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Insurance Defense and Litigation

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Recent SJC Decision Establishes That Insurer’s Duty to Defend Does Not Include Counterclaims

Joseph Coupal - Monday, November 20, 2017

Curtis B. DoolingBy Curtis B. Dooling

Under Massachusetts law, an insurer’s duty to defend its insured is broad. An insurer has a duty to defend its insured if the allegations against the insured are “reasonably susceptible of an interpretation that states or roughly sketches a claim” that falls within the defense obligation’s scope. Billings v. Commerce Ins. Co., 458 Mass. 194, 200 (2010).

Even where some claims against an insured are not covered by insurance, if some of the claims are covered, an insurer has a duty to defend the insured against all claims. This is commonly referred to as the “in for one, in for all” doctrine.

Until recently, the law was unsettled in Massachusetts as to whether an insurer had a duty to pay the legal costs associated with a counterclaim filed by an insured in response to a covered claim against the insured. In the case of Mount Vernon Fire Insurance Company v. Visionaid, Inc., the Supreme Judicial Court, in a 5-2 opinion, held that an insurer is not required to pay for its insured’s counterclaim. Massachusetts has joined the majority of jurisdictions that don’t obligate an insurer to cover the costs of an insured’s counterclaim, even where the counterclaim is related to and assists in the defense of the underlying case.

The defendant/insured, Visionaid, Inc., argued that the duty to defend included all reasonably necessary steps to reduce the liability of the insured, including the costs of a counterclaim. The SJC relied on the plain meaning of the insurance policy and held that the policy did not impose an obligation on the insurer to fund a counterclaim.

Chief Justice Gants dissented and noted that an insurer can’t fulfill its duty to defend without prosecuting related counterclaims that reduce its insured’s liability. The majority disagreed and held that an affirmative counterclaim did not fall within the definition of “defend” under the policy.

Practically speaking, an insured who believes that it has valid counterclaims may still assert the claims, but will have to do so at its own expense. When this scenario occurs, insurance defense counsel will have to work closely with the insured’s personal counsel to both defend the case and prosecute the counterclaim.

Pierce and Mandell’s insurance and litigation attorneys are well-versed in these areas and can assist both insurers and policyholders in assessing what claims are covered under an insurance policy.

Dooling Wins Premises Liability Jury Trial in Berkshire County

Joseph Coupal - Thursday, February 02, 2017

Curt Dooling recently obtained a defense verdict on behalf of his clients in a jury trial in the Pittsfield District Court in Berkshire County.

The plaintiff sustained multiple leg fractures after tripping over an entrance rug in a convenience store in Pittsfield, Massachusetts. Dooling represented the owner and operator of the convenience store. The plaintiff alleged that the entrance rug on which he tripped was defective because it failed to comply with American National Standard B101.6, the Standard Guide for Commercial Entrance Matting. The plaintiff also claimed that the store failed to properly secure the mat to the floor, which created a tripping hazard.

Before the trial began, Dooling filed a motion in limine to exclude any evidence regarding the size and type of the entrance rug on which the plaintiff tripped and whether the rug complied with any industry standard or regulation. The trial judge allowed Dooling’s motion in limine, and as a result, the plaintiff was foreclosed from presenting evidence in support of key elements of his theory of liability.

The jury deliberated for less than one hour and returned a defense verdict, determining that Pierce & Mandell’s clients were not negligent.

Liability Waivers and Releases – Who and What is Being Released - Boston, MA

Joseph Coupal - Thursday, December 01, 2016

Pierce and Mandell, PC. Boston, MAby Curtis Dooling

Superior Court Judge Dennis Curran recently allowed the estate of a man who died at a YMCA facility to proceed with a wrongful death claim against the YMCA even though the decedent signed a liability release. The decedent, who was participating in an elderly exercise program at the YMCA, was found unconscious in a steam room. YMCA employees could not access the control room to shut off the steam heat. The decedent experienced catastrophic burn injuries and died shortly after being transported to the hospital.

The decedent signed a release absolving the Silver Sneakers program from all liability. The Silver Sneakers program was an elderly exercise program that encouraged seniors to join the YMCA to exercise. The program was operated by the YMCA at a YMCA facility. Although the release had broad and somewhat ambiguous release language, it did not specifically mention the YMCA as a released party. Thus, the court held that the plaintiff’s claims against the YMCA and its employees were not barred by the release. The court also held that the release did not bar claims for gross negligence because these claims were not specifically mentioned in the release.

This case demonstrates the importance of the language of a liability release. Liability releases and waivers are ubiquitous in modern society. Businesses often make patrons sign releases to protect against claims and lawsuits. However, as this case makes clear, poorly and vaguely written releases won’t stand up in court. It is vitally important to ensure that liability releases and waivers are carefully drafted to release the numerous potential claims that could be brought and to identify the parties being released as anyone or anything that is involved in any way in owning, managing or working at a business, facility or event.

Pierce & Mandell’s litigators have years of experience advising and representing businesses in risk and claims management and have litigated countless cases involving liability waivers and releases.

Curt Dooling Quoted in Massachusetts Lawyers Weekly Article on Recent SJC Decision DiCarlo v. Suffolk Construction Co., Inc., et al.

Joseph Coupal - Wednesday, July 06, 2016

Pierce & Mandell attorney Curt Dooling was quoted in a Massachusetts Lawyers Weekly article on the recent Supreme Judicial Court decision of DiCarlo v. Suffolk Construction Co., Inc., et al. In DiCarlo, the SJC held that pain and suffering damages were not subject to a workers compensation lien pursuant to G. L. c. 152, § 15.

In the article, Dooling discussed the implication of the case on the settlement of personal injury claims. Dooling noted that workers compensation insurers are less likely to take a hard line in settlement discussions because the SJC has made it clear that pain and suffering damages are not subject to a workers compensation lien. Read Curt’s comments and the full article.

Pain and Suffering Damages Not Subject to Workers’ Compensation Lien - Boston, MA

Joseph Coupal - Tuesday, March 01, 2016

by Curtis B. Dooling

The Supreme Judicial Court recently held that pain and suffering damages recovered by an injured plaintiff in a third-party personal injury case were not subject to a lien held by a workers’ compensation insurer that paid benefits to the injured plaintiff. Although it is too early to tell what effect this case will have in civil practice, the likely result is that tort cases with large workers’ compensation liens may be easier to settle by allocating portions of settlements to pain and suffering damages, circumventing the statutory lien rights of workers’ compensation insurers. However, settlement agreements that are subject to a workers’ compensation lien still have to be approved by a judge so any allocation must be reasonable.

DiCarlo v. Suffolk Construction Co., Inc., 2015 WL 10045032, involved two separate underlying cases that both arose out of workplace accidents. In both cases, the plaintiffs, Robert DiCarlo and Bernard Martin, sustained injuries at work and both collected workers’ compensation benefits. Both plaintiffs then reached settlement agreements with third parties, which included damages for pain and suffering. In both cases, the workers’ compensation insurer sought reimbursement under G. L. c. 152, § 15 from the plaintiffs’ settlement proceeds, including pain and suffering damages.

In DiCarlo’s case, a Superior Court judge rejected a settlement agreement because it did not permit the workers’ compensation insurer to recover a lien on the entire settlement amount, including pain and suffering damages. In Martin’s case, a Superior Court judge allowed a similar settlement agreement. The practice of allocating damages between pain and suffering and special damages is relatively new, leading to inconsistent results, as evidenced by the conflicting decisions in the DiCarlo case and Martin case.

The SJC focused on the language of the workers’ compensation statute, which permits a workers’ compensation insurer to recover benefits paid to injured workers’ where the injured worker recovers damages for the same injury from a third-party tortfeasor. A workers’ compensation insurer is entitled to “the gross sum received in payment for the injury.” G. L. c. 152, § 15. The issue before the SJC was whether “injury” included pain and suffering damages. The Court concluded that it did not.

The Court reasoned that since a workers’ compensation insurer pays for lost wages and medical expenses only, not pain and suffering damages, it is not entitled to be reimbursed for something that it did not pay.

Interestingly, the Court recognized the chance that a plaintiff and settling tortfeasor may attempt to inappropriately allocate the bulk of settlement proceeds to pain and suffering damages in order to work around a large workers’ compensation lien. However, the Court noted that since settlements needed to be approved by a judge after a hearing where the workers’ compensation insurer is permitted to participate, such inappropriate allocation would not be permitted.

The American Insurance Association submitted an amicus curiae brief in support of the workers’ compensation insurer’s position, evidence of the fact that workers’ compensation insurers are not going to be pleased with this decision. On the other hand, general liability insurers may be in favor of the decision because it will make it easier to resolve tort claims with large workers’ compensation liens. Going forward, plaintiff’s lawyers may request that juries allocate damages between pain and suffering and medical/lost wage damages to lessen the amount of jury awards that are subject to a workers’ compensation lien.

Pierce & Mandell’s litigation attorneys have years of experience defending personal injury claims on behalf of insurers and self-insureds. Please contact us with any questions about this new development or any other litigation need.

Recent Changes to Superior Court Rule 9A

Joseph Coupal - Friday, January 22, 2016

By: Curtis B. Dooling

Superior Court Rule 9A governs the service and filing of all civil motions in the Massachusetts Superior Court. A thorough understanding of Rule 9A is essential to a successful litigation practice.

A recent change to Rule 9A that went into effect on January 1, 2016 has simplified the manner in which reply memoranda can be filed. Under the pre-January 1, 2016 version of Rule 9A(3), a moving party was required to seek leave of court to file a reply memorandum after receiving the opposition papers.

Under the newly enacted version, the moving party may file a reply brief without seeking leave of court in order to address “matters that were not and could not reasonably have been addressed in the moving party’s initial memorandum.” The reply memorandum is limited to five pages and is to be filed with the Rule 9A package.

Parties must still seek leave of court to file sur-replies, but the procedure to request leave of court has also been slightly changed. A request for leave of court to file a sur-reply must be in the form of a pleading, can be no longer than one page, and must be addressed to the session clerk.

These changes were put in place in an attempt to remove some confusion surrounding the correct way to request leave of court to file reply and sur-reply memoranda. Under the pre-January 1, 2016 version of the rule, it was unclear whether the moving party needed to provide the proposed reply memorandum to the court when requesting leave of court to file the reply. Some clerks and judges required this, while others didn’t.

Under the pre-January 1, 2016 version of the rule, it was also somewhat unclear to whom the request for leave of court should be addressed, resulting in delays in the filing of motions. If no response came from the judge before the Rule 9A filing deadline, reply memoranda were often filed after the Rule 9A package and were not received by the judge in a timely manner.

This change to Superior Court Rule 9A, although not monumental, nevertheless is important for litigators to understand and to follow. The change to the reply memorandum procedure is also an important step in streamlining Superior Court motion practice.

UBER INSURANCE

Joseph Coupal - Wednesday, November 18, 2015

By Curtis B. Dooling

On New Year’s Eve 2014, an UberX driver in San Francisco struck a family crossing the street and killed a six year-old girl. This was the first – but likely not the last - tragic motor vehicle accident involving vehicles driven by Uber drivers or other ride-share companies.

What propelled this story after the tragedy was a wrongful death claim filed by the family of the little girl against Uber, which denied liability on the basis that while the UberX driver was available to pick up passengers, there were no passengers in the car at the time of the accident. If the regulatory scheme for ride-share companies is complex, the issue of liability is no less complicated.

Under the Massachusetts personal automobile insurance policy, all vehicles are required to carry bodily injury coverage of $20,000 per person and $40,000 per accident, with the option to purchase additional bodily injury coverage over the compulsory limits. This compulsory coverage is available only to individuals who are not occupants of the insured vehicle. Many ride-share drivers use their own personal vehicles when driving ride-share passengers, but don’t disclose their activities to their respective insurers. When insurers learn of this, usually after an accident, the insurer will disclaim all optional coverage, leaving only compulsory coverage available to all non-occupants of the insured vehicle. Thus, often times there is no coverage available under the driver’s auto policy for ride-share passengers injured during a ride-share trip.

According to Uber’s website, from the moment a driver accepts a trip request until that trip ends, Uber provides $1 million in liability coverage, including uninsured and underinsured coverage. This coverage is available to injured ride-share passengers, other drivers, and pedestrians, as long as the ride-share app is on and the driver has passengers. To the contrary, most taxi companies normally only carry the minimum in bodily injury coverage ($20,000 per person/$40,000 per accident). Therefore, Uber’s $1 million in liability coverage is significantly better than the average taxi’s insurance coverage.

However, there is a ride-share insurance gap. When an Uber driver has the ride-share app on but doesn’t have any passengers, does Uber’s $1 million insurance provide coverage? This issue first came to light after the tragic accident in San Francisco. The family of the six year-old girl filed a wrongful death lawsuit against Uber, which denied liability on the basis that the UberX driver, although available, didn’t have any passengers at the time of the accident. After much public outcry and criticism, Uber changed its policy to eliminate this insurance gap uncertainty. Since that time, Uber claims that its drivers are covered by bodily injury coverage from the moment that a driver turns on the app and is available for a trip request. However, the limits of coverage aren’t the same. If an Uber driver is available but has no passengers and hasn’t accepted a job, Uber provides $50,000 person/$100,000 per accident in coverage. Once a driver accepts a job, the $1 million in coverage becomes available.

Governor Charlie Baker is now weighing in on this topic with legislation that would create statutory standards to govern ride-share companies (referred to as Transportation Network Companies or TNCs). The proposed law would require that all TNC drivers carry the standard minimum automobile bodily injury coverage, effective when a TNC driver is available but before accepting a trip request. Upon accepting a trip request, a TNC driver then would be required to carry $1 million in liability insurance. The bill would bring all TNCs within the regulatory authority of the Commonwealth, and would subject TNC drivers to more stringent background and eligibility requirements. The proposed legislation has been vehemently opposed by the taxi industry, which argues that ride-share companies should be subject to the same regulation as the taxi industry.

As the popularity of Uber and other similar companies increases, regulators and lawmakers are responding with changes in the law that will affect liability coverage for ride-share companies, drivers, riders and those who may become involved in an accident with an Uber-driven vehicle. Pierce & Mandell’s attorneys have years of experience in all areas of insurance litigation and personal injury litigation.

Trip and Fall Suit Against Retail Store Dismissed on Summary Judgment - Boston, MA

Joseph Coupal - Friday, October 02, 2015

By: Curtis B. Dooling

A superior court judge recently dismissed a plaintiff’s trip and fall claim against Ward’s Berry Farm in Sharon, MA, holding that a pallet with a box of empty fruit baskets on it next to a checkout counter was not an unreasonable danger that required the store to warn customers.

In the case, Belanger v. Boys in Berries, LLC, the plaintiff was at a checkout counter at Ward’s Berry Farm, a pick your own fruit farm stand. While in the checkout line, the plaintiff saw a large box that contained a number of empty fruit baskets used to pick your own fruit. The plaintiff didn’t notice that the baskets sat on a wooden pallet. As the plaintiff walked away from the checkout counter, she tripped and fell over a corner of the wooden pallet.

The plaintiff claimed that the placement of the pallet directly adjacent to the checkout counter was dangerous and that the store breached its duty to maintain the premises in a reasonably safe condition. The court disagreed. The court found that placing the pallet at the end of the checkout counter in full view of customers was “fully consistent” with a store’s duty to maintain its premises in a safe condition. The court relied on two Supreme Judicial Court cases which held that customers in supermarkets could not sue for tripping over stock carts or shopping carts in aisles. The court held that a pallet near a checkout counter was just as ubiquitous as a shopping cart in a supermarket aisle and was not an unreasonably dangerous condition.

The ruling is a victory for property owners. The ruling confirms that it is insufficient for a plaintiff simply to show that she tripped over an item in a retail store. To the contrary, a plaintiff must show that she tripped because of a retail store’s failure to remedy a dangerous condition. Having a pallet with boxes on it is quite common in retail stores. In this case there was no evidence of poor lighting or damage to the wooden pallet or any other indicia that the pallet or its location in the store was dangerous.

All too often property owners and insurers are willing to settle trip and fall claims rather than litigate the cases and seek summary judgment. Pierce & Mandell’s litigation attorneys regularly represent small businesses and property owners and are uniquely qualified to aggressively defend any slip and fall claim.


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