Insurance Defense Blog

Virginia Supreme Court Reverses JNOV In Food Poisoning Case

In Bussey v. E.S.C. Restaurants, the Virginia Supreme Court reversed the trial court's award of JNOV to the defendant in a food poisoning case, and reinstated a jury verdict of $111,765.25.

The trial court granted the JNOV because it found that the testimony of the treating physician as to causation lacked sufficient factual basis because of “the non-contemporaneous medical examination, the lack of laboratory testing, and the discrepancy in the timeline.”

The Supreme Court rejected that, and among other things found that although the treating physician did not use laboratory testing to definitely identify food poisoning, Virginia law has never required such testing.  In this case, it was enough for the treating physician to have excluded other causes of the symptoms, and to have relied upon other factors.  The Court summarized the relevant Virginia law as follows:

In the context of unwholesome food, the proof necessary to sustain a cause of action based upon negligence or breach of warranty is the same. "[T]he burden requires the plaintiff to show ‘(1) that the goods were unreasonably dangerous either for the use to which they would ordinarily be put or for some other reasonably foreseeable purpose, and (2) that the unreasonably dangerous condition existed when the goods left the defendant’s hands.’ " Harris Teeter v. Burroughs, 241 Va. 1, 4, 399 S.E.2d 801, 802 (1991) (quoting Logan v. Montgomery Ward, 216 Va. 425, 428, 219 S.E.2d 685, 687 (1975)). The implied warranty of wholesomeness applies to the sale of food by restaurants. Levy v. Paul, 207 Va. 100, 106, 147 S.E.2d 722, 726 (1966). With regard to proximate causation where there is no direct proof, the circumstantial evidence must be sufficient to show that the causation alleged is "a probability rather than a mere possibility." Southern States Coop. v. Doggett, 223 Va. 650, 657, 292 S.E.2d 331, 335 (1982).

The Court concluded in this case that there was sufficient credible evidence of record to support the jury's verdict.

Virginia Bar Considering Inclusion of On-Line Research Capability As Benefit of Bar Membership

Steven Minor, author of the SW Virginia blog, recently mentioned that the Virginia bar is considering a proposal to include online legal research as a membership benefit.  Fastcase has submitted a bid to be the service provider.  There is an article about this in the most recent Virginia Lawyer's Weekly newspaper (subscription only). 

While I am not a member of the Virginia bar, I have an indirect interest.  If the Virginia bar provides online research capability as a membership benefit, the D.C. Bar and the Maryland State Bar Associations are more likely to follow suit.

As I've said before, I think it is a no-brainer for any state bar association to offer this as a benefit.  The Washington Lawyer has also recently run an article on this.  To me it is just common sense that a bar association would secure inexpensive access to online legal research for its members.  It can only raise the overall quality of service for all members of the bar to have unlimited, low fee or no fee access to online legal research.  It will potentially reduce costs and overhead for the bar membership, and will encourage pro bono services.  It ensures some competition in the market for online legal research.  Imagine what Lexis and Westlaw might cost if there is no other competition.  It also would be a great incentive to join a bar association, where membership is voluntary.  It seems like a natural extension of the traditional function of the bar association in providing law libraries for its members.

Virginia is considering Fastcase, which has fairly good national coverage and, last time I checked it out, had a clean, simple interface and offered boolean and natural language searching. 

Apparently Casemaker previously also submitted a bid to the Virginia Bar.  The bar associations of 22 states have now adopted Casemaker.  However, according to the Virginia Lawyers Weekly, the bar association withdrew its request for proposals after another legal publisher, Geronimo Development Corp. which publishes the CaseFinder CD/online legal research system, threatened to file suit.  Geronimo explains its position on its website -- it is concerned that as a Virginia-specific product, its business will be destroyed if the Virginia State Bar Association offers a competing product as a zero cost benefit of membership.  The Virginia Attorney General's Office disagrees, and among other things cites the market experience where other state bar associations offer similar programs. 

To me it looks like CaseFinder has greater Virginia coverage than FastCase, since it includes selected Circuit Court opinions and workers compensation commission decisions, and perhaps more.  Plus a CD based service would be available when a firm's internet access is down. 

After this dispute arose, according to the Virginia Lawyers Weekly, the Virginia Supreme Court passed a rule directing the state bar association to provide online research services to its members, which apparently was designed to provide a state-action exemption to any antitrust claim. 

Then the bar association reissued its RFP, and Fastcase submitted the only bid.  It isn't clear whether Casemaker and Versuslaw were scared off by the threatened antitrust suit.  It remains to be seen what the Virginia State Bar will do.

Courts in most jurisdictions are not only publishing their opinions electronically, but are incorporating powerful search engines into their websites.  Likewise, administrative agencies like the Virginia Workers Compensation Commission are offering that service.  With each passing year, the body of law that is available online and searchable at zero cost is increasing.  Given that, it is hard to imagine that Geronimo's threatened antitrust suit will go anywhere, but I have no doubt it would be hideously expensive. 

   

Blog on Virginia Home Owners Association Law

Interesting blog on Virginia Homeowner's Association Law, a subject near (but probably not dear) to the hearts of most people in the Virginia suburbs, which might also be called The Land of the Restrictive Covenants.

Virginia Supreme Court Requires New Trial Where Plaintiff's Damages Expert Based Opinion on Fictional Assumptions

In Vasquez v. Mabini, the Virginia Supreme Court reversed a $2 million judgment in favor of the plaintiffs in a wrongful death case, and remanded for a new trial limited to the issue of damages.  The sole issue on appeal was whether the verdict had to be overturned because it was based on speculative opinions of plaintiff's damages expert, Richard B. Edelman, a Professor Emeritus at American University.  The assumptions made by the expert included an assumption that the decedent's dependent adult son would have continued to live 24 years into the future even though the witness knew that he had died before trial. 

The Court found that the following assumptions made the Edelman opinion inadmissible:

The economic value of the decedent’s lost income was projected from a base of $16,000 per year, beginning the day after the accident and continuing until retirement, based upon an assumption of full-time clerical work with added annual increases and fringe benefits. On cross-examination, however, the expert admitted that Mrs. Mabini had little experience as a clerical worker, had earned less than $1000 the previous year and that her annual earnings for the preceding several years had never exceeded $7000. She had been seeking full-time clerical employment since  moving to Virginia, but had been unable to find anything but part-time work. The record does not show that she had ever held fulltime employment or received any fringe benefits.. . .

. . . .

The expert’s assumption that the decedent would have received a 3.7% retirement benefit in addition to her salary was premised on his further assumption that she would have found full-time clerical employment the day after the accident. He testified: “most full-time employees get that.” His conclusion, however, was based only upon a statistic applied to facts entirely unrelated to the personal circumstances of the decedent. Similarly, his assumption that her income would have increased 4.25% each year until retirement was based upon a statistical projection of wage rate increases applied to the unfounded assumption of fulltime employment.

In calculating the value of Mrs. Mabini’s lost services, protection, care and assistance, the expert made the assumption that her son, Pomeroy, would have lived throughout his mother’s remaining life expectancy, an additional 24 years, and that he would continue as an adult dependent throughout that time. In fact, the expert was aware that Pomeroy had died before trial, less than six months after his mother’s death.

Copyright Infringement Suit Against Police Dismissed

In a bizarre case, Shell v. City of Radford, the U.S. District Court for the Western District of Virginia has dismissed a photographer's copyright infringement suit brought against the City of Radford police department, which had seized a collection of his photographs pursuant to a criminal investigation related to the death of the photographer's assistant. 

In his copyright infringement suit, the photographer contended that he was unable to earn a living because he was unable to access his own work.  He claimed he was unable to complete a book in progress without his work.

The police argued for a blanket rule that copyrighted photographs seized in a criminal investigation may be copied and distributed for use in the investigation.

The Court declined to adopt a blanket rule as to the fair use by the police, but found after balancing the statutory factors governing fair use, that the fair use doctrine applies to the police department's use of the photographs in its investigation.

Untimely Notice to Insured of Breach of Policy Condition Can Result In Waiver of the Policy Defense in Virginia

Under Va. Code § 38.2-2226, in order to disclaim coverage based on an insured’s breach of a policy condition, an insurer has to give notice to the claimant or claimant’s counsel within 45 days after discovery by the insurer of the breach of the condition. Failure to give such notice within 45 days will result in a waiver of the defense. Virginia courts have been strict in applying such waiver. See, e.g., Aetna Casualty & Surety Co. v. Compass & Anchor Club, Inc., 33 Va. Cir. 235 (Feb. 24, 1994).

In other words, under Va. Code § 38.2-2226, an insurer's policy defense based on breach of the cooperation clause can be waived by operation of law if there is failure to give notice to the insured within the statutory time frame. See Morrell v. Nationwide Mut. Fire Inc. Co., 188 F.3d 218 (4^th Cir. 1999)

Legal Malpractice Insurer Wins Summary Judgment in Rescission Action Based on Material Misrepresentations in the Application for Insurance

Applying Virginia law, the U.S. District Court for D.C. granted summary judgment to a professional liability insurer in a rescission action brought against a law firm based on misrepresentations in the application for insurance.  The law firm had failed to disclose the existence of a potential claim, which was evidence by a letter from the claimant which announced the intent to bring a claim.

The opinion summarized Virginia law concerning rescission based on a material misrepresentation in the application for insurance.

4th Circuit Affirms Award of Summary Judgment Where Executive Found To Have Voluntarily Resigned to Take Another Position

In a published opinion, the 4th Circuit has affirmed the Eastern District of Virginia's award of summary judgment to an employer. In this case, the plaintiff had been an executive making over $200,000 per year. The 4th Circuit found that the evidence was clear that the executive had voluntarily resigned, and that there had been no constructive discharge. Honor v. Booz-Allen & Hamilton, No. 03-2076 (4th Cir. Sept. 2, 2004).

Virginia Legislature Acts to Clarify Lien Rights of Employer in Third Party Actions

This is courtesy of my partner, John H. Carstens, who is also our firm's managing partner:

In 2003, the Supreme Court of Virginia held that the employer did not timely protect its subrogation rights in a third party action, where its petition was filed after a settlement was reached but prior to the entry of the final order. See Yellow Freight Systems v. Courtaulds Performance Films, Inc, 266 Va. 57, 580 S.E.2d 812 (2003). While the Supreme Court acknowledged that the petition had been filed prior to verdict as required by the statute, as it then existed, the Court found that the subrogation rights had been extinguished by virtue of the settlement. As a result, the employer had no enforceable right at the time it filed its petition and the trial court could not consider it.

Effective July 1, 2004, the Virginia legislature amended the subrogation provisions of the Virginia Workers’ Compensation Act to address the anomaly created by the Courtaulds decision. The statute now provides that the employer shall have a lien against any verdict or settlement. Va. Code § 65.2-309(A). See also, Va. Code §§ 65.2-309.1, 310 and 311. The statute expressly gives the employer, whose lien has not been satisfied, a right to recover against the person receiving the proceeds of the settlement or verdict either through a civil action, or as a credit against future compensation. Va. Code § 65.2-309(D). These rights are extended to the workers’ compensation carrier by Va. Code § 65.2-812.

Plesae contact John Carstens at our Virginia office for further information.

Backup Man, or Spotter, For Tractor Trailer, Held By Virginia Supreme Court To Be Covered By Tractor-Trailer's UIM Coverage After Spotter Struck By Third-Party Tortfeasor's Vehicle

In Slagle v. Hartford Ins. Co., a construction manager was acting as the backup man, or spotter, for one of his firm's tractor-trailers which was delivering a piece of construction equipment. The tractor-trailer was insured by Hartford. While standing 10 to 30 feet back and directing the tractor-trailer back, the plaintiff was struck by a third party's vehicle. The third party's insurer tendered its policy limits. However, Hartford denied that the plaintiff was an insured covered by its underinsured motorist coverage. The plaintiff filed a declaratory judgment action against Hartford. The trial court found no UIM coverage for the plaintiff under the Hartford policy.

The Supreme Court of Virginia reversed, holding that the plaintiff was using the tractor-trailer in a manner contemplated by Code § 38.2-2206(B) and, thus, was an insured entitled to the underinsured motorist coverage applicable to that vehicle. This decision will have a wide impact, as almost every commercial vehicle requires a backup man or spotter to back up safely (since these vehicles have large blind spots behind them). There was a strong dissent.

The majority of the Court reasoned as follows: