Claims And Issues

INTRODUCE THEM IF THEY ARE SITTING THERE ...

THE FLORIDA SUPREME COURT REQUIRES THAT A PROPERLY JOINED UNINSURED/UNDERINSURED MOTORIST CARRIER BE INTRODUCED TO THE JURY.

           In 2001, the Florida Supreme Court held that its previous decisions "make clear that when the uninsured or underinsured motorist carrier is properly named as a party defendant, it must be identified as such.  We have made it clear that the jury should know who the parties are ...."  Lamz v. GEICO General Insurance Co., 803 So. 2d 593, 595-96 (Fla. 2001).  In the Lamz case, the Court held that it was reversible error not to "fully apprise" the jury "of Geico's specific party status."  Lamz v. GEICO General Insurance Co., 803 So. 2d 593, 596 (Fla. 2001).  Parenthetically, it is not the subject of this post whether a UM/UIM carrier is properly joined or, if so, under what circumstances, just that if a UM/UIM carrier is properly joined, then its status and its representative(s) should be fully introduced to the jury.

          Less than one week before this post is written, the Supreme Court of Florida amended Standard Jury Instruction 201.2 (Introduction of Participants and Their Roles) "to provide," as a result of its decision in Lamz, "for the introduction of a defendant uninsured or underinsured motorist insurance carrier where applicable."  In re Standard Jury Instructions in Civil Cases, 2013 WL 2248678 (Fla. May 23, 2013)(pagination not available; quotation is from fourth paragraph of introductory section of opinion, following "PER CURIAM").

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"Another Lawyer In This Case"

EXPERT WITNESSES IN FLORIDA COURTS, INCLUDING BAD FAITH CASES.

    A lot has been written in the past 3+ weeks about the 2013 Florida Legislature's enactment of a bill to establish new Florida standards for the admission of Expert Testimony.  Yet, none of the articles I have read so far have published the text of the new standards.  To meet the need to know, I researched and am printing here the text of the new standards for the admission of Expert Testimony in Florida Courts, including Bad Faith Cases.

    Putting aside obvious questions of substantive vs. procedural jurisdiction over Court Rules, with the latter being exclusively reserved to the Florida Supreme Court (but which has usually chosen to adopt the provisions of Chapter 90 of the Florida Statutes, the Florida Evidence Code, as a "Rule"), here is the text of the new standards passed by the 2013 Florida Legislature:

Section 1. Section 90.702, Florida Statutes, is amended to
    6  read:
    7         90.702 Testimony by experts.—If scientific, technical, or
    8  other specialized knowledge will assist the trier of fact in
    9  understanding the evidence or in determining a fact in issue, a
   10  witness qualified as an expert by knowledge, skill, experience,
   11  training, or education may testify about it in the form of an
   12  opinion or otherwise, if:
   13         (1) The testimony is based upon sufficient facts or data;
   14         (2) The testimony is the product of reliable principles and
   15  methods; and
   16         (3) The witness has applied the principles and methods
   17  reliably to the facts of the case; however, the opinion is
   18  admissible only if it can be applied to evidence at trial.
   19         Section 2. Section 90.704, Florida Statutes, is amended to
   20  read:
   21         90.704 Basis of opinion testimony by experts.—The facts or
   22  data upon which an expert bases an opinion or inference may be
   23  those perceived by, or made known to, the expert at or before
   24  the trial. If the facts or data are of a type reasonably relied
   25  upon by experts in the subject to support the opinion expressed,
   26  the facts or data need not be admissible in evidence. Facts or
   27  data that are otherwise inadmissible may not be disclosed to the
   28  jury by the proponent of the opinion or inference unless the
   29  court determines that their probative value in assisting the
   30  jury to evaluate the expert’s opinion substantially outweighs
   31  their prejudicial effect.
   32         Section 3. This act shall take effect July 1, 2013.

At this time, it appears that this act is still awaiting the governor's signature.  If he signs it, that act will not change the effective date set by the Florida Legislature.

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Canadians Wade into Sandy Losses With Their Own Computer Models.

    Canadian Catastrophe Computer Modelers are wading into Sandy losses.  Aon Benfield estimates "$72 Billion in total economic loss" resulting from Sandy.  "Aon Benfield's cat modeling arm" estimates that of that amount,  total "insured losses" caused by Sandy "are estimated to be $30 billion.  The $30 Billion estimate of the Cat Modelers includes roughly $7.2 billion" in Flood Insurance payouts.   "$72 billion in total economic loss from Hurricane Sandy:  Aon Benfield" in "Daily News" posted online on May 14, 2013 by Canadian Underwriter.ca.

    The industry publication reports confusing and apparently competing facts but apparently concludes that Sandy may not trigger Hurricane Deductibles.  On the other hand, their Computer Modelers are convinced that (excluded) flood and surge caused much more damage than (covered) wind perils.  Id.

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LATE NOTICE DID NOT BAR EXPERT OPINIONS. IT BARRED COVERAGE.

          Experts can conclude 4 1/2 years later that they can testify to opinions including, say, on the issues left long ago by Hurricane Wilma as in the case of  Yacht Club on the Intracoastal Condo. Ass'n, Inc. v. Lexington Ins. Co., 2013 WL 1932152 (S.D. Fla. May 10, 2013).

          However, the fact that Experts can come to opinions 4 1/2 years after the event does not establish that notice was prompt.  It establishes only that the experts say they can testify to opinions.  Yacht Club on the Intracoastal Condo. Ass'n, Inc. v. Lexington Ins. Co., 2013 WL 1932152 *4-*6 (S.D. Fla. May 10, 2013).

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D&O COVERAGE EXCLUSION OF DIRECTOR DECISIONS ON CEO PAY?

          Decisions by Directors on CEO pay based on revenue over short performance periods are being called into question.  Alternatives are available, including basing CEO pay on return on the shareholders' investment and over a longer period of time than is currently used by most Directors.

          It seems clear that deliberately or negligently choosing a pay scheme for CEOs based on a model detrimental to shareholders while other, superior models are available is a breach of fiduciary obligations at common law or in equity.  This is a pretty clear result at least in most jurisdictions outside of Delaware, for example.

          Is there an Exclusion for D&O Coverage of such Directors' conduct, such as an excluded breach of fiduciary duties for example?

          The issues of CEO pay, performance periods, and Directors decisions concerning them are raised by Gretchen Morgenson, "Fair Game / Directors Disappoint By What They Don't Do" p. 1, col. 1 (New York Times Nat'l ed., "SundayBusiness" Section, Sunday, May 12, 2013).

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Delaware's duty of disclosure

SANDY INSURANCE CLAIMS PENDING, ALTHOUGH SANDY IS LONG GONE.

          According to currently reported figures from the United States Small Business Administration, over 3,300 "small businesses and nonprofits" have received "federal emergency loans" totaling $377 Million as a result of damage claims filed after Sandy. 

          According to recently reported estimates from the Insurance Information Institute, approximately "200,000" apparently also referring to "small businesses and nonprofits," filed insurance claims under various coverages for damage to real property including office buildings and fixtures presumably, damage to personal property including "commercial vehicles and other business assets".  See Angus Loten, "For Entrepreneurs, Sandy Still Tests Survival" p. B6, col. 1 (Wall Street Journal "Small Business" Section, Thursday, May 2, 2013).

          The cited newspaper report also addresses anecdotal evidence of what would clearly be Business Interruption Coverage losses if the reported businesses have such Coverage.

          Sandy came in October.  Sandy Insurance Claims are still pending in May, and it is a reasonable estimate that various Sandy Insurance Claims will still be pending in weeks to come.

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Addressing Medicaid in Experience.

    Volume 23 of Experience magazine of the ABA Senior Lawyers
Division addresses "Elder Law Part III, Health Care, continued ...."

    I contribute a "Report from the ACA Battlefront / Medcaid, the ACA, and the Supreme Court," at 23 Experience 14 (2013).

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Primary and excess carriers: Working definitions of primary, excess insurance.

          Nothing illustrates the distinction between primary and excess policies more clearly than the respective notice provisions of these policies:

    The notice provisions found in primary and excess insurance policies are often not the same. Because excess coverage is contingent on exhaustion of the primary insurance policy, “excess insurers generally do not require notification of occurrences until the excess policy is reasonably likely to be implicated.” Lumbermens Mutual Casualty Co. v. RGIS Inventory Specialists, LLC, 682 F.3d 46, 52 n. 4 (2d Cir.2010) (per curiam) (emphasis added) (citation omitted); see also Evanston Ins. Co. v. Stonewall Surplus Lines Ins. Co., 111 F.3d 852, 861 (11th Cir.1997) (“Excess policies [ ] usually require an assured to give notice of claims that appear ‘likely to involve’ the excess.”). Not so for primary insurance policies. Primary insurers generally only require notification of any occurrence or law suit that may (as opposed to one that is reasonably likely to) give rise to a claim covered under the policy.[1]

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[1] American Guarantee & Liab. Ins. Co. v. Simon Roofing & Sheet Metal Corp., 2013 WL 961158 *4 (S.D. Fla. March 12, 2013).  [Emphasis by the Court.]

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