NEVADA
A Problem with Expert Testimony, Not Flying Souvenirs
In FCH1 LLC, et al v. Rodriguez, the Nevada Supreme Court reversed and remanded a judgment following a bench trial in a tort action. At issue was alleged negligence by the Palms Casino Resort for allowing promotional actors to toss souvenirs into a crowd watching a televised sporting event in the casino’s sports bar. Rodriguez was injured when another patron dove for a souvenir. The Supreme Court reviewed whether to extend to the facts the limited duty rule established in Turner v. Mandalay Sports Entertainment, in which a spectator was hit by a foul ball while sitting in an unfenced beer garden. The Supreme Court declined to do so and found no error with the district court’s refusal to find that the Palms owed no duty of care.
The case was remanded, however, because the district court heard the inadmissible testimony of Rodriguez’s treating physicians. While treating physicians are exempt from the report requirements of NRCP 26 for opinions formed during the course of treatment, if their testimony exceeds that scope, they testify as experts and are subject to the report requirements.—From CLM Member Gina M. Mushmeche, Esq.
WASHINGTON
Settlement Sets Floor for Bad Faith Damages
The Washington State Court of Appeals recently held that a stipulated covenant judgment settlement that is found “reasonable” by the court “sets a floor, not a ceiling, on the damages a jury may award” in an assigned bad faith case. In Miller v. Kenny, a $4.15 million stipulated judgment became a $13 million bad faith verdict, to which the court added $7 million in prejudgment interest and approximately $1.6 million in attorneys’ fees plus an additional appellate fee award. The case was remanded for a proper calculation of court costs and post-judgment interest. —From CLM Member Paul Rosner
ALASKA
Exhaustion of Medical Payments and UM Coverage
The Alaska Supreme Court issued an opinion that could lead to interesting results in the uninsured or underinsured motorist coverage (UM/UIM) context. In Lockwood v. Geico General Ins. Co., the claimant was hit by an uninsured drunk driver. She quickly exhausted her medical payments coverage and sought payment under her UM coverage. The insurer saw the expenses as unduly high and offered $750 to settle. The claimant declined and had to resort to taking out a loan and even delaying treatment. The parties later settled for $25,000 under the UM coverage. Lockwood sued for bad faith due to the unreasonable delay. The trial court granted summary judgment to the insurer, and the claimant appealed. The Alaska Supreme Court reversed the summary judgment and remanded. While the case does not state outright that UM coverage must continue to pay medical bills once medical payments coverage is exhausted, it is close to doing so.—From CLM Member Rebecca J. Hozubin
DELAWARE
Juror Internet Search Means New Trial for Plaintiff
Thomas Baird underwent eye surgeries that resulted in developing a vision-threatening corneal disease. He filed for medical negligence against the doctor and the eye care center in Baird v. Owczarek. The verdict was in favor of the defendants. However, after the case, a juror contacted the plaintiff’s lawyer and called the judge’s chambers to inform them of juror misconduct. The trial judge refused any further investigation and denied the motion for a new trial. The Delaware Supreme Court stated that an allegation by a juror after the trial concluded and the verdict was entered that another juror conducted Internet research represents “an egregious circumstance giving rise to a rebuttable presumption of prejudice from exposure to an improper extrinsic influence” on the jury’s fact-finding duties. It held that once a trial judge is presented with evidence of Internet research during trial by a juror, it is incumbent on the judge to conduct an investigation. The Supreme Court reversed and remanded for a new trial.—From CLM Member Paul A. Bradley
CONNECTICUT
Failure to File Proof of Loss Equals Coverage Denial
Richard Palkimas sustained two losses in his home. He made a claim for both events and hired a public adjuster to negotiate with the insurer on his behalf. However, proof of loss was never filed for either claim, and both were denied. In Palkimas v. State Farm Fire and Casualty Company, the court upheld a trial court summary judgment order in favor of State Farm finding that the plaintiff failed to file a proof of loss as required under the insurance contract. The court was unpersuaded by the plaintiff’s claim of lack of prejudice. The court’s decision turned on the distinction between a delayed filing of a proof of loss and a failure to file a proof of loss.—From Connecticut Chapter President Bruce Raymond
MISSISSIPPI
Absolute Liability Coverage Despite Exclusion
In Machon Lyons v. Direct General Insurance Company of Mississippi, the Mississippi Supreme Court on writ of certiorari affirmed the court of appeals’ decision reversing the trial court and remanding this auto accident case for further proceedings. The court denied the insurer’s petition for rehearing on June 5, 2014. The significance of the case is that the court addressed, for the first time comprehensively, Mississippi’s compulsory insurance law §63-15-4(2)(a), which was adopted in 2013. It held that the insurer’s attempt to exclude liability coverage for a “named driver” was void and in violation of the statute’s absolute requirement that every motor vehicle operated in Mississippi be provided with liability limits of at least $25,000 per person/$50,000 per occurrence/$25,000 property damage. It stated that a liability policy that purports to exclude that coverage for certain drivers fails to comply with the statutory mandate. The court did note that its decision would not invalidate exclusions to coverage limits in excess of the mandated statutory minimum, as to which the parties are still free to contract.—From CLM Member Timothy D. Crawley, Esq.
TENNESSEE
Insurer Responsible for Acts of Producer in Arson Loss
In Cleveland Custom Stone v. Acuity Mutual Insurance Co., while the plaintiffs’ commercial business was on the decline, an arson fire destroyed a building owned by the business. When the building was acquired, the plaintiffs received a certificate of insurance from the insurer’s producer to furnish to the lender as a condition of the loan. However, no policy was ever issued. Upon notification of the loss, the insurer notified the plaintiffs that there was no coverage, and the plaintiffs filed suit. The trial court denied summary judgment to the insurer, and following a jury verdict in favor of the insured, Acuity appealed. The court found the insurer responsible for the acts of the producer under TCA 56-6-115. Despite the unrefuted proof of an arson fire, the insured’s principals had alibis and offered a possible explanation pointing to a third party—a disgruntled former employee. The jury found in favor of the insured, and the court of appeals affirmed.—From CLM Member James C. Wright