CM Report of Recent Decisions
2002 Volume 3
A summary of significant recent developments in the law focusing on substantive issues of litigation and featuring analysis and commentary on special points of interest.
Download this publication as a PDF
Articles in this report
Blanket Fifth Amendment Claim by Insured Who is a Grand Jury Target Does Not Allow Insured to Avoid Examination Under Oath
In State Farm Indemnity Co. v. Warrington, 795 A.2d 324 (N.J. App 2002), the New Jersey Appellate Division reversed and remanded a trial court decision which allowed an insured to refuse to answer any questions at an examination under oath (“EUO”). The appellate court held that an insurer conducting a fraud investigation can rely upon the contractual duty of the insured to appear for an EUO and to answer questions despite the fact that the claim had already been paid and the insured has received notice that he is a target of a state grand jury investigation.
Coast Guard Regulations Requiring Emergency Evacuation Plan Do Not Make Rig Owner Liable For Not Executing the Plan
In Graham Offshore, Inc., Limitation Proceedings, 2002 AMC 1253, 287 F.3d 352 (5th Cir. 2002), two former employees of a mud logging corporation sought compensation for injuries sustained while they were evacuating a drilling rig during Hurricane Danny. Plaintiffs were working aboard an offshore drilling rig located on the Outer Continental Shelf in the Gulf of Mexico. As part of the project, the rig’s time-charterer had chartered a vessel to transport crew and equipment.
Affirming the lower court’s grant of summary judgment in favor of the insurer, the Fifth Circuit rejects an insured’s attempt to interpret its commercial insurance policy contrary to the policy’s plain language to effectuate coverage in General Accident Ins. Co. v. Unity/Waterford-Fair Oaks, 288 F.3d 651 (5th Cir. 2002).
Insurance Adjuster Held to Attorney Standard of Care
The Washington Supreme Court holds that an insurance claims adjuster must comply with the standard of care of a practicing attorney when preparing and completing documents that affect the legal rights of third party claimants and when advising third parties to sign such documents. Jones v. Allstate Ins. Co., 45 P.3d 1068 (Wash. 2002).
Recovery for the Risk of Future Injury - A Creative Resolution
The Traditional American View
The plaintiff’s burden in civil litigation is proof of the claim by a preponderance of the evidence. Each element must be more probably true than not and the law, upon that standard, will not permit the recovery of speculative damages. Thus, the law has historically rejected any award of damages for future injuries unless the plaintiff proves that those injuries are reasonably certain to occur.
Shippers Held Strictly Liable Under COGSA for Damage From Inherently Dangerous Goods Not Known to Be So
In Senator Linie GMBH & Co. KG v. Sunway Line, Inc., 2002 AMC 1217, 291 F.3d 145 (2d Cir. 2002), a carrier sued shippers under the Carriage of Goods by Sea Act (COGSA), 46 U.S.C.App. § 1304(6), for damages caused by spontaneous combustion of chemical cargo aboard its vessel. The vessel was carrying 300 drums of thiourea dioxide (TDO) from Korea to the United States. TDO is a white odorless powder used as a reducing agent in the bleaching of protein fibers such as paper and textiles. A fire broke out in the vessel’s hold, causing damage to the vessel and other cargo.
In King v. Dallas Fire Ins. Co., 2002 Tex. LEXIS 141(Tex. Aug. 29, 2002), the Supreme Court of Texas found that King’s negligent hiring, training and supervision of an employee constituted an “occurrence” under a Dallas Fire Insurance Company (“Dallas Fire”) commercial general liability (“CGL”) policy, thereby imposing a duty to defend King.
Hypothetical 1: Company engages in a hostile work environment in days 1-100. There is no further harassment until the 401st day. Can the 401st day pull in days 1-100 for purposes of liability?
Hypothetical 2: The company creates a hostile work environment in days 1-400, employee files a charge on the 401st day. Can the employee recover for the hostile acts that occurred in the first 100 days?
Answer Is... . Employer was liable in both hypotheticals!
