Author Archives: Vito Pinto

Pennsylvania Court Provides Gateway for Insureds to Keep Lawsuits in State Court (PA)

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The Eastern District of Pennsylvania recently issued a decision that may help insureds interested in having their cases heard in state court rather than allowing those cases to be removed to federal court. In Dominque Ellis v. Liberty Mutual Insurance Company, et al., a plaintiff defeated diversity by naming both the insurer and the claims adjuster as defendants.

Initially, a lawsuit was brought by Dominique Ellis (“Ellis”) who was hit by a car while she was walking down the street. At the time, Ellis was insured by a Liberty Mutual auto insurance policy that listed her mother as the “named insured.” Since the motorist was underinsured, Ellis sought to recover medical expenses from Liberty Mutual. Liberty Mutual later denied her claim and Ellis sued both Liberty Mutual and the claims adjuster, Clare MacNabb (“MacNabb”).

MacNabb was added to the lawsuit because Ellis claimed that she dragged her feet during a six-month investigation into whether Ellis lived at the address listed within the policy. Once MacNabb concluded that Ellis was being truthful about her address, she denied her claim on the ground that her medical expenses were less than the limit of the policy owned by the underinsured driver. Ellis alleged that the investigation was fraudulent and meant to intimidate her from pursuing her claim.

Ellis’ lawsuit was brought in state court and consisted of three counts against Liberty Mutual: (1) an “underinsured motorist claim,” (2) a claim for bad faith insurance denial, and (3) a claim for violations of the Pennsylvania Unfair Trade Practices and Consumer Protection Law (UTPCPL). The UTPCPL claim was also brought against MacNabb. As both Ellis and MacNabb were residents of Pennsylvania, there was no diversity of citizenship grounds to remove that case to federal court. However, Liberty Mutual argued that MacNabb was fraudulently joined and removed the case to federal court. As a result, Ellis moved to remand the matter back to state court.

The District Court granted the motion to remand, rejecting all three reasons asserted by Liberty Mutual to support that MacNabb had been fraudulently joined. First, the Court explained that claims under the UTPCPL against claims adjusters were “colorable under Pennsylvania law.” Under the law, UTPCPL claims against individual insurance claims representatives were allowed.

Second, the Court determined that it was too early to tell whether Ellis’s claim was for mere nonfeasance. Ellis’ complaint alleged nonfeasance by MacNabb in MacNabb taking too long to investigate her claim and ultimately denying coverage. However, a UTPCPL claim requires malfeasance, rather than nonfeasance. The Court determined that Ellis’ complaint also supported “an inference of malfeasance” in that the adjuster’s investigation was intended to intimidate or harass Ellis. According to the Court, malfeasance may exist if an insurer conducted a post-loss investigation in an unfair or unreasonable manner. The Court noted that, at this stage, Ellis still had the opportunity to prove malfeasance by MacNabb and that to dive further into this issue would require an assessment of the merits of the claim itself.

Finally, the District Court rejected Liberty Mutual’s argument that Ellis cannot maintain a claim under the UTPCPL because she did not purchase the insurance policy herself. The UTPCPL grants a claim to any person who, among other requirements, purchases or leases goods or services. In the instant matter, Ellis’s mother was the purchaser and the named insured. However, the Court determined that, although support that Ellis herself purchased the policy was “admittedly slim,” it should remain mindful that “all doubts should be resolved in favor of remand” and that remand was required if there was even a possibility that a state court would find the complaint stated a claim against MacNabb. The District Court thus concluded that the “lenient standard” had been satisfied and that it remained unclear whether Ellis had been making payments under the insurance policy. As a result, Ellis’s motion to remand was granted.

Thank you to Zhanna Dubinsky for her contribution to this post. Please email Vito A. Pinto with any questions.

No Property Damage for Negligent or Intentional Omissions in Home Sales (PA)

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In, Foglia v. Metropolitan Property and Casualty Insurance Company, the Eastern District of Pennsylvania recently ruled that an insurer did not act in bad faith or breach of contract when it refused to defend and indemnify a policyholder in an underlying lawsuit in which the policyholder was accused of concealing water damage.  The Court determined that there was no “property damage” to trigger the insurer’s duty to defend.

Initially, a lawsuit was brought by Jason and Emily Konn (“Konn”) who had previously purchased a house from Merle Foglia (“Foglia”).  Foglia signed a seller’s disclosure that indicated that there was no water leakage, accumulation, dampness, or infiltration within the house or other structures.  At no point did Foglia indicate that the home had a history of water infiltration or damage.  After a few months, Konn discovered significant water damage within the lower level of the house.  As a result, Konn sued Folgia for fraud and intentional concealments, intentional misrepresentation, negligence, and consumer protection violations.

After Foglia was served, she sought defense and indemnification from her homeowner’s insurance policy from Metropolitan Property and Casualty Insurance Company (“Metropolitan”).  Within the policy, Metropolitan would pay “all sums for bodily injury, property damage and personal injury to others for which the law holds you responsible because of an occurrence to which this coverage applies.”  Metropolitan later denied coverage because an “occurrence” had not taken place and that, even if it had, policy exclusions, such as a “failure to disclose” exclusion, were in place that precluded coverage.

As a result of the coverage denial, Foglia sued Metropolitan under claims of breach of contract and bad faith.  In response, Metropolitan countersued for declaratory judgment absolving it of any coverage obligations.  The Court granted summary judgment in favor of Metropolitan as it determined that the Konn complaint did not allege an “occurrence” or the type of “property damage” that required Metropolitan to provide coverage.       The Court found that Metropolitan had no duty to defend Foglia against the Konn lawsuit.

Although the Pennsylvania Supreme Court had not ruled on the issue, the 3rd Circuit has repeatedly held that negligent omissions in home sales does not constitute property damage.  Specifically, in a similar case, the 3rd Circuit stated that the “acts at issue in the underlying lawsuit amounted to a misrepresentation of the status of the home, whether it be intentional or negligent.  At no point did [the insured’s] acts ever inflict damage on the home that was not already in existence prior to the acts in question.  See USAA Cas. Ins. Co. v. Bateman, 2008 WL 4761718, at *1 (E.D. Pa. Oct. 30, 2008).  Additionally, the Court determined that the Konn lawsuit did not allege an “occurrence” as the policy defines an occurrence as “an accident, including continuous or repeated exposure to substantially the same general harmful conditions during the term of the policy.”

Thanks to Zhanna Dubinsky for her contribution to this post.  Please write to Tony Pinto for more information.

Question of Fact in Falling Object Case – But No Question as to the Devastating Consequences for Failing to Provide Discovery

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Thomas Garbett commenced a personal injury action against Wappingers Central School District (“Wappingers”) to recover damages after a cast-iron section of a boiler on its property fell and crushed his foot. Wappingers commenced a third-party action against the plaintiff’s employer, Siteworks Services NY Corp. (“Siteworks”), which, at the time of the accident, was servicing the boiler pursuant to its contract with Wappingers. The Supreme Court subsequently struck Siteworks’ third-party answer as a sanction for its failure to comply with discovery demands and orders.

Plaintiff testified at his deposition that, at the time of the accident, Siteworks employees were disassembling the subject boiler section-by-section to fix a leak. However, the head custodian at the school where the plaintiff’s injury occurred testified at his deposition that the boiler was disassembled every summer for routine cleaning and refurbishing. The head custodian was also not aware of any problem with the boiler in need of repair during the time that the plaintiff was injured.

The plaintiff moved for summary judgment on the issue of Wappingers’ liability under Labor Law § 240(1), and Wappingers cross-moved for summary judgment dismissing the complaint. Wappingers also moved for summary judgment on the issue of common-law indemnification against Siteworks, arguing, among other things, that since Siteworks’ answer was stricken, it admitted that the injuries alleged by the plaintiff constituted a grave injury as defined in Workers’ Compensation Law § 11.

Supreme Court, among other things, denied the plaintiff’s motion and Wappingers’ cross motion on ground that triable issues of fact remained with respect to the applicability of Labor Law § 240(1) and causation, and granted that branch of Wappingers’ motion which was for summary judgment on the issue of common-law indemnification.

In Garbett v. Wappingers Central School District, 160 A.D.3d 812 (2d Dep’t 2018), the Supreme Court found, and the Appellate Division agreed, that the record was unclear concerning the degree to which the boiler sections were “components that require replacement in the normal course of wear and tear” (Esposito v New York City Indus. Dev. Agency, 1 N.Y.3d at 528), and therefore properly determined that triable issues of fact existed with respect to whether the plaintiff’s activity was repair work that would be covered under Labor Law § 240(1), or just routine maintenance.

The Supreme Court also properly concluded that triable issues of fact existed with respect to proximate cause. At the time of the accident, Siteworks employees were disassembling the boiler and moving each heavy section to the ground for the plaintiff to inspect. Testimony indicated that the Siteworks employees did not follow their typical procedure and opted to wedge a pipe against the section that eventually fell. Plaintiff also testified that boiler sections can remain upright without assistance after being detached from each other, and that he, an experienced boilermaker, was satisfied with the apparent stability of the section before it fell. Wappingers also submitted evidence supporting the conclusion that boiler sections do not require securing when they are detached from each other. Thus, triable issues of fact existed as to whether a safety device was required for the undertaking.

Labor Law § 240(1) protects workers from elevation-related hazards while they are involved in certain enumerated work activities. The statute applies when an employee is engaged in the erection, demolition, repairing, altering, painting, cleaning or pointing of a building or structure, as well as acts ancillary to those activities Labor Law § 240(1) does not, however apply to workers engaged in routine maintenance (Fox v H & M Hennes & Mauritz, L.P., 83 A.D.3d 889).

Labor Law § 240(1) imposes absolute liability on building owners and contractors whose failure to provide proper protection to workers employed on a construction site proximately causes injury to a worker. The decisive question is whether plaintiff’s injuries were the direct consequence of a failure to provide protection against a risk arising from a physically significant elevation differential and includes injuries caused by falling objects. Liability will attach where the plaintiff demonstrates that, at the time the object fell, it required securing for the purposes of the undertaking.

With respect to the third-party action, Siteworks’ third-party answer had been stricken for failing to provide discovery, so it admitted all traversable allegations in the complaint, including the basic allegations of liability and that the plaintiff sustained a grave injury, which allegation was necessary for the maintenance of the third-party action, under Workers’ Compensation Law § 11. Accordingly, the Appellate Division upheld summary judgment in favor of Wappingers on the issue of common-law indemnification. (The decision also upheld the denial of Siteworks’ Motion to renew, finding that Siteworks failed to offer new facts that would change the prior determination). And found the sole issue remaining in the third-party action to be the extent of Wappingers’ damages, if any. While there are no specific facts as to the default, this decision nevertheless serves as a cautionary reminder that that careful attention must be paid to discovery obligations.

Thanks to Vincent Terrasi for his contribution to this post. Please write to Tony Pinto for more information.

Non-Commercial Vacant Landowners Owe No Duty to Maintain Abutting Sidewalks (NJ)

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Plaintiff, in Ellis v. Hilton Methodist Church, rolled the dice of life and sued the owner of a vacant church – the Hilton United Methodist Church and the Board of Trustees of the Greater New Jersey Annual Conference of the United Methodist Church – for damages arising from injuries he sustained when he slipped and fell on a sidewalk. He argued a recent decision imposing liability to maintain abutting sidewalks on the owner of a vacant, boarded-up commercial property should apply to vacant churches. His argument, however, was not infallible.

Generally, a landowner in New Jersey does not owe a duty of care to a pedestrian injured as a result of the condition of the sidewalk abutting the landowner’s property. Dupree v. City of Clifton, 351 N.J.Super. 237, 241 (App.Div. 2002). An exception applies to commercial landowners, who are responsible for maintaining, “in reasonably good condition,” the sidewalks abutting their property. Stewart v. 104 Wallace Street, 87 N.J. 146, 157 (1981). The Court expanded the commercial landowner exception in Gray v. Caldwell Wood Products, Inc., 425 N.J.Super. 496 (App.Div. 2012), which held that commercial landowners retain their duty to maintain abutting sidewalks, even if – as was the case in Gray – the commercial building was vacant and boarded-up.

The plaintiff, in Ellis, sought to expand this exception. The argument was simple: a commercial landowner has a duty in New Jersey to maintain abutting sidewalks; the Court recently extended this duty to maintain abutting sidewalks beyond the life of a commercial property; and since landowners now owe pedestrians a duty to maintain abutting sidewalks of vacant and boarded-up commercial properties, public policy warrants an extension to the owners of a vacant and boarded-up churches. The Court not only disagreed, but also affirmed the duties of commercial property owners do not extend to noncommercial and residential landowners.

The Court reaffirmed that the church at issue in this case is not a commercial building. Nothing in the record, the Court noted, indicated it was ever operated for commercial purposes. (9). Simply maintaining liability insurance, like a commercial property, does not convert the church to being one. Additionally, the mere fact that a vacant building could have been used to generate income, and therefore be classified as a commercial property, is irrelevant. Id. In rejecting that argument, the Court noted that liability would then attach to any vacant or abandoned noncommercial (or residential) building.

In rejecting the plaintiff’s attempt to expand the Gray sidewalk liability exception, the Court made it clear: “[w]e reject any reading of Gray that imposes liability on owners of vacant residential or noncommercial properties that have not been put to any commercial use.” (2). Noncommercial property owners of vacant buildings, and the Board of Trustees of the Greater New Jersey Annual Conference of the United Methodist Church, can now breathe a little easier.

Thanks to Brent Bouma for his contribution to this post. Please write to Tony Pinto for more information.

Lawful Possession Not Found For Passenger in Vehicle (PA)

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In State Farm Mutual Automobile Ins. Co. v. Erin C. Dooner, Jean A. Fonte, Jeffrey J. Kowalski, Gary J. Fedorczyk, and Progressive Advanced Ins. Co., the Superior Court reaffirmed a trial court decision that determined the Appellee, State Farm Mutual Automobile Insurance Company (“State Farm”), did not owe coverage to its insured, Erin C. Dooner (“Dooner”).

In the underlying case to this declaratory judgment action, the appellant, Jean. A Fonte (“Fonte”), and Dooner were traveling in Dooner’s car when they were involved in a one-car accident.  At the time of the accident, Dooner had a motor vehicle insurance policy through State Farm.  Due to the accident, Dooner was arrested so Fonte retrieved her own vehicle to pick up Dooner at the police station.  On the way home, a fight arose at which time Dooner grabbed the bottom of the steering wheel causing Fonte’s car to swerve into oncoming traffic and collide with a police cruiser.  The police officer and his wife then sued Dooner.  Subsequently, State Farm initiated this action seeking a declaration that it had no duty to defend, indemnify, or otherwise provide liability coverage to Dooner.  The trial court agreed and granted summary judgment in favor of State Farm.

The following issue was raised for review: “Did the trial court abuse its discretion and commit error by granting [s]ummary [j]udgment on behalf of [State Farm], improperly determining that State Farm did not owe a duty of coverage to [its] insured[,] [Ms.] Dooner, and all parties who suffered injuries through [Ms.] Dooner’s negligence, thus misapplying case law and relevant precedent?

The insurance policy in question was a motor vehicle insurance policy that provided coverage for a “non-owned car” if the car was “in lawful possession of you or any resident relative.”  As the policy did not define the terms “possession” and “lawful,” Fonte argued, on appeal, that the policy was ambiguous and should have been construed in her favor.

In compliance with Pennsylvania law, the Superior Court evaluated the type of coverage afforded under the policy by analyzing the policy’s language.   To determine whether the policy language was ambiguous, the Superior Court relied on Pennsylvania’s long-standing principles regarding insurance policy interpretation.  As noted by the Superior Court, policy language is only ambiguous if it is susceptible to more than one meaning.  Policy language is not ambiguous merely because the parties disagree as to the meaning of the policy’s language.  Accordingly, policy language must be construed in its plain and ordinary sense and read to avoid any ambiguity.  Therefore, the Superior Court determined that if the policy’s language is “plain and unambiguous,” then it is bound by the policy’s language.

As the Superior Court found the policy’s language to be clear, it determined State Farm only owed liability coverage to Fonte if Fonte’s car qualified as a “non-owned car” of the insured [Donner].  Further, the policy only provided coverage if the insured [Donner] was in “lawful possession” of Fonte’s car at the time of the accident.

On appeal, Fonte argued “possession” involved an aspect of control, however, the Superior Court disagreed with Fonte’s analysis because under Pennsylvania law “control” did not necessarily equate to “possession.”  Nevertheless, since the policy in question was a motor vehicle insurance policy, the Superior Court evaluated whether the insured was in “possession” by considering who was in “control” in terms of the entire vehicle.    In doing so, the Superior Court focused on the fact that Fonte was in the driver’s seat at the time of the accident.  Even though Dooner grabbed the bottom of the steering wheel and ultimately caused the accident, the Superior Court determined that based on the totality of the circumstances the insured’s briefly grabbing the steering wheel did not amount to her taking lawful possession or control of the vehicle.

Simply, Dooner’s actions in grabbing the steering wheel merely constituted an interference with Fonte’s operation of the vehicle.  Accordingly, the Superior Court reaffirmed the trial court decision and held that because Fonte failed to establish a genuine issue of material fact, the trial court did not commit an error of law or abuse its discretion.

Thanks to Lauren Brenbaum for her contribution to this post.  Please write to Tony Pinto for more information.

When Policy Exclusions Apply, Brokers Beware

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Last week in Houston Gas Co. v. Cavan Corp. of NY, Inc., the First Department reminded insurance brokers of potential exposure should a policy they procure for an insured fail to cover a liability.  In July 2012, Cavan was retained to act as construction managers for a building project in Manhattan.  For their services, Cavan was to be paid a flat $600,000 fee.  Unfortunately for Cavan, when a subcontractor sued for an injury on the job site, they learned their commercial general liability policy contained an exclusion for losses arising out of construction management services performed for a fee.  The First Department reversed the denial of Houston Casualty Company’s motion for summary judgment, and ruled the exclusion barred coverage.

However, the First Department also denied Ducey’s—Cavan’s insurance broker—motion to dismiss, and granted Cavan’s motion to add a causes of action for negligence, breach of contract, and negligent misrepresentation against Ducey.

In a unanimous decision, the Appellate Court reiterated that individuals who are denied coverage for losses are entitled to recover damages from the insurance broker under a breach of contract theory if the policy obtained does not cover a loss for which the broker contracted to provide insurance, and the insurance company refuses to cover the loss.

In addition, an insured may sue a broker under a negligence theory should the broker fail to exercise due care in a brokerage transaction.  Last, a negligent misrepresentation cause of action may arise when a special relationship exists between the customer and the broker and the customer reasonably relies on the broker’s representations.

Here, Cavan claimed it met annually with Ducey over the course of many years to discuss insurance needs and claimed it relied on Ducey’s advice, which was a sufficient factual pleading to suppot a claim for negligent misrepresentation.  The Houston Cas. Co. Court cited our firm’s recent victory in Dae Assocs., LLC v. AXA Art Ins. Corp. in support of this last point.  In Dae Assocs., LLC, the insured merely alleged a longstanding relationship, which is insufficient on its own to establish a special relationship.  Cavan’s allegations rose to the level of a potential special relationship.

While these cases provide further help to insurers in asserting disclaimers of coverage based on policy exclusions, they also should serve as a warning to the potential exposure for brokers in the event of successful disclaimers.

Thanks to Nick Schaefer for his contribution to this post.  Please write to Tony Pinto for more information.

Why (Not) So Serious? – Case Dismissed on Threshold Where Plaintiff’s Doctor’s Did Not Affirm Reports

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In Wesley v Crown Masonry, plaintiff sued for personal injuries that she allegedly sustained in a motor vehicle accident.  Plaintiff alleges supraspinatus tendinosis, bursitis, and a tear of the rotator cuff.   At the close of discovery, defendants moved for summary judgment on the “serious injury” threshold.

The Honorable Peter H. Mayer of the Supreme Court, Suffolk County, granted the motion and dismissed plaintiff’s case.  The reasoning helps to remind litigants on both sides of the difficulties that plaintiff’s face when opposing motions for summary judgment.

In defendants’ motion, an affidavit of defendants’ physician was provided which found that plaintiff had regained full range of motion and was not disabled.  The Court found that this met defendants’ prima facie burden of establishing the lack of a statutorily defined “serious injury”.  The burden then shifted to plaintiff.  Despite an affidavit from a physician, and annexed medical report notes, the Court found that plaintiff could not rebut defendants’ prima facie case because the medical reports were unsworn, and the affidavit relied upon those unsworn reports.  Further, the Court found that plaintiff’s self-serving affidavit which stated that she faced limitations like at work for at least 90 out of the 180 days post-accident was insufficient to establish a “serious injury” for at least 90/180 days post-accident.

At times it appears that the Court has strayed from the initial legislative purpose of the “No-Fault Law” – to provide injured parties in motor vehicle accidents with insurance through their auto policies, and not burden the Court with unnecessary litigation.  This ruling reminds us to diligently prepare all auto accident cases for “serious injury”, even cases that result in tears, as one cannot presume that a diagnosis found in discovery will later be admissible in motion practice.

Thanks to Christopher Gioia for his contribution to this post.  Please contact Tony Pinto for more information.

No Issue With The Ladder, No Problem

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In Wu v. Yang, the plaintiff fell from an A-frame ladder while working in the defendants’ apartment.  The plaintiff testified that he had no prior issues with the ladder and was working well from the ladder when it suddenly moved and he fell.  The plaintiff did not know why the ladder shifted.

The plaintiff moved for summary judgment on his Labor Law 240 claim against the defendants, the defendants cross-moved to dismiss the compliant.  The lower court found that there was no §240 violation, as the plaintiff could not articulate how the ladder had failed.  All parties appealed.

The Second Department upheld the lower court’s decision as to the plaintiff’s motion but reversed the finding with regard to the defendants and re-instated the plaintiff’s Labor Law 240 claim against them.  The Appellate Division confirmed that not every fall from a height is a guaranteed 240 case and that, in order to prevail on a 240 claim, a plaintiff must establish that proper fall protection was not provided.  In other words, the plaintiff in the instant-action had to show that a proper ladder was not provided.  Nevertheless, the Court held that the question of whether proper protection was provided (whether there was in fact something wrong with the ladder that caused it to wobble) is a question of fact for a jury to decide, even in a case such as this where the plaintiff cannot articulate the reason for the ladder’s failure.

As defense counsel, we frequently defend against 240 claims where the plaintiff cannot articulate why the ladder moved and why they were caused to fall.  We frequently ask what else could we have given the plaintiff to protect them from this fall short of a plastic bubble to encase them in to prevent injuries.  While the Appellate Court’s decision once again protects workers who fall from a height, regardless of their description of the accident, it is not a guarantee win for the plaintiff at trial.  A jury in this action would still hear defense counsel’s argument (as opposed to cases where the plaintiff has already been awarded 240 and the matter proceeds to a damages-only trial) that the ladder was in good condition before the fall and was possibly not the reason why plaintiff fell.  The question of “what else could have been given to the plaintiff?” will be posed to a jury, affording the defendants a chance on prevailing with a defense verdict.

Thanks to Georgia Coats for her contribution to this post.  Please contact Tony Pinto for more information.

 

Update & Interpretation: NY Venue Statute For Personal Injury Actions Amended

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As we wrote in our October 2017 post, a new amendment to CPLR 503, changed the basis of venue determinations to include, not only where the parties reside, but added “the county in which a substantial part of the events or omissions giving rise to the claim occurred”. The justification for the amendment was to give the courts and jurors of communities with the most interest in setting community standards the ability to decide these cases and controversies, and case law is beginning to develop in this area. Contemplated as an advancement in forum shopping for the plaintiffs’ bar, the statute has favorable implications for the defense bar as well.

In Taylor v. Montreign Operating Co., Inc. , a well-known New York City plaintiff’s firm placed venue of a personal injury action in New York County.  Defendant moved to change venue to Sullivan County, a rural upstate county, where the accident occurred. The lower court denied defendant’s motion and the Appellate Division, First Department reversed, and changed venue to Sullivan County.  In finding that defendant demonstrated that the convenience of nonparty witnesses would be better served by the venue change, the First Department ruled that the trial court improvidently exercised its discretion in denying the motion.

Other than one defendant’s registered principal place of business, and one of plaintiff’s physicians maintaining an office in the county, the case had no contact with New York County. Defendants sought to move the case to the county where the accident occurred.  Importantly, Defendants submitted the affidavits of four first responders and plaintiff’s coworker, all of whom averred that they would testify as witnesses, but would be inconvenienced by traveling to New York County.

The court brushed off plaintiff’s arguments that the affidavits were not sufficiently detailed and accepted that the non-party witnesses were material and necessary. Moreover, plaintiff’s argument that there was a likelihood of summary judgment on liability under the Labor Law was deemed irrelevant.

Savvy plaintiffs will always look to place the controversy in the most plaintiff-friendly venue. Yet, defense counsel could use the application of the amendment to CPLR 503 to nullify that perceived advantage.  With any new lawsuit, careful consideration must be given to the location of the accident and the convenience of witnesses in that venue.   Results from a detailed and early investigation into witnesses could bolster support for a venue change to the proper community and perhaps result in a more balanced jury pool.

Thanks to Vincent Terrasi for his contribution for this post.  Please write to Tony Pinto for more information.

John Doe, with a Phantom Vehicle, on a Highway (NJ)

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Wednesday, May 9, 2018 – The infamous phantom vehicle reared its ugly (cylinder) head a few weeks ago in Krzykalski v. Tindall, the facts of which otherwise are rather innocuous: plaintiff Krzykalski was attempting to make a left-hand turn when he was rear-ended by defendant Tindall. Both agreed, however, that a third driver – our phantom vehicle – unexpectedly made a left-hand turn from the right lane, cutting off both parties. Plaintiff was able to stop without striking the phantom vehicle; defendant struck the rear of plaintiff’s vehicle.

At trial, plaintiff made two requests: (1) to enter a directed verdict on liability against defendant Tindall for the rear-end impact and (2) to remove John Doe from the jury verdict sheet. The trial judge denied both requests. The jury, free to apportion liability between defendant Tindall and John Doe, found Doe to be 97% at fault for the accident. Since the jury awarded damages in the amount of $107,890, the trial judge entered judgment against defendant Tindall in the amount of $3,236.70 – 3% of the total award. Plaintiff, unhappy with the minor recovery against the only other named party, appealed.

In his appeal, plaintiff focused on the trial judge’s refusal to strike John Doe from the jury verdict sheet, thereby allowing the jury to apportion fault to an unknown party. Since “a fictitious party is not a party to a suit,” Bencivenga v. J.J.A.M.M., Inc., 258 N.J.Super. 399, 407 (App.Div.), certif. denied, 130 N.J. 598 (1992), the argument goes, and the trier of fact is to determine “each party’s negligence,” N.J.S.A. 2A:15-5.2(b), allowing the jury to apportion liability to a fictitious non-party was reversible error. The Appellate Division, in Krzykalski v. Tindall, 448 N.J.Super. 1 (App.Div. 2016), disagreed and affirmed the trial judge’s rulings. Plaintiff petitioned the New Jersey Supreme Court for certification.

To appreciate plaintiff’s argument, it is necessary to take a step back to examine the facts of Bencivenga, supra. In that case, a nightclub patron sued the club after he was punched in the face by an unknown patron. Id. at 402. Contrary to Krzykalski, the trial court refused to allow the jury to consider the John Doe defendant’s negligence. Ibid. The Appellate Division, on appeal, relied on policy grounds to affirm the trial court’s ruling: since the nightclub was more likely to know the assailant’s identity, it was forced to either identify him and mitigate its share of fault or bear the cost. Id. at 410. Plaintiff therefore argued the same policy considerations involving phantom patrons apply to phantom vehicles.

The New Jersey Supreme Court disagreed. In affirming the Appellate Division’s final judgment, the Supreme Court explicitly concluded that “’phantom vehicles’ driven by known but unidentified motorists that play a part in an accident presumptively may be allocated fault.” (19-20). Referring to Bencivenga as an exception to the general rule, the Court explained that a defendant driver is inherently in a different position than a commercial nightclub with patrons and invitees, and was not more likely than plaintiff to know John Doe’s identity in this case. (17, 20). As a result, the general rule applies, and the jury properly apportioned fault between defendant Tindall and John Doe. (21).

Thanks to Brent Bouma for his contribution to this post.  Please contact Tony Pinto for more information.