex litigation.
  • An underfunded attorney can give up a lot of your money to get a quick settlement.
  • Expert costs can be very high in complex “valuation” cases like this case against Sempra and SDG&E if it goes almost to or to trial. Even extensive mediation can require experts and be costly.

CAUTION IF the attorney says he will reduce his percentage but then gives you a long attorney fee agreement with confusing clauses that could actually inflate your final legal expenses.  Attorney fee agreements should be concise and easy to understand.

Be sure to:

  1. Review and understand any attorney fee agreement before signing it.
  2. Check that fees are based on NET not GROSS fees on your award money.
  3. Check online:
  • Does your attorney and law firm have lots of their own money to fund these complex costly cases?
  • Does your attorney have the necessary successful background and experience to go against SDG&E and its gigantic Los Angeles firm, Quinn Emanuel?
  • Have you checked to see why you need the biggest and best law firm?
  • What experience did the law firm have BEFORE the fires?

TIP: Fees are negotiable even after an attorney fee agreement has been signed.

EXAMPLE:  You win $500,000, the GROSS award.  COSTS of litigation are $100,000. 

Fees based on GROSS                            Gross award $500,000
 You pay 40% attorney fee before paying COSTS  - 200,000
 You pay COSTS                                               - 100,000
 YOU end up with                                                             $200,000

Fees based on NET                                    Gross award $500,000
 You pay COSTS first                                         - 100,000
                                                         Net award $400,000
 You pay 40% attorney fee after paying COSTS    - 160,000
 YOU end up with $40,000 MORE                                  $240,000


I was pondering the three year deadline and remembering that after our fire in '03 there were some tax deadlines that came up at the three year mark. I went looking for them and found this in our Disaster Tax Issues handout which can be found in the "Tax Handout" section of our website. The first thing I found had to do with Property Taxes (page 12, slide 66): 

  • Property tax basis can be transferred to
    another property if you purchase your
    new property within the same county.
    If the purchase price is greater than
    120% of the market value of your
    destroyed home, your property tax base
    will be increased by the amount in
    excess of 120%.
  • You have a three year period in which to
    do this. There is no time limitation if you
    rebuild your home on your vacant lot.

There are a lot of rules and calculations involved with determining whether or not you have to pay taxes on all or part of your insurance claim, so you need to take the handout to your CPA as soon as possible, but if you do have a gain and you want to reinvest the gain as opposed to paying taxes on it (page 7, slide 35):

  • You have 4 years from the end of the
    year in which you receive one more
    from your insurance company
    than your tax basis in your home and
    scheduled personal property.
  • You have 2 years if you lost your second
  • You have 2 years if you lost real
    property that you used as rental or in
    your business.
  • (see the slides following for details and explanations)


Inspirational Quotes

We acquire the strength we have overcome.

Ralph Waldo Emerson


Thank you for all that you and CARe have done to help so many of us. As you well know from our own experience, the distress of suddenly losing one's home and possessions is overwhelming and truly changes a person's life. The information and resources you have provided has been a godsend. You and your organization help empower people when they need it most. Thank you very much.

2003 Cedar Fire Survivor, San Diego CA