William Howard Taft: “We are all imperfect. We cannot expect perfect government.”
About Jeremy W. Richter
I’m Jeremy W. Richter. In addition to authoring this blog, I am an attorney with Webster, Henry, Lyons, Bradwell, Cohan & Speagle, P.C., in Birmingham, Alabama, practicing civil defense litigation and focusing on commercial auto/trucking litigation, premises liability, general business liability, and various other aspects of insurance defense litigation.
Privilege Underwriters Reciprocal Exchange v. Peter Grayson: When a bona fide justiciable controversy exists in a declaratory judgment action, the trial court has jurisdiction to adjudicate the coverage questions without first finding the damages issues.
Facts of the Matter
While riding his motorcycle, Peter Grayson was involved in an accident with a vehicle being driven by an uninsured motorist on October 1, 2012. Rather than suing the uninsured motorist, he made a claim with his personal uninsured motorist (“UM”) carrier, which tendered the policy limits of $50,000.00. Grayson then made a claim with Privilege Underwriters Reciprocal Exchange (“PURE”), on a UM policy issued to Robert Knizley, under which Grayson’s sister Mrs. Knizley was a named insured.
Thereafter, on January 17, 2014, PURE filed a declaratory judgment complaint (under Alabama Code § 6-6-220, the Declaratory Judgment Act) against Grayson, seeking a determination that Grayson was not covered under Knizley’s policy, because PURE alleged that Grayson was not a resident of his sister’s household at the time of the accident. Grayson answered and filed a counterclaim for UM benefits, alleging that he had been a resident of his sister’s household at the time of the accident.
For Argument’s Sake
After undertaking significant discovery, PURE filed a motion for summary judgment, which the trial court denied, concluding that there was sufficient disputed material evidence that the matter should be put before a jury. PURE then filed a motion for bifurcated, separate trials for the claims made by PURE and the counterclaims asserted by Grayson. The parties agreed that the coverage issue should be tried first. At trial, the parties conceded that should PURE prevail in the coverage trial, the entire case would be over. A jury trial was held in January 2016, and the jury returned a verdict in PURE’s favor, finding that Grayson was not covered under the Knizley policy.
Grayson filed a motion to vacate the judgment, pursuant to Alabama Rule of Civil Procedure 60(b)(4), which Grayson contended was void for lack of subject matter jurisdiction. Grayson argued that no justiciable controversy existed at the time of the trial because in PURE’s declaratory judgment complaint it essentially had requested an advisory opinion that Grayson was not covered under the policy assuming that he recovered damages on his claims against PURE. At the time of the trial, he had not made a recovery. The trial court granted Grayson’s motion for a new trial, and further instructed that the damages issue would be tried first with the coverage issue to follow, if necessary. PURE appealed to the Supreme Court of Alabama. Privilege Underwriters Reciprocal Exchange v. Peter Grayson [Ms. 1150927]. — So.3d — (Ala. Dec. 16, 2016).
We’ve Got Issues
The issue before the Supreme Court of Alabama in this matter was whether PURE’s declaratory judgment action seeking a determination of whether Grayson was entitled to coverage under the subject policy presented a justiciable controversy so as to invoke the subject-matter jurisdiction of the trial court. The court found that it did. Since the introduction of the Declaratory Judgment Act in 1935, Alabama courts “have routinely entertained declaratory judgment actions filed by insurance companies seeking a determination regarding their rights and obligations under a policy, especially concerning coverage.”
PURE’s declaratory judgment action sought a determination that Grayson was not entitled to coverage under the Knizley policy, because Grayson was not an insured under the policy in that he was not a household resident of his sister, a named insured. The Alabama Supreme Court has previously held, “All that is required for a declaratory judgment action is a bona fide justiciable controversy.”
In the matter at hand, it found that a justiciable controversy existed at the time PURE filed its action insomuch as PURE alleged a justiciable controversy between PURE and Grayson regarding Grayson’s status as an insured. As defined under the policy, if Grayson was not an insured, he would have no coverage and would not be entitled to benefits under the policy. Therefore, because a justiciable controversy existed between the parties, the trial court had jurisdiction to adjudicate the matter, and did not require a finding of the damages issue prior to a determination being made concerning the insurer’s obligations under the policy.
Photo by Eric Schmuttenmaer.
There are going to be occasions when you do everything you could or should have to prepare your client for a deposition, and they can’t help themselves but to make a mess.
A couple of years ago I was defending a trucking case in which my truck driver was an awfully rough fellow. He had a pretty significant criminal history, had been in-and-out of drug rehab (which hadn’t had much effect), and at the time of the accident involving my case, he had been on a crystal meth bender for a couple days while at a motorcycle rally. Our only saving grace was that the plaintiff was every bit his equal. She was a prescription drug addict who had been kicked out of pain management for selling her pills to a friend.
It soon came time for my client to give his deposition. I met with him in advance for longer than normal, and I really put the screws to him in preparation. There was no way that all of the things could be true that he told me occurred after the accident – anything from the plaintiff shuffling bottles of alcohol from her car to a fellow going by the name of Peacock, to the state trooper showing up on the scene with a teenage girl in his car (not his daughter). But my client told the same story every time. And there’s something to be said for consistency.
My parting words to him on the day of his deposition were to tell the truth and only answer the question that was asked. It was a horror show from the jump. After about 20 minutes of either snide, sarcastic responses, or what can only be described as word vomit (in which he used 50 words where 4 would have sufficed), I requested that we break for a few minutes. We stepped out. I went over the rules and instructed him to lose the sarcasm. We went back in. And picked up right where we had left off. Another 20 minutes later, we stepped out again and had the same conversation. With the same result.
This went on for a bit. The only silver lining was that he told the same implausible story during his deposition that he had been telling me for months. After the deposition ended and he left, I went back in to the plaintiff’s attorney and apologized for my client’s behavior. He responded, “No need to apologize. That’s going to play great for the jury.” I knew he was right.
Coming out of that experience, I felt then and continue to feel now that I had done everything I ought to have done to prepare my client for his deposition. Of equal importance, I had done my diligence to also prepare the insurance carrier for any potential outcome. He was just a wild card. He couldn’t get out of his own way. But this wasn’t an aberration. It’s who he was at his core. And I wasn’t going to change that … even for just a couple of hours.
Within a couple of weeks, we were able to settle the case at a discount. The plaintiff didn’t make any better of an appearance at her deposition than had my client.
This wasn’t the last of my unfortunate interactions with this client; his dog and I also had an old-fashioned stand-off.
Photo by Tit Bonac.
Justice Clarence Thomas: “You have a number of choices. You could continue to always fight against people who are really distractions. They’re people in the cheap seats of life. Or you can do what you went there to do.”
The courts have been busy in 2016 addressing issues of discovery, and interpreting and rewriting the rules of civil procedure. Each of the below links will take you to either a case brief or memoranda analyzing these developments.
Maria Graham v. City of Talladega: An amended pleading is a nullity if it does not comply with ARCP 15, and once the original claims are dismissed, a party has 42 days from the date of dismissal to file an appeal, pursuant to ARCP 4.
Ex parte Tidra Corporation: A trial court may only require a party to submit to a mental examination under Alabama Rule of Civil Procedure 35, if one of parties requests such relief and demonstrates good cause.
2016 Amendments to FRCP 4, 6, and 82: A breakdown of the amendments to Rules 4, 6, and 82 of the Federal Rules of Civil Procedure, effective December 1, 2016.
Amendments to ARCP 4: A review of the July 1, 2016, amendments to Rule 4 of the Alabama Rules of Civil Procedure.
Ex parte North American Adjusters, Inc.: Under Alabama Rule of Civil Procedure 38, a jury demand is required to be endorsed, but not signed.
Ex parte Dr. Barbara Johnson: When a minor child is not a party to a custody dispute, his psychiatric records are privileged and not subject to an exception.
Guidelines for the Discoverability of Social Media Content in Civil Litigation: What social media content is discoverable, permissible methods of obtaining social media content, and authenticating social media content for admissibility at trial.
How to Respond to an Objection to Social Media Discovery Requests: Social media content is subject to discovery under the broad definitions provided in the discovery rules of the Alabama Rules of Civil Procedure and is not usually privileged or protected by privacy rights.
McCullough v. Allstate Property and Casualty Insurance Company: When a motion for summary judgment is not amended to address claims alleged after filing of the summary judgment motion, a ruling granting summary judgment is a non-final judgment.
ENT Associates of Alabama, P.A., et al. v. Lauryn Diane Hoke: Where a plaintiff has no bona fide intent to serve defendants at the time a complaint is filed or prior to the running of the statute of limitations, the action is not commenced and is time-barred.
Carrie Crews v. Grace Jackson: Pursuant to Alabama Rule of Civil Procedure 64B, when a judgment creditor has failed to contest garnishment exemption claims, a court has no discretion to determine whether to dismiss a garnishment proceeding or to modify a writ of garnishment.
We are now on our second Motorola video baby monitor – the first couldn’t withstand a prolonged dunking in the dog’s water bowl. This second monitor, a Motorola MBP36S, has developed its own problems. There is a short between the monitor and the charger input that keeps the monitor from charging. Other Motorola models that have the same input and likely the same problems are the MBP33S and MBP41S. (Note: This topic is far afield from my usual law blog stuff, but I felt pretty heroic when I figured this hack out, and I knew I had to share it, because apparently this short circuit development is really common with these Motorola monitors).
There are two variations of this problem. 1) The short circuit is in the power cord – I have a solution for this problem. 2) The short is in monitor’s receiver input – you’re on your own for this one, and I don’t think there’s an easy fix (if any).
The charger input for the Motorola video baby monitor is MicroUSB, which is the same input as your Kindle and other devices you likely already own. In fact, you probably have a dozen or so MicroUSB cables lying a round the house. So this hack may keep you from having to drop the extra coin on a dedicated Motorola power adapter.
Here’s your hack in 3 easy steps:
- Plug your video baby monitor into one of the spare MicroUSB cords;
- Plug the USB end of the MicroUSB cord into a universal USB adapter/charger; and
- Plug the USB adapter/charger into the wall.
Your monitor should be charging now. If it’s not, then you know that the short circuit is in the monitor itself. And that means you’re probably out of luck.
Disclaimer: You will want to make the sure voltage output on your universal USB adapter is the same as for the Motorola video baby monitor’s dedicated charger, or you risk frying the monitor.
Insurance companies and risk management services are becoming increasingly more savvy about performance metrics than are the attorneys and firms who are being measured against them. Many attorneys are unaware of the categories and parameters they are being evaluated against. And unless a lawyer has a particularly candid with his insurance client, he is likely in the dark as to how he compares to other panel counsel.
Below are some common performance metrics categories being used to analyze attorney efficiency and effectiveness:
How long are your files open?
The cycle time can be an indicator of how efficiently attorneys are managing their caseloads. In many states, the time it takes to get a case from filing to trial can vary wildly from county-to-county. Cycle times are likewise variable when considering practice area and the complexity of individual cases. But over the course of time, the amount of time your cases are open should be an indicator of your case management efficiency.
Are your billables and expenses reasonable and within budget?
Some cases are going to cost more than others. Multiple party or fact witness depositions. Biomechanical and accident reconstruction experts. Site inspections. Thousands of pages of document review. It’s understandable and often completely necessary in order to properly evaluate a case. But are you communicating that to your client? Are the time and expenses you’re incurring on a file truly necessary, or can they be interpreted as bill padding and driving up the costs of defense?
Are your settlement and verdict evaluations accurate?
An injury that’s worth $40,000.00 in one Alabama county could easily be worth $400,000.00 in another. Your claims representative likely isn’t as familiar with the venues in your state as you are. They rely on you to provide appropriate case valuations so they can set their reserves. On a larger scale than your individual case, your insurance client is managing hundreds or thousands of such cases.
Your accurate case valuations enable the insurance company to effectively manage risk over the course of time, or to the contrary, your inaccurate evaluations inhibit their ability to manage risk and operate a profitable business. Additionally, your settlement and verdict evaluations directly affect your adjuster and their team manager, who are likely your direct points of contact and key cogs in maintaining a good relationship with your client.
How compliant are you with reporting deadlines?
Few things will put you in the bad graces of an adjuster than consistently failing to produce scheduled reports. What may seem like arbitrary deadlines typically are not. The attorney’s failure to report has a chain reaction. The adjuster is then unable to provide necessary information to his superiors at roundtable meetings. The team manager does not have the data he needs for conferencing with claims supervisors, ad continuum. On the other hand, timely and thorough reporting ingratiates you with your client and allows everyone to look good.
Are you communicating developments in the case?
Even when no formal reports are due, are communicating with your claims representative? If their claims notes are going months at a time without an entry from you, that’s not ideal. If your adjuster is regularly the one to call or email you asking what’s going on in a case, you can be sure that you aren’t communicating with them as regularly as they’d like.
Do you have expertise in the subject matter?
Have you established a relationship with a new client by pitching yourself as a trucking defense lawyer, when you’ve only ever handled personal auto cases? Your lack of knowledge in a subject area will quickly become evident to the insurance client who is immersed in these lines of coverage.
If your insurance client begins writing a new line of insurance and you represent to them that you can handle those claims, you had better be sure to be competent in the new practice area. It will quickly become evident if you’re not. And that will quickly erode the trust and rapport between you and your client.
Your insurance clients are auditing your performance based on the criteria that are important to them. Do you know what those criteria are? Are you auditing internally? If not, should you be? It may be important to know about yourself what others already know about you. Self-awareness of your strengths and weaknesses in critical case management metrics gives you the opportunity either to maintain your current course or make adjustments.
Justice Sandra Day O’Connor: “Do the best you can in every task, no matter how unimportant it may seem at the time. No one learns more about a problem than the person at the bottom.”
On December 13, 2016, the Federal Motor Carrier Safety Administration (FMCSA) announced the rate at which motor carriers will be required to administer random controlled substance testing on commercial drivers for 2017.
What is the random controlled substance testing rate?
Under 49 C.F.R. § 382.305, motor carriers are required annually to administer random controlled substance testing on a certain minimum percentage of its average number of driver positions. For 2017, the FMCSA is keeping the random testing rate at 25% for controlled substances, just as it was in 2016.
Per the statute, the requisite testing percentage is determined by the results of national testing surveys from prior years. § 382.305 sets the minimum testing rate at 25% for controlled substances unless at any time the data received from the surveys indicates that that violation rate (or positive test results) is equal to or greater than 1.0% for drivers tested, at which time the random controlled substance testing rate requirement will jump to 50%. The random controlled substance testing rate will then remain at 50% until for two consecutive calendar years the positive test result rate is below 1.0%, after which the FMCSA may lower the rate back to 25%.
What effect does the controlled substance testing rate have on litigation in Alabama?
If motor carriers and drivers are acting in compliance with the Federal Motor Carrier Safety Regulations, and particularly 49 C.F.R. § 382.305, then you should not expect it to have any affect of litigation. However, if a commercial driver is involved in a motor vehicle accident and the motor carrier has not been compliant with alcohol and drug testing regulations, there is potential for a problem.
Alabama recognizes a claim for negligent hiring, training, retention, or supervision of an employee. To prove such a claim in the context of a commercial motor vehicle case, a plaintiff must show that (1) the commercial driver was incompetent to operate the vehicle, (2) the motor carrier was or should have been aware of the driver’s incompetence, and (3) the plaintiff was injured as a result of the driver’s incompetence.” See Gardner v. State Farm Mut. Auto. Ins. Co., 842 So. 2d 1 (Ala.Civ.App. 2002). A showing of a driver’s incompetence must be made by demonstrating specific acts of incompetence. See Lane v. Central Bank of Alabama, N. A., 425 So. 2d 1098 (Ala. 1983).
Incompetence can be shown through failed drug tests, among other things. If a driver fails a post-accident drug test and the motor carrier has been non-compliant with FMCSA random controlled substance testing, a plaintiff may be able to establish liability against the motor carrier for negligent retention of the driver. The argument would be that had the motor carrier been in compliance with the FMCSR, it would or should have known of the driver’s incompetence, arising from his use or abuse of a controlled substance.
Whereas, if the motor carrier is compliant with the alcohol and drug testing provisions of 49 C.F.R. § 382.305, the motor carrier is less likely to be liable for a driver who is involved in an accident and subsequently fails a post-accident drug test.
Need to fill some gaps in your knowledge of trucking regulations, common compliance problems, and post-accident evidence preservation? Buy my e-book A Trucking Litigation Primer on Amazon.
Photo by Raymond Clark Images.
William Howard Taft: “Don’t write so that you can be understood, write so that you can’t be misunderstood.”