Spring Issue 2005
INSURANCE COMPANIES HAVE NO DUTY TO UPDATE NCIC DATABASE
Salvatore v. State Farm – In 1996, a Mitsubishi Diamante was stolen in Lower Merion Township, Pennsylvania. As a result, the Lower Merion Township Police Department placed the vehicle into stolen status in the National Crime Information Center "NCIC" database. State Farm insured this vehicle and the insureds submitted a theft claim. After State Farm paid this claim it obtained a salvage title for the vehicle. The title was stamped "stolen vehicle."
Three years later, the Diamante was recovered by the Cheltenham Township Police Department. State Farm was advised of the recovery and directed to pick up the vehicle. The vehicle was then sold by State Farm through a salvage pool on January 26, 2000 to P & H Auto Sales. On February 2, 2000, before the title paperwork transferring the vehicle from State Farm to P & H Auto Sales had been processed by the Pennsylvania Department of Transportation, the Diamante was sold to Matthew Salvatore.
On February 15, 2000, Mr. Salvatore was stopped by a Philadelphia County police officer. When a routine search of the NCIC system indicated that the Diamante was still listed in stolen status, Mr. Salvatore was taken into custody and held overnight at the Northeast Detectives. Approximately twelve hours later it was determined that he was the rightful owner of the vehicle and he was released. The investigating Philadelphia police detective determined that the vehicle remained in stolen status because the Cheltenham Township Police Department had neglected to send a computerized locate message to the Lower Merion Township Police Department over the NCIC system advising of the recovery. As the original reporting agency ("ORI"), Lower Merion Township was the only police department which could remove the vehicle from stolen status under the NCIC protocol.
Mr. Salvatore brought suit against various defendants including State Farm. He contended that all of the defendants owed him a duty to insure that the Diamante had been removed from stolen status prior to sale. State Farm filed preliminary objections and later a motion for summary judgment contending that it owed no duty to Mr. Salvatore. State Farm contended that it owed no statutory or common law duty to insure that police departments correctly perform the official police function of removing vehicles from stolen status. The preliminary objections and summary judgment motion were denied.
All of the other defendants entered into settlement agreements with the plaintiff. Therefore the matter proceeded to trial against State Farm only. On November 25, 2003 after a one day bench trial, the Honorable Alex Bonavitacola of the Philadelphia County Court of Common Pleas found in favor of the plaintiff in the amount of $7,000.00. He held that State Farm did not owe a statutory duty to the plaintiff and had not violated the Unfair Trade Practices Act. However, Judge Bonavitacola did find that State Farm had breached a common law duty to Mr. Salvatore.
The matter was appealed to the Pennsylvania Superior Court. After briefing and oral argument, the Superior Court reversed. Judge Michael T. Joyce in his opinion stated: "Requiring insurers to expend additional time and resources to assure that every stolen car that is returned is properly removed from the NCIC would be costly and unnecessary. We find that it would be unnecessary because it would place insurers in an oversight position over this Commonwealth's law enforcement. In other words, the insurers would be spending time and money to assure that police departments perform their statutorily obligated duty."
The court continued: "We certainly sympathize with [Mr. Salvatore's] situation . . . . .Unfortunately, not every wrong suffered is compensable. Here, there was no duty owed [Mr. Salvatore] by State Farm. As there is no duty, there can be no liability."
For further information, please contact Katherine Cole Douglas, Esquire.
Telephone: (215) 665-3364.
OPTOMETRY MALPRACTICE - DEFENSE AWARD
Freeman vs. Wynnewood Eyecare - Plaintiff, age 33, was poked in the eye with a tag hanging from a pair of DKNY non-prescription sunglasses in defendant's store. She sustained a corneal abrasion requiring two surgeries and leaving her with soreness, dryness and light sensitivity which allegedly interfered with her elementary school teaching and caused her to miss two summer sessions to undergo surgery. The tag drew her attention to the sunglasses as she was waiting for another pair of sunglasses to be adjusted that she had just purchased. She claimed that as she was putting the glasses on slowly with both hands the tag flipped up and went into her eye. No one witnessed the incident and plaintiff did not retain the glasses and tag, nor did she obtain exemplars from the manufacturer, Marchon, Inc., which was also sued. She claimed that the glasses were defective and should not have been displayed with the tag. Marchon, Inc. settled with the plaintiff prior to arbitration for $20,000 and did not participate in the arbitration.
Defendant optometrist examined plaintiff immediately after the incident and his notes stated: "poked herself in left eye with temple tip of frame she was trying on." He conceded that some of his frames had handling tags at the time which came from the manufacturer, but maintained that he did not believe prior to the incident that they posed a risk to his customers. He also questioned whether plaintiff indeed poked herself with the tag or the temple tip in light of his notes about the temple tip.
Plaintiff chose to proceed to arbitration without an expert. She argued that defendant, as an optometrist, should have known of the risk of hanging tags and removed them. Defendant presented the testimony of Dr. Susan C. Oleszewski, who is currently the Associate Dean for Clinical Services at the Pennsylvania College of Optometry. She opined that the defendant did not deviate from the standard of practice and that hanging tags are commonly used. She presented photos of sunglasses displayed in Philadelphia and Houston, where she had recently attended an Optometry conference, depicting different types of hanging tags.
Defendant also argued that plaintiff did not make out a prima facie case of product liability because she did not have an expert who said that the sunglasses were defective or the tag or an exemplar and that she could have obtained one from the manufacturer.
The arbitrators in Montgomery County found in favor of the defendants. Plaintiff appealed, following which a nominal settlement was negotiated.
For further information, please contact Victoria M. Komarnicki, Esquire.
Telephone: (215) 665-3303.
SUMMARY JUDGMENT - SUIT WITHDRAWN
Doe v. State Farm – Doe was seated in the driver's seat of his car while stopped in a line of traffic at a stop sign. He was shot by a mentally ill person situated in a nearby apartment, and sustained injury to his neck, face, mouth teeth, eye orbit, and finger. He made a claim for first-party medical benefits. State Farm denied the claim on the basis that Doe's injuries did not arise from the maintenance or use of a motor vehicle, but rather from a personal attack.
Almost four years later, Doe sued State Farm for bad faith damages and for payment of his medical bills. He claimed that since he was seated in his car when shot - a fact that State Farm did not contest - his medical bills were automatically payable under his automobile insurance policy. State Farm removed the case to federal court.
Plaintiff, proceeding on a "bad day" theory, contended for the first time in his deposition that his teeth had been knocked out, not by the buckshot, but by impact to the steering wheel when his car rear-ended the car in front of him just before the shooting took place.
State Farm filed a motion for summary judgment. The Court, in an opinion highly critical of plaintiff's case, entered summary judgment against plaintiff on the bad faith claim, finding that the denial of benefits had not been unreasonable. Further, judgment was entered for defendant on all claims for medical bills other than for damage for Doe's mouth and teeth. The Court reluctantly allowed plaintiff to attempt to prove at trial that he had sustained mouth or teeth injury in a motor vehicle accident before the shooting. Two weeks before the scheduled trial in Williamsport, Pennsylvania before the Honorable James F. McClure, Jr., and a day after the Court issued a ruling on defendant's motion in limine which prevented plaintiff from asking the jury for attorney fees, plaintiff abandoned the case and marked it "withdrawn with prejudice."
For further information, please contact Moira Clare Duggan, Esquire.
Telephone: (215) 665-3305
JURY TRIAL -
VERDICT SIGNIFICANTLY LESS THAN DEMAND
Harsh v. Friday and Ford Motor Co. and Hollingsworth v. Friday and Ford Motor Co. – Defendant, 83 years old, was involved in a motor vehicle collision in the parking lot of an auto dealership in Schuylkill Township, Pennsylvania. He lost control of his car which moved backwards approximately 60 feet before striking a vehicle being operated by Mr. Harsh, an employee of the dealership. A salesman, Mr. Hollingsworth, was in the car with defendant at the time of impact. Both Harsh and Hollingsworth were injured.
Defendant attributed the accident to confusion with the vehicle's adjustable accelerator and brake pedals and also due to the fact he did not know the vehicle was equipped with adjustable pedals. While getting ready to test drive the vehicle, he attempted to adjust the seat and accidently adjusted the pedals. Thinking his foot was on the brake, the defendant pushed on the pedal, which was actually the accelerator, and drove the vehicle in reverse. Mr. Hollingsworth testified that he advised the defendant of the existence of the pedals and further instructed the defendant on how the pedals worked.
The plaintiffs brought suits against the defendant-driver and manufacturer, each claiming that he was unable to work in his former capacity as a result of the incident. Plaintiff Harsh complained of neck, upper back, and low back pain, with some complaints of cervical and lumbar radiculopathy. MRIs of his cervical and lumbar spine, however, were essentially negative except for the presence of degenerative changes. He had treatment which included physical therapy, cervical and lumbar epidural injections, and radiao-frequency ablation/rhizonotomy, at the lumbar levels. He now walks with the assistance of a cane and alleged serious limitations in his ability to ambulate or sit or stand for long periods of time.
At the request of defendant, Harsh was seen by an orthopedic surgeon and a neurologist, and both opined that Mr. Harsh sustained soft tissue injuries which would have resolved as of the time of the examinations. The physicians also stated that Mr. Harsh was not limited in any of his activities of daily living, including his ability to return to his prior job.
Mr. Hollingsworth alleged injuries to his left shoulder and neck, including an inability to turn his head due to pain. His physician testified that Mr. Hollingsworth's injuries included cervical disc herniation, cervical disc degeneration, cervical strain with whiplash mechanism, rotator cuff tendinitis, and internal derangement of the right shoulder. He also opined that Mr. Hollingsworth sustained an internal derangement of the left shoulder, which required surgery. According to his doctor, he would likely require vocational training for a sedentary position but should be capable of an eight hour work day. Further, due to an inability to turn his neck, he would be unable to return to his pre-accident job of a car salesman since he would need to operate a vehicle in order to sell it. Another physician had earlier cleared Mr. Hollingsworth to work light duty.
Plaintiff was examined by an independent orthopedic surgeon who, after examining the MRI films and Mr. Hollingsworth, diagnosed Mr. Hollingsworth with cervical strain, cervical spondylosis, and a shoulder contusion. The physician also opined that Mr. Hollingsworth had sustained a post-traumatic impingement syndrome of the left shoulder which had responded well to surgical intervention. There was no objective evidence to support his complaints of cervical pain or limited range of motion. The physician confirmed that Mr. Hollingsworth was not restricted from participating in his regular activities of daily living, including working.
Each plaintiff had a workers' compensation lien greater than $100,000. Mr. Harsh presented live testimony from a vocational expert and an economist who testified to lost earnings capacity and loss of services claims of between $259,000 and $540,000. Mr. Hollingsworth presented live testimony from a vocational expert who estimated future wage losses between $830,000 and $1.5 million dollars. All of the experts admitted during cross-examination that the numbers should be reduced if the jury felt the plaintiffs could work in some capacity.
Defendant and Mr. Harsh each provided testimony from engineering experts, who opined that the vehicle was defectively designed and unreasonably dangerous. The experts contended that the accelerator adjustment control should have been located elsewhere in the vehicle, away from the seat controls, and that the vehicle should have been manufactured with an interlock that prevented the pedals from being adjusted when the vehicle was in gear. The manufacturer provided live testimony from an expert engineer and a human factors expert, each of whom testified that the vehicle was not defective and was safe for its intended use.
Mr. Hollingsworth's demand prior to trial was $1.2 millions dollars. He was offered $140,000. Mr. Harsh demanded $2.5 million dollars with a settlement offer of $265,000. Mr. Hollingsworth settled for the $140,000 after seven days of trial before the Honorable Jacqueline Cody of the Chester County Court of Common Pleas. Mr. Harsh declined to settle and, after eight days of trial, the jury awarded him $115,000.
For further information, please contact Kevin M. Blake, Esquire.
Telephone: (717) 393-4400
DEEMER STATUTE - UNINSURED MOTORIST CLAIM - BINDING ARBITRATION
Donsky v. AAA Mid-Atlantic Insurance Group – On January 17, 2000, Ms. Donsky, a Pennsylvania resident, was involved in an automobile accident in Cherry Hill, New Jersey. The insurance company for the other driver denied her liability claim contending that her injuries did not pierce the New Jersey verbal tort threshold. After receiving this denial, Ms. Donsky submitted an uninsured motorist claim to her insurer, AAA Mid-Atlantic.
Donsky contended that she could present an uninsured motorist claim because, although she was legally entitled to recover damages from the tortfeasor, she was prevented from doing so because the New Jersey statute operated as a statutory damages cap. She also argued that the tortfeasor's denial of her liability claim had the same effect as a denial of insurance coverage to the tortfeasor. In response, AAA asserted that because the New Jersey statute completely barred her claim against the tortfeasor, she was not legally entitled to recover uninsured motorist benefits. Furthermore, AAA argued that the denial of a liability claim by the tortfeasor's insurance carrier did not transform the insured tortfeasor into an uninsured motorist. Finally, AAA responded to Donsky's public policy arguments by asserting that the proper remedy in this circumstance lies with the Pennsylvania legislature and not a strained interpretation of clear policy language.
A binding arbitration panel found in favor of AAA.
For further information, please contact Louis E. Bricklin, Esquire.
Telephone: (215) 665-3400
Bennett, Bricklin & Saltzburg LLP is pleased to announce that Edward J. Bradley, Jr. was admitted to the partnership effective January 1, 2005.