When dealing with injuries resulting from an automobile accident, uninsured motorists are often a victim’s worst nightmare. While a victim can seek coverage for medical bills from his or her insurance provider, the lack of an identifiable driver who caused the accident can make it difficult to obtain damages for pain and suffering or a lost ability to work. For this reason, many drivers also obtain uninsured motorist coverage, which permits them to bring personal injury lawsuits against an anonymous uninsured motorist, which the insurance company may or may not choose to defend.
There are a wide variety of people and entities that may face legal liability in a personal injury case, particularly one that occurs at a public place or on a business property. If the person or business caused an accident through negligence or direct actions, for example, the resulting injuries may be covered under an auto, business, or homeowner’s insurance policy. While insurers are likely to be able to pay out covered claims without much financial strain, they usually fight tooth and nail to limit their liability in these cases. The outcome often depends on the circumstances of the case and the specific terms of the policy at issue, as a federal court in West Virginia recently explained.
Mr. Slusarek was injured in a late night altercation at a Kwik King convenience store. As the court explained, the dispute arose after a Kwik King worker gave Slusarek incorrect change when he purchased cigarettes. The worker wasn’t able to open the register due to store policy and couldn’t find a manager to open it. Mr. Parker, who was shopping at the store at the same point, intervened in the argument that followed. He and Slusarek came to blows, according to the U.S. District Court for the Northern District of West Virginia, during which “Parker inflicted serious physical injuries upon Slusarek.”
Slusarek later sued Parker and Kwik King for his injuries. He also named as a defendant State Auto Property and Casualty Insurance Company, which issued the store a business operations insurance policy. He alleged that the incident was covered under that policy and that State Auto was therefore liable.
Recently, the West Virginia Supreme Court ruled that a construction company was not liable for a fire in a hotel started by an employee who was off duty. The incident occurred back in November 2010, when Robert Harris, a Powell Construction Company employee, dropped his cigarette in his room at Aracoma Hotel and started a fire. Because Harris was from out of state, he needed to stay in the hotel overnight in order to work on a company project in West Virginia.
Evanston Insurance Company, the Aracoma Hotel’s insurance carrier, was forced to pay over one million dollars for the damage caused. This led Evanston to file claims against Powell Construction Company in Logan County Circuit Court, charging it with “respondeat superior” — that is, vicarious liability — and negligent hiring. Evanston argued that Powell Construction Company should have seen that Harris had “certain propensities,” such as a criminal record and a history as a recovering addict, that made it foreseeable he could cause damage.
The Logan County Circuit Court granted Powell Construction’s motion to dismiss, stating that in order for the company to be liable, Harris would have to actually hold himself out as an agent of Powell Construction and to have caused the fire as part of his job duties, within the scope of his employment. Just being at the hotel while an employee of Powell Construction was not enough. Likewise, the circuit court found that Harris’s history with drugs and alcohol were not the cause of his dropped cigarette and thus the accident was not foreseeable when Powell Construction hired him.
Evanston petitioned the Supreme Court, arguing that the circuit court committed several errors in reaching its decision, including (1) granting the motion to dismiss when the claims were sufficient to withstand one, (2) finding that Evanston failed to state sufficient facts to support its claim of respondeat superior, and (3) finding that Evanston failed to state a claim of negligent hiring. Evanston argued that its claims were sufficiently stated because West Virginia is a notice pleading state, which means the threshold for stating a plausible claim is fairly low. Notice pleading merely requires “a short and plain statement of the claim showing that the pleader is entitled to relief,” as opposed to a higher threshold articulated by the United States Supreme Court in Bell Atlantic Corp. v. Twombly, which required that a claim meet a “plausibility” standard. Under the “plausibility” standard, the complaint must provide “enough fact[s] to raise a reasonable expectation that discovery will reveal evidence of illegal agreement.” Though some states have adopted the Twombly standard, West Virginia is not among them.
The West Virginia Supreme Court reviewed the Logan County Circuit Court’s decision and, finding it to be well reasoned, affirmed it.
This blog has previously discussed the tragedy that took place at the 2011 All Good Music Festival. The festival is a three-day music event that is typically held in July, at a campground near Masontown, West Virginia. In 2011, tragedy struck the event when one guest crashed his truck into the tent of three other guests from South Carolina. Nicole Miller died in the accident, while her friends, Yen Ton and Elizabeth Doran, were injured. The driver, Clay Lewin, claimed that he lost control and blamed parking and security staff for guiding him to the steep, grassy slope that was near so many tents.
The families of the dead and injured girls eventually sued the campground operator and three security providers. Now insurance companies are getting involved in filing lawsuits: American Insurance Company and Fireman’s Fund Insurance Company have filed suit against St. Paul Fire & Marine Insurance Company and RSUI Indemnity Company.
Initially, two of the girls’ families filed personal injury suits against Event Staffing, Inc. and Walther Corporation. Walther Corporation was doing business as the All Good Music Festival, while Event Staffing, Inc. was in charge of providing guest service personnel, including ticket takers, door attendants, parking attendants, perimeter security, overnight security, and state-certified security guards. The lawsuit claimed that Event Staffing, Inc. had a duty to observe and monitor the campsite, which included requiring Lewin to move the truck, which had been improperly parked. By failing to do so, Event Staffing, Inc. breached its duties under the security service contract.
In accordance with the terms of the security service contract and Walther’s insurance policy with American and Fireman’s Fund, the tort actions against Walther were tendered to Event Staffing, Inc. and its insurers for the purpose of defense and full indemnification.
However, Event Staffing, Inc.’s insurer, St. Paul, claimed that there would be no coverage under the Event Staffing, Inc. policy to the extent that Walther was solely negligent. What was more, St. Paul allegedly would not defend and indemnify Walther, nor would it reimburse Fireman’s Fund and American for costs incurred defending Walther, or for a $2,000 settlement. Soon, RSUI Indemnity Company followed suit and refused to pay. In their lawsuit, American and Fireman’s Fund seek compensatory damages.
West Virginia has become something of an enemy to tort reformers — so much so, that this state has placed second on the American Tort Reform Association’s list of Judicial Hellholes, behind only California. For the previous two years, the state had been third on the list, and has been on the list every year since it premiered. The reasons given by the American Tort Reform Association are that West Virginia judges “systematically apply laws and court procedures in an unfair and unbalanced manner,” especially against defendants.
Examples of West Virginia’s heresies include Supreme Court justices who made “liability expanding” decisions; the lack of an intermediate appellate court between the circuit courts and Supreme Court; “excessive” awards given by juries, such as $91.5 million in the case of a negligent nursing home; and asbestos litigation “abuse.”
Fortunately, all is not lost in this state, for the American Tort Reform Association sees “occasional glimmers of hope.” The group cites as a positive the fact that West Virginia voters replaced longtime Attorney General Darrell McGraw with his Republican opponent, Patrick Morrisey. McGraw made a practice of awarding no-bid state contracts to firms that contributed to his campaign.
However, that positive step could not overcome the fact that West Virginia judges had made decisions that caused insurance companies feel slightly less secure, or that jury awards had made nursing homes slightly more afraid to operate within the state.
We at the Wolfe Law Firm don’t disagree with all of the problems mentioned by the American Tort Reform Association. For instance, it could be to the benefit of West Virginians to have an intermediate-level appellate court, as the West Virginia Supreme Court has a heavy work load as the only court of appeal in the state. However, the sort of court we have in mind is not the same as the one the American Tort Reform Association has in mind. For us, intermediate appellate courts might be helpful only because they might allow cases to be heard sooner, relief to be dispensed faster, and people to get on with their lives sooner. For the business interests opposing people hurt by their products or services, it means getting a right to appeal in a state that currently does not provide an absolute right to appeal for all litigants. Some businesses, like Chesapeake Energy, have pouted and refused to make further investments in the state unless they could appeal verdicts against them.
A bill that would require insurance companies to disclose the type of insurance their customers carry won approval in the West Virginia House of Delegates on a 64 to 33 vote. Supporters of the bill believe that it could reduce the number of lawsuits filed in the state, while critics argue that if signed into law, it could make businesses more vulnerable to lawsuits.
House Bill 4486, which is now on its way to the Senate, would permit those who filed an insurance claim following an accident to get more information about the other party’s insurance coverage before filing a lawsuit. Supporters believe that if more people knew at the outset how much coverage the other party carried, that might discourage them from filing lawsuits because they would know whether insurance coverage alone could meet their needs. At present, people cannot view the other party’s insurance coverage without first filing a lawsuit. One supporter, an attorney, noted: “For insurance companies to hide the ball, they’re going to have to give it up after a suit is filed. Why not do it before and possibly eliminate a lawsuit filing?”
Critics such as the Chamber of Commerce, however, argue that the bill is a “cracker killer” — meaning that it could prevent companies from building an ethane cracker plant in West Virginia. Critics contend that if a business’s insurance coverage were exposed, that would lead to more lawsuits directed at the business in the future. House Judiciary Chairman Tim Miley, a West Virginia personal injury attorney, became so outraged by the Chamber’s comments that he took to the floor and delivered a 15-minute speech denouncing their scare-mongering tactics.
We at the Wolfe Law Firm find it difficult to judge exactly which way the legislation could lead. On the one hand, it seems naïve to think that companies would run screaming from West Virginia just because interested parties could see the insurance coverage they carry. As noted above, if the company was sued previously anyway, its insurance coverage would already be available to the public. Furthermore, 12 other states have enacted this type of legislation, and if they experienced a massive exodus of business, wouldn’t there be more documentation?
On the other hand, it also seems naïve to conclude that people would refrain from filing lawsuits just because they knew the other party’s insurance coverage. One source notes that “[t]he logic is that the person filing an auto or home insurance claim for an injury might opt out of going through costly physical therapy sessions if they knew the costs would exceed the other person’s policy’s limits.” Yet that seems absurd: if a person was injured in an accident and needs physical therapy, that person is going to try and get physical therapy. That person won’t really care if the other party’s insurance does not cover it — especially if the other primarily was primarily at fault. The only lawsuits this type of law might stop are the ones filed specifically to force the insurance company to open its books.
The Fourth Circuit Court of Appeals recently reversed a decision by a district court in West Virginia, finding for an insurer who refused to defend an inmate against a lawsuit. Originally, the District Court of the Southern District of West Virginia had found that Ezra Lambert, an inmate at Southwestern Regional Jail, should be defended by National Union Fire Insurance Company because he met the definition of a “volunteer worker.”
The incident that sparked the lawsuit took place in 2006. Lambert was working in the jail’s kitchen six days a week, eight hours a day, as a cook. Betty Jean Hale, a jail employee who worked in the kitchen with Lambert, alleged that Lambert injured her while pushing a cart carrying a mixer. The mixer fell and injured Hale’s foot, resulting in medical bills. Hale then filed suit in state court, naming Lambert along with the West Virginia Department of Military Affairs and Public Safety, and the West Virginia Regional Jail and Correctional Facility Authority. When National Union Fire Insurance Company — the state’s insurance company at the time — learned that Lambert had been named a defendant, it filed a declaration stating that it had no duty to defend or provide other policy benefits to Lambert.
Both Hale and Lambert sought a court order declaring Lambert insured under state policy, which would allow Lambert to defense as well as indemnification. The district court ruled that Lambert qualified as a volunteer worker under state law, and was therefore covered by state insurance, due to Lambert’s work in the kitchen without compensation. However, the Fourth Circuit ruled that Lambert could not possibly fit the definition of “volunteer worker” as defined by statute. Because Lambert was an inmate and forced to work in the jail, he could not be a volunteer. The Fourth Circuit noted that while a volunteer had the freedom to leave work if it became too onerous, when Lambert tried to protest working conditions by refusing to labor, he was put on lockdown. Lambert therefore was not entitled to be covered by the state insurer.
Back in 2005, the legislature, due to the influence of out-of-state corporations and the flood of lobbing money from insurance companies the legislature to take away third party rights. What are third party rights? If you are in a car accident in West Virginia and you have a claim against the person who was at fault in the accident you are a third party claimant because the claim is not against your insurance but the other persons insurance company.
Today, I received a faxed letter from an insurance company involving a claim where a concrete truck struck a citizen in West Virginia. Liability is clear, the driver admitted to fault, there were significant damages, and the person was injured significantly, incurring medical bills of approximately, $12,500.00. In that letter I received, the insurance company stated that their evaluation of the claim was $3,500.00. Now, how can they do that? Obviously, if the person has $12,500.00 in medical bills, their claim must be at least worth what their medical bills. These companies are playing these games because we no longer has third party unfair settlement practice rights in West Virginia. Once insurance company from Atlanta even said we don’t have to properly evaluate your claim you don’t have third party rights in West Virginia.
There is a constant bombardment against the rights of citizen who are injured in West Virginia. This is because the main goal of insurance companies is to make money and the less they pay on claims the more money they make.
The West Virginia Office of Disciplinary Counsel statistics for 2010 and what does this tell us about the practice of law? Every year, the Office of Disciplinary Counsel for the State of West Virginia publish statistics outlining lawyer discipline and complaints for the previous year. In 2010, the West Virginia Supreme Court of Appeals received fourteen complaints regarding eleven lawyers. Of the lawyers disciplined by the West Virginia Supreme Court, seven were solo practitioners, and four had 20 or more years of experience.
These statistics are also a commentary about what type of ethical violations which were committed by attorneys. Last years figures and past years find two primary area for ethical violations: trust account violations and failure to communicate with the clients. Both of these areas, trust account violations and failure to communicate with the clients, each separately were responsible for 22 percent of all acts of ethical violations by Attorneys
So what is a trust account and why does an attorney have to have a trust account? The Office of Disciplinary Counsel in West Virginia requires that every attorney have a trust account. In deed, an attorney in West Virginia has an ethical obligation to have a trust account in which to place a client’s funds.
Car wrecks are one of the most common events that give rise to personal injury claims, and when a vehicle accident occurs, insurance companies are invariably involved. In such cases, understanding the insurance policy at issue is of the utmost importance, and the language of that policy can have a huge impact on the recovery amount available to the injured persons. We here at the Wolfe Law Firm have handled cases for many victims who have been wounded in automobile, motorcycle, and tractor trailer accidents, so our West Virginia traffic accident attorneys are constantly monitoring changes in the field as new decisions are issued by the courts in this state. We recently discovered a decision rendered by the Supreme Court of Appeals of West Virginia that shows just how important it is to be mindful of the wording and definitions contained within any insurance policy factoring into a case.
Adkins v. Erie Insurance Company is a case that arose from an automobile accident in 2005 that severely injured a young girl under the age of 18. The case began as a declaratory judgment action filed by the victim’s parents, who sought the court’s ruling as to whether they were entitled to damages that they incurred as a result of their daughter’s injuries and the medical costs of helping her recover. Plaintiffs alleged that the woman who caused the accident was insured by defendant Erie Insurance, and the policy she had purchased from defendant provided a $300,000 per accident limit and a $100,000 per-person limit. The victim’s case settled for the per-person limit of $100,000, and as a part of that settlement, plaintiffs reserved the right to file a declaratory judgment action against defendant in order to determine whether the defendant would have to pay an additional sum to plaintiffs under a separate per-person policy limit.
At the circuit court, defendants proffered evidence that their policy provided coverage for damages from “bodily injury, meaning physical harm, sickness or disease, including care, loss of services, or resultant death.” As a result of this definition, the court found that the plaintiff parents’ claims were separate and distinct from their daughter, and that their claims for expenses and medical treatment for their child. That meant that the claims were not subject to the limitation of liability provision restricting payment to the single, per-person limit. Defendant then moved under rule 60(b) of the West Virginia Rules of Civil Procedure for the court to vacate the order, contending that they had given the court an incorrect and inapplicable definition of bodily injury. Evidently, Defendant had amended the policy at issue so that damages involved “bodily injury, meaning physical harm, sickness or disease, or resultant death of a person” — meaning they had removed the language regarding care and loss of services. As a result of this motion, the circuit court reversed its earlier decision, and held that the per-person limit applied, and that her settlement prevented any further recovery under the insurance policy.