As a North Carolina Bad Faith Insurance lawyer, I deal with cases where homeowners insurance or commercial insurance wrongfully adjusts or wrongfully handles storm claims. These claims typically include refusing to pay for storm damage, refusing to properly replace a damaged roof, excluding flood damage, or simply low balling repair estimates.

So what can you do right now before the storm hits?

1) Make sure you have a copy of your insurance policy and declarations page. Read through what is covered. Know your coverage when you report your loss.

2) Prepare your home and business. You have a duty to mitigate damages when you can do that safely. Preposition tarps and repair equipment in a safe place so you can immediately plug holes and leaks. Have some buckets ready to catch water from leaks.

3) Take video of your home and business inventory. Preserve copies of important records before the storm hits. Take your phone and walk around your home or business and record items of value. Narrate the video and explain what the item is. For businesses, make sure you know and document exactly what is in inventory. Keep these papers with you when you evacuate.

Did you know that you can hire a lawyer to negotiate losses with your insurance company? There are non-lawyers who act as “public adjusters” and charge you a percentage of what you recover. But most public adjusters are no lawyers, so that can not advise you on the legal meaning of your insurance contract, or whether the behavior of the insurance company is in violation of good faith requirements for insurance companies. Furthermore, if the insurance company won’t do the right thing, only a lawyer can file a law suit to enforce your rights under your insurance contract. Many law firms charge exactly the same as non-lawyer public adjusters to negotiate claims before litigation begins.

Nichols Law Firm has experience handling storm losses and works with experienced engineers, architects, roofers, and general contractors to make sure you get the fair and full value for your loss.

On a personal note, I grew up in Hurricane country. I lost my home in 2004 to a huge tree when a micro-burst toppled a 100 ft pine tree on my house during Hurricane Isobel, right here in North Carolina. I, my wife, and my 2 year old were in the home when it happened- thankfully no one got hurt. I know exactly what it is like to be displaced from your home and have your insurance company haggle with you over everything. It’s very personal to me.

So be prepared for the worst, but hope for the best!

Chris Nichols
Nichols Law Firm
www.NicholsTrialLaw.com

You can download the pdf files and open them in Acrobat and then CTRL F search for the codes that show up on your conditional payment letters from Medicare. This will help you sort out medical visits that have been “coded” for payment for non-related medical procedures and visits.

This makes it easier to find and eliminate appointments for pre-existing conditions. You can also scan in a long conditional payment spread sheet, do a conversion to searchable text (OCR) and then use the search feature on that to find the billing codes.

Hope this is helpful to some of you.

Chris Nichols
www.NicholsTrialLaw.com

Trial: Priest joked about abusing 3 boys in week

By MARYCLAIRE DALE | Associated Press – 17 hrs ago

PHILADELPHIA (AP) — Jurors in a landmark priest-abuse trial heard Monday about a priest-turned-camp prowler and another who allegedly bragged about having sex with three boys in one week.

Also Monday, two jurors were replaced by alternates, but a gag order prevents lawyer from discussing the reasons for the move.

Monsignor William Lynn is on trial for child endangerment and conspiracy. Lynn, 61, is the first Roman Catholic church official in the U.S. charged for his handling of priest-abuse complaints. Prosecutors say he helped the church bury them in secret files, far from the prying eyes of investigators, civil attorneys and concerned Catholics.

In the day’s most startling testimony, a detective read internal church memos about a priest who allegedly “joked about how hard it was to have sex with three boys in one week.” His accuser also stated that the priest had a “rotation process” of boys spending time sleeping with him.

________________________________________

Interestingly, North Carolina has no Statute of Limitation for criminal cases involving this type of sexual assualt. Unfortunately, the general rule for civil cases is that the civil statute of limitations runs three years after the last date of sexual abuse. If the abused person is a minor, the statute of limitations would begin to run when the minor reaches age 18, and expire 3 years later on the minor’s birthday.

There is case law in NC for “recovered memory” cases, but the requirements for this exception to the statute of limitations on sexual abuse require expert testimony and almost a complete lack of awareness of the abuse until the memory was recovered.

For more information on sexual abuse cases in North Carolina, you can go to our Sexual Abuse Injury page.

Chris Nichols
www.Nicholstriallaw.com

The oral argument can be heard here: http://coop.ca4.uscourts.gov/OAarchive/mp3/10-1865-20111026.mp3#

Chris Nichols
www.NicholsTrialLaw.com

After about 7 years of multiple protracted litigation on three separate cases, the United States Court of Appeals for the 4th Circuit has established in the matter of E.M.A. v. CANSLER, that Ark. Dep’t of Human Servs. v. Ahlborn, 547 U.S. 268 (2006) is the law of North Carolina and that the NC Supreme Court opinion of Andrews v. Haygood did not properly interpret Ahlborn as it applies to NC Medicaid reimbursement.

Congratulations to Bill Bystrynski of Kirby & Holt of Raleigh, NC for the huge win for his client.

I’m going to keep this post fairly short and then add more posts with analysis, but I think the court puts their finding best.

Given that North Carolina common law does not bar DHHS’s lien against E.M.A.’s settlement proceeds, we arefaced with the same question considered by the North CarolinaSupreme Court in Andrews: Whether North Carolina’sthird-party liability statutes comport with federal Medicaidlaw and Ahlborn merely because the subrogation statute, N.C.Gen. Stat. § 108A-57, “caps” the state’s recovery at the lesserof the actual medical expenses paid or one-third of the totalsettlement. The North Carolina Supreme Court in Andrewsand the district court in this case adopted a narrow interpretationof Ahlborn, limiting its holding to cases in which the partieshave stipulated to or otherwise allocated settlementproceeds between different categories of damages, therebyidentifying a sum certain for medical expenses. Thus, thesedecisions are based on the view that Ahlborn is inapplicablein cases involving an unallocated lump-sum settlement, suchas the instant matter.On the contrary, however, nothing in Justice Stevens’sopinion for a unanimous court in Ahlborn supports such acrabbed application of that case. The Ahlborn Court addressedthe specific issue of “whether [ADHHS] can lay claim tomore than the portion of [the recipient’s] settlement that representsmedical expenses.” 547 U.S. at 280.

The Court in no way rested its analysis of this issue on whether there has been a prior determination or stipulation as to the medical expensesportion of a Medicaid recipient’s settlement. Thus, Ahlborn isproperly understood to prohibit recovery by the state of morethan the amount of settlement proceeds representing paymentfor medical care already received. The North Carolina statute’sone-third cap on the state’s recovery against a Medicaidrecipient’s settlement proceeds does not satisfy Ahlborn insofaras it permits DHHS to assert a lien against settlement proceedsintended (or otherwise properly allocable) tocompensate the Medicaid recipient for other claims, such aspain and suffering or lost wages (i.e., in cases where one-thirdof the recipient’s total settlement recovery is greater than theamount DHHS expended on the recipient’s behalf).10 See Andrews, 669 S.E.2d at 607-09 (Hudson, J., dissenting) (concludingthat the North Carolina statutes conflict with federalMedicaid law by allowing the state to recover from a recipientfunds that were for purposes other than medical expenses);Andrews, 655 S.E.2d at 445 (Wynn, J., dissenting) (same).

…

We are not persuaded that a mere “reasonable cap” on astate’s recovery from an unallocated lump-sum settlement satisfiesthe federal anti-lien law as required by Ahlborn. Indeed,contrary to the Andrews court’s reliance on Justice Stevens’sfootnote, the ATLA Brief, rather than advocating full recoverysubject only to a statutory cap, discussed procedures inseveral states to have “mini-hearings” to set allocations ofproceeds from tort settlements where there is no agreementamong the interested parties. Nevertheless, the Supreme Courtof North Carolina found that footnote 18 in Ahlborn authorizesthe states to mandate full recovery up to a legislativelydetermined,across-the-board limit or cap. This reliance is misplaced.

….

On the basis of Ahlborn’s clear holding that the general anti-lien provision in federal Medicaid law prohibits a statefrom recovering any portion of a settlement or judgment not attributable to medical expenses, DHHS’s lien on E.M.A.’ssettlement proceeds in this case violates federal law. In order to comply with 42 U.S.C. §§ 1396a(a)(18), 1396p, and Ahlborn,North Carolina is free to implement a process by whichsettlement proceeds are explicitly allocated or otherwisedetermined. In this case, we must remand for an evidentiaryhearing consistent with this opinion to determine the properamount of the DHHS lien on E.M.A.’s settlement proceeds.

This is an outstanding opinion and reflects the excellent analysis of Judge Wynn and Judge Hudson on the NC cases of Ezell and Andrews.

I’ll be writing a whole lot more on the issue, but wanted to get this out there.

I’m also proud that the 4th Circuit relied on a Memorandum issued by CMS to the states in their decision:

It is also illuminating that the Centers for Medicaid andMedicare Services (“CMS”) issued a memorandum to all Associate Regional Administrators for Medicaid and State Operations in the wake of the Ahlborn decision to aid the states in understanding the effect the decision would have onstate third-party liability recovery. See Memorandum from Gale Arden, Director of CMS’s Center for Medicaid and StateOperations Disable and Elderly Health Programs Group(DEHPG) to all Associate Regional Administrators for Medicaidand State Operations, “State Options for RecoveryAgainst Liability Settlements in Light of U.S. Supreme CourtDecision in Arkansas Department of Human Services v. Ahlborn”(July 3, 2006) (hereafter “CMS Memorandum”). The CMS Memorandum stated that, post-Ahlborn, “if a State attempted to recover from more than the portion of a settlementthat the parties allocated to medical items and services,it was in violation of the federal anti-lien statute.” Id. Additionally,the CMS Memorandum clarified that, “to the extent State laws permit recovery over and above what the partieshave appropriately designated as payment for medical itemsand services, the State was in violation of federal Medicaidlaws.” Id. (Page 32)

NCTrialLAw Blog was the first blog to find and publish CMS Advisory Ahlborn Settlement Options (July 2006)-1 after some deep searches on the Internet. It was a sort of “smoking gun” that showed that CMS itself was telling the State of North Carolina that Ahlborn applied.

Chris Nichols
www.NicholsTrialLaw.com

I was sent this brief “idiot’s guide” to dealing with Medicare and thought it was an excellent summary of the process. I’ve posted it in full, along with the contact information for a company that will help with the lien resolution process. I am not endorsing their product as I have never used their services.

http://lienblog.wordpress.com/2010/07/02/the-idiot%E2%80%99s-guide-to-medicare-lien-resolution/

The Idiot’s Guide to Medicare Lien Resolution

Typically, Medicare liens are placed on the personal injury case of a person whose treatment is paid by Medicare. Medicare’s agents, the COBC, MSPRC, and CMS have a right to recover funds which would not have been paid without the negligent act which harmed the plaintiff-beneficiary.

If you are the Medicare beneficiary and plaintiff in a lawsuit, your attorney should handle the Medicare liens for you. If you are the attorney, but you don’t know how to handle the lien, or just need some help, follow these simple steps:

1. Report the case to the COBC
   1. Call (800) 999-1118
   2. Be prepared to give the following Plaintiff/Beneficiary information:
      1. Name
      2. Social Security Number
      3. Medicare Number (a/k/a HIC Number)
      4. Date of Birth
      5. Address
      6. Date of Incident
      7. Injury (the COBC prefers physical body parts )
      8. Defense insurance (if known)
2. This should be the only time you deal with the COBC
3. Wait 10-15 days. During this time period the COBC will transfer the file to the MSPRC, another Medicare agency. At the end of this time period you should receive two (2) pieces of Medicare lien information from the MSPRC:
   1. First, you will receive a Beneficiary Information Questionnaire (you will recognize this document based on the red grid lines on the back pages). This document can be ignored if, and only if, the plaintiff-beneficiary’s information has not changed.
   2. Concurrently, you will receive a Rights and Responsibilities Letter. This will give some information on the Conditional Payment Letter process. No action on your part is required.
      1. This Rights and Responsibilities Letter starts a countdown until you should receive a Conditional Payment Letter (a/k/a the initial lien). That countdown will last 65 days – however, you need something else to receive the letter.
      2. Within the 65 day period, you need to send consent and proof of representation to the MSPRC. If you do not send the consent, you will not receive information on the Medicare lien, nor will you be able to speak to MSPRC representatives regarding your case.
         1. Unfortunately, the MSPRC is notoriously slow. Without constant checks on the status and timeline, your Conditional Payment Letter probably won’t arrive within the 65 day period.
            1. Be sure to call the MSPRC to check the status of your consent (its validity).
            2. Be sure to call the MSPRC multiple times after to check the status of your Conditional Payment Letter.
            3. Please be ready to wait when you call theMSPRC. Hold times range anywhere from 10 to 55 minutes (and increasing). In fact, due to theMSPRC’s inability to handle current volumes of mail, its call center is now closed on Fridays.
4. After all that time and effort you should receive the Conditional Payment Letter.
   1. But if you did not bother to call the MSPRC – you probably don’t have it!
   2. You’ve received the Conditional Payment Letter, now what?
      1. Review the payments. Check every ICD-9 code and injury to make certain they relate to the plaintiff’s sued-for injuries.
         1. Hint: ICD-9 Code 250.00 (Diabetes Mellitus) usually does not relate to malpractice or a personal injury.
5. On nearly every Conditional Payment Letter there will be unrelated codes – this means the lien is too high and Medicare is claiming funds to which it is not entitled.
6. If you have time before settlement you should Dispute theConditional Payment Letter.
   1. The MSPRC requires these in writing.
   2. Dispute the codes that are unrelated and explain why the MSPRCwas wrong to include them.
   3. Be detailed.
   4. The MSPRC will take 60-90 days to review your dispute. When it replies to your dispute it will not give reasons, it simply sends a new Conditional Payment Letter.
   5. The case is settled, how do I pay Medicare?
      1. First you have to request a Final Lien Demand by notifying theMSPRC of settlement.
         1. Be sure to include the settlement, attorneys fee, any costs incurred (plus an itemization), and the date of settlement.
         2. In 30-45 days you will receive a Final Lien Demand. This is the amount you must pay to Medicare from the settlement proceeds.
            1. You have 60 days to repay the lien before interest accrues.
            2. If you fail to pay within 60 days the interest will accrue for all 60 days plus any additional time.
7. A Final Lien Demand is not really final:
   1. You can appeal the Final Lien Demand on the basis that unrelated payments are included in the lien.
      1. You must do so within 120 days.
      2. Be very careful and detailed when appealing. Keep in mind the MSPRC is the judge, jury, and executioner at this point of the Medicare lien appeal.
   2. Other methods exist to lower the lien, including:
      1. Compromises with CMS.
      2. Waivers through the Social Security Administration.
      3. Now that I appealed, how does my client get aMedicare Lien Reimbursement?
         1. Medicare lien reimbursements (for “overpayment”) take 10-14 weeks to be processed and sent to your client.
         2. You don’t have to do anything once the appeal has been agreed to by the MSPRC.
            1. But the check will go straight to the last-known address for the beneficiary.
            2. If you want the check to go to your office you must contact the MSPRC and request it be sent to you.
               1. Usually this check arrives as a two-party check.
               2. This will protect the interests of all heirs who have an entitlement to the lawsuit funds.
               3. Now you can put the check into your escrow account and disburse the funds as is legal, ethical, and agreed to by the plaintiff, heirs, and secondary lienholders.
8. Timelines:
   1. Reporting to COBC – Day 1
   2. COBC transfer to MSPRC – Day 3-5
   3. MSPRC sends Rights and Responsibilities letter, starting 65 day countdown to a Conditional Payment Summary, or Initial Medicare Lien – Day 15-20
   4. Conditional Payment Letter arrives – Day 80-85
   5. Disputes add 60-90 days
   6. Compromises add 60-90 days
   7. Appeals add 60-90 days
   8. Notice of settlement to receive Final Lien Demand
      1. Was 10-21 days
      2. Now is 30-45 days
      3. If you do everything right in Medicare Lien Resolution, you could resolve a lien within 110 days; but, if you let letters sit and do not take the time to carefully review and resolve your liens, they could take years.
         1. Report early;
         2. Call often; or,
         3. GET HELP! Lien Resolution Servicesspecializes in this process. When we see a Medicare letter, we know what to do with it – reducing lag time and speeding up the lien resolution process. LRS makeslien resolution 100% of our focus; we take this administrative work off your hands providing you with time to practice law and litigate cases.
         4. Best of all – The cost of lien resolution isbillable to the client, just like an expert fee. The attorney pays nothing; and, while the client pays a small fee, he or she ultimately benefits by a reduced lien, faster disbursement, and results.
         5. Contact us for all of the above.

Ryan J. WeinerCo-Founder Lien Resolution Services

www.lienresolutionusa.com
http://lienblog.wordpress.com
rweiner@lienresolutionusa.com

The legislators who have bought into the corporate lobbyist’s money agenda in Senate Bill 33 would gladly sacrifice the liberty of the citizens at the throne of the new “King”: international pharmaceutical corporations and insurance companies.

This BOLD parts are from the “core values” listed for the “Tea Party Patriots” and serve as an example of Tea Party values. http://www.teapartypatriots.org/mission.aspx

Core Values of the Tea Party

• Fiscal Responsibility
• Constitutionally Limited Government
• Free Markets

Fiscal Responsibility: Fiscal Responsibility by government honors and respects the freedom of the individual to spend the money that is the fruit of their own labor. A constitutionally limited government, designed to protect the blessings of liberty, must be fiscally responsible or it must subject its citizenry to high levels of taxation that unjustly restrict the liberty our Constitution was designed to protect. Such runaway deficit spending as we now see in Washington D.C. compels us to take action as the increasing national debt is a grave threat to our national sovereignty and the personal and economic liberty of future generations.

Why “tort reform” proposed by the NC legislature is contrary to these values:

Fiscal responsibility emanates from the individual and is embodied by the government which derives its existence from the will of the people. “Tort reform” in the form of arbitrary caps on damages and immunity from certain forms of negligence by certain “classes” of individual (for example, immunity for negligent emergency room doctors) shifts the natural consequences of actions from the wrong doer to the government. Individuals who do harm should be held personally responsible for the full extent of their harm and not shift financial responsibility to government entitlement programs.

“Tort reform” in the form of NC Senate Bill 33, simply redistributes the cost of individual harm from the wrong doer to the tax payer. More specifically, by providing immunity to certain types of negligent physicians, when those physicians cause great harm to individuals, the harmed individual will eventually take tax dollars in the form of entitlement programs such as medicare, social security disability, and medicaid. The harmed citizen will be a drain on our government and our taxes.

Fiscal responsibility demands that the individual causing harm rely on their own resources and insurance converge in a robust free market- not the government to use tax dollars to bail out the negligent.

“Tort reform” is not fiscally responsible.

Constitutionally Limited Government: We, the members of The Tea Party Patriots, are inspired by our founding documents and regard the Constitution of the United States to be the supreme law of the land. We believe that it is possible to know the original intent of the government our founders set forth, and stand in support of that intent. Like the founders, we support states’ rights for those powers not expressly stated in the Constitution. As the government is of the people, by the people and for the people, in all other matters we support the personal liberty of the individual, within the rule of law.

Why “tort reform” proposed by the NC legislature is contrary to these values:

There is no question that our founders believed in, and enshrined with the Constitution, the unalienable right to a jury trial for civil suits, which our Founding Fathers protected through the 7th Amendment to the Constitution after centuries of recognition in British law and Judeo-Christian writings.

Historically, the right to a trial by jury was the basis for “The Declaration of the Causes and Necessity of Taking Up Arms,” which was a document issued to explain why the colonists had initiated armed conflict against Great Britain, and was written by John Dickinson of Virginia based on a draft by Thomas Jefferson.

Dickinson wrote in the Declaration, “Parliament was influenced to adopt the pernicious project, and assuming a new power over them, have in the course of eleven years, given such decisive specimens of the spirit and consequences attending this power, as to leave no doubt concerning the effects of acquiescence under it. They have undertaken to give and grant our money without our consent, though we have ever exercised an exclusive right to dispose of our own property; statutes have been passed for extending the jurisdiction of courts of admiralty and vice-admiralty beyond their ancient limits; for depriving us of the accustomed and inestimable privilege of trial by jury, in cases affecting both life and property…” — Declaration of the Causes and Necessity of Taking Up Arms, enacted July 6, 1775 by the Second Continental Congress

The “tort reform” proposed by the North Carolina legislature fundamentally deprives citizens of the right to a trial by jury in several ways. First, it grants blanket immunity from suit to certain classes of citizens, namely, emergency physicians and emergency room personnel, and corporate producers of pharmaceuticals (drugs). The proposals say, quite plainly, that a citizen injured or killed by any of these privileged groups can not sue and have a jury determine the fairness of their claim.

The Constitution clearly guarantees the right to a trial by jury to all citizens in the 7th Amendment.

In Suits at common law, where the value in controversy shall exceed twenty dollars, the right of trial by jury shall be preserved, and no fact tried by a jury, shall be otherwise re-examined in any Court of the United States, than according to the rules of the common law.

John Adams wrote:

As the Constitution requires that the popular branch of the legislature should have an absolute check, so as to put a peremptory negative upon every act of the government, it requires that the common people, should have as complete a control, as decisive a negative, in every judgment of a court of judicature.

He also wrote, “Representative government and trial by jury are the heart and lungs of liberty. Without them we have no other fortification against being ridden like horses, fleeced like sheep, worked like cattle and fed and clothed like swine and hounds.”

Thomas Jefferson, the author of the Declaration of Independence and the third President of the United States, said, “I consider trial by jury as the only anchor ever yet imagined by man, by which a government can be held to the principles of its constitution.”

James Madison, the author of the Constitution and the fourth President of the United States, said, “Trial by jury in civil cases is as essential to secure the liberty of the people as any one of the pre-existent rights of nature.”

“Tort reform” as proposed in SB33 and other bills curtails the natural right to trial by jury and should be opposed.

Free Markets: A free market is the economic consequence of personal liberty. The founders believed that personal and economic freedom were indivisible, as do we. Our current government’s interference distorts the free market and inhibits the pursuit of individual and economic liberty. Therefore, we support a return to the free market principles on which this nation was founded and oppose government intervention into the operations of private business.

Why “tort reform” proposed by the NC legislature is contrary to these values:

A free market economy rewards entrepreneurs for their actions that benefit society. The manufacturer who builds a superior product wins in the marketplace, and few would question that manufacturer’s right to reap the rewards of its own ingenuity. This is largely because the manufacturer has, in the effort to succeed, shouldered a risk of failure. It is the marketplace, comprised of ordinary people, rather than the government, which determines whether the manufacturer wins or loses.

If the efficient production of material wealth is all that concerns us, then the marketplace needs no other rewards or penalties. Most will agree, however, that manufacturers should be encouraged to create safe as well as efficient products, for the number of deaths and injuries annually caused by defective products is astronomical. According to the 2003 Annual Report of the U.S. Consumer Product Safety Commission, there were 4,509 deaths and 13,690,526 injuries associated with just 15 categories of consumer products during that one-year reporting period. Deaths and injuries caused annually by toxic pharmaceutical products also rival these numbers.

By making manufacturers liable to the people they have injured, the once-revered common law tort system creates an incentive for the manufacturer to build a safer product. Those who advocate more government might suggest that safety can best be engineered from above, by governmental regulation, but true advocates of a free market will agree that it is better to permit the manufacturer to determine how to make its own product safe for consumer use, rather than some government bureaucrat. In exchange for the right to determine the most efficient way to make its products safe, however, a manufacturer must be subject to suit for failure to perform this undertaking.

“Tort reform” as proposed by the NC legislature in SB33 relieves manufacturers of defective products and providers of negligent services from the natural free market consequences of their actions. This creates imbalance in the market and also encourages an increase in governmental regulations.

The free market demands that consumers have a right to recoup their losses through the fundamental right of trial by jury. This provides natural incentives for “good behavior” in the marketplace.

At any rate, the 3 minute video below came through my email from a friend and I dared to click on it. It’s a little cheesy, potentially apocryphal, and it ends with an advertisement for what may even be a pseudo-religious employee training service. And yet, I’m reposting it even though it violates many of my cardinal rules for reposting. So why? Why would I re-post this?

First if all, even trial hardened lawyers need to be a little mushy from time to time, right? 

But more importantly, I think this video reminds us about how to effectively try a case and prepare witnesses. In the story, Johnny the Bagger manges to break through the mundane world of grocery shopping by connecting with his customers on an emotional level with a simple but genuine gesture.

How does this apply to jury trials? First off, most jurors come into the courtroom with a deep set of unrealistic expectations about trials and often a mindset that is “anti-plaintiff.” After decades of insurance company propaganda, Jurors often start out by thinking they can not trust the plaintiff or their lawyer because they “want something.” The Plaintiff’s lawyer has a monumental task of overcoming these perceptions while also juggling a long “to do” list of minimum evidence requirements.

In the pressure of trial, making sure we cross off our “to do” list, we often forget that we MUST connect on some visceral level with our jurors. Our clients can not simply clinically spout off a list of symptoms and economic losses. It is our job to find a subject that breaks through the perceptions and connects the jurors and the plaintiff on an emotional level.

I find that when I prep even the most stoic witness, there is usually one subject or another that can get them emotionally stirred up. I wish I could say it was always the same subject, but it never seems to be. Often it is how the Plaintiff perceives the emotional impact of the injury on the family. But that “a-ha” testimony never seems to come in the abstract. It only comes in story telling. It happens when I say, “Look, I hear you when you say this injury has impacted your family, but tell me one story, give me one example of how you figured that out.”

Once I hear that story, the story that makes my client get misty eyed, I never ask about it again, until trial. I don’t tell my client I am going to ask about it. I want my client to be raw for a moment, I want them to be emotional, I even want them to be (emotionally) messy and uncomfortable.

I want them to be real.

The video I watched this morning reminded me that being real is so important in what we do. How do you “stay real”? When do you let your guard down? As lawyers, we have so many roles to fulfill in trial that it is very easy to become mechanistic. What gets you out of that non-emotional role and shows the jury that this is not just another case for you, but a real person with real injuries?

If you can’t answer the question easily, watch this video, see if it makes you feel something, and then take a moment to figure out how you can translate that feeling.

Chris Nichols
www.NicholsTrialLaw.com

Four people were in critical condition after the explosion at the ConAgra Foods plant in the town of Garner and 20 others were taken to area hospitals. It appears that the worst of the injured suffered severe burns.

This is an unwelcome and sadly familiar feeling for our area after the plant explosion in Apex.

I noticed in my search on the Internet for news about the explosion that law firms from out of the state of North Carolina are already posting about the explosion. I hope that these posts are part of an overall reporting of industrial accidents rather than simply an attempt to attract business. Even with law, the idea of “buying local” makes sense.

Thankfully, Raleigh and Garner have many talented lawyers experienced in industrial fires and explosions and the claims resulting from them. As anyone from North Carolina can tell you, the worst industrial accidents was the fire at Imperial Foods chicken processing plant in Hamlet in 1991.

According to official reports, twenty-five (25) people died and another forty-nine (49) were injured as the result of a fire in the Imperial chicken processing plant. Witnesses at the scene described that workers could not get out of exit that were padlocked by the plant management to prevent vandalism and theft.

There is an excellent article on the investigation and eventual prosecution of the owner of the Hamlet plant on Wikipedia found here.

I sincerely hope that the ConAgra Plant had no safety violations like the Hamlet Plant.

Interestingly, the Wikipedia entry for Hamlet says that some of the Hamlet fire victims hired an out of state lawyer who handled the Bhopal chemical disaster in India but that that lawyer did not qualify to practice in North Carolina.

I send thoughts and prayers to the families of the injured and killed.

Chris Nichols
Nichols Law Firm
Raleigh, NC

Arbitration is a good thing when it is at the option of the injured person.

One issue that is constantly debated on arbitration panels is the issue of “Prejugment” Interest on the Arbitration Award. A new case from the North Carolina Court of Appeals clarifies this often hotly debated subject. 

The case is Hamby v. Williams, NO. COA08-662 (May 2009) which supports the leading case on the issue Sprake v. Leche, 188 N.C. App. 322, 658 S.E.2d 490 (2008)

In Hamby, the arbitration panel was asked to award interest on the award but deferred that issue to the Superior Court “for further review”. The plaintiff presented evidence of the date of filing of the complaint. The Superior Court denied Plaintiff’s motion for interest and confirmed the arbitration award. In Hamby, the court first confirms that Interest is available under the standard insurance policy. 

[Insurance carriers contend that] the UIM/UM policy “does not specify anywhere that a party is entitled to prejudgment interest on an arbitration or jury award.” This assertion is incorrect. The applicable provision of the policy provides that “[UIM carrier] will pay all sums the ‘insured’ is legally entitledto recover as compensatory damages . . . .” In Sprake v. Leche, 188 N.C. App. 322, 658 S.E.2d 490 (2008), this Court held that prejudgment interest is part of compensatory damages for which an UIM carrier is liable. Id. at 325, 658 S.E.2d at 492 (citingBaxley v. Nationwide Mutual Ins. Co., 334 N.C. 1, 11, 430 S.E.2d 895, 901 (1993) and Austin v. Midgett, 159 N.C. App. 416, 419, 583 S.E.2d 405, 409 (2003)). Since the policy specifically provides for payment of “compensatory damages” these cases control. The arbitration provision provides that if the parties disagree on the amount of damages, then the matter may be arbitrated. The arbitration provision in no manner limits the scope of “compensatory damages” and the above-referenced provision of the policy controls.

Then the court goes on to establish HOW a Plaintiff can get interest awarded.

In the instant case, the parties consented to arbitrate plaintiff’s UIM claim “in accordance with the terms of the policy of insurance[.]” The parties stipulated that the issue to be determined was the amount of plaintiff’s “damages resulting from the auto accident of May 22, 2003[.]” The terms of the policy provided for “compensatory damages,” which included prejudgment interest. Id. at 325, 658 S.E.2d at 492. We thus hold the arbitration agreement did encompass prejudgment interest. Since the arbitration agreement encompassed prejudgment interest, and this issue was deferred to the trial court for resolution, Palmer, Eisinger, and Blantonare not applicable, and an award of prejudgment interest would not constitute a modification of the arbitration award. N.C. Gen. Stat. § 24-5(b) (2007) provides that: “[i]n an action other than contract, any portion of a money judgment designated by the fact finder as compensatory damages bears interest from the date the action is commenced until the judgment is satisfied.” We hold this provision to be mandatory and not discretionary on the part of the trial court, and that the trial court erred in not awarding prejudgment interest to plaintiff. (emphasis added) The portion of the trial court’s order denying prejudgment interest to plaintiff is reversed and this matter is remanded for entry of judgment awarding plaintiff prejudgment interest.

So what does this mean? How do you get interest?

1. Have an arbitration agreement that includes, at least, the following:

(A) The “issue to be determined is the amount of plaintiff’s compensatory damages resulting from the auto accident of ……”

(B) The arbitration is to proceed ““in accordance with the terms of the policy of insurance”.

2. You MUST ADDRESS and ASK for prejudgment interest at the time of the arbitration. 

3. If the panel does not address the issue of interest in the award, you will not get interest from a Superior Court Judge even if you attempt to get it by having the award entered as a judgment. See Blanton v. Isenhower, ___ N.C. App. ___, ___ S.E.2d ___ (April 7, 2009) (No. 08-864) which cites the original “killer” of interest awards, Palmer v. Duke Power Co., 129 N.C. App. 488, 499 S.E.2d 801 (1998) (sorry no link, but basically the Court said that if the arbitrators did not address something in an Award, a Court can not modify that award unless it is simply a mathematical error.)

My last bit of advice is to advise your opposing counsel that you are seeking interest before the arbitration. Send a copy of the Hamby case. Get a copy of the policy and make sure that the language works for you. Prepare a “suggested” award for the panel which addresses the interest issue. Be prepared to hand up cases to the Panel confirming they have the power to award interest.

Chris Nichols
Nichols Law Firm

I don’t have a lot of time today to dig through this case, which is 50 pages long and denser than a fruitcake, but this is, in my opinion, and “extension” on Ahlborn. also, it addresses that tricky part of Ahlborn stemming from the “stipulation” of the meds and the “either/or’ aspect of the case as presented to SCOTUS.

Here is a good summary from Med Law Blog by Michael Cassidy: 

 http://www.medlawblog.com/archives/medicare-reimbursement-tristanis-blow-to-state-medicaid-agencys-third-party-liability-collection-practices.html

I emailed one of my friends, Bryan Milner, who is a structured settlement broker and gave him a Q & A on questions I anticipate my clients will be asking about future (and past) structured settlements. I thought this would be helpful for anyone who may be looking at a structure in the near future.

Here are the answers to my questions from Bryan.

Alleviating Structured Settlement Fears- Q & A

My client is considering a structured settlement but the situation with AIG has them (and me) worried about the safety of an annuity investment. Here are some of the questions I anticipate:

Q: If the life insurance company holding my annuity fails, what happens to my structured settlement?

A: The insurance companies are subject to regulations that require them to have assets set aside and earmarked solely for the purpose of meeting their obligations to policyholders . Even in bankruptcy, these funds are not touchable, and would still be there for the purpose of honoring their commitments. In addition, each life company that offers structured settlement annuities provides a guarantee from their holding assignment company that the scheduled payments will be made to the claimant. A document with the details of the guarantee are included in each structured settlement annuity policy.

Q: Are some “types” of structured settlements safer than others? 

A: Safety is based solely on the ability of the issuing life insurance company to pay claims. Settlement annuities, and annuities in general, are well capitalized and regulated in efforts to help ensure the safety of the industry as a whole. Pay attention to overall ratings and creditworthiness of the company you choose.

Q: Are Structured settlements “insured” or guaranteed by someone other than the company issuing them?

A: All states have a Guaranty Association Act. The Act states that in the event that a member insurer, who is licensed to sell annuities in that particular state, is ordered to be liquidated by a court, the Guaranty Association Act enables the State Guaranty Association to provide protection up to a certain amount for its residents who are holders of annuity policies with the solvent insurer. For example in North Carolina, the State Guaranty limit is $300,000.

Q: What is a qualified assignment? And does it help protect the annuity?

A: The key word in Qualified Assignment is the word “Qualified”. It simply means that the assignment procedure, if done correctly, will allow benefits to “qualify” for beneficial tax treatment under 104(a)(2). As far as the protection aspect, in most cases, the assignment company is a smaller affiliated company of the parent company that issued the actual annuity contract. Again, in most cases, the assignment company’s only assets are the settlement annuities that it owns. There are no other prospective creditors that could have a claim on the assets of the assignment company. It serves as a way of separating away from the parent’s general creditors. You can also consider a “secured creditor” status with many of the issuing life companies. That level of security puts your policy higher up on the food chain when compared to a general creditor for payback if the issuing company fails and has to be liquidated. A specialized Uniform Qualified Assignment and Release and Pledge from the life company would need to be signed at the time of settlement.

Q: If I have a structured settlement with Insurance Company A, can they “sell” my annuity to Insurance Company B like mortgage companies do? Can Insurance Company B sell it to other companies? 

A: No.

Q: If I already have a structured settlement, is there anything I can do to make it “safer?” 

A: No. The settlement annuities are so well capitalized and reserved at the highest levels, we believe they are as safe as they can possibly be. Regulatory agencies and state insurance departments have dramatically increased the reserve levels to help ensure the safety of annuities.

Q: Is it possible to “split” annuities among different companies to spread risk? Would that also help to keep the annuity amount “under” the maximum coverage provided by the NC Guaranty Fund?

A: Yes, it is possible to “split” the settlement amount into different life companies for the structured settlement in order to stay under the $300,000 limit for the North Carolina Guaranty Association Act.

Q: Historically, have any other annuity companies failed and left customers with nothing?

A: Not in the settlement industry. Executive Life was the only carrier writing settlement annuities (back in the late 80’s and early 90’s) that went into receivership. When they went into receivership the courts treated settlement recipients at a higher level since their money with Executive Life was “Settlement” money, not a traditional investment. The courts instructed Executive and the assignment companies to pay 100% on the dollar for the remainder of all policies. It was unfortunate that we had to experience that event (the Executive collapse) but it did show that the safety systems in place had the support of the court(s) and allowed settlement recipients to be made whole without interruption.

Answers from:

Bryan Milner
Settlement Planner
Milner Plaintiff Services
an affiliate of Millennium Settlements
toll free: 877-212-9990
cell: 818-926-5100
fax: 818-302-1414

Questions by:

Christopher R. Nichols, Attorney
Nichols Law Firm
Raleigh, NC 27609
800-906-5984 (toll free)
www.NicholsTrialLaw.com and www.nctriallawblog.com

That said, where do Obama and McCain stand on Tort Reform? I’ve tried to present the information below from the most unbiased sources I can find.

John McCain on Tort Reform

I’ve included some links from traditionally conservative voices. The Club for Growth and an AMA related website. Most of the information is somewhat critical of McCain for not supporting tort reform “enough.” Because of the nature of the primaries, there is plenty of information about McCain and tort reform from conservative sources (most of which didn’t think he was tough enough on tort reform).

From: The Club For Growth:

Tort Reform

The American economy suffers from excessive litigation which increases the cost of doing business and slows economic growth. The Club for Growth supports major reforms to our tort system to restore a more just and less costly balance in tort litigation.

Senator McCain’s record on tort reform is generally positive. These votes include:

• Sponsored the Class Action Fairness Act of 2005 which sought to curb lawsuits by shifting suits from state to federal courts, by requiring judges to review all coupon settlements, and by limiting attorneys’ fees in non-cash settlements^[65]
• Voted for a bill that would bar lawsuits against manufacturers, distributors, dealers and importers of firearms^[66]
• Voted for a bill that would place caps on damage awards in medical malpractice suits against obstetricians and gynecologists^[67]
• Voted for a motion to proceed to a bill that would cap non-economic and punitive damages in medical malpractice suits^[68]

This generally positive record, however, is tarnished by Senator McCain’s sponsoring of and outspoken support for the Patients’ Bill of Rights,^[69] which encouraged an increase in the number of frivolous lawsuits filed against healthcare providers. He also voted against the Litigation Uniform Standards Act, which limited the conduct of securities class actions under state law.^[70]

And for what it is worth, here is a transcript from a Rush Limbaugh Radio Show where Rush refers to the above website in order to assess McCain’s willingness to implement tort reform. Rush seems to agree with the above- McCain has a good start but could do even better on tort reform.

If we assume that what a politician promises in one election they would support in another election, we can go back to 2000 when McCain was running against Bush in the Republican primary. McCain’s website then stated:

“John McCain has been a leading proponent of lawsuit reform at the federal level. He recently authored the Y2K law that will help limit potential frivolous lawsuits resulting from the Y2K computer problem while also protecting the rights of those truly injured to bring a legal action. The bill addresses the needs of businesses that may find themselves as both plaintiff and defendant, by providing incentives to fix Y2K problems, not rush to the courthouse.

“John McCain has and will continue to fight to reform our nation’s product liability laws. He supports reforms that would establish a time limit on liability for most products and cap damages on small businesses. He has also worked to provide liability relief to small businesses by sponsoring legislation that limits punitive damages and eliminates joint liability for non-economic damages for small businesses that employ less than 25 people.

“John McCain also supports small business relief from ‘Superfund’ liability. He believes the law imposes too severe a penalty on small businesses. He supports changing the regulations to limit the liability of small businesses to the amount of pollution they directly caused to a site, and no more.” From Freedom Works

Back to 2007. From a physician website, MedPage Today:

Arizona Sen. John McCain said tort reform is a top priority. He’s supported caps on awards and expressed some support for a loser-pays rule. “We cannot let the search for high-quality care be derailed by frivolous lawsuits and excessive damage awards. … Liability reforms should eliminate lawsuits for doctors [who] follow clinical guidelines and adhere to patient safety protocols.”

McCain laments increased costs stemming from defensive medicine. “In every other industry when technological advances are implemented, costs to the consumer decreases,” he told supporters in South Carolina. “This is not the case in health care. … I can’t tell you the number of tests that all of us in this room have taken just so that doctors won’t be sued for malpractice.”

And while this is not necessarily a “tort reform” issue, McCain supports changes to our health care system which would take most self-funded health insurance plans OUT of ERISA pre-emption.

The senator does suggest he would change current pre-emption provisions in the Employee Retirement Income Security Act, when he says he would “give states the flexibility to, and encourage them to experiment with: alternative forms of access; risk-adjusted payments per episode covered under Medicaid; use of private insurance in Medicaid; alternative insurance policies and insurance providers; and, different licensing schemes for medical providers.”

ERISA adjustment is also implied by his call to “build genuine national markets by permitting providers to practice nationwide” and his proposal to “allow individuals to purchase health insurance nationwide, across state lines, to maximize their choices.”Obviously, in North Carolina, taking self funded health plans out of ERISA would have a “pro-plaintiff” benefit because self-insured entities would be subject to NC’s anti-subrogation rule. Clearly, this is an unintended consequence for our state.

Finally, according to AllBusiness.com, McCain has publicly lamented increased costs stemming from so called defensive medicine, where doctors allegedly over-cautiously order multiple tests in the hopes of avoiding any mistakes or liability. “In every other industry when technological advances are implemented, costs to the consumer decreases,” he told supporters in South Carolina. “This is not the case in health care…. I can’t tell you the number of tests that all of us in this room have taken just so that doctors won’t be sued for malpractice.”

Barack Obama on Tort Reform

As a lawyer and constitutional law expert, Obama has spoken favorably of civil litigators at times, but has also been noted in the press to be somewhat more critical of “trial lawyers.” While campaigning for the Senate in Illinois years ago, he said, “Anyone who denies there’s a crisis with medical malpractice is probably a trial lawyer.” [Unsubstantiated info ahead] Furthermore, it has been noted that Obama voted in favor of caps on non-economic damages in medical malpractice cases when he served in the Illinois General Assembly. [NOTE: I pulled this quote from a business website doing a neutral review of the tort reform stances of the candidates. It was old (pre-nomination) and fairly balanced. Of course, there was no reference in the article. I’ve been questioned on this now, so I’m trying to verify the so-called votes. Frankly, I was suprised that Obama would vote for any type of cap given his Constitutional experience, so this could be my bad reporting compounding someone else’s bad reporting. Good thing I’m not a reporter!]

In 2005, Barack Obama voted for CAFA, the Class Action Fairness Act of 2005. Who voted against it? Hillary Clinton, Dick Durbin, Ted Kennedy, Pat Leahy, Joe Biden, Barbara Boxer and other progressive Democrats. The Class Action Fairness Act was strongly supported by business groups like the US Chamber of Commerce.

The ABA describes CAFA in this way:

In a nutshell, the Class Action Fairness Act has two principal parts. One set of provisions establishes new procedural and substantive standards applicable to class action settlements. Some of these merely duplicate (or add little to) existing practice under the Federal Rules of Civil Procedure, but others — such as new limitations on attorneys’ fees in coupon settlements and requirements that government officials be notified whenever a class action settles — are brand new.

In addition to the CAFA bill, Obama has taken a position on medical malpractice tort reform which focuses on improvements in patient care and lower error rates. In fact, Obama and Hillary Clinton co-authored an article in the May 25, 2006 issue of the New England Journal of Medicine, entitled “Making Patient Safety the Centerpiece of Medical Liability Reform.“

In conjunction with the publication of their article, Obama and Clinton introduced and co-sponsored the National Medical Error Disclosure and Compensation (MEDiC) Act of 2005, a bill that, in part, would have required hospitals to disclose errors to patients and would have also created a national patient safety database. The bill further proposed to create a Department of Health and Human Services program that would seek early compensation for patients and offer liability protections to doctors in exchange for their disclosure of errors and apologies. This legislation was never realized and died in 2006.

The Last Frontier: The Supreme Court of the United States

Other than the candidate platforms and positions, many would argue that the real “tort reform” is accomplished by appointing Judges who will take “tort reform” positions on legal cases. Justice John Paul Stevens (88 years old) and Justice Ruth Bader Ginsburg (74 years old), are both considered to be left leaning and potentially ready to retire in the next four years.

About the Supreme Court, Obama has said in a July 7, 2007 speech “We need somebody who’s got the heart, the empathy, to recognize what it’s like to be a young teenage mom. The empathy to understand what it’s like to be poor, or African-American, or gay, or disabled, or old. And that’s the criteria by which I’m going to be selecting my judges.”

McCain has said, “I tell you I will nominate only people who have a clear, complete adherence to the Constitution of the United States and do not legislate from the bench. That’s who I’ll nominate to the U.S. Supreme Court.”

This article will not attempt to futher address the issue of Supreme Court appointments, though obviously the candidates would presumably appoint Judges who agree with their general philosophy on the law. Whether that position is “pro-consumer” or “tort reform” will be for the reader to decide.

I’ll update this article as I find more information. Obviously, John McCain has a long voting record, so there can be much more analysis of his voting positions than of Obama. I may also try to take a look at the positions taken by Biden and Palin, although, again, Biden will have a much deeper record than Palin.

—-Chris Nichols

Nichols Law Firm

Not bad for a blog concentrating on one of the more boring topics in the world: liens and subrogation.

Here are the stats as of today:

Maybe I’ll set my summer intern loose on trying to make this Blog look slick and sophisticated…. probably not.

Chris Nichols

So when you make a settlement which will not cover “all” the bills, how do you handle this scenario? I see two ways to go about making the disbursement. I can’t say if one or the other is “right” as I don’t think the statutes clearly cover this.

It should go like this, hypothetically:

Scenario 1

Assume:

Med pay $2,000 (already paid to Chiro 1)

Settlement $10,000
Medicaid Lien: $5,000
Chiro 1: $1,000 (balance after med pay received of $2,000)
Chiro 2: $2,000 balance

So, now let’s apply the law and do the math:

$10,000 Settlement
-$3,333.33 Atty Fees
$6,666.66 Balance

1/3 of settlement is $3,333.33 for Medicaid purposes (Medicaid is limited to recovering 1/3 of settlement)

1/2 of Net is $3,333.33 for NCGS 44-49 lien purposes (Medical liens can only force the attorney to pay 1/2 of the Net settlement after attorney fees and it makes it easier when 1/2 of net and 1/3 are the same thing).

Medicaid shares pro-rata with unpaid medical providers within the 1/3.

$5,000 Medicaid
$1,000 Chiro 1
$2,000 chiro 2
$8,000 $3,333,3/$8,000 = 41.66% shares of the 1/3

Now we figure the prorata share for each lien holder using the percentage from above:

5,000 x 41.66% =$2,083.31
1,000 x 41.66% = $416.6
2,000 x 41.66% = 833.20

That’s how the 1/3 should be distributed BUT, since Medicaid is entitled to 100% of the medpay, they will get another $2,000 on top of the share above.

So:
$10,000 Settlement
-$3,333.33 Atty Fees
$6,666.66 Balance

-$2,083.31 Medicaid
-$416.6 Chiro 1
-833.20 Chiro 2
$3,333.50

-$2,000Medicaid Med pay
1,333.50 to Client

But there appears to be another way to do this. In the first scenario above we prorated Medicaid’s full lien, then paid Medicaid the $2,000 from the remainder of the settlement.

The second method would pay Medicaid the $2k medpay FIRST, then use the balance of the lien for proration purposes. That would give the other providers more money under pro-ration.

The second method would look like this:

Scenario 2

$10,000 Settlement
-$3,333.33 Atty Fees
$6,666.66 Balance

1/3 of settlement is $3,333.33 for Medicaid purposes

1/2 of Net is $3,333.33 for 44-49 lien purposes (makes it easier when 1/2 of net and 1/3 are the same thing)

Medicaid shares pro-rata with unpaid medical providers within the 1/3. (We’ve already taken out the $2k Medicaid will receive)

$3,000 Medicaid lien
$1,000 Chiro 1
$2,000 chiro 2
$6,000 $3,333.33/$6,000 = 55.55% shares of the 1/3

Now we figure the prorata share for each lien holder using the percentage from above:

3,000 x 55.55% = $1,666.50
1,000 x 55.55% = $555.55
2,000 x 55.55% = $1111.11

Since Medicaid is entitled to 100% of the medpay, they will get another $2,000 on top of the share above.

So:
$10,000 Settlement
-$3,333.33 Atty Fees
$6,666.66 Balance

-$1,666.50 Medicaid
-$555.55 Chiro 1
-$1111.11 Chiro 2
$3,333.50

-$2,000 Medicaid (Med pay)
1,333.50 to Client

Let’s compare scenarios now:

Scenario 1:

$2,083.31 (Medicaid prorated share) + $2,000 for med pay = 4,083.31 to Medicaid
$ 416.6 Chiro 1
$ 833.20 Chiro 2

Scenario 2:

$1,666.50 (Medicaid prorated share) + $2,000 for med pay = 3,666.50 to Medicaid
-$555.55 Chiro 1
-$1111.11 Chiro 2

So, technically, Scenario 2 is better for your clientin my mind because Medicaid is paid in full with $3,666.50 and there is more money available for the doctors (who are not paid in full but might be more likely to accept the higher % payment as payment in full).

I don’t know if there is a right or wrong to his one. I’m sure Medicaid would prefer to be paid more, and they may have a point since technically, the Medpay should have gone to them in the first place.

–Chris Nichols
www.NicholsTrialLaw.com

The gist of the problem was that the while the Uniform Arbitration Act provides that arbitration Awards can be reduced to judgments and filed as judgments, AND judgments in North Carolina are subject to prejudgment interest at 8% per annum, the insurance policies were not clear as to whether pre-judgment interest was covered under the policy.

That problem lead many arbitration panels to conclude that they did not have the authority to award pre-judgment interest. Then as an extra twist, there is North Carolina case law (seePalmer v. Duke) which stands for the proposition that if an arbitration panel does not award a certain damage, a Superior Court Judge can not change or modify that award to include the damage. In 2000, there was another Court of Appeals case which went on to say that if a panel failed to award something in their award, even if both parties agreed that the award was incorrect but one party objected to an amended award, the panel did not have the authority to amend the award (see North v. North)

Thus, Courts were ruling that they could not add prejudgment interest to the Award even when they were reducing the Award to a judgment.

Major Catch 22.

Finally, this has come to a Court of Appeals panel and we have some clarification. Sprake v. Lech, NC COA 06-1690. The case is best summarized in the last few paragraphs:

Defendant argues that the language of the agreement did not include any specific provision allowing prejudgment interest. The contract permits an insured party to demand arbitration when the parties “do not agree: 1. Whether that insured is legally entitled to recover compensatory damages from the owner or driver of an uninsured motor vehicle or underinsured motor vehicle; or 2. As to the amount of such damages . . . .” It is true that there is no explicit mention of prejudgment interest in this section. However, as our Supreme Court has stated,
[a]n ambiguity can exist when, even though the words themselves appear clear, the specific facts of the case create more than one reasonable interpretation of the contractual provisions. In interpreting the language of an insurance policy, courts must examine the policy from the point of view of a reasonable insured.

This Court has applied the rule that “prejudgment interest up to the amount of the carrier’s liability limit is part of compensatory damages for which the UIM carrier is liable.” Austin v. Midgett, 159 N.C. App. 416, 419, 583 S.E.2d 405, 408 (2003) (citing Baxley v. Nationwide Mutual Ins. Co., 334 N.C. 1, 11, 430 S.E.2d 895, 901 (1993)). This Court has also noted that “unless the policy of insurance provides to the contrary, prejudgment interest constitutes a portion of a plaintiff’s damage award.” Ledford v. Nationwide Mutual Ins. Co., 118 N.C. App. 44, 50, 453 S.E.2d 866, 869 (1995). Given the law as it stands in this State, we hold that the provision granting the arbitration panel authorityto address issues of “compensatory damages” was ambiguous as to whether prejudgment interest was available. As such, we resolve our doubt “against the insurance company and in favor of the policyholder.” Register, 358 N.C. at 695, 599 S.E.2d at 553. The arbitration panel had the authority to address the issue and the trial court properly confirmed the amended award. Defendant’s assignment of error regarding the trial court’s denial of its motion to vacate the arbitration award is likewise without merit. We therefore affirm the order of the trial court.

Congratulations to Jay Ferguson, of Thomas, Ferguson & Mullins, L.L.P., of Durham. The above link tracks to the unpublished opinion, but the COA has agreed to make the case a published opinion so you can cite it in briefs now. This case will have two great side effects. First, insurance companies will not drag their feet on scheduling arbitrations because the extra time will cost them money. Second, arbitration panels will finally have some authority to “back up” interest awards.

If you have an arbitration in North Carolina, bring this case with you for your panel to consider. And as always, it is best to have this issue resolved in a pre-arbitration agreement if possible. Finally, I would calculate interest (or present to your panel) the interest running from the day the 30 day notice of tender of liability limits is made to the UIM carrier, or the day that the Demand package is sent to the UM carrier.

I think it is sufficient for the arbitration award to simply cite “that upon motion of the Plaintiff and based upon the authority vested in this pane pursuant to Sprake v. Lech, NC COA 06-1690, this arbitration panel awards prejudgment interest on the award to be paid by defendant or any unnamed defendant responsible for paying the award.” Probably it would be better for the panel to award an actual sum so there is no post award battle over how the interest should be calculated.

Chris Nichols
www.NicholsTrialLaw.com

Allstate won’t produce records despite $25,000-a-day fine
By JOE LAMBE
The Kansas City Star

Allstate Insurance Co. lawyers made this clear Tuesday to a Jackson County judge: They will not produce key records for public view no matter how much he fines them.

And Judge Michael Manners has already fined them $25,000 a day since mid September — a total of $2.4 million and growing.

And last month the Missouri Supreme Court ordered the documents produced,

At issue are the so-called McKinsey documents, a kind of holy grail for plaintiff lawyers nationwide.

Plaintiff lawyers allege they show how Allstate set up a claims payment system in the 1990s that shortchanges clients while earning huge profits.

Allstate contends the 12,500 pages prepared by consultant McKinsey & Co. are trade secrets used to create company policies, methods and claims procedures.

Until this year, state high courts had agreed with the company. But last month the Missouri Supreme Court ruled that it must provide them in the case before Manners.

Allstate still refused. Tuesday’s hearing took place in part so Manners could consider whether to increase his daily fine.

The case stems from a car wreck seven years ago on Interstate 70. Allstate client Paul Aldridge of Hawaii ran into the back of a truck and severely injured the driver. He is suing Allstate for bad faith for refusing to pay the claim for years.

As for the documents, Ronald Getchey, a San Diego lawyer representing Allstate, told the judge: “We won’t produce them without a protective order (sealing them).”

He questioned whether the $25,000-a-day fine was legal and whether the judge’s order finding them in contempt was too vague.

Plaintiff lawyer Steve Garner of Springfield called those arguments “silliness.”

Getchey argued that the matter is uncertain and noted that the Missouri Supreme Court ruled that the company could return there if Garner tried to collect the $25,000-a-day fine, which would go to Aldridge.

Garner said he was more concerned about getting the documents and going to trial, but he may start collecting the fine for his client.

Getchey told the judge: “We have a principled difference we’re not able to resolve until somebody says what the law is.”

Manners countered: “I’ve already said that, but you just don’t agree.”

Then he set a July trial date, the first time Garner had available.

Getchey noted that was a long time at $25,000 a day.

“We shouldn’t get a $5 million fine because counsel is not available to try the case,” he said.

Manners conceded the point and said he may not increase the daily fine after all.

Where the right to intrastate travel is a “right of function,” the right to enter public parks is not encompassed by either the fundamental right of travel or the right to intrastate travel. We affirm the trial court order upholding the defendant-town’s ordinance, which prohibits registered sex offenders from knowingly entering any public park owned and operated by the town.

Standley v. Town of Woodfin

Click Here for the full text of the opinion.

Chris Nichols
www.NicholsTrialLaw.com

So, if you are looking for a Raleigh personal injury attorney, you have found one. My law firm, Nichols Law Firm, never pays anyone for endorsements. We provide personalized service to clients, and are available to meet with you during your hours, at your home if you need us too. There is never a fee for a consultation.

_______________

Chris Nichols
www.NicholsTrialLaw.com