Utah Appellate Update
The following are the cases contained in the Utah Advance Reports that are relevant to the insurance industry.
Reese v. Tingey Constr., 2008 UT 7 (Utah 2008): Utah Supreme Court Underlines Confidentiality of Mediation Proceedings.
After obtaining workers compensation benefits, an employee sued a contractor for personal injuries sustained when he fell from a third-story balcony. The employee and the contractor attended mediation together with the workers compensation carrier, which had a subrogation interest in any settlement. The employee and contractor reached an oral settlement agreement during mediation, but the workers compensation carrier would not sign a memorandum of understanding documenting the settlement, claiming it had not agreed to all of the settlement terms.
The employee and contractor then filed a motion to enforce the settlement agreement they claimed was reached at mediation. The workers compensation carrier opposed the motion and argued that the employee could not present evidence of the settlement discussions from the mediation. The trial court found that “mediation discussions contain 'confidential' and 'non-confidential' discussions.” The trial court ordered that the workers compensation carrier’s mediation counsel “appear and be deposed regarding the content of the mediation . . . including the process of the mediation and the conversations and agreements that were made during the mediation.”
On interlocutory appeal, the Utah Supreme Court reversed. The Court initially noted that confidentiality of mediations “serves the important public policy of promoting a broad discussion of potential resolutions to the matters being mediated” and that “this candid exchange of information and ideas can be achieved only when the parties are assured that their communications will be protected from postmediation disclosure.” As such, the Court held that all communications from a mediation are confidential and that in order for a settlement reached at mediation to be enforceable, all parties must sign a written settlement agreement.
The Court did note some exceptions to the broad confidentiality rule, including: (1) when the parties agree that certain information from the mediation may be disclosed; (2) a written agreement from the settlement to be filed with the court as a judgment; (3) information regarding child abuse or neglect or similar crimes; and (4) evidence regarding fraud or duress during the mediation process.
Sorensen v. Barbuto, 2008 UT 8, P1 (Utah 2008): Utah Supreme Court Prohibits Ex Parte Communications with Treating Physicians.
A passenger in a single-automobile accident sought treatment with his doctor for eighteen months before having to switch providers due to a change in his health insurance. The passenger later filed a personal injury lawsuit against the driver of the vehicle. The defendant obtained a copy of the doctor’s medical records and subpoenaed him to testify at an upcoming trial. During a five-month period of trial preparation, the doctor spoke with the personal injury defendant’s attorneys and agreed to testify as an expert witness on behalf of the defendant. The passenger did not know of the communications between the doctor and the defense attorneys until just before trial, at which time he filed a motion in limine to exclude the doctor’s testimony. The trial court excluded the doctor in the basis that he had not been properly designated as an expert and the passenger went on to prevail at the personal injury trial.
The passenger then filed a subsequent lawsuit against the doctor claiming he breached the duty of confidentiality and committed other torts by communicating ex parte with the defense attorneys. The trial court granted a motion to dismiss on the grounds that the passenger had waived the physician-patient privilege when he filed suit against the driver because the passenger placed his physical condition at issue. (See Utah Rule of Evidence 506.) The case was ultimately appealed on certiorari to the Utah Supreme Court.
On appeal the Utah Supreme Court first held that Rule 506 only provides a limited waiver of the physician-patient privilege. The Court stated that “a waiver under rule 506(d)(1) does not mean that the patient has consented to the disclosure of his entire medical history.” Instead, “Rule 506 is only broad enough to allow the disclosure of information relevant to an element of any claim or defense.” Therefore, the Court held that Rule 506 “is a limited waiver of privilege, confined to court proceedings, and restricted to the treatment related to the condition at issue.”
The Utah Supreme Court next held that a physician’s duty of confidentiality is not limited by Rule 506. The Court explained that “Rule 506 undoubtedly allows a treating physician to disclose confidential information as part of a court proceeding, but a waiver of that privilege is not a waiver of the healthcare fiduciary duty of confidentiality. This duty of confidentiality continues to control to whom and what information the physician may release even when the evidentiary privilege has been waived.”
Given the above reasoning, the Court concluded that a treating physician may not have ex parte communications with counsel opposing the patient and that a treating physician may not act as a retained expert witness for an opposing party. Contacts between a treating physician and opposing counsel must be limited to formal discovery methods.
N.M. ex rel Caleb v. Daniel E., 2008 UT 1 (Utah 2008): Utah Supreme Court Considers Accidental Versus Intentional Conduct Under “Occurrence” Definition of Insurance Policy.
Eight-year-old Daniel was teased by seven-year-old Caleb and others during a hockey camp. After several days of being teased, Daniel swung his hockey stick at Caleb striking him in the head and causing a brain injury. Daniel testified he was aiming at Caleb’s shoulder, and did not intend to hurt Caleb.
Daniel was covered by a homeowner’s insurance policy which indemnified against liability for “damages because of bodily injury or property damage caused by an occurrence.” The policy defined an “occurrence” as “an accident, including exposure to conditions which result in: bodily injury; or property damage.” The policy did not further define the term “accident.”
Caleb filed suit against Daniel and his insurer seeking a declaratory judgment that the insurer must provide coverage to Daniel for any legal liability arising out of the incident. The insurer obtained summary judgment when the trial court found that the incident was not an “accident” under the terms of the policy.
On appeal, the Utah Supreme Court used the definition of “accident” from case law and defined the term to be “means which produce effects which are not their natural and probable consequences.” In other words, the Court said, “[a]n effect which is the natural and probable consequence of an act or course of action is not an accident, nor is it produced by accidental means.”
Using this definition of “accident” the court explained that there are two independent methods by which bodily injury may be deemed non-accidental. First, injury is not accidental if it is the result of actual design or intended from the perspective of the insured. Second, injury is not accidental if it is the natural and probable consequence of the insured’s act or should have been expected by the insured. The Court stated that the first method presents a factual question as to what the insured intended and the second method generally presents a legal question as to what the average individual would expect to happen under the circumstances.
Applying this methodology to the facts of the case, the Court indicated that Daniel’s intentions needed to be measured in light of his young age and needed to focus on the nature of the injury, not the act that led to the injury. As the Court summarized, “we do not examine whether an act is intentional or deliberate, but rather whether the result was intended or expected.” However, the Court tempered this analysis by adding that “the specific type of injury suffered need not be intended or expected by the insured” and recognized that some injuries are “so inherently injurious” that they cannot be accidental.
The Court concluded that the average eight-year-old would not necessarily expect that nontrivial bodily injury would result from swinging a hockey stick at another child’s pad-protected shoulder and held that this was an issue of fact that would need to be determined at trial.
Begaye v. Big D Constr. Corp., 2008 UT 4 (Utah 2008): Utah Supreme Court Reiterates Limits of Liability of General Contractors under Retained Control Doctrine.
A general contractor was hired for a large construction project at the University of Utah. As part of its contract with the owner, the general was “responsible for initiating, maintaining, and supervising all safety precautions and programs in connection with the project.” The general hired a masonry subcontractor to build several walls for the project. The subcontract stated that the subcontractor was an independent contractor and was responsible for its own employees.
An employee of the subcontractor was killed while helping to build “Wall 39.” The employee’s widow filed a wrongful death suit against the general. The general moved for summary judgment on the basis that it did not have control over the manner and method of the work that caused the employee’s death. The trial court granted summary judgment in favor of the general because the general had not directed the subcontractor on how to build Wall 39 and because it did not control the method of injury.
The Utah Supreme Court affirmed summary judgment in favor of the general. The Court held that, although the general had a broad supervisory role over when and where the subcontractor worked, it did not exercise control or discretion such that the subcontractor “could not carry out the injury-causing aspect of the work in its own way.” As such, the general did not fall within the retained control doctrine.
Pearce v. Utah Athletic Foundation, 2008 UT 13: Utah Supreme Court Permits Pre-Injury Releases for Recreational Activities.
The plaintiff signed a waiver of release prior to riding a bobsled. The plaintiff’s back was injured while riding the bobsled and brought negligence and gross negligence claims against the park. As to the negligence claim, the Court affirmed dismissal because the plaintiff had signed a pre-injury release of liability. In so doing, the Court reviewed the three circumstances under which releases are deemed unenforceable. First, the Court found that the waiver was not contrary to any identifiable public policy. Second, the Court determined that the release was not invalidated by the public interest exception because the release concerned a recreational activity. Finally, the Court found that the release was not ambiguous. Therefore, the Court determined that the release was valid and precluded the plaintiff from bringing an ordinary negligence claim.
As to the gross negligence claim, the Court stated that there is no standard of care fixed by law for bobsled rides. The Court also noted that the parties’ experts had failed to identify the standard of care. Therefore, without having the standard of care established, the Court found that the trial court erroneously dismissed the plaintiff’s claim for gross negligence.
Bowman v. Kalm, 2008 UT 9: Utah Supreme Court Applies “Common Knowledge Exception” to Requirement of Expert Testimony to Show Causation in Medical Malpractice Cases.
In this case, the defendant psychiatrist prescribed sleep medication to a patient. The patient was later found dead under a dresser against her bed frame. The sleep medication was known to make one clumsy. The plaintiff did not provide any expert testimony regarding causation between the breach of duty and the death. The Court found that, although generally expert testimony is required for medical malpractice cases, there is a “common knowledge” exception. This exception is applicable to instances when the causal link between the negligence and the injury would be clear to a lay juror who has no medical training. The Court found that the exception applied to the case and overruled the summary judgment granted to the defendant.
Summaries provided by Andrew D. Wright
