December 2024 Update on the NY Grieving Families Act

As previously reported the New York Senate and Assembly passed Bill S74A, also known as the Grieving Families Act which amended the law regarding payment and distribution of damages in wrongful death actions.  Thereafter, Governor Hochul vetoed the Act twice and each time the Act returned to the Senate and Assembly for revisions. On December 21, 2024, Governor Hochul vetoed the Act for the third time. In her veto, she left open the possibility of a fourth draft of the Act.

By way of background, the Act extended the time to bring a wrongful death action for up to three years and six months, permitted recovery for emotional loss when a tortfeasor is found liable for causing a death, permitted recovery by close family members which included a spouse or domestic partner, children, grandparents, stepparents, and siblings. It also replaced the term “distributes” with “persons for whose benefit the action is brought”. Finally, it stated that the Act shall take effect immediately and apply to all pending actions commenced on or after such date.

On January 30, 2023, when Governor Hochul first vetoed the Act she agreed with the objective of the Act, but raised some concerns which included the potential creation of open-ended beneficiary groups, confusion that may result for judges and litigants regarding the wide-ranging types of damages, potential for conflicting claims for damages in ongoing legal cases, and the potential rise in insurance costs burdening families and small businesses.

Later that same year on December 29, 2023, Governor Hochul vetoed the Act for the second time citing “the potential for significant unintended consequences” such as increased insurance premiums and various risks for healthcare facilities, namely hospitals.

The most recent version of the Act included narrowing the definition of who can claim compensation, the amount of damages that can be recovered, and the “look back” window to make a claim.

Most recently in December, 2024 Governor Hochul called the changes “[w]ell-intentioned” but believed the act could lead to higher costs, such as insurance premiums, and may have a negative impact for insurance companies to pay for grief, pain, and suffering.  Furthermore, there might be confusion, increased costs, and competition for damages.  The Governor left open the possibility to work “collaboratively” to find solutions and left open the possibility of a fourth version of the Act.  There are no indications that the Senate and Assembly will attempt to override the veto.

Callahan & Fusco will continue to monitor the status of the Act and any corresponding court decisions on this issue.

Florida Circuit Court Holds Florida Statute Section 768.0427 Not Retroactively Applicable

ELI WOLF, Appellant, v. EXYLENA WILLIAMS, Appellee. 5th District. Case No. 5D2023-3234. L.T. Case No. 2019-CA-008017. November 25, 2024.

This appeal to the Fifth District Court of Appeals of Florida stems from a jury verdict in favor of the Plaintiff, Exylena Williams, in the underlying lawsuit. The defendant, Eli Wolf, admitted negligence in relation to the motor vehicle collision but contested the severity of Williams’s injuries, which she claimed were permanent spinal damage. Wolf contended that a new trial was necessary for the following reasons: First, Wolf argued that Florida Statute Section 768.0427 should have applied to the underlying trial; Second, Wolf argued that the repeated references to “defense organizations” implied the existence of insurance. The Fifth DCA affirmed the trial court’s decision, holding that the verdict was not the product of reversible error.

The Fifth DCA, in analyzing Wolf’s first argument, noted that the Statute states: “[e]xcept as otherwise expressly provided in this act, this act shall apply to causes of action filed after the effective date of this act.” Ch. 2023-15, § 30, Laws of Fla. Wolf argued that Section 68.0427, which limits evidence of medical expenses in personal injury cases, should have applied retroactively to this case. However, the court held that the statute applies only to cases filed after its effective date in March 2023, whereas Williams filed her lawsuit in 2019.

The Fifth DCA also noted that that the Plaintiff’s references to “defense organizations” was not improper. Wolf claimed that Williams improperly suggested to the jury that he had insurance coverage by using the term “defense organizations” during the trial. The court ruled that this term was permissible as it facilitated legitimate inquiries into potential financial biases of defense experts without explicitly revealing insurance coverage.

Thus, the appellate court found no reversible error in the trial court’s rulings and affirmed the jury’s verdict, which awarded damages to Williams.

Levels of Coverage Shattered in PA

In Crook v. Erie Insurance Exchange, No. 2014-00867-TT (C.P. Chester Co. June 14, 2024 Binder, J.), the Court recently overruled various Preliminary Objections filed by an insurance company. The case is of import in the unsettled “Post-Koken” landscape where courts, not arbitrators decide Uninsured Motorist (“UM”) and Underinsured Motorist (“UIM”) issues.

Plaintiffs Dennis Crook and Frangipani Martin were injured in an automobile accident. Plaintiff Crook was driving his vehicle with Plaintiff Martin as a passenger. Mr. Crook's vehicle was struck by a vehicle driven by Defendant Hall. It was averred that Ms. Hall and her vehicle were uninsured. Mr. Crook and his wife, Plaintiff Siti Crook, are covered by an insurance policy written by an insurance company. Plaintiff Frangipani Martin is covered by an insurance policy written by a second insurance company. The Amended Complaint alleged counts against both insurance companies for failure to pay the UM benefits stated in the respective policies.

Defendant Westfield argued that the claim against the second level UIM carrier was premature given that it was not clear as to whether or not Plaintiff Martin’s alleged damages would be fully covered by the first level of UM coverage because Plaintiff Martin’s damages had not been determined at this point.

75 Pa.C.S. § 1733 states [w]here multiple policies apply, payment shall be made in the following order of priority: (1) A policy covering a motor vehicle occupied by the injured person at the time of the accident. (2) A policy covering a motor vehicle not involved in the accident with respect to which the injured person is an insured.

As Plaintiff Crook's policy (the Erie policy) covered the vehicle occupied by Plaintiff Martin at the time of the incident, Defendant argued that Erie was responsible for the "first layer of coverage." Defendant further asserted: "Here there is no indication that Plaintiffs' damages exceed the coverage provided by Erie." The Erie policy has first priority and Defendant Westfield's policy has second priority for Plaintiff Martin.

Defendant Westfield reasoned that it was not clear if the Plaintiff’s passengers alleged damages would be fully covered by the first level of UM coverage.  The Court stressed, as Plaintiff’s Passenger's damages have not been determined at this point, it is premature to state that second level UIM carrier defendant will have no liability. The case cited by the second level UIM carrier, Nationwide Ins. Co. v. Schneider, 599 Pa. 131, 960 A.2d 442 (Pa. 2008), holds that, no exhaustion of the first priority insurance policy is required to pursue a claim but, as the second level UIM carrier argued, a credit for limits must be given to the secondary provider. 

The Common Pleas Court of Chester County emphasized that, while the second level of UM carrier was entitled to a credit for the policy limits under the first level UIM coverage, the Plaintiff’s passengers were not required to exhaust the first level of UM coverage before pursuing the secondary coverage available from the second level UM carrier.

Ability to Obtain Insurance Can Mitigate Damages Award, NY Court Rules

A significant question of first impression was addressed on August 21st, 2024, by the Appellate Division, Second Department in Liciaga v. New York City Transit Authority: Whether a Defendant has the right to seek a hearing pursuant to CPLR 4545, to establish the extent to which a Plaintiff's potential future medical costs would be reduced by insurance available to such Plaintiff, including the Affordable Care Act. This ruling was particularly important given the changing face of healthcare and access thereto.

The Patient Protection and Affordable Care Act, or “PPACA”, dramatically changed the healthcare landscape throughout the United States by providing basic health insurance to millions of previously uninsured people. With insurance options increasingly becoming available, especially to the uninsured at the time of an injury, Courts have now started to recognize that potential offsets are now available, and ought to be factored in the determination of damages. As stated by the New York State Supreme Court, Kings County, in Liciaga, when Plaintiffs have access to insurance, these avenues must be explored during collateral source hearings in order to appropriately adjust awards for damages.

The facts in Liciaga are particularly interesting. The Plaintiff was 23 years-old and uninsured, when he fell in a non-barricaded drop zone. Thereafter, he was struck from behind by a railroad tie, resulting in severe injuries such as multiple fractures in his thoracic spine and a severed spinal cord. The incident ultimately resulted in Plaintiff claiming permanent paralysis. At trial, the jury concluded that Defendant's negligence was a substantial factor in causing Plaintiff's injuries and awarded the Plaintiff a verdict in excess of $100,000,000 ($9 million for past pain and suffering, $60 million for future pain and suffering, $1,174,972.38 for past medical expenses, and an astounding $40 million for future medical expenses).

Following the jury verdict, Defendant moved, pursuant to CPLR 4404(a), for a new trial limited to the issue of damages. Alternatively, if such request was to be denied, Defendant requested a collateral source hearing pursuant to CPLR 4545 in order to scrutinize the future medical expenses issue more closely. The underlying premise of that motion was that Plaintiff, although uninsured on the date of this accident, was entitled to insurance through the PPACA, which would greatly reduce the economic burden of Plaintiff's future medical expenses. However, the trial court denied Defendant's request for a collateral source hearing, and Defendant appealed.

On appeal, the Appellate Division, held that a hearing can be granted to the Defendant when there is competent evidence showing that the Plaintiff's economic losses may be recoverable from collateral sources either in the past or in the future. Further, the Court explained that an application for a collateral source hearing may be made at any time prior to the entry of judgment, unless otherwise directed by the court. The rule insulates Defendants in this way from having to bear the entire cost of damages as insurance would likely cover part of such expenses. It serves further to underscore that courts must acknowledge the realities of an evolving healthcare system wherein options of insurance coverage are becoming plentiful and will influence personal injury cases.

In short, Liciaga v. New York City Transit Authority sets forth a new mitigation device available in future cases involving uninsured Plaintiffs.

De Minimis Compliance With Post Loss Obligations Creates Issue of Fact

In the case of Hally Finnell v. Florida Insurance Guaranty Association Inc., 383 So.3d 836 (Fla. 4th Dist. Ct. App. 2024). the main issue at hand was whether the insured breached the homeowner's insurance policy by failing to submit to an Examination Under Oath (EUO). The insurer denied the insured's claim for property loss due to water damage based on this alleged breach.

The insured, Hally Finnell, had a homeowner's insurance policy with the insurer, Florida Insurance Guaranty Association Inc. The homeowner's insurance policy specified that in the event of a property loss, the insured was required to submit to an EUO, which would be conducted separately and not in the presence of any other persons except legal counsel. However, prior to the scheduled EUO, Finnell’s counsel informed the insurer's counsel that Finell intended to bring her own videographer and court reporter. The insurer objected to this, resulting in the EUO not proceeding as planned and the subsequent denial of the claim.

In response, Finnell brought a lawsuit against the insurer, claiming breach of contract and seeking declaratory judgment for the insurer's failure to pay the covered claim. The insurer, in its answer and affirmative defenses, alleged that the insured breached the policy by failing to submit to the EUO and moved for summary judgment on this defense. Finnell, in her response to the motion for summary judgment, argued that she had complied to some extent with the EUO requirement but cited the hostile relationship between the attorneys as a barrier to the EUO being conducted and, specifically, pointed to instances of unprofessional conduct by the insurer's trial counsel as evidence of this hostility.

The trial court granted the insurer's motion for summary judgment, finding that Finnell breached the homeowner's insurance policy by failing to submit to the EUO. However, on appeal, the appellate court ruled differently. The appellate court determined that when an insured complies to some extent with post-loss obligations, an issue of fact arises.

In this case, Finnell appeared for the EUO and provided an explanation for why it did not proceed. The appellate court concluded that since the insured cooperated to some degree with the policy's post-loss obligations, the motion for summary judgment should not have been granted. The court found that an issue of fact remained in dispute and therefore reversed the trial court's decision and remanded the case for further proceedings.  

In essence, this ruling shifts the balance of power, allowing insured individuals to navigate the complexities of policy compliance with greater ease. By merely demonstrating a reasonable effort to meet post-loss obligations, they can now effectively challenge an insurer's summary judgment, transforming the landscape of insurance disputes and ensuring that a genuine commitment to fulfilling their responsibilities is enough to keep their claims alive.

Clicking to Agree: Supreme Judicial Court of Massachusetts Declares Online Agreements Aren’t So Different

In a recent ruling from the Supreme Judicial Court of Massachusetts (“SJC”), the Court held that the Superior Court erred by denying Defendant’s motion to compel arbitration because the contract formation requirements were met, and Plaintiff reasonably manifested his assent to Defendant's
Terms of Use.

In Good v. Uber Technologies, Inc., 494 Mass. 116 (2024), Plaintiff was a chef at a Boston restaurant, and first registered an account with Defendant Uber in August 2013.  On April 25, 2021, when Plaintiff opened Uber's app to secure a ride, he was presented with a screen that stated Uber had updated its Terms of Use.  Plaintiff clicked a checkbox next to text indicating that he had reviewed and agreed to the terms.  Only after performing these actions could Plaintiff proceed to order a ride via Defendant’s rideshare application.  Days later, Plaintiff again used Defendant’s app to secure a ride, during which the Plaintiff’s uber driver collided with another vehicle, causing Plaintiff to be thrust forward, strike his head on the front passenger's seat headrest, and break his neck. Plaintiff was instantly paralyzed and was later diagnosed with a severe spinal injury and quadriplegia.

Defendant Uber’s updated Terms of Use, inter alia, required that users of Defendant’s application agree to resolve all disputes—including personal injury claims—through “final and binding arbitration,” and further waived the right to a trial by jury.

The main issue before the SJC was the enforceability of this arbitration provision or, more generally, whether an enforceable contract had been formed based upon the surrounding facts and circumstances.  For an online contract to be enforceable, the Court stated, “there must be both reasonable notice of the terms and a reasonable manifestation of assent to those terms.”

As to the issue of notice, the Court highlighted the conspicuous nature of Defendant’s Terms of Use—for example, that they were hyperlinked in blue font, and a user could not proceed to use Defendant’s application without checking a box saying the user reviewed and agreed to the terms. 

Significantly, the Court explained that even in the absence of Plaintiff’s actual review of all of Defendant’s Terms of Use, that a reasonable opportunity to review the terms would be sufficient to satisfy the notice requirement.

As to a reasonable manifestation of assent, the Court found that Plaintiff affirmatively manifested his assent twice—first when he was required to check a box immediately adjacent to text stating, “By checking the box, I have reviewed and agree to the Terms of Use,” and second when he was required to click a button stating “Confirm.” The Court found that the connection between checking the box and indicating assent to the terms was express and unambiguous—especially where Plaintiff could not proceed past the screen without indicating his assent.

Based on its analysis, the Court ultimately held that there was an enforceable online contract, and accordingly, that the Superior Court erred in denying Defendant’s Motion to Compel Arbitration.

This decision highlights two significant takeaways:

1. Users of applications and/or digital technologies, need to carefully read through and understand terms of use or service carefully before affirmatively indicating assent to such terms; and

2. Creators of online services, products, or applications, need to ensure that any terms of use or service are conspicuously displayed and that a reasonable opportunity for review of these terms is provided to users in order to have an enforceable, online/digital contract.