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in an attempt to settle the case in Appeals. Petitioners’
contention is based on their understanding of the controversy and
the factual development of the case at the time of the Appeals
conference. Petitioners argue that they made a good faith effort
to settle and thereby exhausted their administrative remedies.
Respondent’s contentions that petitioner should have
provided Appeals with more information can be divided into two
general categories: (1) Information already in petitioners’
possession concerning the damage to their residence, and (2)
information concerning the insurance company’s intent not to pay
petitioners for punitive damages. Initially, we consider the
first category of information available to petitioners that was
not provided to the Appeals officer.
In connection with their claim against the insurance
company, petitioners obtained two engineering reports concerning
the damage to the subsoil and to petitioners’ residence. Those
reports were not provided to the Appeals officer, but they were
presented at trial in order to support petitioners’ position
regarding the repairs to the residence. Although the reports
provided some support for petitioners’ contention that the
repairs exceeded the insurance recovery, the reports would not
have resolved the issue being considered by Appeals; i.e.,
whether the settlement payment was paid to petitioners in
satisfaction of their claim for punitive damages.
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