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Avoid Uncertainty With Cooperation in Post-Koken TrialsAs expected — or perhaps dreaded, depending upon which side of the courtroom you sit — uninsured and underinsured motorist claims litigation has completely changed in the wake of Insurance Federation of Pennsylvania v. Koken.
2013-06-18 12:00:00 AM
As expected or perhaps dreaded, depending upon which side of the courtroom you sit uninsured and underinsured motorist claims litigation has completely changed in the wake of Insurance Federation of Pennsylvania v. Koken, 889 A.2d 550 (Pa. 2005). The landmark Pennsylvania Supreme Court ruling has created a longer path to resolution filled with hazy rules and a lack of uniformity.
Since the Koken court explicitly struck down mandatory arbitration provisions, most insurance carriers have dropped arbitration clauses from their policies and opted to litigate in Pennsylvania's state and federal courts. This has spelled the end of the pre-Koken days of scheduling a UM/UIM arbitration with advance notice, submitting expert opinions through reports and litigating the claim to a final conclusion within a few hours. Now, both plaintiffs and defendants must prepare for multi-day trials on potentially less than 24-hour notice.
Although the Koken decision came down in 2005, we are only recently seeing the full ramifications of holding UM/UIM trials. Not only are many plaintiffs and defense lawyers struggling to handle the unique issues presented by arguing UM and UIM claims in front of juries, but trial judges are new to this litigation as well. Without any guidance from the appellate courts, trial judges are often left to interpret Koken however they wish. This makes litigating UM/UIM claims even more unpredictable because there is little consistency throughout Pennsylvania. For example, on the issue of consolidating or severing bad-faith claims from UIM claims, there have been 55 decisions from 16 counties in favor of consolidation along with 41 decisions from 18 counties in favor of severance, according to Daniel Cummins' Tort Talk blog. Trial courts are also equally split on whether to allow evidence of insurance coverage or to preclude a claims representative from testifying.
Navigating these inconsistent rulings in a post-Koken world can certainly seem daunting. Until the Superior Court or Supreme Court clarifies exactly how judges should conduct UM/UIM trials, your most helpful partner in the post-Koken arena is actually your adversary. Communicating with your opponent before trial is absolutely vital to working out some of the novel issues that arise in these types of cases, and this should occur before the pretrial conference.
One of the most important issues that needs clarification is how the actual insurance policy will be handled. Although a UM or UIM claim is contractual in nature, the insurer stands in the shoes of the uninsured or underinsured tortfeasor, and, therefore, the relevant issues are really the same as a tort case. Like any other tort action, there should be no reference to the insurance contract, coverage limits, the plaintiff's premium payments or the insurance company's advertisements. None of these aspects of the insurance coverage are relevant to the ultimate issues of liability and damages. Ideally, these issues can be worked out by stipulation before trial and provided to the judge so that a verdict can be molded without having to file costly motions in limine and/or appeals after the fact.
Furthermore, defense counsel will need to determine if the plaintiff intends to subpoena the insurer's claim representative. The claims representative did not witness the accident, will not be able to provide any relevant evidence on liability or damages and should not have to testify. Prior to Koken, claims representatives rarely if ever testified at arbitrations. If no agreement can be reached, defense counsel should file motions in limine to preclude the admission of evidence of premium payments and policy amounts, while also seeking to preclude the testimony of claims representatives.
One additional agreement that could save both parties costly expert fees is to agree to introduce experts through reports rather than live or video testimony. Before Koken, expert reports were acceptable in arbitrations, so it is worth trying to stick to reports at trial unless, of course, the medical testimony or cross-examination is important to prove or disprove the nature or extent of the alleged injuries. Although medical reports may be less interesting to jurors, they are far less costly to the litigants and avoid scheduling difficulties with the doctors.
Following the resolution of the pretrial motions, counsel should try to formulate the opening instructions the judge will deliver to the jury. You will need to determine whether the judge should explain to the jury what an uninsured or underinsured motorist case is, or whether the jury should simply be advised that the case involves an auto accident. In an uninsured motorist case, advising the jury that the insurance company steps into the shoes of the tortfeasor may be confusing and complicate the actual issues, which are liability and damages. Therefore, it is best to try to artfully craft a joint instruction to propose to the judge rather than wait until the morning of trial.
A UIM trial can become more complicated, as both parties should weigh whether the judge should mention the underlying tortfeasor's credit. This can become a bit of a chess match, as both parties must determine the pros and cons of withholding information from the jury. For instance, during a UIM trial, one strategy is to preclude any evidence of the tortfeasor's policy limits/credit in the underlying tort case. The case is then tried like a standard negligence claim with the judge molding the verdict for the applicable credits or limits of coverage. Another route is to tell the jury that the plaintiff received some money from the underlying tort claim but withhold the exact amount. The judge then molds the verdict accordingly.
The parties could also choose to disclose the full amount of the underlying credit and instruct the jury to solely determine whether the damages were worth more or less than the disclosed amount. If the underlying action settled for a low amount, the jury might believe that the damages are only worth a small amount and award accordingly. Alternatively, if the jury hears a large number, they might feel as if the plaintiff received too much and find for the defendant. Disclosing any numbers is always risky.
Ultimately, both sides should agree on jury instructions to give to the judge before trial because judges are still inexperienced in this area. No matter how you decide to proceed, in a UIM trial, defense counsel should always have a motion ready requesting the judge to mold the verdict to reflect the credits from the settlement of the tort action and the limits of UIM coverage. In a UM trial, defense counsel should have a motion requesting the judge to mold the verdict to the UM policy limits.
Once you have hopefully resolved these issues with opposing counsel or through motions, you will have to pick a jury. Selecting a jury is an art, no matter what type of case. Picking a jury for a trial where the insurance company is named may be a bit trickier. Although Philadelphia county judges often allow the attorneys to conduct individual voir dire, many county and federal judges conduct the voir dire in open court. If permitted by the trial judge, you want to ask pointed questions to individual jurors away from the rest of the jury pool. For example, if you ask if anyone has had a bad experience with ABC Insurance Corp. and one prospective juror tells a horrific story in front of everyone, then the juror pool becomes tainted. Likewise, jurors may tell stories of how wonderful ABC Insurance treated them with their own claims. If forced to conduct the voir dire in open court, ask about any prejudice, past experiences or feelings toward the company and if the jurors have ever filed a lawsuit or claim against an insurance company. You should ask to follow up individually with jurors who have indicated a past experience.
Finally, until an appellate court calms the volatility and unpredictability in UM/UIM trials, where appropriate, both parties should consider accepting a high-low agreement to guard against an extreme verdict in favor of the plaintiff or a complete defense verdict.
For better or worse, until Pennsylvania adopts a uniform set of rules for handling post-Koken cases, each trial judge is free to proceed how he or she pleases. Therefore, reaching across the aisle and working together with your adversary will help ensure an efficient and productive trial that is fair to all parties involved.
Lori C. Miller is a shareholder in the Philadelphia law firm of Goldberg, Miller and Rubin and has more than 20 years of experience in defending general liability cases for insurance carriers and self-insured corporate clients in state and federal court. Her practice is heavily concentrated on all aspects of motor vehicle law, including third-party and first-party claims, as well as bad-faith suits.