Your Insurance Company Generally Has No Duty To Warn You Of Policy Time Limits

Insurance policies frequently include time limits on filing suit against the insurance company.  The time limit can be as short as one year.  Such time limits can be binding and enforceable under Iowa law.  Failure to file suit within the policy time limit can permanently extinguish your legal rights against your insurance company.

So does your insurance company have an obligation to warn you about policy time limits for filing suit, especially if the time limit is about to expire?  The Iowa Supreme Court has consistently said “no,” with one exception.  The exception to the general rule is that your insurance may have an obligation to tell you about policy time limits if you specifically ask.  But that exception applies only if you ask; you’re out of luck if you’re unaware of the policy time limit because you don’t have a copy of your insurance policy and didn’t ask for a copy.

You’re even less likely to get around an expired policy time limit if you had a lawyer before the time limit expired, especially if your attorney was in contact with the insurance company about your claim.  Failing to respond to inquiries from the insurance company, particularly when you have an attorney, is definitely a surefire way to have your claim eliminated by an expired policy time limit.

So what can you take away from this?  First, it’s best to have an attorney assist you with your insurance law claim.  Second, and regardless, make sure you have or request a copy of your insurance policy and read it.  Third, if your insurance policy includes any time limits for filing suit against your insurance company, assume that the time limits are valid and enforceable.  Finally, make sure you file suit against your insurance company within any such time limits because you may permanently forfeit your rights against your insurance company if you don’t.


The Iowa Court Of Appeals Reminds You To Prove Causation

There’s a question that sometimes seems to be overlooked in civil cases — How did the defendant’s supposed wrongdoing harm you?  You have to prove not only that the defendant violated some aspect of the law, but also that the defendant’s violation caused you injuries and damages.  That’s generally referred to as “causation.”  The standards for causation vary from one type of claim to another, but the basic principle is always that you must prove you were harmed by the defendant’s conduct or you have no claim.  The principle applies to a personal injury suit, products liability claim, motor vehicle accident claim, motorcycle accident claim, dog bite claim, employment or labor law claim, construction defect claim, business practices or contract law claim, debt collection practices law claim, nuisance law claim, or insurance law claim.

This is not an issue to be taken lightly.  Money damages do not automatically flow from a determination that a defendant violated the law.  If Point A is the defendant’s liability and Point C is your injuries and damages, you need to have a good argument for Point B, which is causation, or the connection between the defendant’s liability and your injuries and damages.

The Iowa Court of Appeals’s recent decision in Stutzman v. West Des Moines OB/GYN illustrates this concept in tragic fashion.  Stutzman was a wrongful death case involving Julie Stutzman’s death from cancer.  Her estate and surviving family claimed that her doctor committed malpractice in the manner in which the doctor handled some of Julie’s earlier doctor visits.  The plaintiffs argued that, had Julie’s doctor properly handled and responded to earlier communications from Julie, Julie’s cancer would have been detected sooner and she would have had a higher chance of survival.

The Stutzman plaintiffs lost because they could only prove one aspect of malpractice against Julie’s doctor and clinic — A charting error.  But they were unable to establish that the charting error made a difference in the course of Julie’s subsequent cancer diagnosis and death, i.e., causation.  So Stutzman is a recent, good example of the importance of having sufficient proof of causation to connect the defendant’s wrongdoing to your harm.  Even though Julie’s family proved that her doctor did something wrong, they could mot prove that the doctor’s error harmed Julie, and they lost their case.

The Impact Of Your Social Media Use On Your Legal Rights

Your social media posts are not private.  Nor is there any law that prevents a lawsuit opponent from using against you something you posted on Facebook, Twitter, Instagram, or any of countless internet websites and blogs.  If you’re involved in a personal injury suit, products liability claim, motor vehicle accident claim, motorcycle accident claim, dog bite claim, employment or labor law claim, construction defect claim, business practices or contract law claim, debt collection practices law claim, nuisance law claim or insurance law claim, that information could compromise your case.

It is routine for opposing counsel in all types of cases to request this information as part of their pretrial investigation.  They want to know if you’ve posted anything anywhere online that contradicts any part of your claim.  They also want to know if there are any photos or videos of you doing things that you shouldn’t be doing or claim that you can’t do.

Judges increasingly allow opposing counsel access to this information, even if you’ve marked it as private in your online profile or settings.  To judges, your online musings, pictures, and video are as much fair game in a lawsuit as would be a diary, journal, scrapbook with photos, etc.  So odds are good opposing counsel will get this information whether you like it or not.

And that only covers opposing counsel’s attempts to come in through the front door.  As long as opposing counsel doesn’t communicate directly with you, they’re also free to view anything that you’ve left publicly available.  So opposing counsel may be poking around your internet persona and you won’t even know it until it’s too late.

The moral of the story is to avoid putting anything online that your common sense tells you will be used against you by opposing counsel.  Chances are good counsel will eventually get that information somehow.  And they’re guaranteed to try to use it.

Legal Liability For Abuse Of Process

Invariably, when I represent someone or a company that gets sued, early questions from my client include “how can they just sue me?”, “don’t they have to have proof?,” and “can I get my attorney fees after we win the defense?”  Let me discuss the attorney fee question.  It’s extremely rare, absent a contract or statute that provides for attorney fees, for a successful party to recover attorney fees from the losing party.  Usually, upon successfully defending a case the only way you can recover your attorney fees is if the lawsuit against you had absolutely no basis in law or fact or was brought for an improper purpose.  One such claim for attorney fees is called “abuse of process.”

Abuse of process is the use of legal process, whether criminal or civil, against another primarily to accomplish a purpose for which it was not designed.  The improper purpose is ordinarily an attempt to secure from another some collateral advantage not properly includable in the process itself and is a form of extortion in which a lawfully used process is perverted to an unlawful use.  An abuse of process can occur even though there is probable cause to bring the action and the original action terminates in favor of the plaintiff.  At the same time, the mere failure of a legal claim, without more, furnish proof of some attempt to gain a collateral advantage by pursuit of the claim.  Any type of legal claim, including business or contract law cases, motor vehicle accidents, motorcycle crashes, dog bite cases, private nuisance actions, employment law matters, construction defect claims, personal injury or wrongful death claims, or products liability claims, can be improper and thus expose the party bringing the action to a later abuse of process claim.

To prove a claim of abuse of process, a plaintiff must show (1) use of the legal process, (2) in an improper or unauthorized manner, and (3) that damages were sustained as a result of the abuse.   With respect to the second element of the cause of action for abuse of process, a plaintiff must prove that the defendant used the legal process primarily for an impermissible or illegal motive.  Id. 

A very restrictive view is taken of the “impermissible or illegal motive element.”  Proof of an improper motive by the person filing the lawsuit for even a malicious purpose does not satisfy this element.  This is so to protect the right to ready access to the courts.  An ulterior motive does not alone satisfy the requirement for an action in abuse of process; a definite act or threat outside the process is required.  Consequently, this is a difficult element to establish.

All of this is true as long as the act that is alleged to be improper is in fact proper in the regular prosecution of the proceeding.  A defendant is not liable if it has done no more than carry the process to its authorized conclusion, even with bad intentions.  There is no action for abuse of process when the process is used for the purpose for which it is intended, but there is an incidental motive of spite or an ulterior purpose of benefit to the defendant.  For abuse of process to occur there must be use of the process for an immediate purpose other than that for which it was designed and intended.  The usual case of abuse of process is one of some form of extortion, using the process to put pressure upon the other to compel him to pay a different debt or to take some other action or refrain from it.

Any act that is proper in the regular prosecution of a proceeding cannot be relied upon as a basis for an abuse of process claim.  Rather, to show abuse of process, a plaintiff must show defendants took some specific action in connection with their use of process which can be characterized as unlawful or irregular.  In other words, plaintiff must show defendants committed some act in the use of process that was not proper in the regular prosecution of the proceeding.  Proof of an improper motive by the person filing a lawsuit, even a malicious purpose, does not satisfy that element.

Abuse of process will not lie for a civil action that inconveniences a defendant, or for one filed in expectation of settlement (a “nuisance” suit).  Wilson, 464 N.W.2d at 267.  Settlement is included in the goals of proper process, even if the suit is frivolous.  Id.  Additionally, there is no abuse of process when the action is filed to intimidate and embarrass a defendant knowing there is no entitlement to recover the full amount of damages sought.  Id.


What’s The Big Deal About Big Class Actions?

Class actions allow groups of people to come together in one lawsuit against a common defendant and assert common legal claims.  Class actions are a method of addressing the same legal problem across a group of people rather than doing so through many individual lawsuits.  Class actions are available for personal injury or wrongful death, defective products, employment and labor, consumer fraud, business practices and contract law, or insurance law cases, among many other possibilities.

It seems like some lobbying group is always complaining about class actions.  Trying to reduce the situations when a class action can be brought.  Trying to shuttle all class actions to federal court where they can suffer a slow death.  Trying to get people to agree to contracts that foreclose their right to participate in a class action.  Trying to eliminate the class action vehicle period.

So, given the uproar over class actions, they must be easy moneymaking machines that any lawyer can file and instantly become a multimillionaire, right?  Just find a named plaintiff, slap the words “class action” in the lawsuit caption, file the thing, and have plenty of buckets available to catch the gold coins when they start raining from the sky.  Well, let’s have a reality check for a moment.

The truth is that there’s an entire section of the rules of procedure and an entire body of case law on the books that governs class actions.  Any lawsuit that becomes a class action usually does so after passing through a series of judicial checks and balances to ensure that a class action is truly appropriate.  And, under Iowa law, any district court order certifying a lawsuit as a class action is automatically reviewed by the Iowa Supreme Court.  Even the settlement of a class action, which is when the big bucks are usually made, is strictly monitored by the courts for compliance with the procedural rules and case law I mentioned.  Thus, class actions are not the license to print money that some organizations would have you believe them to be.

What’s often omitted from the discussion is the benefits provided by class actions, such as:  class action lawsuits create strength in numbers; class action lawsuits allow people to be included in the lawsuit who otherwise would not have been able to bring an individual lawsuit;even if they wouldn’t have been able to afford an individual lawsuit; class actions are cost effective for plaintiffs and defendants because both benefit from not having to deal with dozens, hundreds, or thousands of the same claim over and over again; class action lawsuits increase the courts’ efficiency for the same reasons that class actions are cost effective; and class action lawsuits are the great equalizer between the masses and huge corporations with limitless bank accounts to use defending themselves, especially for small claims that otherwise have no chance on an individual basis.

Iowa Supreme Court Rules That Life Insurance Agents Owe Duty Of Care To Beneficiaries

On July 6, 2012, the Iowa Supreme Court decided in Pitts v. Farm Bureau Life Insurance Company that life insurance agents owe a duty of reasonable care to not only the people who contact them for life insurance, but also those who are intended to be benefited by the life insurance policy.  This question arises when life insurance beneficiaries do not receive the proceeds of a life insurance policy because of negligence committed by the agent who helped the deceased obtain life insurance.  Pitts is the first time that Iowa has recognized that the intended beneficiaries of the life insurance policy have a claim against the life insurance agent for negligence that causes the beneficiary to lose the right to recover the life insurance proceeds under the policy.

In Pitts, the plaintiff claimed that when an insured intends for a particular person to be the beneficiary of a life insurance policy, and the insured expresses that desire to his or her life insurance agent, the agent procuring insurance for the insured owes the insured’s intended beneficiaries a duty of care to procure the insurance requested.  The Iowa Supreme Court identified several reasons for allowing the plaintiff to sue the deceased’s insurance agent.  First, the main purpose of the agent’s transaction with the insured is to benefit the intended life insurance beneficiary.  Second, damage to parties other than the life insurance policyholder, such as the intended beneficiary in the event of negligence, is foreseeable to the insurance agent.   The intended life insurance beneficiary is exactly the person the insurance agent could reasonably know and foresee was relying on the agent’s professional performance.

The Iowa Supreme Court carefully circumscribed the potential liability of life insurance agents to intended beneficiaries.  In order to limit the potential liability of insurers, avoid conflicts of interests, and not interfere with the insured–insurer relationship, Iowa requires a plaintiff to show that he or she was the direct, intended, and specifically identifiable beneficiary of the life insurance policy as well as prove negligence.  Further, the plaintiff must produce evidence from the life insurance policy itself that indicates the plaintiff is the intended beneficiary of the policy.  If the plaintiff cannot show that he or she is the intended beneficiary of the policy, then the insurance agent does not owe that person a duty of care.

Please feel free to contact me if you have an insurance law question about a life insurance policy or would like to discuss a negligence action against a life insurance agent.  I’ll be happy to review your circumstances with you to determine whether you may have a possible case.

Eggshell Or Aggravation? An Important Concept For Personal Injury Cases

Sometimes personal injury or wrongful death claimants have a “preexisting condition.”  That’s lawyer-speak that means you’ve been hurt before.  The impact, if any, of that preexisting condition on your legal rights is analyzed under the related theories of “eggshell plaintiff” and “aggravation of injury.”

Simply put, if you’re seeking money for physical injuries, perhaps in a car accident, motorcycle crash, dog bite, or police brutality case, the eggshell theory is good and the aggravation concept is bad.  Flip that statement if you’re defending a personal injury claim or happen to be an insurance company.

An eggshell plaintiff is someone who, because of an earlier injury, is more susceptible to re-injury of the same area of the body than a normal person would be.  On the other hand, the aggravation theory applies if a person has an ongoing injury that is aggravated by a second injury-causing event, which then amplifies or aggravates the symptoms of the original, preexisitng injury.

The key distinction between the eggshell and aggravation theories is that an eggshell plaintiff has completely healed by the time of the injury-causing event while an aggravation plaintiff has not completely healed and instead has ongoing problems because of an existing injury.  Under Iowa law, defendants take their victims as they get them, so if an “eggshell” plaintiff gets hurt worse than a normal person would have, that’s the defendant’s problem and the defendant has to deal with the greater damages exposure because of the misfortune of hurting someone who was more susceptible to injury.

Here’s an example of the two theories:  Say you broke your arm as a child.  It heals as best it can, but the bone is never as strong as it was before you broke it.  Decades later you’re in a car crash and break the same arm, an injury that wouldn’t have happened to most folks but happened to you because of the break years earlier when you were a kid.  That’s an eggshell plaintiff situation and the defendant is responsible for 100% of the injuries to your arm, even though many people who had not previously broken their arm would not have suffered a broken arm in the collision.  Remember, defendants take their victims as they get them, and that includes earlier injuries that make a victim more susceptible to injury in the present day.

Conversely, if you’d broken that arm just two weeks before the car crash and the bones were still healing, but the fracture was worsened by the collision, that would be an aggravation situation and the defendant would only be liable for the amount of injuries and damages that occurred because of the aggravation of the injury during the crash.  That is an aggravation, not eggshell, situation because you had not completely healed at the time of the collision.

You can see why the eggshell vs. aggravation distinction is heavily contested in cases that involve a plaintiff with an earlier injury.  The plaintiff wants to prove the eggshell theory; the defendant needs to argue that it’s actually an aggravation of injury situation.  This is frequently an issue that gets fought between competing medical experts.

Please feel free to contact me if you have a personal injury or products liability matter that you would like to discuss.  I’ll be happy to see if I can give you a hand.