The Hagerstown company acted in bad faith and without legal justification in suing the Earl S. Bell family of Sixes Bridge Road, according to Circuit Court Judge Mary Ann Stepler.

In a 29-page opinion issued last week, Judge Stepler said the insurance company harassed and attempted to intimidate the family while delaying and obstructing their legitimate casualty claims.

The dispute began Feb. 4, 1998. when a wind storm damaged Mr. Bell's barn so badly that it had to be rebuilt, according to court documents. Within two months, Mr. Bell submitted a loss claim of $119,795.

Mr. Bell said that under Frederick County regulations a building would be required for rebuilding. That would substantially increase costs because the county requires footings under all load-bearing walls.

Breather’s adjuster, Jim Hardy, appraised the loss at $30,240. A building permit was not included. The Bells' appraiser, Allan H. White, set repair cost at $119,795. Brethren obtained an outside appraiser, P H. Drayer Co., which determined loss at $69,240 without a building permit.

Meanwhile, Mr. Bell obtained a letter from Tim Goodfellow, a county development review planner, Who said that since the Bells were not involved in farming and no agricultural activities occurred in the Barn - used mainly to store cars - the rebuilt structure would be required to have footings and reinforcements in the walls, as required b y code.

In response, Brethren rejected Mr. Bell's proofs of loss and offered a final settlement of $21,953. Mr. Bell filed a complaint with the Maryland Insurance Administration. Shortly after the complaint was filed, Brethren sent written notice to Bell that his claims were rejected and both his insurance policies were canceled. Brethren said Bell had made "material misrepresentations" to Brethren.

Both Judge Stepler and the Maryland Court of Special Appeals determined -that Mr. Bell had not made any statement that constituted a misrepresentation actionable in a court of law.

Mr. Bell then requested an "extraordinary remedy," the awarding of attorney's fees, because Brethren acted in unjustified or bad faith. Judge Stepler said Brethren’s lawsuit was based on the premise that no building permit was needed. In fact, both of the insurance company's appraisers ignored the need for a permit. Judge Stepler said it was significant that the second insurance appraiser's figure "was more than twice the original estimate calculated by their own adjuster."

Judge Stepler also found it significant that Brethren’s final offer, $21,953, was $8,287 less than Mr. Hardy's "original low ball estimate and $47,287 less than Drayer's external estimate. Brethren submitted to Bell no basis for this. stark deviation."

The next significant issue uncovered by Judge Stepler dealt with Mr. Bell's complaint to the Maryland Insurance Administration. Within two weeks of being notified MIA was investigating, Brethren filed a declaratory judgment action which 'Judge Stepler said, "suspended any further investigation by MIA into Brethren’s questionable actions."

Judge Stepler said the MIA can- not intervene in declaratory judgment cases.

"This court," she wrote, "is under no illusion that Brethren knew exactly what impact filing a declaratory judgment in the circuit court would have on MIA's pending investigation. There is little doubt that this move by Brethren was in bad faith.

"It was a strategic move done for the improper reason of avoiding and or delaying further investigation by the MIA and delaying any payment to Bell for his claim."

Judge Stepler dismissed Brethren’s complaint about the need for a permit by saying, "It is a well-established legal principle that the circuit court is not a proper forum for the interpretation or determination of administrative laws."

She also dismissed Brethren’s second amended complaint, which alleged material misrepresentations but offered no evidence supporting those claims.

Judge Stepler said there was 41 significant evidence in support of the fact that Brethren filed its second amended complaint without substantial justification.

"The court notes that fraud and misrepresentation are intentional torts. We are under no illusion that Brethren was aware of Bell's position (Lieutenant Colonel, U.S. Air Force) as well as the possible implications bringing such an action would bring to a man in Bell's positions."

Mr. Bell's attorney, Owen D. Keegan of Arlington, Va., said the allegations of wrongdoing made against Lt. Col. Bell created problems within the service due to the nature of the officer's Work

Judge Stepler said, "Brethren's actions do merit the assessment of both costs and attorney's fees. The court does find that the fees requested are fair and reasonable.