Insurance Investigator Establishes Fire Accidental and Defeats Attempt to Bind Insured to Trial for Arson and Fraud
One New Year’s Eve, Clare Eugene Prisbrey’s house caught fire. It took firefighters more than an hour to get the fire under control, and the house sustained severe damage. After examining the scene that night and the next day, fire officials came to suspect that Prisbrey had set the blaze intentionally, and the State later charged him with aggravated arson and filing a false insurance claim. At a preliminary hearing, however, the magistrate found no probable cause that Prisbrey had committed those crimes, and declined to bind the case over for trial. The State appeals that determination, and we affirm.
In State Of Utah v. Clare Eugene Prisbrey, 2020 UT App 172, No. 20190569-CA, Utah Court Of Appeals (December 24, 2020) the state failed to prove there was enough evidence to bind Prisbrey to trial for arson and insurance fraud and appealed the decision of the magistrate.
On December 31, 2017, Prisbrey and his girlfriend (Girlfriend) were together at Prisbrey’s house, celebrating the holiday. A few weeks earlier, Prisbrey had decorated his living room (the great room) with Christmas decorations, including a miniature Christmas village—a collection of decorative ceramic houses arranged on foam blocks, wood, and synthetic snow—set up on a table against the wall. Around 9:30 that evening, Prisbrey lit several candles in the Christmas village display and, later, around 10:00 p.m., he and Girlfriend opened a bottle of sparkling grape juice and watched New Year’s Eve fireworks displays happening in “different time zones.”
A few minutes later, Prisbrey and Girlfriend left the house; Prisbrey explained to fire officials that he had made a “last minute” decision to propose marriage to Girlfriend that evening, and wanted to do so on the grounds of the local temple of the Church of Jesus Christ of Latter-day Saints.
Just as Prisbrey and Girlfriend arrived at the temple and pulled into a parking spot, Prisbrey received a phone call from one of his neighbors informing him that his house was on fire. Fire crews arrived at “about the same time” and began attempts to extinguish the fire. At that point, the fire was already “50 percent involved,” with “fire showing from the roof and from the windows.
Once the fire was contained, Chief began inspecting the damaged remains of the house, and noticed some “red flags” that he thought might indicate that the fire had been intentionally set. Nevertheless, this piece of information added to Chief’s suspicions, and based on all of the information he had at the time, he made the decision to notify the office of the Utah State Fire Marshal to ask it to investigate.
Before entering the house, Marshal spoke with Prisbrey, who was sitting in his vehicle in front of the house. Prisbrey told Marshal about leaving the six candles lit in the Christmas village. After interviewing Prisbrey, Marshal then inspected the house. Perhaps most significantly, Marshal noticed, along the wall between the garage and the great room, “two holes in the wall” that were located very close to where the Christmas village display had been (on the great room side) and where the gas cans were (on the garage side).
Despite conducting no further investigation, Marshal testified at the preliminary hearing that, in his opinion, “this was an arson.”
Marshal reaffirmed that his opinion was not based on the presence of accelerants, but was instead based on “the hole[s] in the walls, [the] location of the gas cans, as well as the lit candles.”
Soon after the fire, Prisbrey notified his insurance company and submitted a claim, therein representing to the insurance company that he did not intentionally cause the fire. On January 2, 2018, the insurance company hired its own investigator (Investigator) to inspect the home and offer an opinion as to whether the fire was arson, so that the insurance company could make a decision about whether to pay the claim.
Investigator also focused on the two holes in the wall between the great room and the garage. In particular, he examined the relative damage on the two sides of the wall, as well as on the gypsum and the paper in the drywall along the sides of the holes, and concluded that the holes had been created after the fire, and not before. Investigator also noted the absence of any fire damage inside the garage, observing that a fire burning intensely enough to burn the drywall inside the room “would have gone into the garage” if the holes had existed while the fire was burning.
Investigator notified the insurance company that his preliminary conclusion was that the fire was accidental, and he later submitted a final written report reaffirming that conclusion and detailing the basis for it. Based in part on Investigator’s conclusion, the insurance company approved Prisbrey’s claim, ultimately paying him “over $350,000 in benefits” for, among other things, repair to the house and for temporary housing.
After the insurance company paid the claim, the State charged Prisbrey with aggravated arson, a first-degree felony, and with filing a false insurance claim, a second-degree felony.
After the State rested, Prisbrey called Investigator and Girlfriend. At the end of the hearing, the magistrate declined to bind Prisbrey over on either charge, determining that, even though the State’s burden “is not very high,” the State had failed to meet that burden.
The preliminary hearing is a fundamental procedural right guaranteed by article I, section 13 of the Utah Constitution. The State need only present reasonably believable evidence—as opposed to speculation—sufficient to sustain each element of the crime(s) in question.
Despite the relatively low evidentiary threshold at a preliminary hearing, a magistrate may deny bindover in certain situations. Indeed, when properly construed and applied, the probable cause standard does not constitute a rubber stamp for the prosecution but, rather, provides a meaningful opportunity for magistrates to ferret out groundless and improvident prosecutions. Similarly, a magistrate may properly deny bindover where the facts presented by the prosecution provide no more than a basis for speculation.
Over the course of a case, inferences that once appeared reasonable may, upon further investigation, be proven to be unreasonable or no longer based on facts in evidence. And in exceptional cases, evidence put forward by a defendant at a preliminary hearing may overcome a prima facie showing of probable cause. The magistrate adjudged this case to be one of those rare cases in which the State’s evidence did not surmount the low probable cause bar. And in this unique case, for two related reasons, we discern no abuse of the magistrate’s limited discretion in reaching that conclusion.
The evidence of the insurance company’s investigation presented by the defense at the preliminary hearing served to overcome any remnants of reasonable inference that remained in the State’s references to accelerants or the holes in the wall. It bears noting that—at the time it investigated the claim—the insurance company was fully aware that local fire officials were wondering about arson; indeed, that is why the company dispatched its own investigator to the scene. And it goes almost without saying that the insurance company—given the $350,000 insurance claim at stake—had every interest in making sure the fire had not been started intentionally.
After considering all of the evidence as presented at the preliminary hearing, the magistrate determined that the State’s case was based on speculation and not on reasonable inferences grounded in evidentiary facts. The State’s theories did not hold up against an actual investigation by an entity with every incentive to validate them.
Insurance companies are obligated, in every fire claim, to conduct a complete, thorough, and fair investigation of every claim, even when a state fire investigator and a state prosecutor believe that the insured set an arson fire to defraud the insurer. Although the insurer’s investigator established by a thorough investigation – unlike the investigation conducted by the state – that the cause of the fire was accidental and paid its insured more than $350,000. The state charged the insured, regardless, only to have the attempt to bind the insured over to trial on the arson charge, and have a Magistrate dismiss the charge for lack of evidence.
© 2020 – Barry Zalma
Barry Zalma, Esq., CFE, now limits his practice to service as an insurance consultant specializing in insurance coverage, insurance claims handling, insurance bad faith and insurance fraud almost equally for insurers and policyholders. He also serves as an arbitrator or mediator for insurance related disputes. He practiced law in California for more than 44 years as an insurance coverage and claims handling lawyer and more than 52 years in the insurance business. He is available at http://www.zalma.com and email@example.com.
Mr. Zalma is the first recipient of the first annual Claims Magazine/ACE Legend Award.
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