Over the past several months, there have been several decisions and developments which are potentially significant to the
practice of insurance law. These involve settlements, limitations and insurance coverage.
Always, each case involves different facts and law, and, accordingly, the following must be taken for general information purposes only, rather than for action upon any specific fact situation. Protection of Medicare Claims: As of July 1, 2009, there is now a requirement that insurors and self-insureds must report certain information pertaining to settlements and judgments involving Medicare recipients to the federal government. Thus, all parties, their insurers, and their lawyers must take steps to insure that the claims of the United States for the recovery of Medicare monies paid to plaintiffs are protected.
Such claims of the U.S. government constitute independent claims to recover Medicare money paid to plaintiffs because of accidents. Thus, the failure of a party, an insurer and/or the parties’ attorneys, and/or the Medicare recipients to make certain that such monies are reimbursed to the U.S. government may generate liability for a duplicate payment to the U.S. government, even though already paid to the plaintiff.
Medicaid recipients who may be involved are generally over 65 years old, although for certain illnesses, such as renal failure, Medicare claims for reimbursement may extend to people of all ages.
The Texas Tort Claims Act-“Special Defect”:
In Denton County, Texas v. Beynon, 08-0016 (Tex. 2009), the Supreme Court held that for purposes of liability suits against the state of Texas, a “special defect” under the Texas Tort Claims Act is limited to “excavations or obstructions” that exist “on” the roadway surface. Therefore, a horizontal floodgate arm barring access to a roadway, which was located approximately 3 feet above the surface of a two-lane rural highway, was not a “special defect” under the Texas Tort Claims Act, and the plaintiff was not entitled to sue the state of Texas for injuries received in a collision with the floodgate arm.
High-Speed Police Chase Automobile Accident-Coverage Under Policy of Fleeing Driver:
In Tanner v. Nationwide Mutual Fire Insurance Company, 07-0760 (Tex. 2009), plaintiffs sued a fleeing driver, who while being chased by police, collided with the vehicle occupied by plaintiffs. The fleeing driver’s insurer refused to pay damages, and the plaintiffs filed a declaratory-judgment action to recover a default judgment taken against the fleeing driver. Nationwide asserted that the acts of its fleeing insured were intentional, and that the plaintiffs’ claims for bodily injury were thus excluded from coverage under Nationwide’s policy. Our Supreme Court held that “intentionally” as used in the policy exclusion excludes coverage only for “the resulting damage or injury, [and not] the actions that led to it.” Thus, the court held that the exclusionary language voids coverage when the resulting injury was intentional, but not when merely the insured’s conduct was intentional. Accordingly,
Nationwide was held to have coverage for damages resulting from its insured’s intentional effort to avoid police in a high speed chase, because Nationwide’s insured did not intend to cause the plaintiffs’ injuries.
Limitations-No Tolling by Temporary Absence from State:
In Ashley v. Hawkins 07-0572 (Tex. 2009), the Texas Supreme Court held that when a potential defendant leaves Texas following a motor vehicle collision, but is otherwise amenable to out of state service of process, Texas’ two year statute of limitations applicable to personal injury claims is not tolled, and a plaintiff must obtain substituted service by publication or other means to prevent the expiration of the statute of limitations.
No Revivor of Claims Barred by Statute of Repose:
In Galbraith Engineering Consultants, Inc. v. Pochucha, 07-1051 (Tex. 2009), the Supreme Court dealt with the question of whether a claim, which was barred by statute of “repose,” can be revived after a defendant to a lawsuit designates another person or entity as a “responsible third party.”
For purposes of proportionate 33, TEX. CIV. PRAC. & REM. CODE, a defendant may designate a non-party as a “responsible third party.” When this occurs, the plaintiff has a 60-day window in which to bring suit directly against the designated responsible third party despite the fact that the applicable statute of limitations would otherwise bar a direct action against such designated party. However, the statute allowing designation of responsible third parties speaks only of revival of those claims which are “barred by limitations” and does not mention claims barred by statutes of repose. Since statutes of repose are passed by the Legislature to provide a definitive date beyond which an action cannot be filed, and thereby create a statutory right to be free from liability after a specified time, the Supreme Court held that the aforesaid provisions of our proportionate responsibility statute do not revive a plaintiff’s claims against a designated responsible third party when such claims are barred by a statute of repose.”
By H. Norman Kinzy