Insurance Disagreement

Holding Insurers Accountable After a Maryland Accident

November 11, 2020 | Lebowitz & Mzhen

Under Maryland law, an insurance policy is governed by general contract principles and interpretation. In Maryland insurance disputes, courts are supposed to interpret the contract based on the parties’ intentions when the contract was drafted, and the contract must be considered a whole. In addition, the insurer has the burden to prove an exclusion from coverage.

Insurers are bound by the actions and representations of their agents. If an agent is an actual agent of an insurer, the agent is subject to the insurer’s right of control, the agent has a duty to act for the insurer’s benefit, and the agent holds the power to alter the legal relations of the insurer. In some cases, insurers can also be bound under the apparent-agency theory. In this situation, the insured must show that the insurer led him to believe that the apparent agent was an actual agent of the insurer, the belief was reasonable, and the insured relied upon the apparent agency.

In a recent case, one court considered whether a couple could succeed on a theory of apparent agency after they continued to make payments on their expired policy to who they believed was an agent of the insured. In that case, the insured couple purchased an insurance policy for a period of one year. The couple met with an insurance agent to purchase the policy and paid the policy premium to the agent. Such a payment was permitted as it fell under an “agency bill policy.” The couple continued to make payments on the policy to the agent rather than to the insurer directly. After the first year of the policy, the policy was eligible for renewal as a “direct bill policy,” which meant that the couple was supposed to make payments directly to the insurer to renew and continue coverage under the policy. The couple claimed it did not receive notice reflecting the cancellation and notice of the new policy. The couple continued to make payments directly to the insurance agent after the expiration of the initial one-year period, and the insurer never received the payments to renew and continue the policy.

The Use of Interrogatories in Maryland Accident Cases

May 19, 2020 | Lebowitz & Mzhen

Interrogatories are part of the discovery process in a civil case. An interrogatory is a series of written questions asked by one party to another, which must be answered in writing. In Maryland motor vehicle accident cases, any party may serve written interrogatories to another party. The receiving party must answer interrogatories within 30 days after service or within 15 days after the date after the date when the party’s initial pleading or motion is required, whichever is later. Responses must be made under oath.

A recent case before a federal appeals court shows how failing to answer interrogatories completely and honestly can lead to much bigger problems down the road. In that case, a van had slipped off the edge of a roadway while carrying six family members—all were injured, and one family member died. The crash took place in a construction zone, where a guardrail had been removed and had not been replaced. The lines on the road also had not been repainted where it had been repaved, and there were pieces of asphalt on the shoulder.

The family sued the two construction companies that had repaved the road. The defense attorney for the companies told the plaintiffs that the two companies had a joint venture with a $1 million insurance policy. The defense attorney sent initial disclosures under Federal Rule of Civil Procedure 26. In the disclosures, concerning the defendants’ insurance coverage, they listed the joint venture’s $1 million policy as their only insurance coverage. The parties settled for $1 million and signed a release stating that they were not relying on any statements by any parties’ attorneys.

Do Maryland Accident Victims Need to Attend Independent Medical Exams?

June 4, 2019 | Lebowitz & Mzhen

When an accident victim files a Maryland personal injury case, the plaintiff must present some evidence of the injuries they sustained to satisfy the “damages” element of their claim. If a plaintiff cannot prove that they sustained damages, the court will dismiss the plaintiff’s claim, even if the defendant admits that they were negligent in causing the accident.

Typically, a plaintiff will present evidence from either a treating physician or a physician who was seen for the specific purpose of obtaining a medical opinion for the case. Of course, the defendant may be skeptical about the plaintiff’s claimed injuries, and they may seek to obtain an independent medical examination (IME) of the plaintiff. Like it or not, if the court orders an IME, a plaintiff must attend and cooperate with the examination. A recent case illustrates the consequences a plaintiff may face if he or she fails to cooperate with a court-ordered IME.

According to the court’s opinion, the plaintiff, a railroad worker, was injured when he slipped after stepping in a puddle of oil. The plaintiff filed a personal injury lawsuit against his employer under the Federal Employer’s Liability Act and was deposed shortly afterward. The defendant requested an IME, which the plaintiff contested, arguing that it was scheduled too far from his home. The court ordered the plaintiff to attend the IME, but it required the defendant to pay for the plaintiff’s mileage.

Court Discusses Insurance Company’s Obligations in Horse-Drawn Carriage Accident

May 15, 2018 | Lebowitz & Mzhen

Recently, a state appellate court issued a written opinion in a personal injury case requiring the court to determine if an accident victim’s claims against an insurance company fit within the underinsured/uninsured motorist (UIM) provision of the victim’s policy. After conducting a thorough analysis of the specific language used in the policy, the court concluded that the accident was not within the scope of the UIM clause and dismissed the plaintiff’s case against the insurance company.

The case is important for Maryland car accident victims because it raises an issue that often comes up in car accident cases, specifically whether an accident is covered under a motorist’s insurance policy.

The Facts of the Case

The plaintiff was riding in the rear of a horse-drawn carriage during a Christmas parade. The carriage was such that it could only be towed by an animal – either horse or mule – and could not be towed by a vehicle. After the parade, a car rear-ended the carriage, causing the plaintiff to sustain serious injuries. The plaintiff filed a personal injury lawsuit against the driver of the carriage. However, since that claim was initially denied, the plaintiff also filed a claim against their own insurance company under the UIM provision.

Court Determines Good Samaritan Was “Occupying” Vehicle as She Provided Road-Side Assistance to Accident Victim

July 17, 2017 | Lebowitz & Mzhen

Insurance companies can be one of the biggest roadblocks to a Maryland car accident victim receiving the compensation they deserve. Earlier this month, an appellate court in Rhode Island issued an interesting opinion in a car accident case involving the question of whether the plaintiff was “occupying” the insured vehicle at the time he was struck by a passing motorist. The court ultimately concluded that the plaintiff was occupying the vehicle and that the insurance company covering that vehicle should not have denied his claim.

The Facts of the Case

The plaintiff was the passenger in a car driver by her then-boyfriend. The two had just pulled up to a grocery store and were talking in the car before getting out to enter the store. As the two were talking, they heard two cars collide on an adjacent road.

The plaintiff got out of the car and approached the accident scene. As she walked behind one of the cars to get its license plate information, another vehicle came down the road, crashing into the two cars that were just involved in the accident. The plaintiff was injured as a result of this second accident.

Accident Victim’s Bad-Faith Claim Against Insurance Company Fails Based on Legitimate Dispute of Liability and Causation

October 3, 2016 | Lebowitz & Mzhen

Earlier this month, an appellate court in Kentucky issued an interesting opinion that is of interest to anyone dealing with a difficult insurance company after a Maryland car accident. In the case, Holloway v. Direct General Insurance Company, the court determined that the plaintiff’s bad-faith claim against the insurance company, based on the company’s failure to settle her claim, must fail because the insurance company had a legitimate reason to doubt its own liability.

The Facts of the Case

Holloway, the plaintiff, was involved in an auto accident with Sykes. The accident took place in a parking lot and involved low speeds. However, each party had a different account of how the accident occurred. Holloway claimed that she suffered property damage and injuries as a result of the collision, and she sought compensation from Sykes’ insurance company, the defendant.

Holloway made property damage claims as well as personal injury claims. The parties reached a settlement regarding the property damage claims, but settlement negotiations broke down regarding the personal injury claims. Since the insurance company would not settle her personal injury claims, Holloway filed a personal injury lawsuit against the insurance company. One of the claims she made was that the insurance company acted in bad faith when it refused to settle her personal injury claim. If successful, Holloway could potentially receive compensation above and beyond her actual damages through punitive damages.

Court Reads Insurance Policy to Limit Total Recovery in Accident Involving Underinsured Motorist

May 16, 2016 | Lebowitz & Mzhen

Earlier this year, a federal court of appeals issued a written opinion interpreting the language of a contested insurance policy in favor of the insurance company, thus limiting the total amount of recovery among the three injured parties to $500,000. In the case, Trotter v. Harleysville Insurance Company, the court determined that the insurance company that carried an underinsured motorist policy for one of the victims involved in the accident was not required to pay out on the claim, since the at-fault party’s insurance policy provided the same limit.

The Facts of the Case

This case involves a single accident between two vehicles. Powers was the at-fault party, and he had an insurance policy that covered damages up to $250,000 per person or $500,000 per accident. The driver of the other car, Trotter, as well as his two passengers, Jackson and Petrie, were all injured as a result of the accident. All the injured parties filed claims against Powers’ insurance company.

The injured parties all entered into a settlement agreement with Powers’ insurance company, whereby Trotter would receive $250,000, Jackson would receive $238,000, and Petrie would receive $12,000. However, after the settlement, the parties asserted that the recovered sum failed to make them whole. So they filed a claim under Trotter’s insurance company, the defendant in the case.

Insurance Company Escapes Liability for Non-Covered Driver

December 22, 2015 | Lebowitz & Mzhen

Earlier this month, a California appellate court issued an opinion in a case between accident victims and the insurance company of the at-fault driver. In the case, Nationwide National Insurance Company v. Shimon, the at-fault party’s insurance company was determined not to be liable for the injuries sustained by the accident victims because the policy did not cover “non-owed” automobiles that were “furnished or available” for the driver’s regular use.

The Facts of the Case

The Shinons (“the Plaintiffs”) were injured as a result of the negligence of a 17-year-old girl, Lionudakis. At the time of the accident, Lionudakis was driving a GMC that was owned by and registered to her father. However, to save money, her father did not list her on the insurance policy.

Lionudakis’ mother, who was separated from Lionudakis’ father, maintained a separate insurance policy that covered her own vehicles, but not the GMC. The policy did, however, cover family members’ use of “non-owned” vehicles, as long as they were not furnished for the family members’ regular use. This restriction was contained in the insurance agreement.

Supreme Court Reviews Class Action Reform Law

January 21, 2013 | Lebowitz & Mzhen

Class action lawsuits have long provided a means for large numbers of claimants to consolidate their claims into a single action, when they might not have the resources to pursue individual lawsuits. This has allowed countless people to seek compensation in cases involving products liability, bad faith insurance practices, and other types of personal injury. Class actions are also common in areas like consumer protection law and certain types of securities litigation. For a variety of reasons, class action lawsuits have also been the subject of much controversy, and legislation supported by businesses, many of whom often appear as defendants in class action cases, has placed limits on the amount class action plaintiffs may recover. The U.S. Supreme Court recently heard arguments in a case, The Standard Fire Insurance Co. v. Knowles, No. 11-1450, that involves a federal statute regulating large state and federal class action lawsuits.

Congress passed the Class Action Fairness Act of 2005 (CAFA) in response to an alleged pattern among trial lawyers of filing class action lawsuits in specific state courts where they could obtain favorable verdicts. Calling this an “abuse” of the class action system, the Republican-led Congress passed the bill by a wide margin, and President Bush signed it into law in February 2005. CAFA applies to class action lawsuits that seek damages in excess of $5 million, and in which more than two-thirds of the plaintiffs are from a different state than the principal defendant. CAFA requires the automatic removal of lawsuits meeting these criteria to federal court, which supporters of the law believed would be less predisposed towards the plaintiffs. CAFA’s opponents called the law an assault on individuals’ legal rights.

Insurer Not Obligated to Defend in Tort Case for Sex Abuse, Maryland Court Rules

January 10, 2013 | Lebowitz & Mzhen

An insurance company is not obligated to defend or indemnify its insured in a civil claim for damages arising from acts of sexual abuse of a child, according to a Maryland court’s order. The U.S. District Court for the District of Maryland, ruling in Harrison v. Fireman’s Fund Ins. Co., Civil Action No. ELH-11-1258 (D. Md., Dec. 29, 2011), denied a request for a declaratory judgment that the defendant insurance company had a duty to defend the plaintiff. After the plaintiffs in the civil sex abuse lawsuit intervened in the case, they and the insurance company each filed motions for summary judgment. The court granted the insurance company’s motion and entered a declaratory judgment in its favor. It denied the intervenors’ summary judgment motion.

The chain of events leading to the declaratory judgment action began with a criminal case. William L. Harrison was convicted of sexual abuse of a minor in August 2009, and received a ten-year prison sentence. See Harrison v. Maryland, 17 A.3d 144 (Md. Spec. App. 2011). According to the appellate court that affirmed the conviction in 2011, Harrison approached the father of the victim, identified as S.B., in the summer of 2006. He reportedly asked the father if S.B., who was thirteen years old at the time, would be interested in working with him on landscaping and other jobs. S.B. worked for Harrison part-time until the summer of 2007, when S.B. told his mother that Harrison had “touched him inappropriately.” Id. at 145. Harrison was indicted in January 2008.

S.B.’s parents filed a civil lawsuit against Harrison in February 2010 for damages related to the abuse of S.B., identified in that lawsuit as S. Doe. The Does pleaded five causes of action against Harrison: negligence, assault, battery, intentional infliction of emotional distress, and a claim for medical expenses. Harrison in turn filed suit against his insurer, Fireman’s Fund Insurance Company, seeking a declaratory judgment as to its duty to defend him in the Does’ lawsuit. The Does intervened, and both they and the insurance company moved for summary judgment.