Insurer cleared of liability in S.D. dairy lawsuit

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A jury determined an insurer will not have to pay compensation after a South Dakota dairy sued Aurora County claiming zoning regulations forced the dairy to close.

Thompson Farms sued Aurora County in April 2002 because of a county zoning ordinance limiting the number of cows the dairy could house. According to the Associated Press, the dairy owners said the ordinance forced them to sell their farm and asked for $5.6 million in damages.

In February 2009, Circuit Judge Bruce Anderson ruled the county had violated the Thompson’s rights and taken their property without payment.

Aurora County purchased insurance coverage from the South Dakota Public Assurance Alliance, a company that provides insurance to local governments, the report said, adding that the county purchased coverage in March 2001 but did not disclose information about the zoning dispute with Thompson Farms as required by the insurer.

A Davison County jury decided the insurer was not obligated to cover Aurora County because the county knew of the dispute and failed to inform the insurer. The South Dakota Public Assurance Alliance would only have to pay unknown retroactive claims.

As part of the 2009 lawsuit, Circuit Judge Bruce Anderson would wait for the legal dispute over insurance coverage to determine how much the Thompson family was owed, AP reported.



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