Facts

Claimant V&A Lagorio is a large and diversified farming business. It purchased a FCIC crop insurance policy, known as an Actual Production History Policy, from respondent Global Ag Insurance Services for its processing tomatoes grown on Roberts' Island, which is West of Stockton. Branched Broomrape, a parasitic weed, was found on Lagorio's property in July of 2014.

The San Joaquin Agricultural Commissioner issued a "Notice to Hold Commodities on Premises," but gave Lagorio the opportunity to harvest the crop if it, and its processors, agreed to abide by certain restrictions, such as processing the tomatoes separately, separately disposing of the waste water, rigorous sanitation practices for equipment and trucking, etc. V&A Lagorio's processors refused and therefore the crops were destroyed. It submitted a claim to Global Ag, asserting that its loss should be indemnified under the Actual Production History Policy. Global Ag denied the claim.

CLAIMANT'S CONTENTIONS: V&A Lagorio contended that its loss was covered by the FCIC crop insurance policy.

RESPONDENT'S CONTENTIONS: Global Ag argued that there was no loss because the appraised crop in the field was larger than amount of production guaranteed under the policy and that losses caused by a quarantine were not a covered cause of loss under the policy.

Damages

V&A Lagorio asserted damages in the amount of $476,624, which included $448,641 for its lost crop and interest of $27,983.

Result

The arbitrator found in favor of Global Ag Insurance Services.