Curtin & Associates is pleased to review significant jury trials recently completed by our office:

 

Butler v. Chen, Summit County Court of Common Pleas Case No. CV 2008 01 0872 – G. Michael Curtin tried the case wherein the defendant had lost control of her car and struck the vehicle of the plaintiff. Both motor vehicles sustained significant damage. Plaintiff delayed her care for a period of ten days but claimed that this was attributable to her lack of a motor vehicle. The plaintiff did have a prior history of Workers’ Compensation claims and motor vehicle accidents but discovery had disclosed that none of these had anything to do with musculoskeletal injuries. Plaintiff further had no prior history of neck, mid or low back complaints. Counsel for the plaintiff’s demand was $100,000 and he refused to lower the demand. Plaintiff presented Dr. Tassi and Dr. Soni as witnesses in the trial. Dr. Markarian appeared live and testified that the plaintiff had two herniated discs attributable to the accident. Dr. Markarian also opined that approximately $34,000 in medical bills accrued to date was reasonable and future bills could reach $300,000. A final offer of $20,000 was extended by defense counsel and the jury returned a verdict of $10,320. 

 

 

 

 

            The Ohio Supreme Court rendered a decision in an area which has been extremely restricted by judicial interpretation, specifically, the ability to include any restriction into available monies under uninsured/underinsured motorist coverage. This subject matter has produced a wealth of case law from the Ohio Supreme Court in conjunction with legislation promulgated by the Ohio General Assembly. In this particular case, a certified question was presented to the Ohio Supreme Court by the United States District Court for the Northern District of Ohio. In paragraph 1, that question was summarized as follows:

 

“... the question is whether an insurance carrier may decline to pay medical expenses pursuant to UM/UIM coverage when those same medical expenses have previously been paid or will be paid pursuant to the medical payments coverage in the same policy.”

 

            The facts of the case are less important than the decision’s actual holding. The case does include a detailed analysis of O.R.C. §3937.18 both prior to and subsequent to Senate Bill 97. The court answered the certified question in the affirmative and held, in paragraphs 35 and 36, the following:

 

            “Unlike the situation that obtained when the General Assembly enacted S.B. 20, the facts and circumstances surrounding the enactment of S.B.97 and the language used by the General Assembly in R.C. 3937.18(I) broadly permit insurance carriers to limit or exclude UM/UIM coverage in their policies and make no distinction on the basis of premiums paid.

 

            Based upon the foregoing, we hold that R.C. 3937.18(I), as amended by S.B. 97, permits an insurer to limit coverage so as to preclude payment pursuant to UM/UIM coverage for medical expenses that have previously been paid or are payable under the medical payment coverage in the same policy.”

 

            All seven justices joined in the opinion but Justice Pfeifer wrote a concurring opinion warning that policy language, different than that contained in the State Farm policy, that created any gap in coverage might very well result in that policy language being struck as violative of the public policy behind the uninsured/underinsured motorist statute. In his concurring opinion, Justice Pfeifer stated the following:

 

            “I cannot say with confidence that the State Farm policy in this case is contrary to public policy or goes beyond what the General Assembly intended to allow. Furthermore, based on the policy language in this case, the exclusion does not present a gap in coverage. See Clark v. Scarpelli (2001) 91 Ohio St.3d 271, 276, 744 N.E.2d 719 (the purpose of uninsured-motorist coverage is to eliminate gaps in coverage that could occur because the tortfeasor is uninsured or underinsured). An exclusion that creates a gap in coverage would be contrary to public policy, and nothing in the statutory scheme indicates that by enacting R.C. 3937.18(I), the General Assembly intended to abandon its policy against such gaps.”

 

            The language contained in the State Farm policy was set forth in paragraphs 8 – 14 and clearly has been approved by the Ohio Supreme Court by virtue of the aforementioned decision. Said policy language is as follows:

 

“’Non-Duplication

 

We will not pay under Uninsured Motor Vehicle Coverage any medical expenses paid or payable under:

 

            (1)        Medical Payments Coverage of this policy; or

 

            (2)        The medical payments coverage, no fault coverage, personal injury protection, or other similar coverage of any other motor vehicle policy.’

 

            Each policy also contained a separate ‘non-duplication’ clause within the Med Pay portion of the policy, stating:

 

‘Non-Duplication

 

No person for whom medical expenses are payable under this coverage shall recover more than once for the same medical expense under this or similar vehicle insurance.’”

 

 

 

 

            The origination of the case was a home purchase wherein the home purchasers subsequently sued several parties including the home inspectors with whom they had contracted to complete the home inspection. The contract between the purchaser and the home inspector included an arbitration provision. The plaintiffs (home purchasers) had originally agreed to a stay of their claims against the home inspectors pending arbitration but, subsequently, they changed their minds and the trial court issued a new order declining to stay the matter and ordered the home inspectors to participate in the trial.

 

            Counsel for the home inspectors filed an appeal pursuant to O.R.C. 2711.02(C). Said statutory section was reviewed in paragraph 12 of the Ohio Supreme Court’s opinion wherein it was stated the following:

 

            “R.C. 2711.02(C) provides: ‘An order ... that grants or denies a stay of a trial of any action pending arbitration ... is a final order and may be reviewed, affirmed, modified, or reversed on appeal pursuant to the Rules of Appellate Procedure and, to the extent not in conflict with those rules, Chapter 2505. of the Revised Code.’”

 

            The order did not include Civ. R. 54(B) certification that oftentimes elevates an interlocutory order into an appealable order. Rather, this order from which an appeal was taken, did not include said language but the statutory language set forth above conferred upon the parties the opportunity for appellate review.

 

 

 

            Kincaid v. Erie Ins. Co. represents a breach of contract and bad faith case reviewed by the Eighth District Court of Appeals. The facts are extremely interesting, especially in light of the fact that they serve as the cornerstone for the plaintiff’s lawsuit against Erie Insurance. 

 

            Don Kincaid was an insured of Erie Insurance and, after having been involved in an accident, was defended by Erie Insurance. No allegations were made that anything was wrong in the defense of the case and, eventually, the underlying tort claim settled. Subsequent to the settlement of that case, Don Kincaid filed a class action against Erie Insurance arguing that he had incurred expenses such as copying charges, postage, transportation, parking costs and missed time from work at the request of Erie Insurance or their attorneys in order to represent him. Mr. Kincaid petitioned the court to certify as a class all insureds since February, 1993 who were covered by Erie and Mr. Kincaid alleged that the failure to pay him was a breach of the contract and an indicia of bad faith.

 

            The case had been decided by the trial court pursuant to a motion for judgment on the pleadings O.R.C. 12(C) and, therefore, there was no evidence. However, although the plaintiff alleged that he had done everything required of him under the insurance contract, there appeared to be no dispute that Mr. Kincaid never sought payment from Erie Insurance for these claimed expenses. In fact, he had never turned any purported expenses over to Erie Insurance.

 

            The Erie Insurance policy contained the following provision which was stated in paragraph 5 of the opinion:

 

            “At issue is the portion of the insurance policy covering ‘Liability Protection.’ Under the subsection titled ‘Additional Payments,’ the policy states:

 

            We will make the following payments in addition to the limit of protection:

 

...

 

            5.         Reasonable expenses anyone we protect may incur at our request to help us investigate or defend a claim or suit. This includes up to $100 a day for actual loss of earnings.”

 

            Erie Insurance Company’s position was best summarized in paragraph 12 of the court’s opinion wherein it is stated as follows:

 

            “Erie responds that Kincaid failed to state a cognizable claim for relief because he did not provide proper notice to the company of his alleged expenses and has not shown that he had actually incurred any expenses as a result of Erie’s representation of him in the lawsuit. Therefore, Erie claims, its duty to perform was never triggered. Erie does not dispute that it owes its insureds any expenses they incur at its request; instead, the insurer asserts that it was never properly notified of the expenses because the purported class members never made a demand for payments. Because it was not notified, Erie asserts, the purported class members have no viable claim.”

 

            The Eighth District Court of Appeals reached a decision that even it impliedly stated may be somewhat illogical and held in paragraph 20 the following:

 

            “Our review of the insurance policy, which was attached to Kincaid’s complaint, shows no requirement that Kincaid notify Erie in any particular way or within a certain time frame to recover incurred expenses. While it may seem illogical that an insurer is required to pay for expenses that the insured never notified the company about, we are required to interpret the contract as written, and we find no notice requirement in the insurance policy in regard to additional payments. Simply put, the terms of the contract are plain and unambiguous; there is no notice requirement for additional payments under the policy.”

 

            Based upon the foregoing, the court reversed and remanded the case to the trial court for further proceedings with regard to the complaint for breach of contract as well as bad faith. The absence of any requirement in the policy that the insured notify its liability insurance carrier of the claimed expenses apparently salvaged the ability of Mr. Kincaid to continue his breach of contract and bad faith claims.

 

            The case clearly stands for the proposition that prudence would dictate some language be included in an insurance policy requiring an insured to give notice to the insurer of costs incurred but it is certainly difficult to reconcile this case as one that is worthy of ongoing litigation in the breach of contract and bad faith arenas.