Recent Blog Posts in December 2009

Colorado law, C.R.S. § 42-4-237, requires that passengers and drivers of automobiles must wear seatbelts. You can even get a ticket for not wearing your seat belt. But, there is a lesser known cousin of the “seat belt required” movement that people often learn about after it’s too late – the civil consequences of being in a motor vehicle collision, and not having worn your seat belt.

	Under Colorado case law, even if the accident was completely the other driver's fault, a jury is free to reduce your damages, if they choose, all the way down to zero for a failure to wear a seat belt.  Anderson v. Watson, 929 P.2d 6, (Colo.App. 1996).  The jury is charged with deciding, often with scant evidence, how much of your pain and suffering would have been avoided had you theoretically been wearing your seat belt at the time of the accident. The reality is that seat belts are a good idea. They are of vital importance in head-on collisions. They are of some benefit in off center collisions. They are of marginal benefit in side-impact collisions. And, yes, in lower impact rear-end collisions they often cause more injury than they avoid. However, the law correctly endorses the use of seat belts and as a matter of public policy continues to encourage their use. It has always been curious to me that our legislature continues to make the laws stricter related to seat belts being worn by drivers often with six thousand pound steel buffers around them already, but has no problem endorsing motorcycles lack of use of a helmet when that rider has no buffer between himself and the pavement. But, those issues are for legislators to resolve. As a lawyer, when we come upon a case of a person who reports themselves at the scene as NOT wearing a seat belt, the first thing I start thinking about is what sort of evidence might be helpful to a jury in assisting them in minimizing the possibly large bite that they might take out of my clients verdict. Accident reconstruction testimony, police testimony and sometimes just some plain old-fashioned horse sense and logic help me in formulating my arguments dealing with this problem. For you drivers out there, particularly during this holiday season, make it one of your New Year’s resolutions to start buckling up EVERYTIME you get into a vehicle. Seat belts do save lives and not wearing one can cost you in the event of an accident both physically and monetarily.

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From all of us at ANDERSON, HEMMAT AND LEVINE, please BUCKLE UP, for your safety and for your case.  But, if you happen to forget and unfortunately are then involved in an accident, call us so we can you cope with the civil consequences.

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Say you are injured in a rear-end motor vehicle collision while driving for your job.  Assume that your medical care, wage compensation, and even a workers’ compensation settlement seems to just happen without much effort.  But at some point, before the statute of limitations, you make a claim against the at-fault driver’s insurance.  Assume that the maximum insurance coverage is $50,000.  Assume further that they want to settle with you for the full $50,000.  Sounds like a good problem to have, right?   Actually, the above scenario is much, much more complicated than you may think, and it is frought with pitfalls that can be avoided with proper guidance.

Many people who would be eligible to make what is referred to as a ”third party claim,” become overwhelmed with the details and just give up on making a third party claim at all. Though this is their decision, from a legal stand point, not making a third party claim (when a valid claim exists) is nearly always a mistake.

Complicating Factor #1

A. Workers Compensation Will Want Their Money Back

If you recover workers’ compenation benefits and make no additional efforts to seek recovery from some other source (i.e. the negligent driver), you have no obligation to repay Workers’ Compensation the money they spent for your medical care and wage loss compensation.  If, however, you elect to pursue a claim against, in our example, the driver who rear-ended you, then Worker’s Compensation will assert a lien for the amount of money they paid you (including the cost of the medical care provided).

How Much Money is Worker’s Compensation Entitled to If I Pursue a Third Party Claim?

This is a very complicated matter which usually requires consultation with an attorney familiar with the interplay of worker’s compensation claims with general personal injury laws.

1) Economic versus Non-Economic Recovery

In virtually every personal injury case that goes to trial, a jury is asked to award economic losses as well as non-economic losses. Economic damages are past or future economic based claims such as medical bills or wage loss.  Non-economic damages include what is commonly referred to as “pain and suffering,” emotional distress, etc. 

With respect to the money you receive from a third party claim, Workers’ Compensation is technically entitled to reimbursement for that part of your settlement (or jury verdict) related to your economic damages. The rationale is that Workers Compensation paid for past medical bills, past wage loss, future wage loss, and possibly future medical care.  Accordingly, those benefits are essentially identical to the claims that could be brought in the third party action under the umbrella of economic recovery.  However, as to recovery that the jury awards for pain, emotional upset, aggravation, sleepless nights, anxiety, suffering, loss of enjoyment of life, etc., there is no comparable workers’ compensation  benefit.  In fact, the Worker’s Compensation laws do not recognize these types of damages.  Accordingly, noneconomic recovery does not have to be repaid to Worker’s Compensation.  However, Workers’ Compensation subrogation people will often boldly claim that they are entitled to be repaid their full lien amount before you get a penny from the settlement.  This is a gross distortion of the law.

Furthermore, assuming that you get a clear jury verdict for economic benefits that fully cover what they paid, Workers’ Compensation should still reduce their lien amount by the attorney’s fees you paid to pursue the recovery of these benefits.  After all, Worker’s Compensation sat back and let you pursue this money for them.  They should at least reduce their lien by the percent of attorney fees you paid your lawyer. 

This process is pretty clear cut when the third party case is resolved at trial but is much more complex when these cases settle prior to trial.  However, with proper guidance,  you can end up receiving more of the settlement proceeds than you may have thought possible. 

Complicating Factor #2

B.  The “Exclusive Remedy” Provisions of the Workers’ Compensation Laws

One of the main reasons many people forego bringing a valid “third party” claim against the party who caused their work injury is due to a misunderstanding of the law.  The first incorrect assumption is based on a misunderstanding of the “Exclusive Remedy” laws.  The second incorrect assumption is based on a misunderstanding as to the amount of money Worker’s Compensation can rightfully demand to be repaid from an eventual settlement.  These mistakes are not just made by victims, but sadly, in our experience, also by their lawyers. I hope to clarify both of these general misunderstandings.

 What “Exclusive Remedy” means:

There is language in Colorado’s Worker’s Compensation Act stating that a worker’s exclusive remedy is the Worker’s Compensation system.  Simply stated, it means that if you are injured on the job, you are barred from bringing a third party claim against your EMPLOYER.  You are limited to benefits available under the law through your employer’s workers compensation insurance.  Basically, as long as the employer had worker’s compensation insurance in place for his employees, regardless of how negligent the employer was, you cannot sue the employer.  This also means that if the person who caused your injury was a co-employee of your employer, no third party claim can be brought against that co-employee either.  Finally, if your employer is a sub-contractor, you cannot bring a third party claim against your employer’s general contractor. 

What “Exclusive Remedy” Does NOT mean:

There are exceptions to the “Exclusive Remedy” rule.  For instance, you can take worker’s compensation benefits and still sue for additional compensation against any driver on the road that caused your injury, (provided that person is not your co-employee or an employee of your employer’s contractor while acting within the course and scope of employment).  You may also bring claims against other companies and their employees on a job site. You can also bring claims for product liability against equipment manufacturers that caused your injury.  Basically, you can usually bring a claim against any member of the general public who in any way caused or contributed to your injury.

 A creative lawyer will be able to help you discover third party claims that may be brought in addition to worker’s compensation recovery.

At Anderson, Hemmat, & Levine, LLC, we do not view the system as being stacked against the injury victim.  We will be happy to give you a free consultation to help you determine whether you have a valid third party claim, and if you do, we can help you keep more of the money at the conclusion of the case.

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You have likely heard about young reckless drivers leaving a trail of injury, death, and destruction and probably have then thought: “Boy, I hope that young man has good insurance.” However, often the reality is that these ultra reckless young drivers have little to no insurance and no tangible assets.  Therefore, victims of these young drivers need to arm themselves with attorneys who are educated in the latest aspects of current laws and prepared to use every possible means to find recovery.

Reckless young drivers are often the product of over-indulging parents. Even if the parents are not wealthy themselves, there are often additional insurance policies available if you bring these parents into a lawsuit.  But how do you do that?  This article will talk about the 3 claims you can bring against parties OTHER than the driver of the car.

1)    Negligent Entrustment :

If the at-fault driver was using a vehicle that didn’t belong to him at the time of the accident, a claim for negligent entrustment may be brought against the actual owner of the vehicle.  This claim can only be successful if you can show that the owner of the vehicle either had knowledge of or reasonably should have known of the driver’s tendency to be a dangerous driver. 

a)      Mechanics

Intensive investigation into the at-fault driver’s history and driving record is the best way to determine whether this claim can and should be brought.  After all, a negligent entrustment claim cannot be brought EVERYTIME a person loans a car.  There must first be evidence that BEFORE the accident occurred, the owner should have had reasonable concern about letting this driver borrow his car.

A driving record that merely shows a pattern of speeding or red light violations is not always considered a sufficient basis for bringing a negligent entrustment claim.  There is even some question as to whether a driving record showing prior accidents would be sufficient.  After all, if your neighbor asked to borrow your truck would you really ask to see his DMV driving record first?  Most likely, the answer is no.   However, such information would very likely be obvious to the parent of a young son or daughter who has a history of reckless driving, and thus the claim would certainly be appropriate.

b)     Advantages

Negligent entrustment claims have several advantages.  For one, they bring more insurance policies to the table, which ultimately means more money for the victims. 

Additionally, these claims make it possible for jurors to hear about the horrible driving record of the Defendant, which normally would be precluded. Court rules normally prevent the Defendant’s poor driving record from being presented as evidence.  Without being able to present this evidence, jurors often mistakenly believe that the young Defendant has a clean driving history, even though nothing could be further from the truth.  Negligent entrustment claims help Plaintiffs overcome this obstacle by allowing them to show the jury the poor driving record of the Defendant.  After all, the at-fault driver’s poor driving history is the heart of the claim against the owner of the car.

2)    Family Car Doctrine :

Growing up, you may have heard your dad say “my house-my rules.” Turns out, there is a law that supports that notion. If I were going to give a new name to the Family Car Doctrine, I would say “Dad’s car-Dad’s fault.”

a)      Mechanics

Under the Family Car Doctrine, if you are the head of a household and a relative resident [ex: son or daughter] of your household borrows your car, then under the law you are just as responsible for the negligence of that driver as if you were driving and crashing the car yourself.

It is important to note that in a two parent household, either or both parents can be considered the head of the household, and therefore, both can be at fault to the same level of responsibility as the resident relative who was driving a family car.

b)     Advantages   

This is a particularly important claim to bring when very inexperienced drivers without lengthy driver histories get behind the wheel.  Where the at-fault driver is a young driver who does not yet have a driving history, let alone a poor one, a claim for Negligent Entrustment may just not be viable.

But if dad lent his car to his son, irrespective of what dad knew or should have known, the Family Car Doctrine makes his vicariously liability equal to that of the driver, simply by proving the basic elements of tort.  This is a useful and yet often overlooked claim.

3)    Financial Responsibility Act :

What if Junior crashes a car not owned by his parents and he doesn’t have a poor driving record yet because he is too young?  Dead end?  Think again.

Again, the idea here is to try and find as many insurance policies as possible which can be stacked to provide a very injured victim the money needed to help with recovery. 

a)      Mechanics

When Junior first got his provisional license at the DMV, a parent or guardian had to accompany himand sign a Financial Responsibility document pursuant to C.R.S. § 42-2-108.  This document means that an injured victim may hold the parent or guardian who signed for the minor driver liable for any accidents caused by that driver, no matter which vehicle he is driving, until the minor driver turns 18.

b)     Advantages

This is yet another vicarious liability tool that may afford the added opportunity to bring another insurance policy into play.  Remember though, this claim is limited to situations where the negligent driver is under 18 years of age at the time of the crash.  After Junior’s 18 ^th birthday, this claim extinguishes.

4)    Conclusion :

It can be a challenge to find sufficient money for people who have been catastrophically injured in bad car crashes. Collateral claims, such as the ones explored above, need to considered and explored in cases where the injuries are extreme and on first blush it appears that the insurance coverage is inadequate.

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At ANDERSON, HEMMAT & LEVINE, we understand that Justice For Victims is not easily obtained but we believe that it Begins Here.

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Over my nearly 20 year legal career, there always seems to be a small, but vocal, group of attorneys who try to convince the rest of us that the “sky is falling.” “The laws are against injured people,”  ”Colorado jurors do not compensate auto accident victims,” and, of course, my favorite Dooms-Day comment, “the government and the insurance industry are going to eventually make injury recovery impossible.”

I have always navigated through this negativism with an understanding that though lawyers are often pessimistic in their outlook on the future, they are also pretty bad at predicting the future.  In my view, the legal climate for bringing claims has gotten better, not worse, in Colorado.  After all, the jury sentiments about the cases WE take to trial have generally remained quite favorable.  Our verdicts and settlements have been larger and larger, and I certainly would rather go to court today than 15 years ago.  However, the “Negative Nancys” continue to bang their doomsday drums. 

But a recent case came down from the Colorado Court of Appeals that is going to give these “Dooms-Dayers” something to chat about for a long time.  The Colorado Court of Appeals recently issued a ruling in a case calledDeHerrera v. American Family Mutual Insurance.  This case has the potential to change the an accident victim’s recovery for his/her losses.

This case originally made me start to wonder if maybe the “Negative Nancys” are right.  But the question I continue to ask is: “Can a good person who gets injured in a car crash and is permanently injured get a fair shake in Colorado?”  This article will explore this recent Colorado Court of Appeals decision and its far- reaching implications for Colorado residents who become injured and need their insurance company to step up to the plate.

A)        WHAT DID THE COURT SAY IN THE DEHERRERA CASE?

In Deherrera, the facts were as follows.   Deherrera was injured in an auto accident in September 2004.  He used his American Family $5000 MedPay coverage to pay for needed medical treatment he received following his accident.  The Colorado Springs District Court and then the Court Of Appeals rejected Mr. DeHerrera’s claim that American Family should not be entitled to be paid back from his ultimate settlement the MedPay coverage they fronted him since his settlement money did not fully compensate him for his losses. 

B)        IN WHAT WAY IS THIS CASE A CHANGE IN THE LAW?

Basically, the argument DeHerrera made was not substantially different than similar arguments made in the past by other injured people who were, by Court Order, compassionately relieved of the payback obligation of a subrogation clause in an insurance contract requiring the injured person to reimburse his insurance company upon settlement or judgment from the at-fault driver’s insurance company.  Colorado courts have traditionally relied on what is commonly referred to as the “Make Whole” Doctrine.

To begin to understand the issue, assume that settlement or judgment was obtained by an injured party against the insurance company of the person who caused the injury. Secondly, assume that BEFORE this settlement occurred, the injured person took some form of insurance benefit from his own insurance company (e.g. disability money, medical bill reimbursement, etc).  Third, assume that once the injured person settled his injury case, his own insurance company, based on a language in their own insurance policy with him, started asking for THEIR money back from the settlement.  Lastly, assume that the settlement or judgment was inadequate to pay back his own insurance company and yet still have enough money to adequately compensate him for the losses he sustained in the accident.  Basically, there just isn’t usually enough money to go around.

Before DeHerrera, when Colorado courts had faced this issue, the Courts had effectively said, “back off insurance man– stop trying to put your hand in this poor injured person’s pocket!”  

In cases known as Marquez and Krall, the courts had reasoned that people who buy insurance do so with the intent that they are willing to pay a premium to better assure that they will not be less than “whole” after an injury or accident.  The courts further reasoned that any language in an insurance policy suggesting that the insurance company should get paid back BEFORE their insured was “made whole,”  would run contrary to the reasons people buy insurance.

So, prior to DeHerrera,  the courts had come down on the side of the consumer.  The courts said the injured person should be made whole BEFORE the insurance company gets any money back.  The Courts said this was proper EVEN when the insurance policy contract stated that the insurance company was to be paid back FIRST.  In other words, the courts simply refused to enforce the insurance company’s subrogation clause because it ran contrary to public policy.

C)        SO WHAT DID THE DEHERRERA CASE DO?

Well, along came the DeHerrera case. Contrary to the couple of cases that ruled on the side of the consumer nearly 30 years ago, this case says that the insurance policy language is the insurance policy language. The DeHerrera court went on to suggest that the Marquez case was based on a now repealed Auto Reparations statute, and therefore, was not applicable.  DeHereara completely ignored the similar ruling or rationale in Krall (related to uninsured motorist subrogation), and declared that “Colorado does not have any law suggesting that the “Make Whole” doctrine has ever been the law in Colorado.”

One wonders if the court would have been so quick to disavow long regarded rights of consumers in battles with greedy insurance companies if the plaintiff “Gomcindo DeHerrera” was instead named something like “Spencer Larson.”  That being said, a great society is judged by how it treats its weakest members.  In that regard, the Colorado Court of Appeals did much to question Colorado’s place in a great society.

D)        DID THE RULING IN DEHERRERA HURT YOUR CHANCES OF KEEPING A FAIR AMOUNT OF YOUR SETTLEMENT?

The answer is, PERHAPS.

First, MedPay and the obligation to pay it back, is no longer the way it was when Mr. DeHerrera had his accident on September 24, 2004.  Thus, a strong argument can be made that the court’s silly rationale in DeHerrera will have little effect on Colorado consumers’ lives, except for poor Mr. DeHerrera. In fact, MedPay became a mandatory requirement of Colorado auto insurance policies in 2009, and by state law the insurance companies are NOT allowed to request to be paid back from any eventual settlement.  So the DeHerrera case does not affect MedPay obligations at all.

However, the concern is how other courts might look to DeHerrera for guidance when issues come up related to health insurance subrogation, uninsured motorist subrogation, or frankly, any occasion when the court will be asked to consider giving an insured compassionate relief from inequitable provisions of insurance policy language. 

E)        CONCLUSION: How it might affect you.

For as long as I can recall, attorneys have known that they could argue the applicability of the “Make Whole” doctrine to get insurance companies to agree to take less than what their actual subrogation interest was. 

Now, for the first time in Colorado, it is possible that insurance companies will be less likely to agree to a money distribution that results in the injured person getting more and the insurance company getting less.  It is likely that insurance companies will feel they have the upper hand.  If this happens, it will require attorneys representing these victims to be MORE willing to take on these issues by bringing the issue to the courts.

Therefore, it our duty as a profession to be more creative and astute than to simply stand up in front of the judge and say the words “make whole.”  Those days of simply using the magic words are gone.  I can assure you that the lawyer who comes into court not understanding the perceived erosion of the “Make Whole” doctrine in Colorado will find a cool and uninviting reception at the courthouse.

For years, our firm has argued the “Make Whole” doctrine, but we have always continued to include attacks on the insurance companies’ policy language, the vagueness of its provisions, and the ambiguity of the subrogation language.  These types of arguments will now have to be the cornerstone of our future battles to make sure our clients get appropriate disbursements from settlements.

I am fond of saying, “it isn’t what you settle for, it’s what you get to keep.”  When looking for an attorney to represent you for a motor vehicle accident, I would suggest that you find one with the knowledge and “can-do” to deal with these ever-changing issues.  Also, make sure THEY fully understand how important the “…what you get to keep” part of the settlement is to you.

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At Anderson, Hemmat & Levine, we regularly and successfully resolve issues favorably with insurance companies that maximize the recovery for our clients.  DeHerrera did not help our fight.  But a good lawyer can always make an argument, and our job is to convince judges and jurors of our point of view.  I would simply say that people injured in motor vehicle collisions need the help of good legal counsel more than ever.

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Lawyers can certainly become creatures of habit and as such get comfortable in their routine. Auto accident injury victims hire lawyers with an expectation that they will thoroughly investigate these accidents.  Often, lawyers who think they have seen it all, make assumptions about how things probably were instead of actually investigating.  A specific area of investigation that all too often is not thoroughly investigated by some attorneys is: “What was the purpose of the at-fault driver’s trip?”

 A.   The Law:

If a company puts an employee on the road, and that employee causes an accident, then the company is legally responsible for the damages caused by that employee.  This responsibility is promulgated through various doctrines of law including: respondeat superior liability, vicarious liability, and perhaps even negligent entrustment.  Finding out the purpose of the at-fault driver’s trip is critical to maximizing an injury victim’s recovery.

If a driver is on his own time and causes an accident, then that driver’s auto insurance is responsible for the losses. But if a driver is on a task for his employer then at least two insurance policies are in play: the personal auto policy and a company commercial policy. Two policies mean more opportunities for fully compensating an injured person.

 B.   Specific Example:

Recently, a father of two received significant and permanent injuries in accident with a 19 year old driving on a suspended license. The good news was that the boy had his mother’s car and she had $100,000 of insurance coverage. The bad news was that $100,000 was insufficient for the extent of injuries the man suffered. The accident happened at around noon. Further investigation revealed that the boy worked part time at a tire shop. The shop was several miles away.

Without further investigation, the story many attorneys would tell themselves is, “a 19 year boy, with a suspended license? Our injured guy is lucky the 19 year old was driving his mom’s well insured motor vehicle. Let’s just take $100,000 and be thankful.”   In fact, that was just such the advice our client received from a lawyer before he hired us.  

However, while the boy was a 19 year old with a troubled driving record, there was more to the story.  Our further investigation revealed that the teenager was working at the time of the accident. This19 year old worked part time for a tire shop. On that particular day, the manager asked their young employee to take his car (actually his mother’s) and go pick up a tire from another tire shop. In fact, when the teenager took the right a way from our client he was on his way back to the shop with the tire. While getting $100,000 is often nice, upon investigation we located a million dollar additional policy.

There was nothing fancy about our research methods, just good old fashioned hard work. We asked questions, followed leads and didn’t let “what probably happened” get in the way of our investigation.

 C.   Conclusion:

If your lawyer is not willing to fully investigate all the possible means of recovery for your accident, consider making a switch to an attorney who is willing to ask the right questions and do the hard work.

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At ANDERSON, HEMMAT & LEVINE, we look forward to the opportunity to work hard on your behalf, by asking the right questions and doing the proper investigation to maximize your recovery.

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