Verdicts/Judgments/Motions

Where a plaintiff injured in a car accident has brought a personal injury claim against the defendants allegedly responsible, the defendants must be granted summary judgment in light of the plaintiff's prior recovery in an arbitration proceeding against the insurer of the rental car that collided with hers.

Johnson v. Lapan, et al. (Lawyers Weekly No. 13-016-10) (7 pages) (Gardner, J.) (Appellate Division, Western District) Appealed from a decision by LoConto, J., in Worcester District Court. Daniel J. Shanahan for the plaintiff; Stanley A. Shea, of Hassett & Donnelly, for the defendants; Charles C. Gale for the third-party defendants (App. Div. No. 09-ADMS-70010) (March 15, 2010).

Where (1) a plaintiff child skier was injured when a defendant snowboarder collided with him, (2) a tort claim filed by the plaintiff against the defendant was settled and (3) the plaintiff has sued the codefendant insurance company which sold the snowboarder's mother a homeowner's policy, claiming that the insurer violated G.L.c. 93A, I hold that judgment should enter for the codefendant insurer because the plaintiff has not demonstrated that the insurer failed to make a reasonable settlement offer at a time when liability had become clear.

Discussion
"Insurers have a statutory duty to ‘effectuate prompt, fair and equitable settlement of a claim in which liability has become reasonably clear.' ... Insurers also have a duty of good faith and fair dealing in insurance settlement negotiations. ... Violation of these duties may give rise to liability under G.L.c. 93A. ...

"In order to determine whether a defendant's liability is ‘reasonably clear,' one must employ an ‘objective test which calls upon the fact finder to determine whether a reasonable person, with knowledge of the relevant facts and law, would probably have concluded, for good reason, that the insurer was liable to the plaintiff.' ... ‘[W]hat matters ... is whether [codefendant Harleysville Worcester Insurance Company] reasonably believed that [its insured's] liability was not clear, or was unreasonable in holding that belief.' ... ‘So long as the insurer acts in good faith, the insurer is not held to standards of omniscience or perfection; it has the leeway to use, and should consistently employ, its honest business judgment.' ... ‘Good faith requires that any settlement decision be made without regard to the policy limits and that the insurer exercise common prudence to discover the facts as to liability and damages upon which an intelligent decision may be based.' ... An insurer's good faith but mistaken evaluation of a claim does not constitute a violation of G.L.c. 176D. ...

"I rule that the plaintiff has failed to prove that liability was reasonably clear in June or September of 2006. Harleysville had two very different versions of the accident from its insured and the claimant, and indeed was in possession of a statement from its insured which suggested that he had not acted negligently. Moreover, while it is true that Harleysville was in possession of the ski statute as early as March of 2004, the mere fact that a snowboarder collides with a skier below him does not conclusively establish that the snowboarder was negligent. Even during the trial of this matter, counsel for [injured skier] Kevin [Yang] conceded that G.L.c. 143, §71O is not a strict liability statute. Thus, it follows that there may be situations where a skier collides with another skier below him on the slope and where no liability results. Harleysville reasonably believed in 2006 that this may be one of those cases. Therefore, I conclude that Harleysville was justified in denying liability at that time.

"... I am not persuaded that Harleysville's adjuster told [plaintiff's counsel in the underlying tort action David R.] Cianflone in 2006 that he felt that liability was clear or that he intended to make a substantial offer. However, even if he did say those things, it is clear that his view was not shared by his superiors at Harleysville. [Claims adjuster Stephen] Strouse's request to increase the reserve at that time was denied. Christine Jaworski, a senior general liability supervisor at Harleysville who oversaw the work of both Strouse and his successor [Heather] O'Toole, agreed with O'Toole's assessment that liability was not clear. There were perfectly understandable reasons supporting her belief, including the statement of [defendant snowboarder Reed T. Wendorf-]French and the absence of any indication of negligence in the Jiminy Peak incident report There is simply no persuasive evidence of any bad faith on Harleysville's part. ... Strouse may have been wrong in his assessment of the claim, and O'Toole may have ultimately been proven wrong in hers, but a mere mistake in the evaluation of a claim, i.e., bad judgment, does not constitute bad faith or a violation of G.L.c. 176D. ...

"For the foregoing reasons, judgment shall be entered for the defendant, Harleysville Worcester Insurance Company."

Yang v. Wendorf-French, et al. (Lawyers Weekly No. 12-327-09) (9 pages) (Ford, J.) (Berkshire Superior Court) David F. Hassett and Scott T. Ober, of Hassett & Donnelly, for the defendant insurance company; Matthew Mozian, of Compoli & Monteleone, for the plaintiff (Civil Action No. 2006-326) (Dec. 22, 2009).

On March 31, 2001, more than two years after the defendant plumber and mason completed a job in the plaintiffs' basement, it began to flood. The source of the flooding was an open polyvinyl chloride pipe that allowed surface water to flow from the well pit to the basement.

According to the plaintiffs, the flooding continued for a period of approximately 20 days before it stopped, when the water table in the ground went down.

The plaintiffs' complaint included counts for negligence, breach of contract and violations of G.L.c. 93A, alleging that, as a result of the water intrusion, their home developed mold that caused them various personal injuries, including cognitive impairment, short-term memory loss, confusion, mold allergies and respiratory diseases.

One plaintiff claimed that he could not work and was not able to resume his career as a financial consultant or perform any activities that required concentration and mental alertness. The alleged lost earning capacity was reported to be $1.5 million before trial; however, at trial, the lost earnings and medical expenses claims totaled $230,000.

The defendants challenged liability and damages. With respect to liability, the defendants submitted evidence that they did the work properly, complied with their contractual obligations and were not negligent. They also submitted evidence that the plaintiffs' home had other water intrusions that were unrelated to their work and that could have and did contribute to mold in the home.

The defendants challenged the plaintiffs' damage claims on the grounds that the alleged health problems were unrelated to mold and either existed prior to 2001 or were caused by other factors or conditions.

The defendants presented expert medical testimony that the plaintiffs did not have any respiratory ailments related to mold and had no mold allergy.

After a two-week trial, the jury found in favor of the defendants after two hours of deliberations.

Name of case: Harvey v. Lopes, et al.
Name of judge: Robert J. Kane
Amount of verdict: $0 (defense verdict)
Demand: $485,000 prior to trial; reduced to $395,000 during trial
Highest offer: $50,000
Attorneys: Scott T. Ober, Hassett & Donnelly, Worcester (for the defendant mason); and Andrew R. Ferguson, Coughlin Betke, Boston (for the defendant plumber)

Where an insurance company successfully brought a declaratory judgment action establishing another insurer's duty to defend a policyholder, the successful insurer is not entitled to an award of the counsel fees incurred in prosecuting the declaratory judgment action.

"It is well settled that an insured is entitled to recover reasonable attorney's fees and expenses incurred in successfully establishing the insurer's duty to defend under the terms of the policy. See Preferred Mut. Ins. Co. v. Gamache, 426 Mass. 93, 98 (1997) (Gamache). What happens when the party incurring attorney's fees and expenses to establish the insurer's obligation to defend is not the insured but a different insurer that has defended and provided coverage to the insured? That is the question raised in this case. We answer that the exception to the American Rule in Gamache and its progeny does not extend to allow the prevailing insurer recovery of its attorney's fees associated with an action brought to establish the defense and coverage responsibility of another insurer. ...

"The policy underlying the Gamache exception to the American Rule is not to punish wrongdoers or to reward those who act responsibly. Rather, it is a policy designed to protect the insured's right to receive the full benefit of its liability insurance contract. Through the successful declaratory judgment action, [John T.] Callahan [& Sons, Inc.] did receive that benefit at no cost to itself, thanks to Zurich [American Insurance Company]. But Zurich also received a separate and very real benefit from the action: the requirement that Worcester [Insurance Company] reimburse Zurich for one-half the settlement amount and one-half the attorney's fees. Application of the American Rule to Zurich in this context deprives the insured, Callahan, of nothing, and comports with established practice."

John T. Callahan & Sons, Inc., et al. v. Worcester Insurance Co. (Lawyers Weekly No. 10-046-09) (8 pages) (Botsford, J.) (SJC) Case heard by Chernoff, J., on motions for summary judgment, and a motion for entry of final judgment and award of attorney's fees also heard by him. Aaron R. White, of Boyle, Morrissey & Campo, for the plaintiffs; David F. Hassett and Scott T. Ober, both of Hassett & Donnelly, for the defendant (Docket No. SJC-10180) (March 19, 2009).

Paul S. Rainville successfully defended a case involving a slip and fall on ice at a gas station. The plaintiff sustained multiple fractures to his leg that required surgical repair and left the plaintiff with a partial disability. The plaintiff alleged medical bills of approximately $33,500.00 and a loss of earning capacity in excess of $100,000.00. We asserted that the accident was a result of the plaintiff’s own negligence and that there was no evidence that the defendants had notice of the alleged accumulation of ice.

Scott T. Ober was victorious following a two-week mold trial in Superior Court. The plaintiffs alleged that work performed by our client, a mason, and the co-defendant, a plumber, caused a flood in the basement of their home. The plaintiffs claimed that mold developed as a result of this water intrusion and that they suffered respiratory difficulties and cognitive impairment due to their exposure to mold. Lost earning capacity in the amount of $1,500,000.00 was further alleged. The jury returned a verdict after two hours of deliberations, finding no negligence and no breach of contract by our client.

Matthew G. Lindberg successfully defended a snow removal contractor in a Superior Court jury trial stemming from a slip and fall. The plaintiff sustained a four-part fracture to his shoulder when he slipped and fell in a snowy parking lot. We defended the case on the grounds that the plaintiff fell on a natural accumulation and that there was no evidence that our client was negligent in the manner in which it performed snow removal.

David F. Hassett prevailed on a Superior Court jury trial in a case brought by a state trooper who fell off of stairs at our clients’ rental property during the course of a drug raid. The plaintiff sustained a back injury and was out of work for approximately one year, alleging $90,000.00 in lost wages and $10,000.00 in medical bills. John M. Dealy assisted in the handling of the case and the preparation of the case for trial.

Paul S. Rainville won a Superior Court case filed against our client, a rental property owner, following a four-day jury trial. The plaintiff alleged numerous injuries, including a herniated disc, after a five-foot piece of siding purportedly fell off of our client’s building from a second floor stairway enclosure and struck the plaintiff on her head and neck. The jury returned a verdict after deliberating for ninety minutes, finding no negligence on the part of our client.

Matthew G. Lindberg was awarded Summary Judgment in a product liability action stemming from a crane accident filed in Superior Court. The plaintiff, when struck by the crane, sustained serious injuries including multiple fractures that required surgeries and the installation of hardware. The court agreed that due to the passage of time and the accidental disposal of the subject part, summary judgment should enter in favor of our client, the manufacturer of the crane, which fabricated some of its component parts, but not the one that was alleged to have failed.

Matthew G. Lindberg prevailed on a Motion for Summary Judgment in an asbestos case pending in Superior Court in which the plaintiff’s decedent died from malignant mesothelioma. We successfully argued that there was insufficient evidence to establish liability on the part of our client, whom the plaintiff had named as a supplier of asbestos-containing truck parts used at the decedent’s place of employment.

Courtney E. Mayo prepared a Motion to Dismiss that was presented by Paul S. Rainville and allowed in open court. Our client, a home improvement contractor and the third-party defendant, was hired by the defendant/third-party plaintiff homeowner in 2001 to perform certain work at the homeowner’s residence. The plaintiff sustained an injury at the residence in 2002 and thereafter instituted a negligence action in Superior Court, alleging special damages in excess of $32,000. The homeowner brought a third-party action against our client in 2008. We successfully moved to dismiss the third-party complaint on the grounds that it was untimely pursuant to the statute of repose.