TT&H eNotes: Liability – June 2018

May 31, 2018

FIRM NEWS

SUPER LAWYERS AT TT&H

We are proud to announce that a number of our attorneys received recognition in the most recent Super Lawyers issue.

Super Lawyers

Super Lawyers “Rising Stars”

TT&H LAWYERS IN COURT

Joe Cardile wins defense verdict in jury trial involving negligence and private nuisance claims in sunlight reflection case.

Attorney Joe Cardile won a defense verdict for a home builder in a negligence and private nuisance lawsuit. Plaintiff, a real estate agent, owned a single family home in Baltimore City, Maryland. Attorney Cardile’s client built and sold a neighboring home containing low emissivity windows. Plaintiff sought up to $96,000 and alleged that the windows reflected sunlight at such a high intensity as to cause the Plaintiff’s vinyl siding and interior electrical components to melt. Following four days of trial, the jury determined that Attorney Cardile’s client was not negligent for installing the windows and that the windows did not create a private nuisance.

Questions about this case can be directed to Joe Cardile, at (410) 653-0460 or scardile@tthlaw.com.

Joe Cardile and Mike Burgoyne win directed verdict in furnace fire case.

Attorneys Joe Cardile and Mike Burgoyne won a directed verdict in a subrogation case brought by Nationwide Mutual Fire Insurance Company. Nationwide sought to recover $595,000 in payments made to its insured as a result of a house fire in Baltimore City. Nationwide brought suit against an HVAC contractor in Baltimore City Circuit Court and requested a jury trial, alleging that the HVAC contractor caused a high temperature limit safety switch to be bypassed, or observed the bypassed switch and failed to correct the condition. Nationwide alleged that the contractor thereby permitted an unsafe operation of the furnace, which subsequently overheated and ignited the wood structure above the furnace, consuming the home in a fire.

Representing the HVAC contractor, Attorneys Cardile and Burgoyne pursued an alternative theory for the origin and cause of the fire through their experts. They also challenged the failure of Nationwide’s fire investigator to follow NFPA 1033 and NFA 921, and to preserve the scene for other investigators. Motions in limine were denied, but at trial, the Court permitted cross examination on issues of spoliation of evidence. Following a five-day jury trial, and after a motion made by Attorney Cardile, the Court entered judgment for the Defendant contactor. The motion was based upon Nationwide’s failure to prove when the safety switch had been bypassed, which in turn meant a failure on the part of Nationwide to establish any duty on the part of the client.

Questions about this case can be directed to Joe Cardile, at (410) 653-0460 or scardile@tthlaw.com.

TT&H SPEAKING OUT

TT&H Attorney Ryan Blazure will be speaking on the topics of “Smartphone and Text Evidence” and “GPS and Wearable Device Evidence” as part of NBI’s Personal Injury Evidence: Social Media, Smartphones, Experts and Medical Records continuing education seminar to be held in Scranton, Pennsylvania, on August 23, 2018. For additional information, please contact Ryan Blazure, at (570) 820-0240 or rblazure@tthlaw.com.

TT&H Attorney Joe Holko will be speaking on “Creative Settlements” during Pennsylvania Defense Institute’s 2018 Annual Conference & 50th Anniversary Celebration to be held at the Bedford Springs Resort from July 11 – 13, 2018. Joe is also co-chair of PDI’s Civil Practice and Procedure Committee. For additional information, please contact Joe Holko, at (610) 332-7005 or jholko@tthlaw.com.

CLIENT ADVISORY

GDPR Advisory from the TT&H Retail/Hospitality Practice Group

By now, you may have heard of the General Data Protection Regulation promulgated by the European Union. (“GDPR”). At the same time, you may be asking yourself, what does something promulgated by the European Union have to do with me? As with most matters in the law, the answer is “it depends.” Exploration and a healthy understanding of the GDPR is important given its geographic reach into the United States.

In an effort to protect the privacy rights of its member states and their respective citizens within the European Union, the EU set forth the GDPR which seeks to protect individuals’ privacy rights. The GDPR, itself, is extensive and comprehensive. Accordingly, highlights will be discussed here and will apply to you if your business extends to residents of the member states of the EU. Be it taking orders, reservations or even, for whatever reason, maintaining customer information, if that information pertains to a resident of the EU, you need to be aware of the GDPR.

The GDPR applies to member states of the EU and those entities located outside of the EU which offer goods or services to or monitor the behavior of “data subjects” (individuals) within the EU. It, therefore, applies to all companies processing and/or holding the personal data of data subjects residing in the EU, regardless of that entity’s location. The breath of the GDPR is extensive and connected to those entities we deal with stateside. The GDPR’s scope of protection is far-reaching and specific. Penalties for its violation are by any definition severe – up to 4% of “annual global turnover” or 20 million Euros, whichever amount is greater.

Importantly, the GDPR’s definition of the “personal data” it seeks to protect includes any and all information related to a data subject which can be used to directly or indirectly identify said data subject (again, an individual). The information can take the form of a name, a photo, an e-mail address, bank details, posts on social networking websites, medical information or even computer IP addresses.

To be clear, the GDPR identifies a “controller” as an entity which determines the purpose(s) and means of processing data; and a “processor” is a subsidiary entity to the controller also assisting in the handling of information pertaining to data subjects. Similarly, the term “processing” includes the storage, as well as the dissemination of such personal data.

Data subjects have various rights under the GDPR, including the “right” to be forgotten. In other words, upon request, a controller must erase the requested data subject’s information and cease any further dissemination. Such data subjects will also have the right to learn of the content of the personal data a controller has about them, including obtain a copy of the data and learn of relevant storage protocols.

Further, should a controller become aware of a breach of its network, notification must be given to: (1) a supervisory authority in each applicable member state of the EU within seventy-two hours of the breach’s discovery; and (2) the affected data subject(s) themselves, when such breach is likely to result in a high risk to their rights and freedoms.

The GDPR also seeks to simplify the agreements between data subjects and controllers by requiring “plain language” written agreements. Similarly, a controller’s relationship with data subjects is expected to be as transparent as possible. Additionally, when a controller’s business activity requires regular and systematic monitoring of data subjects, they may be required to designate a data protection officer.

While the GDPR came into existence in April of 2016, it became effective on May 25, 2018. Further information can be found at www.eugdpr.org and www.itgovernanceusa.com/blog/list-of-free-gdpr-resources. As of this writing, the GDPR just went into effect. Immediate news reports indicate that many stateside business are simply choosing to block their content from potentially affected persons, rather than run afoul of the GDPR. This effect likely will be felt by the persons the GDPR seeks to protect and will be a developing area of law.

For additional information, please contact , Co-Chair of TT&H’s Retail and Hospitality Practice Group, at (570) 820-0240 ext. 8603 or rblazure@tthlaw.com.

SIGNIFICANT CASE SUMMARIES

PENNSYLVANIA | MD | NEW JERSEY | D.C. | VA

PENNSYLVANIA CASE SUMMARIES

Vella v. State Farm Mut. Auto. Ins. Co.

United States District Court for the Middle District of Pennsylvania
2018 U.S. Dist. LEXIS 67419
Decided: April 23, 2018

When the insurance company intermingles a first-party underinsured motorist claim with a third-party liability claim and fails to meet policy limits demands to settle both, a bad faith claim can be asserted based upon the handling of only the underinsured motorist claim.

Background

Plaintiff was injured in a motor vehicle accident. The tortfeasor was insured by State Farm, which was also the plaintiff’s underinsured motorist carrier. State Farm assigned the same claim representative to handle both aspects. Plaintiff demanded the limits of both policies. State Farm denied the claims under both policies. Plaintiff then reduced his demands. State Farm responded with an offer of an amount less than the liability limits of the tortfeasor’s policy, but it offered nothing under plaintiff’s underinsured motorist policy.

Plaintiff sued for underinsured motorist benefits, and for bad faith, alleging, inter alia, that State Farm acted improperly by assigning the same claim representative to the third-party liability claim and the first-party underinsured motorist claim. State Farm filed a motion to dismiss, which the Court granted in part and denied in part.

Holding

The Court dismissed the portions of the complaint asserting bad faith regarding the handling of the liability claim. In doing so, the Court applied a traditional standing analysis, reasoning that a plaintiff cannot maintain a claim of bad faith against a tortfeasor’s insurer. The Court did not dismiss the claim for bad faith regarding the handling of the underinsured motorist claim and, to the extent that that particular claim involved alleged improprieties in the commingling of the two matters, the plaintiff would be allowed to proceed.

It is important to note that the Court did not hold that State Farm acted in bad faith per se by commingling the claims. Rather, it simply held that the allegations of commingling the claims were part of the background for the first-party bad faith claim and that that part of the complaint was sufficient to survive a motion to dismiss.

Insurers that have both liability and underinsured motorist exposures arising from the same accident must exercise great care to treat the cases separately and to refrain from using one claim—the liability claim, for example—as a bargaining chip for the other.

Questions about this case can be directed to Louis Long, at (412) 926-1424 or llong@tthlaw.com.

Kershner v. Komatsue, Ltd.

United States District Court for the Eastern District of Pennsylvania
No. 17-4787
Decided: April 10, 2018

Where Plaintiff offered no persuasive rationale for choosing a forum where he did not reside, was not treated for his injuries, and was unconnected to the accident, the lawsuit was transferred from the Eastern District to the Western District of Pennsylvania.

Background

Plaintiff’s action alleged that he sustained injuries in an accident that occurred on a pipeline project that covered parts of Western Pennsylvania. Plaintiff treated at UPMC in Pittsburgh, Pennsylvania. The case was originally filed in the Eastern District of Pennsylvania. Defendants filed a motion to transfer the action to the Western District of Pennsylvania.

Holding

Under a personal jurisdiction analysis, the Court found that the events giving rise to the claim, the construction project location, and a majority of the witnesses and evidence resided in the Western District. Additionally, the Defendants were not subject to personal jurisdiction in the Eastern District. Having determined that venue would be appropriate in the Western District, the Court found that many of the public interest factors were neutral for transfer, but the private interests weighed in favor of transferring venue for witness and evidence convenience. The Court held that lawsuit was properly transferred to the Western District of Pennsylvania.

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

Mazur v. Cuthbert

Pennsylvania Commonwealth Court
No. 1008 CD 2017
Decided: April 16, 2018

Reversing grant of Preliminary Objections in defamation case where Plaintiff alleged that a Commonwealth employee knowingly lied in unemployment proceeding.

Background

Plaintiff Mazur, an employee of the Southwestern Veterans Center in the Commonwealth’s Department of Military and Veterans Affairs Department, brought a defamation action against a fellow employee, Defendant Cuthbert. Mazur was employed as an accounting assistant and Cuthbert was employed as a human resources analyst. On May 16, 2016, Mazur withdrew $4,700 in cash to be used by the Center’s residents and $500 went missing. Mazur denied taking the money and an internal and police investigation were not able to identify who took the funds.

Mazur was suspended without pay pending the results of the internal investigation, and subsequently filed a claim for unemployment compensation benefits, in an attempt to recover the income lost during her unpaid suspension. Her claim was denied by a notice of determination which erroneously stated that she was discharged for dishonesty related to theft of money from her department. Mazur’s defamation Complaint attributed these erroneous statements to Cuthbert. The Trial Court granted Cuthbert’s Preliminary Objections, finding that as a Commonwealth employee, Cuthbert was protected by sovereign immunity because her allegedly false and defamatory statements were made in the scope of her employment as a human resources analyst for the Center. Cuthbert’s job duties included representing the agency at unemployment compensation hearings.

Holding

The Commonwealth Court affirmed the Trial Court’s ruling in part, and reversed in part. First, the Court affirmed the Trial Court’s decision to allow Cuthbert to raise the immunity argument in Preliminary Objections, rather than as an affirmative defense, because the defense was clearly applicable on the face of the Complaint. Second, the Court affirmed the Trial Court’s holding that the act of Cuthbert relaying false information to the unemployment compensation representative, by itself, was performed within the scope of her job duties. However, the Court found that Mazur properly alleged that Cuthbert knowingly made false statements to the unemployment compensation representative, in violation of the Center’s policies on false statements. The Court found that if this allegation were proven, Cuthbert would have been acting outside the scope of her employment and sovereign immunity would not apply.

Questions about this case can be directed to Eric Horst, at (215) 564-2928 ext. 8506, or ehorst@tthlaw.com.

Caltagirone v. Cephalon, Inc.

Pennsylvania Superior Court
No. 1303 EDA 2017, 2018 Pa. Super. Unpub. LEXIS 1504
Decided: May 9, 2018

Superior Court upholds order sustaining preliminary objections, dismissing Defendant pharmaceutical companies, in wrongful death action where the asserted state law violations were pre-empted by federal law.

Background

Mr. Caltagirone was prescribed ACTIQ (a very powerful form of fentanyl approved by the FDA for “breakthrough” cancer pain) for his migraine headaches from a period of 2005 to 2011. In 2014, Mr. Caltagirone died from “drug intoxication” and “methadone toxicity”. Plaintiff, Joseph A. Caltagirone, individually and as administrator of the estate of his deceased son, Joseph F. Caltagirone brought a wrongful death and survival action against Defendant pharmaceutical companies for “unlawfully and recklessly promot[ing], market[ing], and [selling] ATIQ for off-label uses not approved by the FDA. Plaintiff’s argument was that his son’s addiction was the proximate cause of the pharmaceutical companies’ marketing of ATIQ for non-FDA approved purposes. The Trial Court sustained the pharmaceutical companies’ preliminary objections, dismissing the action with prejudice, as Plaintiff’s claim were premised on violations/disregard of the FDCA and FDA regulation, and thus were pre-empted.

Holding

The Superior Court agreed with the Trial Court’s reasoning that, except in limited circumstances not applicable to the present situation, there is no private right to enforce the law and regulations of the FDA. Accordingly, as Plaintiff’s claims were premised on violations of the FDA’s “off-label” restrictions, they were pre-empted, and the Trial Court properly sustained the pharmaceutical companies’ preliminary objections.

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

Kibler v. Blue Knob Recreation Inc.

Pennsylvania Superior Court
No. 903 WDA 2017
Decided: April 19, 2018

Exculpatory clause in ski resort season pass application upheld as valid to preclude negligence action when injury caused by inherent risk of skiing.

Background

Plaintiff purchased a season pass at a ski resort. The application paperwork contained an exculpatory clause which provided that the holder assumed the risk of injury and insulated the resort from claims of bodily injury caused by the “inherent risks” of skiing such as ruts and variations in terrain of the slopes. While skiing, Plaintiff encountered “trenches” in the slope, which were later determined to have been caused by an ATV that was used by a resort employee. Plaintiff fell and broke his left leg in two places as a result. The resort filed a Motion for Summary Judgment raising the exculpatory clause as a complete bar to the claims. Plaintiff countered that the trenches were not hazards inherent to the risk of skiing as they were made by resort employees in using the ATV, the clause was not conspicuously placed in the paperwork and that the resort’s “gross negligence” barred the applicability of the clause. The Lower Court rejected Plaintiff’s arguments and dismissed the complaint.

Holding

The Superior Court accepted the Trial Court’s findings and affirmed summary judgment. The Superior Court noted that Pennsylvania law provides that “inherent risks” of downhill skiing are those that are “common, frequent, or expected.” It agreed that the “trenches” or “ruts” at issue, while not necessarily expected, were specific risks set forth in the language of the exculpatory clause and any injury caused by the condition was released. The Superior Court agreed that the language of the clause was consistent with the policy of Pennsylvania that places the risk of skiing “squarely on the skier” and was not “hidden” as it contained a warning to read that was set forth in bold type and used two exclamation points. The Superior Court further agreed that the use of the ATV on the slope was not of such a “reckless” nature so as to rise to gross negligence. The clause was valid, enforceable and applicable to require dismissal of the action.

Questions about this case can be directed to Rebecca Sember-Izsak, at (412) 926-1446 or resember@tthlaw.com.

MARYLAND CASE SUMMARIES

Barbosa v. Osbourne

Maryland Court of Special Appeals
September Term, 2015, No. 1258
Decided: April 26, 2018

The pre-treatment conduct of a patient is irrelevant in determining whether a physician is liable for violating the standard of care in rendering medical services to that patient.

Background

Dr. Osbourne surgically removed Joao Barbosa’s inflamed gallbladder. During the procedure Dr. Osbourne cut Mr. Barbosa’s bile duct. Mr. Barbosa and his wife, brought a medical malpractice action in the Circuit Court for Frederick County, Maryland, alleging that Dr. Osbourne negligently cut Mr. Barbosa’s bile duct. Dr. Osbourne denied any negligent conduct and further argued that Mr. Barbosa’s failure to seek treatment for his severe abdominal pains prior to Dr. Osbourne’s involvement constituted contributory negligence by Mr. Barbosa. At the close of evidence the jury received an oral instruction and a special verdict sheet which indicated that contributory negligence was a defense to the Barbosas’ claims. The jury did not find that Dr. Osbourne breached the standard of care and therefore did not reach the question whether Mr. Barbosa was contributorily negligent.

Holding

The Court of Special Appeals held that the Trial Court erred when it permitted Dr. Osbourne to pursue the defense of contributory negligence based solely on Mr. Barbosa’s pre-treatment conduct, in giving a contributory negligence jury instruction, and in providing the jury with a special verdict sheet containing the defense of contributory negligence. The Court explained that the pre-treatment conduct of a patient is irrelevant in determining whether a physician is liable for violating the standard of care in rendering medical services to that patient. Further, the Court held that the error was not harmless, because it was so prejudicial that it likely affected the jury’s verdict. Therefore, the case was reversed and remanded to the Trial Court.

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

Sissoko v. State of Maryland

Maryland Court of Special Appeals
September Term 2016, No. 613
Decided: April 9, 2018

The Frye-Reed general acceptance standard test has evolved to now require scientific methodologies and the scientific conclusions based on them be generally accepted, like the federal Daubert standard.

Background

In 2002, a jury convicted Defendant Moussa Sissoko of first degree murder, child abuse, and child abuse resulting in the death of his 11-week old child. The state argued that Mr. Sissoko killed his child by shaking him to death, slamming him on a surface, or both. He was eventually granted post-conviction relief and a new trial. Before his second trial, Mr. Sissoko filed a motion to preclude the state from introducing expert medical testimony that the child’s injuries and death resulted from abusive head trauma arguing that the methods doctors used to diagnose abusive head trauma were not reliable because certain underlying assumptions about the methods were sufficiently disputed within the relevant scientific community. The Trial Court denied the motion and found the Defendant guilty of first-degree murder, premeditated murder, and child abuse resulting in murder. Mr. Sissoko appealed.

Holding

The Court of Special Appeals held that given the last decade of expansion of the Frye-Reed test, an analysis about the admissibility of scientific evidence requires an examination of both the Frye-Reed general acceptance test, i.e., that the technique or methodology is generally accepted as reliable in the relevant scientific community and Maryland Rule 5-702(3), i.e., whether a sufficient factual basis exists to support the expert testimony. This allows the examination of non-novel methods and conclusions drawn from reliable methods. In the words of the Court of Special Appeals, Frye-Reed and Maryland Rule 5-702(3) “overlap.” In fact, the two inquiries are now “melded into one.” Further, Frye-Reed analysis applies to a medical diagnosis. Because the state’s experts were using a non-novel, reliable methodology in diagnosing the abusive head trauma and that determination fell within the “overlap” between Frye-Reed and Rule 5-702(3), the evidence was admissible.

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

NEW JERSEY CASE SUMMARIES

Burr v. Newark Morning Ledger Co.

New Jersey Superior Court, Appellate Division
No. A-1487-16T4
Decided: April 26, 2018

Superior Court affirms dismissal of Plaintiff’s libel and trade libel actions on the basis that the libel claim was time barred and no special damages were pled to support the trade libel action.

Background

Plaintiff Burr’s claims of libel and trade libel resulted from the publication of an article on Newark Morning’s website, NJ.com, on May 13, 2013, which coincided with the issuance of the Superior Court’s unpublished opinion affirming Burr’s conviction for third-degree endangering the welfare of a child. Although the article included specific references to the trial testimony described in the Superior Court opinion, Burr alleged it also contained false statements. Burr claimed to have first discovered the article in the winter of 2015 or 2016. Burr first filed suit on May 16, 2016. The Trial Court dismissed the libel claim as time-barred and dismissed the trade libel claim because Burr failed to plead particularized special damages. Burr appealed, arguing the discovery rule applied to the libel claim and that his damages would be developed during discovery to support his trade libel claim.

Holding

The Court held that the discovery rule was inapplicable to Burr’s libel claim and because he did not commence his libel action within one year after the article’s publication, the libel claim was time-barred. With respect to the trade libel claim, the Court noted that Burr’s amended complaint only alleged the false statements in the article inhibited “his ability to practice his profession . . . of private music instruction” because “prospective clients shunned his business.” The complaint was devoid of any reference to particularized damages and failed to identify the prospective clients allegedly lost as a direct result of the article’s publication. Burr’s claim that the damages would be developed during discovery was insufficient to survive dismissal.

Questions about this case can be directed to Michael Bishop, at (610) 332-7009 or mbishop@tthlaw.com.

Caldas v. Janard Mgmt. Servs.

New Jersey Superior Court, Appellate Division
2018 N.J. Super. Unpub. Lexis 972
Decided: April 26, 2018

Where a lease unquestionably places responsibility for maintenance or repair solely on a commercial tenant, there is no landlord liability for personal injuries suffered by the tenant’s employee on the leased premises.

Background

Plaintiff Caldas was injured while at work when he slipped and fell on ice on property his employer leased from Defendant Janard Management Services (landlord). The lease required Plaintiff’s employer, as Tenant, to “take good care of the premises and . . . at the Tenant’s own cost and expense, make all repairs . . . and maintain the entire premises, without limitation, including, but not limited to . . . driveway and parking areas.” The lease further stated: “Landlord shall not be responsible for . . . injury to persons, occurring in or about the demised premises, by reason of any existing or future condition, defect, matter or thing in said demised premises . . . or for the acts, omissions or negligence of other persons or Tenants in and about the said property.” Plaintiff’s employer agreed to indemnify and hold Defendant Janard harmless for liability for property damage and injury claims. The parties acknowledged “[Defendant Janard] shall not be liable for any damage or injury to person or property caused by or resulting from steam, electricity, gas, water, rain, ice or snow.” Defendant Janard moved for summary judgment based on the lease. The Trial Court granted summary judgment in favor of the Defendant.

Holding

The Appellate Court affirmed, citing language in the Trial Court’s supplemental opinion that “‘there is no landlord liability’ for personal injuries suffered by a commercial tenant’s employee on the leased premises ‘due to a lack of proper maintenance or repair, when the lease unquestionably places responsibility for such maintenance or repair solely upon the tenant.’” Further, the Appellate Court reiterated the factors to be considered when determining whether a duty is owed — and if so, to what extent — in a premises liability action. The factors include the relationship of the parties, the nature of the attendant risk, defendant’s opportunity and ability to exercise reasonable care, and the public interest in the proposed solution.

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

DC CASE SUMMARY

Saunders v. Hudgens

District of Columbia Court of Appeals
No. 12-CV-1318
Decided: May 10, 2018

Courts cannot require Plaintiff’s to elect between contract damages and specific performance before a determination as to Plaintiff’s right of recovery.

Background

Buyer sued Arnold for his tortious interference with a contract to buy property which Buyer entered with Seller. She sought both compensatory damages and equitable relief canceling Arnold’s contract with the Seller and requiring the Seller to fulfill his contract to Buyer. The Trial Judge entered a pretrial Order bifurcating the issues into two parts, one on her tortious interference claim and her requested award of damages, and the second only for specific performance of the contract of sale. At the end of trial, the Judge instructed the jury that if it determined that a contract existed and Arnold had conspired with the Seller to breach it, the jury should “compensate” the Buyer and further explained how to determine damages for breach of contract. The jury found for the Buyer and awarded her monetary damages pursuant to the Judge’s instructions. Buyer then moved for judgment on her specific performance claim, but the motion was denied.

The Trial Judge later entered a Memorandum Opinion holding that allowing Buyer to seek specific performance would constitute a double recovery since the jury had already awarded her contract damages. As a result, Buyer appealed asserting an error by the Court in refusing to award her specific performance on the basis of Buyer electing contract damages as a remedy.

Holding

The Court of Appeals acknowledged that Buyer was not entitled to both contract damages and specific performance, but held that the Court had improperly forced her to elect one of her two possible remedies without Buyer knowing how the Court would rule on the availability of each remedy. The Court opined that the purpose of election of remedies is not to prevent recovery for any remedy, but to prevent double recovery for a single transaction. Plaintiffs are entitled to pursue multiple remedies to verdict, and then elect one when judgment is entered and enforcement is attempted. As such, the Buyer’s election to pursue damages did not bar her claim for specific performance. The problem only arose because of the Judge’s decision to bifurcate the trial and prevent evidence on the specific performance until after resolution of the damages claim, not because the Buyer abandoned specific performance as a remedy.

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

VIRGINIA CASE SUMMARY

Cherry v. Lawson Realty Corp.

Virginia Supreme Court
No. 170718
Decided: May 3, 2018

A new Virginia statute requiring landlords and property managers to resolve visible mold issues did not displace existing common law remedies for mold exposure.

Background

Tenants leased a property from the Landlord and managed by Lawson. An HVAC line leaked into the apartment after the Tenants moved in, caused water damage, and later mold. The Landlord fixed the HVAC system, but failed to resolve the mold issues promptly or effectively, and eventually black mold and mushrooms began growing where the water damage had originated. Tenants were forced to move out due to the conditions. Tenants alleged five counts, violation of the Virginia Residential Landlord and Tenant Act, breach of contract, common law and per se negligence, and fraud. Landlord and Lawson moved for summary judgment, which the Court initially denied.

At the pre-trial conference, however, the Court held that based on a review of the newly enacted Va. Code §8.01-226.12, the General Assembly had intended to abrogate all common law remedies for personal injuries arising from landlord-tenant relationships, and dismissed the two negligence counts. Tenants filed a number of objections to this decision by the Trial Court and later filed an interlocutory appeal.

Holding

The Supreme Court of Virginia held that the language of the Code did not displace the common law remedies available to the tenants, as Virginia law states “Statutes in derogation of the common law are to be strictly construed and not to be enlarged in their operation by construction beyond their express terms.” The Court opined that the evidence suggested the General Assembly did not intend to remove existing protections outside a limited and expressly stated scope, but rather to add new duties and clarify the prior language of the Code. For instance, the statute created liability in the landlord or manager for failure to remediate visible mold, an obligation that did not exist at common law. Consequently the Court reversed and remanded.

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