Earle v. Cobb and the UIM Conundrum

Earle v. Cobb and What Do We Do Now?
Here is an analysis, commentary, opinion piece for lawyers trying car accident cases.

Sometimes, it is simply easier said than done.  When the Kentucky Supreme Court held in Earle v. Cobb, 2000-SC-000818-DG.pdf, on December 16, 2004 that an underinsured motorist (UIM) carrier must be identified at trial when it chooses to preserve its subrogation rights by means of the procedure set forth in Coots v. Allstate Ins. Co.  (the "Coots procedure"), it left some questions unanswered. 

I took a detailed look at Earle v. Cobb in the LawWire (click here for the commentary) addressing why the decision was correctly decided, the judiciary's antiquated fears and distrust of our juries regarding the mention of insurance,  and a multitude of other issues to put this decision in perspective.  The 'PowerPoint' presentation of these issues are:

• Exposing the "Coots Lie" which is that insurers do not advance to preserve subrogation rights but rather to hide behind the defendant's coat tails and minimize their exposure.
• Letting the jury know the entire truth since we live in a world that we want educated jurors who presumably comply with the law and purchase compulsory insurance for their own cars.
• KRE 411's evidentiary prohibition applies only to liability.
• Since the legislature allows for PIP subrogation by the insurance companies, then there is no absolute proscription about the mention of insurance and that the plaintiff and the defendant may very well have complied with the law and purchased insurance.
• The appellate court's conclusions that what works for UM works for UIM is naive and ill-conceived.
• The law is not static and grows with the times.  Just look at the opinions of Justice Liebson, Brandeis, and Harlan.

At the time of my original comment, the hot-button issue was whether the underinsurance carrier would be identified in all UIM cases whether or not the liablity limits were advanced.  Now, this issue has not left us, but sometimes we forget about the practicalities of implementing the decision such that if the insurer is going to be identified, then what are the limits to be placed upon the parties and counsel at trial? 

If you wish to read a "real" order in a "real" case that was just issued here in Jefferson Circuit Court by Judge Kathleen Voor Montano on Aug. 22, 2005, then click here.  Judge Montano had an excellent analysis of Cobb, 411, and 403 in her opinion, and issued an order with the following three limitations:

1. The UIM carrier "may, at its discretion, participate at trial and must produce a company representative for testimony if called by opposing counsel, and
2. No party shall reveal to the jury the policy limits for either insurance policy, and
3. It may be revealed to the jury that [UIM carrier] is the insurer of Plaintiff and may be entitled to recovery from Defendant . . . of any funds paid in regard to the accident."

Numbers 2 and 3 go without saying for the simple reason that the amounts of insurance are clearly not relevant to any claim of the Plaintiff or the subrogation claim of the UIM carrier and that the essence of a subrogation claim is that there might be a recovery of same against the defendant.

Number 1 is a tad hard to understand, however.  It seems that the UIM carrier has the option of cutting and running at trial or simply having a lawyer suit up but no insurance company representative.  This cannot be so.  If nobody shows up for the UIM carrier, than the defendant should move to dismiss the subrogation claim, and this will never happen if the UIM company has advanced monies to preserve that subrogation right in the first place.  Therefore, the lawyer will be present, but there will be an "empty chair" unless the plaintiff plans in advance to request the name of the company representative and that he/she be produced for testimony.

But will there really be an empty chair, and would an insurer thrust its counsel into the position of pursuing a subrogation claim while holding its own insured to the fire but deigning to be absent from the affray.  Any remarks by the UIM attorney that it shall recover its claim against the defendant should ring hollow.

Here are some preliminary thoughts for the plaintiff's attorney:

1. Submit comprehensive discovery (interrogatories, document requests, admissions) to the defendants on the injuries, the medical bills and expenses, causation, damages (eg., pain, suffering, anguish, inconvenience, etc.) and see if the UIM adjuster disagrees with the counterpart PIP adjuster.  A Kodak moment  could be in the offing when $10,000 in causally connected medical expenses and any concommitant pain and suffering and inconvenience are disputed by UIM after being paid by PIP from the same company.  Can you hear the lawyer at trial saying "Imagine this very same company accepted insurance premiums but refuses to acknowledge that their own insured was inconvenienced one iota when he/she was hit and received medical treatment or even had to stuggle for payment of those late lost wage and medical payments."
2. The UIM carrier's conduct in handling the PIP claims (late, questioning, paying, etc. for lost wages and medicals; IME) should be closely scrutinized between the pretrial and trial postures for inconsistencies.
3. With bareboned instructions, the lawyer for the plaintiff has the obligation to give the jurors an explanation of the mechanics of why the UIM carrier is there in the first place (a/k/a the Coots procedure) and that there is liability insurance but not enough to make the plaintiff whole so he is looking to his own carrier for the benefit of that contract for which he has paid premiums for 1, 2, . . 10 years.  And how much were those premiums by the way?  $1,000. . . $10,000 . . . more?

Now the insurance defense attorney will and should keep the focus of the trial on the value of the insured's damages which is the issue before the jury (assuming no liability, apportionment or other issues in the case), avoid saying the word insurance altogether, keep the representative away from the view of the jury, and otherwise be silent, sterile, and solemn.  Avoid the emotion and become the alter ego of the tortfeasor's lawyer.

And the plaintiff's lawyer will/should focus on the nature of the insurance contract as an element of his claim for UIM to include proving the elements of any contract (consideration, promises, quid pro quo, etc.).  Will the defense be able to diffuse this by admitting these elements of the case?  Possibly.  But take a look at that original answer filed by the UIM Defendant and note how there probably are a series of denials and  references to the actual contract and applicability of all the "terms, conditions, limitations, and exclusions" of that contract.  And if they have changed their position now, why and why not then? 

Admittedly, this is a full-disclosure approach to the issues in the case.  Rather than insult the jury's intelligence, embrace the fact that many drive cars and pay insurance bills.  If UIM must be offered, and UM rejected, do not be suprised if someone (eg., insurance agent) has already explained this aspect of insurance law to the jurors outside of the jury box.  Could it be possible that this explanation was incomplete, biased, or wrong?

In conclusion, we  have juries.  Trust them to do their duty, their job, their responsibility.  If you cannot trust a juror to follow his oath, then can we trust you to do the same?

"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." --Thomas Jefferson to Thomas Paine, 1789. ME 7:408, Papers 15:269

With regard to trial by jury, Sir William Blackstone wrote "This, therefore, preserves in the hands of the people that share which they ought to have in the administration of general justice, and prevents the encroachment of the powerful and wealthy citizens."  Sir William Blackstone, Commentaries on the Laws of England (1765)

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