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BP Business Economic Loss Claim Appeal 2015-1076: CAM not included as revenue

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The following is an Appeal Panel Decision issued pursuant to Section 6 of the BP Deepwater Horizon Economic & Property Damages Settlement Agreement and the Rules Governing the BP Appeals Process. Links may have been added to assist the reader. The original decision may be found here, as well as a glossary of BP Settlement terms.


BP appeals the BEL award to this claimant, a commercial shopping center in Bonita Springs, FL. The Claims Administrator issued an eligibility notice for $48,263.84 (pre-RTP) which Claimant submitted in its final proposal. BP claims that the Claims Administrator erroneously included Claimant’s CAM receipts as revenue resulting in an inflated award. BP submitted a final proposal of $16,705 (pre-RTP).

Policy 328v.2 provides a list of items that the Claims Administrator does not “typically” treat as revenue for purposes of the various calculations to be performed under the terms of the Settlement Agreement in BEL claims. While admittedly not an exhaustive list, the policy provides that “reimbursed expenses” are not typically treated as revenue.

After a review of the record, this panelist requested a summary of review addressing why Claimant’s CAM expenses were treated as revenue in this claim as opposed to reimbursed expenses pursuant to Policy 328v.2. The Claims Administrator stated:

CAM is typically included in revenue as a recurring revenue stream in the normal course of operations (Policy 373 v2) unless these charges can be specifically matched to expenses or represent revenue typically excluded under Policy 328 v2 (e.g., capital in nature). In the case of [XXXXX] for the Benchmark Period of May-December 2007/2009, the Claimant billed and earned CAM revenue in excess of potential CAM expenses in the amount of $66,578. Therefore, CAM was included in revenue as the Claimant’s CAM appear to have a profit component included in them.

In response, BP notes that Claimant’s CAM receipts declined each year from a high of $218,940 in 2007 to $117,740 in 2010. A comparison to the CAM expenses over that same period reveals a near dollar for dollar decline such that the total receipts and expenses are nearly identical. Further, the types of expenses listed as CAM (insurance, real estate taxes, trash collection, building repairs, etc.) are typical of expenses usually assessed to the tenants of a shopping center such as Claimant’s.

Disappointingly, the claimant elected not to offer any explanation why its CAM receipts should not be excluded as reimbursed expenses. Of note, Claimant did submit an offer of compromise which, though not accepted by BP, was much closer to BP’s final proposal that was Claimant’s.

After careful consideration, this panelist agrees with BP that the CAM receipts should have been excluded as reimbursed expenses under Policy 328v.2 rather than revenue pursuant to Policy 378v.2. In so doing, this ruling should not be interpreted as a finding that CAM expenses can never be considered revenue under appropriate circumstances. While tempted to find BP’s final proposal the correct result, this panelist is unable to determine if BP’s final proposal produces the correct result after excluding the CAM revenue and, therefore, remand this claim to the Settlement Program to recalculate the award in light of the above.

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