eNotes:Liability – January 2019

eNotes: Liability – January 2019

TT&H LAWYERS IN COURT

Attorneys Eric Appelbaum and Chris Gallagher win summary judgment in Philadelphia County trip and fall.

Eric Appelbaum and Chris Gallagher, in TT&H’s Philadelphia office, won summary judgment in a trip and fall case outside a restaurant in Philadelphia. Plaintiff allegedly tripped when her foot caught in a sidewalk crack as she was moving backwards, fleeing from an assailant. Defendant established through discovery that it did not have possession of and was not responsible for the maintenance of the sidewalk. The Court found that TT&H’s client owed no legal duty of care to the Plaintiff and granted the Motion for summary judgment. Notably, the Plaintiff’s settlement demand prior to the ruling was $395,000.00.

Questions about this case can be directed to Eric Appelbaum, at (215) 564-2928 ext. 8507 or eappelbaum@tthlaw.com, or to Chris Gallagher, at (215) 564-2928 ext. 8519 or cgallagher@tthlaw.com.

SIGNIFICANT CASE SUMMARIES

FEDERAL CASE SUMMARY

HARRIS-SAWYER v. PRRC, Inc.
United States District Court for the Eastern District of Pennsylvania
No. 5:18-cv-04682
Decided: November 1, 2018

Court is unable to determine diversity jurisdiction where Plaintiff fails to allege Defendant’s state of incorporation and principal place of business.

Background

Plaintiff filed a state-law negligence claim against Defendant in the Eastern District of Pennsylvania based on diversity jurisdiction. To establish diversity jurisdiction, the matter in controversy must exceed $75,000 and must be between a citizen of one state and citizens or subjects of a foreign state. A corporation’s citizenship is in every state in which it is incorporated, and the location of its principal place of business. Plaintiff, a Pennsylvania citizen, alleged that Defendant was incorporated in Delaware, but failed to allege Defendant’s principal place of business. Moreover, in the Civil Cover Sheet, Plaintiff selected the box that Defendant “is either incorporated in or has its principal place of business in the Commonwealth of Pennsylvania.”

Holding

Unless Plaintiff could establish in an amended complaint, that Defendant had its principal place of business outside of Pennsylvania, the Court noted that it would dismiss the Complaint. Plaintiff voluntarily withdrew the complaint.

Questions about this case can be directed to Brook Dirlam, at (412) 926-1438 or bdirlam@tthlaw.com.
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PENNSYLVANIA CASE SUMMARIES

Goldstein v. Am. States Ins. Co.
United States District Court for the Eastern District of Pennsylvania
No. 18-3163
Decided: November 28, 2018

Insurer’s Motion to sever and stay bad faith and UIM claims denied.

Background

Plaintiff was in an auto accident and filed suit against his insurer, Safeco, claiming it failed to honor the terms of the UIM provision in the insurance contract and acted in bad faith in handling the claim. Plaintiff brought both claims together. Safeco filed a Motion to Sever and Stay, arguing that severance was appropriate because the bad faith claim would be resolved in a bench trial, versus the contract claim in a jury trial. Safeco also argued that resolution of the contract claim may moot the bad faith claim, each will rely on a different set of evidence, and a jury hearing these separate sets of evidence together would be prejudicial. Further, if discovery was not stayed, there was a possibility of distracting discovery disputes that would prejudice the jury against Safeco.

Plaintiffs had the benefit of four “factually similar cases” decided by the Court, three of which declined to sever and stay the claims, and the fourth permitting severance largely because of the differing degrees to which discovery was underway in the claims. In the other three cases, bifurcation was denied because there was no indication that bifurcation would expedite resolution.

Holding

The Court denied Safeco’s Motion because bifurcation would not be convenient, economic, or expeditious and would not prejudice the parties. The evidence to prove Plaintiff’s bad faith and contract claims overlapped. Although the ultimate issues were distinct, the evidence was similar. To present the same evidence in two different trials “is a waste of resources.” Finally, the mere potential for discovery disputes is Plaintiff’s risk to take, and there are adequate procedures in federal court to address such disputes. As Safeco failed to demonstrate that the prejudice to be faced from trying both claims together outweighed the effects of bifurcation, or that severing the claims would serve the interests of convenience, economy, and expedition, its Motion was denied.

Questions about this case can be directed to Julia Morrison, at (717) 441-7056 or jmorrison@tthlaw.com.

Thomas v. Family Dollar Stores of Pa., LLC
United States District Court for the Eastern District of Pennsylvania
No. 17-4989
Decided: November 19, 2018

Defendant owed no duty of care to Plaintiff because the thick yellow substance Plaintiff slipped on was open and obvious.

Background

Plaintiff sued Family Dollar for her slip and fall on a thick, yellow substance in the store. Plaintiff was a business invitee in the store, and she argued that the condition on the floor was not open and obvious because she was looking at the shelves for products and not on the ground.

Holding

Family Dollar’s Motion for summary judgment was granted. The Court noted that it was hornbook law in Pennsylvania that a person must look where he is going. The Court also rejected Plaintiff’s argument of requisite notice because Plaintiff provided no evidence of the length of time the spill was on the floor.

Questions about this case can be directed to Jolee Bovender, at (717) 255-7626 or jmbovender@tthlaw.com.

Foremost Ins. Co. v. Nosam, LLC
United States District Court for the Eastern District of Pennsylvania
No. 5:17-cv-02843, 2018 U.S. Dist. LEXIS 18925
Decided: November 5, 2018

Insurance Company had no duty to defend and indemnify an owner/landlord in a personal injury action because the Pollution Exclusion provision barred coverage.

Background

Nosam sought defense and indemnification from Foremost Insurance Company pursuant to an insurance policy providing coverage for premises Nosam owned and rented to tenants in Pennsylvania. Tenants suffered carbon monoxide poisoning due to a furnace and heating apparatus maintained by Nosam. Tenants filed a personal injury complaint against Nosam for failing to ensure that the furnace was safe. Nosam defended against the allegations and sought indemnification from Foremost Insurance Company pursuant to its insurance policy. Foremost Insurance Company then filed a declaratory action, contending that it has no duty to defend or indemnify Nosam based on the Pollutant Exclusion. In response, Nosam and the tenants/underlying Plaintiffs argued that the Exclusion did not apply because the poisoning was the result of an accidental fire.

Holding

Although the Policy excepts from the definition of pollutant, irritants and contaminants released by an accidental fire, it is undisputed that the carbon monoxide poisoning from the furnace caused the injuries alleged in the complaint. While the buildup of carbon monoxide was accidental, it was not released by an accidental fire. If the complaint alleges facts that trigger an exclusion to coverage without alleging facts giving rise to an exception to the exclusion, the insureds may introduce extrinsic evidence to prove an exception to a policy exclusion. Here, the insureds failed to meet their burden.

Questions about this case can be directed to Chloe Gartside, at (215) 564-2928 or cgartside@tthlaw.com.

Legos v. Travelers Cas. Co.
United States District Court for the Middle District of Pennsylvania
No. 3:16-cv-1917
Decided: October 11, 2018

Statute of Limitations on UIM claim is 4 years from breach of the contract; not from the date of the 3rd party settlement.

Background

Plaintiff claimed injuries as a result of an April 29, 2003 auto accident. He filed suit against the tortfeasor on April 29, 2005. He later notified Travelers of his claim for underinsured motorist benefits on August 29, 2006. Travelers confirmed that a UIM claim had been established. Plaintiff ultimately settled his claim against the tortfeasor on March 7, 2012. Travelers notified Plaintiff, on April 23, 2016, that the statute of limitations on his UIM claim had run and that his file would be closed. On August 29, 2016, Plaintiff filed a complaint against Travelers in Lackawanna County asserting a state law breach of contract claim. Travelers removed the case to Federal Court on September 20, 2016. Travelers initially sought to have the complaint dismissed, claiming that the four year statute of limitations precluded Plaintiff’s action for breach of contract. Travelers’ motion was denied for lack of a factual record.

At the close of discovery, Travelers sought summary judgment arguing that the statute of limitations had expired. Both parties agreed that the statute of limitation for a contract action was 4 years; they disagreed as to when the statute began to run. Travelers contended that the statute of limitations began to run on the date Plaintiff settled his claim against the tortfeasor. Plaintiff claimed that the statute of limitations began to run on the date that Travelers notified Plaintiff that his file was being closed, thus, effectively denying him coverage.

Holding

The Court denied Travelers’ motion for summary judgment. In reliance on Erie Ins. Exch. v. Bristol, 174 A.3d 578 (Pa. 2017), the Court concluded that for UIM claims, the running of the statute of limitations commences upon the alleged breach of a contractual duty. Since it was undisputed that coverage was denied on April 23, 2016, the date the Plaintiff was notified that his UIM file would be closed, he had 4 years from that date to initiate his lawsuit. As Plaintiff filed his action on August 29, 2016, the action was deemed timely.

Questions about this case can be directed to James Swartz, III, at (610) 332-7028 or jswartz@tthlaw.com.

Watson v. Capo
Pennsylvania Superior Court
No. 983 EDA 2018
Decided: December 11, 2018

Superior Court upholds the Trial Court’s order granting a petition to transfer venue from Philadelphia County to Somerset County based on forum non conveniens.

Background

Plaintiff Watson was traveling westbound on the Pennsylvania Turnpike in Somerset County, PA when Defendant Capo, driving a tractor trailer struck the Watson vehicle. The truck driven by Defendant was leased/rented/owned by Defendant National Delivery Systems. Defendant Capo left the scene of the collision, but was located by the State Police and given a citation for causing the accident. Plaintiff sustained various injuries and was treated in an emergency room in Somerset County. The accident was reported to and investigated by the Pennsylvania State Police, Somerset County. Trooper Brian Seifert of the Somerset Barracks of the Pennsylvania State Police Turnpike Division went to the accident scene and wrote a report. The accident was also investigated by Trooper Derek Thorpe of the Somerset Barracks of the Pennsylvania State Police Turnpike Division. A lawsuit was filed in the Philadelphia Court of Common Pleas, and Defendants filed a Motion to Transfer to Somerset County pursuant to forum non conveniens. The Trial Court granted the Defendants’ Motion and an appeal followed.

Holding

The Superior Court held that Defendants met their burden of demonstrating that Philadelphia is an oppressive and vexatious forum as Somerset County, in which the underlying events occurred, is far from Philadelphia County, and neither the Plaintiffs nor Defendants are from Philadelphia County. Further, potential witnesses for the Defendants are engaged in activities that make their ability to appear in Philadelphia a much bigger burden than appearing in Somerset, and the sole connection with Philadelphia is the fact that Defendants occasionally conduct business in Philadelphia.

Questions about this case can be directed to Christopher Gallagher, at (215) 564-2928 or cgallagher@tthlaw.com.
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MARYLAND CASE SUMMARIES

Price v. Murdy
Maryland Court of Appeals
Misc. No. 1, September Term 2018
Decided: December 18, 2018

The licensing requirement of the Maryland Consumer Loan Law is a statutory specialty and, therefore, any action filed pursuant thereto is subject to a 12-year statute of limitations.

Background

Maryland consumers brought a putative class action against a lender in the U.S. District Court for the District of Maryland alleging, inter alia, that lender Samuel Spicer operated as an unlicensed lender in violation of the Maryland Consumer Loan Law (MCLL). However, all loans originated outside the general three-year statute of limitations for civil actions. The U.S. District Court certified a question to the Maryland Court of Appeals to determine if the MCLL licensing requirement, that is the basis for the Plaintiffs’ suit, is considered an “other specialty” under Md. Code Ann., Courts and Judicial Proceedings Article (CJP) §5-102(a)(6), entitling any action brought because of the licensing requirement to a 12-year statute of limitations.

Holding

The Court of Appeals found that the MCLL licensing requirement is an “other speciality” and any action filed pursuant to that statutory provision is subject a 12-year statute of limitations. The MCLL fits all of the test criteria for the 12 year statute of limitations: (1) the licensing duty is created solely by statute and does not exist under common law; (2) the remedy is solely statutory and does not exist under common law; and (3) because Plaintiffs seek recover of all monies paid to the lender, the nature of damages is readily ascertainable. Therefore, a 12-year statute of limitations applies to the MCLL licensing requirement actions.

Questions about this case can be directed to Renita Collins, at (410) 653-0460 or rcollins@tthlaw.com.

Johnson v. Francis
Maryland Court of Special Appeals
September Term, 2017, Nos. 1425 & 2500
Decided: November 28, 2018

A judgment creditor may not propound interrogatories in aid of enforcement of a money judgment to non-parties.

Background

Michael Johnson filed a lawsuit against three Baltimore City Police Officers who he alleged violated his rights by “‘taking him from Baltimore in a police van, assaulting him, breaking his phone, and then dropping him off in Howard County in the rain, without shoes, socks or a way home.’” A jury found the officers liable and awarded Johnson $500,000.00 in damages, which was reduced to $247,000.00 in compensatory damages and $34,000.00 in punitive damages. After Johnson was unsuccessful in his collection efforts from the officers, Johnson attempted to collect the judgment from the Baltimore Police Department; an option legally available to Johnson had he added the Department as a party to his enforcement action. Attempting to discover the Departments assets, Johnson issued interrogatories. He then sought the same information from the Department through depositions of the commissioner and fiscal officer. However, Johnson did not initiate an enforcement action against the Department, so the Department was a non-party.

In response to Johnson’s discovery efforts, the Department moved for protective orders. The Circuit Court for Baltimore City entered protective orders as to all of Johnson’s discovery requests issued to the Department.

Holding

The Court of Special Appeals affirmed the Trial Court’s ruling. It explained that because the Department was not a party to an enforcement action, Johnson could not require it to answer interrogatories. The Court looked to the Maryland Rules which do not provide for Interrogatories to a non-party, including interrogatories in aid of execution.

Questions about this case can be directed to Salvatore Cardile, at (410) 653-0460 or scardile@tthlaw.com.
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NEW JERSEY CASE SUMMARIES

Dean v. Harrah’s Atlantic City Operating Co.
New Jersey Superior Court, Appellate Division
No. A-1651-17T3, 2018 N.J. Super. Unpub. LEXIS 2734
Decided: December 13, 2018

Plaintiff’s attempt to assert new duty under New Jersey negligence law was deemed frivolous where Plaintiff failed to provide legal support for the hypothesized duty.

Background

Plaintiff was injured when she was knocked over by an unidentified minor running through the casino. The incident was captured on a security camera, but no one was able to identify the minor or the parent who was with him at the time. Plaintiff sued the casino, arguing that it breached a hypothesized duty to detain the minor and parent so that they could be identified for a future lawsuit. Defendant casino sent two “safe harbor” letters to Plaintiff’s counsel, placing Plaintiff on notice that Defendant regarded the lawsuit as frivolous and demanding it to be withdrawn. Plaintiff nonetheless elected to continue to pursue the case.

After the Trial Court granted summary judgment in the casino’s favor, the casino moved for sanctions. Plaintiff argued that the litigation had been appropriately pursued based on existing law or “a non-frivolous argument for the extension, modification, or reversal of existing law or the establishment of new law” under New Jersey Court Rule 1:4-8. During oral argument on the sanctions motion, the Trial Court asked Plaintiff’s counsel if he could cite to any case from “any jurisdiction” recognizing a legal duty of a property owner to detain a third party customer after an injury, and counsel provided in response no citation but only alluded generally to a premises owner’s duty to keep its property “reasonably safe.” The Trial Court awarded sanctions.

Holding

The Appellate Division affirmed, observing that Plaintiff consistently failed to provide any legal authority from which the hypothesized duty could be extended. The Court commented that “[o]ur statutes and court rules do not wish to discourage inventive or creative lawyering.” But “in absence of at least colorable or analogous support for plaintiff’s claims cited in case law or statute,” the Trial Court did not abuse its discretion in finding Plaintiff’s claims frivolous.

Questions about this case can be directed to Charles Skriner, at (908) 574-0513 or cskriner@tthlaw.com.

C.H. v. Rahway Bd. of Educ.
New Jersey Superior Court, Appellate Division
2018 N.J. Super. Unpub. Lexis 2527
Decided: November 16, 2018

The duty of care applicable to participants in informal recreational sports, like a fundraising school basketball game, is to avoid the infliction of injury caused by reckless or intentional conduct.

Background

The 14 year old minor Plaintiff was participating in an annual fundraising basketball game where a team of teachers play against a team of students. Student participation is voluntary. The game was officiated by at least one referee and attended by five teachers who did not play, but provided supervision. During the game, Plaintiff went up for a rebound, made contact with Defendant teacher Garry Martin and landed awkwardly injuring her knee. In describing how the injury occurred, minor Plaintiff stated she was going up for an offensive rebound when Defendant Martin also went up and shoved her out of the way by pushing his body backward to create more space between himself and the basketball rim while jumping for the ball. Minor Plaintiff through her guardian sued the teacher, her school and the school board under the theories of negligent supervision, negligence, and intentional conduct. Defendants filed a summary judgment motion which the Trial Court granted finding that there was no showing that Plaintiff’s injury which occurred while the players jumped for a rebound, could have been prevented by further supervision. Further the Trial Court found that a participant in recreational sport activity cannot assert a claim of negligence against a co-participant who causes injury. Rather, a showing of reckless or intentional conduct was required.

Holding

The Appellate Court affirmed finding that the school’s duty to supervise was met as there was no showing that the game was being conducted in a reckless or out-of-control manner before the minor Plaintiff was injured. Moreover, the Appellate Court reiterated that “[t]he duty of care applicable to participants in informal recreational sports is to avoid the infliction of injury caused by reckless or intentional conduct.” The Court explained there are two considerations which support the heightened standard: “the promotion of vigorous participation in athletic activities, and the avoidance of a flood of litigation generated by participation in recreational games and sports.” A recklessness standard is more appropriate because a certain level of risk of harm is a normal part of a recreational game. The records contained no facts that would support a finding that the Defendant teacher acted intentionally to injure the minor, and the Plaintiff concede as much.

Questions about this case can be directed to Paraskevoula Mamounas, at (610) 332-7029 or pmamounas@tthlaw.com.
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DC CASE SUMMARY

Feld v. Fireman’s Fund Ins. Co.
United States Court of Appeals for the District of Columbia Circuit
No. 17-7169
Decided: December 7, 2018

D.C. Circuit reverses summary judgment for insurance carrier and finds existence of a rate agreement is jury question in absence of written rate agreement.

Background

Karen Feld (“Karen”) sued her brother, Kenneth Feld (“Ken”), in 2008, after Ken ordered security guards to remove Karen from his condo building. The incident occurred at a Shiva, a Jewish mourning ritual, hosted by Ken for the Felds’ aunt, who had passed away in September 2007. Karen sued Ken for assault, battery, false imprisonment, intentional infliction of emotional distress, and negligent infliction of emotional distress. Ken retained the firm of Fulbright and Jaworski, LLP (“Fulbright”) to defend him in the action. Ken was insured under a homeowner’s policy and an excess policy with Fireman’s Fund Insurance Company (“FFIC”), which both had exclusions for intentional tort claims, but provided coverage if the acts were committed in self defense or defense of property. FFIC defended Ken subject to a reservation of rights, and a dispute arose over the payment of Fulbright’s fees by FFIC after Ken prevailed at trial.

Ken sued FFIC in the U.S. District Court for the District of Columbia to recover $2.4 million in attorney’s fees, which Ken claimed FFIC was contractually obligated to pay to him as reimbursement for Fulbright’s fees. FFIC contended that it had reached an agreement with a Fulbright associate in a September 2009 telephone call to pay certain rates, which were approximately half of the hourly rates that Fulbright had billed up until that point. Fulbright and Ken vigorously denied the existence of any agreement. FFIC claimed that a proposed budget prepared by the Fulbright associate, which included FFIC’s preferred rates, was proof of the contract. The budget also included a cover letter stating that the fees in the budget were not binding. On these facts the District Court entered summary judgment in FFIC’s favor and found that the budget was proof of a binding contract. Ken appealed to the D.C. Circuit.

Holding

The D.C. Circuit reversed the District Court’s grant of summary judgment and held that the reference to rates in the Fulbright associate’s proposed budget was not an unambiguous agreement between the parties, particularly in light of the fact that the cover letter disclaimed any intent to be bound by the “fees and expenses” stated therein. The court further found that a reasonable jury could infer from the disclaimers in the letter from the Fulbright associate that the budget proposal was only a provisional estimate and did not constitute an agreement. Because a reasonable jury could reach a different conclusion than the inferences drawn by the Trial Court, the D.C. Circuit reversed and remanded the case for trial on the issue of whether an agreement was indeed reached between FFIC and Fulbright for the payment of attorney’s fees.

Questions about this case can be directed to Peter Biberstein, at (202) 945-9506 or pbiberstein@tthlaw.com.
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VIRGINIA CASE SUMMARY

Frouz v. Commonwealth of Virginia
Virginia Supreme Court
No. 171450
Decided: December 6, 2018

A dog-on-dog attack which begins on the owner’s property, but ends on another’s property where an injury occurs, is not subject to safe-harbor protections.

Background

Two adjacent property owners had dogs; the mother of the aggressor dog’s owner was keeping the aggressor dog for her son while he was at school, and the neighbor kept three dogs. The mother had sent warnings to the neighbor about her son’s dog’s aggression, and on occasion referred to the aggressor dog as her own. While the neighbor had friends over, she let her dogs out in her yard. The neighbor’s friends noticed that the aggressor dog approached the waterfront area where they were kayaking, and attempted to get the mother to call back the aggressor dog. Before the mother could do so however, the aggressor dog and one of the neighbor’s dogs began fighting. Ultimately the fight concluded on the neighbor’s dock, where the aggressor dog bit and inured the neighbor’s dog. The victim dog spent several days receiving surgical care for its injuries and the neighbor incurred over $3,000 in bills.

The mother argued that the attack began on her property, and as such should be subject to the safe harbor provision in VA. Code §3.2-6540(a)(iii). She further argued that the aggressor dog was her son’s, not hers, and so she should not be required to pay restitution to the neighbor for her veterinary bills even if the court found that the safe harbor provision did not apply. The veterinary bills were excluded from evidence, but the veterinarian testified at trial and used the bills to refresh her memory. The Circuit Court held that the attack, though beginning on the mother’s property, had resulted in injury to the neighbor’s dog on the neighbor’s property, so the safe harbor did not apply, and that sufficient evidence had been put on as to the actual amount of the neighbor’s damages to permit an order of restitution.

Holding

The Supreme Court affirmed the Circuit Court’s ruling. Though the mother argued that an attack should be considered to have occurred where it began, she could not explain why occurrence should not also extend to where the attack concluded and ultimately led to injury to the neighbor’s dog. As such, the safe harbor protections did not apply. The Court also found that the mother, though not the aggressor dog’s actual owner, had held herself out as its custodian, having referred to the dog has hers after the attack and in testimony and sent warnings about him to the neighbor. Custodianship of the aggressor dog is covered in the applicable statute, which permitted an order to pay restitution by the Trial Court.

Questions about this case can be directed to Collin Shannon, at (202) 945-9504 or cshannon@tthlaw.com.