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Juanita Harris had a $25,000 life insurance policy claim on her deceased husband denied but was awarded a $3 million settlement from the company that issued the policy. Photo by Jim Laurie. Juanita Harris, flanked by her two attorneys, Matt Vannah, left, and Bob Vannah, says she can buy a headstone for her late husband now that she's settled a case for $3 million. Photo by Jim Laurie.

Sunday, September 17, 2000
Copyright © Las Vegas Review-Journal

Seeking simply a headstone, widow ends up with a diamond

By PETER O'CONNELL
REVIEW-JOURNAL

      Cancer stealing the life of a loved one. An insurance claim denied. Revelations of an altered document. A civil judgment that dwarfs the initial claim.

      All were elements in the 1997 film adaptation of John Grisham's novel, "The Rainmaker."

      And all were present in the civil trial resulting from Ohio State Life Insurance's decision to deny a $25,000 claim arising from the April 1997 death of Paul Harris of Henderson.

      As jurors filed into court expecting to hear closing arguments Tuesday, they instead were told that the insurance company had agreed to settle the case for just more than $3 million.

      The sizable judgment obtained on a relatively paltry policy was just one of many similarities between Grisham's fictional account and the real-life legal battle of Harris' widow, Juanita.

      So numerous were the coincidences that attorneys, while addressing prospective jurors at the start of the trial, joked about which movie characters corresponded to which trial participants.

      "The similarities are uncanny," said attorney Bob Vannah, who represents Juanita Harris.

      One difference: In the movie, the insurance company declares bankruptcy and never pays the $50 million jury verdict. In the Harris case, Ohio State Life pledged that the $3 million settlement will be paid by Sept. 27.

      Juanita Harris, a 66-year-old native of Louisiana, said her sudden wealth will prompt no drastic lifestyle changes.

      She doesn't even plan to quit her job at The Reserve, where she makes $8 an hour in the first paid position of her life. She joined the work force in order to meet mortgage payments on her Henderson home.

      "I won't have to worry about making payments of any kind now," she said in an interview Wednesday.

      Paul and Juanita Harris wed in October 1952, five months after they met on a blind date. "Love at first sight for me," Juanita Harris said.

      They subsequently moved from Louisiana to Texas, and raised four children before moving to Las Vegas in 1993. An old friend had offered Paul Harris a good job as an air-conditioning engineer at the Luxor.

      Two years later, the couple purchased their Henderson home and for the first time decided to buy life insurance.

      They responded to a letter in which insurance agent Allan Meredith of Ohio State Life pitched a "mortgage-payment plan, which due to its very low costs, helps make it possible for you to make your monthly mortgage payment in the event of sickness or injury. Also pay off the balance of the mortgage in the event of death of one or both insureds."

      In May 1995, the Harrises completed the insurance application and made the initial required payment of $104. The policy was issued two months later.

      However, a key event had occurred in the interim. On June 25, 1995, Paul Harris suffered a heart attack.

      Juanita Harris said her husband missed a total of five weeks of work. With money scarce, the couple called Meredith to ask that Ohio State Life make their monthly mortgage payment in keeping with the policy, Juanita Harris said.

      She said Meredith replied that theirs was strictly a life insurance policy, covering only claims arising from a death.

      She and her husband considered dropping the policy, but decided that no other company would sell them insurance now that Paul Harris had had a heart attack.

      In August 1995, they were asked to sign forms that asked whether they had experienced any sickness since the date of the application.

      Paul Harris signed one form without making written mention of his heart attack. The couple disclosed that medical testing had revealed that Juanita Harris had elevated glucose levels.

      Paul Harris was diagnosed with brain and lung cancer in September 1996, and he and his wife traveled to Texas to be near their children. Paul Harris died in April 1997 at the age of 64.

      In an interview with an Ohio State Life claims examiner one month later, Juanita Harris mentioned her husband's June 1995 heart attack.

      Internal documents show that the examiner then recommended the company deny the $25,000 claim, citing the August 1995 form in which Paul Harris did not mention his heart attack.

      Juanita Harris said the company's decision left her unable to pay for her husband's funeral. There still is no headstone over Paul Harris' grave in Texas, and the funeral home that handled the arrangements has a $7,790 civil judgment against her.

      Vannah filed suit on her behalf, and the subsequent litigation spawned myriad complex issues, many of which turned on the events of summer 1995.

      Vannah contended that Paul Harris already was covered by Ohio State Life when he filled out the form that did not mention his heart attack.

      Moreover, the attorney said Paul Harris, who never graduated high school, did not intend to mislead the insurance company. He said Paul Harris had notified the company of his heart attack when he called Meredith in June 1995 and asked that Ohio State make a mortgage payment because he was ill and could not work.

      Meredith told company officials he would not have delivered the policy to the Harrises had he known of the heart attack. In a letter to Juanita Harris, the company said it would not have issued the policy had it been advised of Paul Harris' changed medical condition.

      Juanita Harris rejected the company's offer to settle the lawsuit for $10,000, and the parties commenced the laborious process of preparing for trial.

      In June, attorney Matt Vannah, Bob Vannah's son and co-counsel, requested various documents from the law firm that initially represented the insurance company. Because the plaintiff was entitled to the papers, the firm complied and Matt Vannah began poring over the pages.

      Within minutes, he picked up the phone and called his vacationing father. "I think this is big," he said.

      What had caught his eye was an internal document that the company already had provided. But the version the company had provided the plaintiff did not include six lines of text in the version that Matt Vannah obtained.

      In those six lines, a claims examiner wrote that Meredith maintained the Harrises did not inform him that Paul Harris had suffered a heart attack. The examiner went on to state that she considered it possible that the agent did know of Paul Harris' changed medical condition.

      "I believe it is feasible that the insured could've called expecting some sort of mortgage benefit after his heart attack (he was off work for approx. 5 wks)," the examiner wrote.

      The examiner also wrote that Paul Harris might have misunderstood the purpose of the August 1995 form on which he made no mention of his heart attack.

      Paul Harris might have believed he was merely acknowledging that his wife's elevated glucose levels had changed her insurance rating, the examiner wrote.

      Bob Vannah said he decided not to mention the altered document until a company vice president took the stand at the trial that began Sept. 5 before District Judge Gene Porter.

      "We waited," the attorney said.

      On Sept. 7, he showed the vice president two poster-sized exhibits that highlighted the text missing from the document the company had provided to the plaintiff. "It was devastating," Bob Vannah said.

      The next day, attorneys for Ohio State Life broached the idea of a settlement. Bob Vannah said several days of negotiations ended Monday night when the company agreed to pay just over $3 million.

      The parties made the settlement official in court the next morning, then told jurors that the case had been resolved.

      Attorney Mitch Cobeaga, who represents Ohio State Life, told jurors that the company still believed in the merit of its case. But he said the company decided to settle in part because of concern about the impact of the altered document.

      Contacted Thursday, Cobeaga declined to comment. Bob Vannah said an evidentiary hearing outside the jury's presence established that Ohio State Life attorneys did not participate in the deletion of the examiner's written remarks.

      The identity of the person who altered the document was not determined, though Bob Vannah said the evidence established it must have been done by someone in a high-level position within the company.

      A phone message left at Ohio State Life headquarters in Dallas was not returned. Nor was a message left at the Missouri headquarters of the company's owner, Americo Life Inc.

      Contacted at his Las Vegas office Thursday, Meredith said he was not aware the company had settled the case. "I'll be darned," he said.

      The agent defended his actions, saying he never would have delivered the policy had he been apprised that Paul Harris had suffered a heart attack. Internal company documents state that Ohio State Life had received no prior complaints regarding Mere- dith.

      Juanita Harris said she has no grandiose plans for spending the proceeds of the settlement. She plans to satisfy the civil judgment obtained by the Texas funeral home. And she plans to place a fine headstone on her husband's grave at a ceremony attended by the entire family.

      "I want all the kids to be involved," she said.