THE YEAR IN REVIEW: 2006 –2007 CASE LAW UPDATE FOR WEST VIRGINIA
Submitted by the Young Lawyers Committee
Areas of Law Covered:
Civil Procedure Commercial Litigation Deliberate Intent Evidence Insurance Law Labor & Employment Mass Tort/Class Actions Statutes of Limitation Workers’ Compensation Civil Procedure Update
Tiffany Swiger Steptoe & Johnson PLLC Sixth Floor, Chase Tower P.O. Box 2190 Clarksburg WV, 26301 (304) 624-8161 –Direct Dial (304) 624-8183 –Facsimile [email protected]
State ex rel. W. Va. Dept. of Transp., v. Cookman, 219 W. Va. 601, 639 S.E.2d 693 (2006).
Department of Transportation (“DOT”) condemned 48.24 acres of property owned by Respondent Fort Pleasant Farms, Inc. (“Fort Pleasant”) for use in the construction of Corridor H, a highway project. The 48.24 acre tract of property at issue is a portion of a 160 acre tract owned by Fort Pleasant and contains a significant fine, fissel shale deposit. After a commissioners’ hearing was held on December 14, 2005, a report was issued valuing the taking and residue damage at $1,100,600.00. Both parties filed exceptions to the commissioners’ report with the circuit court. Fort Pleasant also filed a motion to compel answers to its discovery requests with the circuit court. The discovery requests included the following two interrogatories:
INTERROGATORY NO. 1: Identify each and every expert witness or potential expert witness Petitioner or its counsel have consulted or communicated with in any fashion and/or retained in connection with this case, whether or not Petitioner intends to use or call such persons as a witness, who have not been previously disclosed.
INTERROGATORY NO. 2: Have any of the persons identified as expert appraisal witnesses or potential expert appraisal witnesses appraised other properties for the Petitioner of a similar nature (properties having a highest and best use as residential, commercial and/or industrial development properties), which are located within one-half mile of the subject? If so, identify each such person and provide a copy of all appraisal reports as to each of said properties.
DOT objected to both interrogatories. The circuit court found that the information sought was relevant, was not unduly burdensome and that it constituted proper discovery. The circuit court ordered DOT to produce copies of all appraisal reports and other evaluations, of or relating to the subject property, prepared for DOT regardless of whether the entities or persons would be made witnesses in the proceeding. Also, the Court ordered production of copies of all appraisal reports and evaluations relating to other properties acquired for the development of Corridor H, which were located within one-half mile of the subject property. The latter category of appraisals included all such appraisals that had been conducted twelve months before or after the date of the taking of the subject property and prepared by those persons who were or may be designated by the DOT as witnesses in the action.
DOT filed a petition to the Supreme Court of Appeals of West Virginia for a writ of prohibition, arguing that the circuit court exceeded its legitimate powers and abused its discretion by ordering the production of appraisal reports and other evaluations performed by persons not designated as witnesses in the underlying condemnation case. DOT also contended that the circuit court improperly ordered the production of appraisal reports and evaluations pertaining to other properties. DOT claimed that Fort Pleasant has not satisfied its burden of showing “exceptional circumstances” as is required by Rule 26(b)(4)(B) of the West Virginia Rules of Civil Procedure, to permit the production of materials prepared by consultants and non-testifying experts. DOT maintained that none of the materials were properly discoverable.
The West Virginia Supreme Court of Appeals granted the writ of prohibition with regard to both types of information sought by Fort Pleasant, finding that the circuit court failed to address the application of Rule 26(b)(4)(B)’s exceptional circumstance requirement. The Court held that “a circuit court is required, pursuant to Rule 26(b)(4)(B) of the West Virginia Rules of Civil Procedure, to make specific findings regarding the existence of exceptional circumstances justifying the discovery of facts known or opinions held by an expert or consultant who has been retained or specially employed by a party in anticipation of litigation or preparation for trial and who is not expected to be called as a witness at trial before the circuit court may compel such discovery over a party’s objection.”
The Court held that to the extent the circuit court compelled the production of appraisal reports and other evaluations prepared by persons who have not been designated as DOT witnesses in the underlying condemnation matter and appraisal reports and evaluations prepared by designated witnesses relative to other properties, the circuit court’s order lacked the appropriate findings to order the disclosure of this information. In granting the writ, the Court recognized that upon the return of the matter to circuit court, Fort Pleasant could renew its motion to compel. If Fort Pleasant chose to do so, the circuit court would be required to hold a hearing and make the appropriate findings regarding the existence of exceptional circumstances.
State ex rel. Taylor v. Nibert, 640 S.E.2d 192 (W. Va. 2006).
The petitioners were plaintiffs in three separate cases wherein Nationwide was named as a defendant based upon its alleged failure to pay the full amount of uninsured and underinsured motorist coverage benefits due under certain automobile insurance policies. Two of the three cases were filed in Jefferson County and the third case was filed in Marshall County. The petitioners claimed that their cases were transferred from their chosen forums to Roane County, without any prior notice. Moreover, petitioners alleged that their cases were consolidated with twenty other civil actions from around West Virginia into a pending class action by the Circuit Court of Roane County. The Order transferring petitioners cases stated that said cases were transferred and consolidated pursuant to Rule 42(b) of the West Virginia Rules of Civil Procedure for “the purpose of enabling the Settlement Parties to proceed with a settlement of this matter.” On the same day as entry of the Transfer Order, the circuit court also entered a class certification order, which conditionally certified two classes based upon a stipulation between Nationwide and the class representatives. One of the classes contains a punitive damages subclass designated as a mandatory or non-opt-out class pursuant to Rule 23(b)(1)(B) of the West Virginia Rules of Civil Procedure.
Petitioners objected to the transfer of their cases. However, said objections were rejected. Subsequently, Petitioners filed a motion to decertify the class action on the grounds that the circuit court had failed to make any findings supporting its class certification and that the mandatory punitive damages subclass failed to meet the requirement of West Virginia Rule Civil Procedure 23(b)(1)(B). The circuit court rejected Petitioners’ argument, stating that its class certification amounted to a “temporary certification” with “no binding effect” and was “geared solely to the limited goal of putting the entirety of this litigation on a proper platform and schedule [for discovery purposes].” The petitioners filed a petition for a writ of prohibition with the West Virginia Supreme Court of Appeals.
The petitioners maintain that the transfer was not sanctioned by Rule 42(b) because their cases did not arise from the “same transaction or occurrence” as those cases pending in Roane County. Under Rule 42(b), transfer is required only when two or more actions arise out of the “same transaction or occurrence.” Previously, the West Virginia Supreme Court of Appeals held that “claims and counterclaims arise out of the same ‘transaction or occurrence’ where there is a logical relationship between the claim and the counterclaim.” Never having defined “logical relationship,” the Court looked to other states who have adopted this same test. There, it found the following test for determining whether a logical relationship exists between two or more actions so as to require transfer under Rule 42(b):
[A] claim has a logical relationship to the original claim if it arises out of the same aggregate of operative facts as the original claim in two senses: (1) that the same aggregate of operative facts serves as the basis of both claims; or (2) that the aggregate core of facts upon which the original claim rests activates additional legal rights in a party defendant that would otherwise remain dormant.
Id. (citing Revere Copper & Brass Inc. v. Aetna Cas. & Sur. Co., 426 F.2d 709, 715 (5th Cir. 1970); In re Lazar, 237 F.3d 967, 979 (9th Cir. 2001)).
Utilizing the “logical relationship test,” the Court concluded that the cases were not logically related such that it could be said that they arose out the same transaction or occurrence. The Court noted that they were “mindful of the fact that all of the plaintiffs have claims for uninsured or underinsured motorist coverage and all received either or both of the 1993 and 1999 mailings offering such coverages;”however, the mere fact that all of the plaintiffs received the mailings was not a sufficient basis, by itself, for mandatory transfer. The Court recognized that common questions of law could arise “regarding whether Nationwide made commercially reasonable offers of uninsured and underinsured motorists coverage to insureds such as the petitioners,” the Court held that such inquiries alone could not be the basis for transfer under Rule 42(b).
Moreover, the West Virginia Supreme Court of Appeals held that the decision to transfer the cases, without first giving petitioners an opportunity to object, was unfair and contrary to the purpose of Rule 42(b). The Court held that transferring cases without notice and an opportunity to object defeats the purpose of Rule 42(b) to “avoid unnecessary cost or delay” when transfer is not proper. The Court held that when a motion is made to have an action transferred pursuant to Rule 42(b) of the West Virginia Rules of Civil Procedure, “the movant must give notice to all parties in the case(s) to be transferred. The parties in the case(s) to be transferred must be given the opportunity to object prior to the transfer and if requested, the transferring court shall hold a hearing to determine whether transfer is proper under Rule 42(b).”
Hardwood Group v. LaRocco, 219 W. Va. 56, 631 S.E.2d 614 (2006).
Claire V. LaRocco was the president of a company, Greenbrier Architectural Woodworks. She signed a promissory note with Hardwood guaranteeing repayment of a specific sum of money. Hardwood extended credit to Ms. LaRocco in exchange for the promissory note so her company could continue running its business. Hardwood filed a complaint against Ms. LaRocco alleging that Ms. LaRocco had defaulted on her personal guarantee of a debt. Ms. LaRocco signed the restricted delivery notice on October 1, 2003, evidencing receipt of the summons and complaint. On December 3, 2003, Hardwood moved for default judgment pursuant to Rule 55 of the West Virginia Rules of Civil Procedure based on Ms. LaRocco’s failure to file an answer or other responsive pleading to the complaint. Ms. LaRocco was sent a copy of the letter requesting a ruling of default, the motion, and an accompanying affidavit. The circuit court entered an order granting default judgment on December 9, 2003, with a copy of the order forwarded to Ms. LaRocco. Hardwood then sought execution of the judgment. Then on February 3, 2004, Ms. LaRocco filed a motion to set aside the default judgment and to quash its execution. Ms. LaRocco argued that her failure to respond was based on excusable neglect and that a meritorious defense existed to the default action. The Court denied her motion to set aside the default judgment. Ms. LaRocco appealed this ruling.
In reviewing the case, the Court looked to Rule 55(c) of the West Virginia Rules of Civil Procedure, to determine the proper standard for setting aside defaults and default judgments. Rule 55(c) directs that “[f]or good cause shown the court may set aside an entry of default and, if a judgment by default has been entered, may likewise set it aside in accordance with Rule 60(b).” The Court acknowledged that said language suggests that two different standards have been created under Rule 55(c): one of good cause to set aside an entry of default, and one following Rule 60(b) to set aside an entry of default judgment. The Court clarified these two standards. First, Rule 60(b) of the West Virginia Rules of Civil Procedure allows a court to excuse a moving party from a final judgment, if one of the relevant factors set forth in said Rule can be shown by a moving party. Then, in Syllabus pt. 3, of Parsons v. Consol. Gas Supply Corp., the Court held that “in determining whether a default judgment should be ... vacated upon a Rule 60(b) motion, the trial court should consider: (1) The degree of prejudice suffered by the plaintiff from the delay in answering; (2) the presence of material issues of fact and meritorious defenses; (3) the significance of the interests at stake; and (4) the degree of intransigence on the part of the defaulting party.” 163 W.Va. 464, 256 S.E.2d 758 (1979). Here, the Court adopted a similar standard for addressing a motion to set aside an entry of default. The Court held that a trial court must determine whether “good cause” under Rule 55(c) of the West Virginia Rules of Civil Procedure has been met. In analyzing “good cause” for purposes of motions to set aside a default, the trial court should consider: (1) the degree of prejudice suffered by the plaintiff from the delay in answering; (2) the presence of material issues of fact and meritorious defenses; (3) the significance of the interests at stake; (4) the degree of intransigence on the part of the defaulting party; and (5) the reason for the defaulting party’s failure to timely file an answer.
Accordingly, the Court held that in addressing a motion to set aside a default judgment, “good cause” requires not only considering the factors set out in Syllabus point 3 of Parsons, supra but also requires a showing that a ground set out under Rule 60(b) of the West Virginia Rules of Civil Procedure has been satisfied. Contrary to Ms. LaRocco’s argument that she was improperly required to meet two standards: good cause and excusable neglect, the Court held that Ms. LaRocco misunderstood the law and that she was required to establish excusable neglect as an element of “good cause” not in addition to good cause. The Court noted that the Parsons factors and excusable neglect, or any other relevant factor under Rule 60(b), constitute “good cause” for setting aside a default judgment.
The Court held that the circuit court did not abuse its discretion when it denied Ms. LaRocco’s Rule 60(b) motion to set aside the default judgment. The Court noted the deference afforded to trial courts when making the decision to grant a default judgment, but also noted that it is quite willing to review default judgments and to overturn them in cases where good cause is shown. Here, the Court found that Ms. LaRocco’s inability to advance any meritorious defenses, her intransigence and her inability to present any excusable neglect for not filing a timely answer, the proper balance of the factors required the Court to affirm the trial court’s denial of Ms. LaRocco’s motion to set aside the default judgment.
Hawkins v. U.S. Sports Ass’n, 219 W. Va. 275, 633 S.E.2d 31 (2006).
Mr. Hawkins injured his knee on a plastic pipe while sliding toward first base in a softball tournament organized and controlled by the Appellees. Mr. Hawkins incurred over $56,000.00 in medical expenses due to that injury. As a result, he filed a civil action against the Appellees, alleging that the Appellees were negligent in their failure to discover the pipe and confirm that the field was safe before allowing Mr. Hawkins to play there. After significant discovery, it was revealed that the Appellees prepared the field the night before the softball game and had performed precautionary inspections of the field prior to the competition. Any noticeable obstructions were removed from the field. Rain the night before had resulted in further preparation of the field.
Discovery also indicated that the pipe on which Mr. Hawkins injured his knee was a two- inch diameter PVC pipe located approximately five feet from first base in the base line and was approximately twelve inches long. It was also revealed that coaches employed by the Marion County Board of Education installed the pipe in the base line in order to serve as an anchor for bases to accommodate different size dimensions. These coaches testified that they did not inform any member of Appellee that the pipe had been buried on the field. The primary area of conflict among the parties involves the portion of the buried or partially buried pipe that might have protruded above ground level at the time of Mr. Hawkins’ injury. The parties also disagree regarding whether the pipe was hollow or filled with concrete.
The lower court granted the Appellee’s motion for summary judgment finding that “[n]o witness testified that the [Appellees] acted improperly” and that the Appellees fulfilled their duties by taking reasonable steps to ensure a safe playing field. Moreover, the Court found that because the Appellees had no knowledge of the buried PVC pipe, they did not breach their duty by “failing to locate a latent danger.” According to the lower court, only the Marion County Board of Education, which knew about the pipe, was “legally responsible for the [Appellants’] injuries.”
“If there is no genuineissue as to any material fact summary judgment should be granted but such judgment must be denied if there is a genuine issue as to a material fact.” In determining whether a genuine issue of material fact exists, this Court construes the facts in the light most favorable to the party against whom summary judgment was granted. Id. (citing Masinter v. WEBCO Co., 164 W. Va. 241, 242, 262 S.E.2d 433, 435 (1980); Alpine Prop. Owners Ass’nv. Mountaintop Dev. Co., 179 W. Va. 12, 17, 365 S.E.2d 57, 62 (1987)). A genuine issue for purposes of West Virginia Rule of Civil Procedure 56(c)
is simply one half of a trialworthy issue, and a genuine issue does not arise unless there is sufficient evidence favoring the non-moving party for a reasonable jury to return a verdict for that party. The opposing half of a trialworthy issue is present where the non-moving party can point to one or more disputed “material” facts. A material fact is one that has the capacity to sway the outcome of the litigation under the applicable law. Id. (citing Syl. Pt. 5, Jividen v. Law, 194 W. Va. 705, 461 S.E.2d 451 (1995)).
In reviewing the case at hand, the Court discussed its decision in Mallet v. Pickens, 206 W. Va. 145, 522 S.E.2d 436 (1999) explaining that certain factors must be considered in a premises liability case. There, the Court relied on Syllabus point 3 of Sewell v. Gregory, which states that: The ultimate test of the existence of a duty to use care is found in the foreseeability that harm may result if it is not exercised. The test is, would the ordinary man in the defendant’s position, knowing what he knew or should have known, anticipate that harm of the general nature of that suffered was likely to result?
179 W. Va. 585, 371 S.E.2d 82 (1988). Then it reasoned as follows:
In determining whether a defendant in a premises liability case met his or her burden of reasonable care under the circumstances to all non- trespassing entrants, the trier of fact must consider (1) the foreseeability that an injury might occur; (2) the severity of injury; (3) the time, manner and circumstances under which the injured party entered the premises; (4) the normal or expected use made of the premises; and (5) the magnitude of the burden placed upon the defendant to guard against injury.
Hawkins, 219 W. Va. at 278, 633 S.E.2d at 34 (citing Mallett, Syl. Pt. 6, 206 W. Va. at 146, 522 S.E.2d at 437. However, the Court noted that an exhaustive investigation of all the Mallet factors is not necessary at the summary judgment state. The Court recognized that while some of the Mallet factors may have application in a premise liability action at the summary judgment state, the Mallet factors were intended to be used by a jury when determining liability.
Here, after a review of the complete record in a light most favorable to the Appellants given the standards set forth by Sewell and Mallet, the Court held that the lower court properly granted summary judgment. The Court found that the evidence did not present a scenario in which the defendants, other than the Marion County Board of Education, had any actual or constructive knowledge of the dangerous instrumentality. Also, the evidence failed to indicate any negligence in preparation of the field or any negligence to locate the pipe through reasonable inspection. The Court held that the evidence provides no basis upon which to conclude that the injury was foreseeable in any manner to the Appellees and that under such findings summary judgment was appropriate.
Farley v. Shook, 218 W. Va. 680, 629 S.E.2d 739 (2006).
A benign soft tissue mass was removed on Mrs. Farley’s right foot near her ankle. She was discharged the same day. The next day, Mrs. Farley called Dr. Shook’s office on several occasions with complaints of pain. Ms. Farley was instructed to come to the office, but was unable to find transportation. Later that night, Mrs. Farley called for an ambulance and was taken to the emergency department at St. Mary’s. She was seen by Dr. Fornari, an emergency room physician. Dr. Fornari contacted Dr. Shook’s office to inform him that one of his recent surgical patients was in the emergency room. Dr. Fornari spoke with Dr. Miller who had assisted during the subject surgery. Dr. Miller indicated to Dr. Fornari that there was no need to remove the surgical dressing because, during a previous conversation with Dr. Shook’s office, Mrs. Farley had informed the office employees that she had already loosened her dressing. Mrs. Farley was medicated and discharged from the emergency room with instructions to see Dr. Shook in his office the next day. Mrs. Farley went to Dr. Shook’s office the next morning. It was discovered that she suffered from gas gangrene. The condition resulted in an emergent, above-the-knee amputation of her leg.
The Farleys filed a medical malpractice lawsuit. Defendant doctors and St. Mary’s disclosed expert witnesses, after asking for and receiving a stipulation from counsel for the Farleys as to an extension of time in which to disclose their experts. Thereafter, the Farleys only expert, Dr. Weihl, was deposed. He testified as to deviations from the standard of care as it related to Dr. Fornari and St. Mary’s; however, he was unable to testify regarding causation as to Dr. Fornari and St. Mary’s. Moreover, because his area of expertise is emergency medicine, he did not testify as to any deviation of the standard of care as it would apply to podiatrists such as Dr. Shook and Dr. Miller. Thus, Dr. Fornari and St. Mary’s filed motions for summary judgment based on the lack of any expert who could opine as to a causal link in the care provided to Mrs. Farley and her alleged injuries. The Farleys filed no responsive pleading or affidavits. Said motion was granted.
Dr. Shook and Dr. Miller moved for summary judgment on the ground that the Farleys failed to put forth any requisite expert testimony as to any alleged deviations from the standard of care from the perspective of a doctor of podiatry. The circuit court granted Dr. Shook and Dr. Miller’s motion for summary judgment finding that their expert lacked the expertise to opine as to whether either Dr. Shook or Dr. Miller breached the duty of care owed by a doctor of podiatry. The Farleys appealed the circuit courts’ orders granting the summary judgment motions.
The West Virginia Supreme Court of Appeals found the grant of Dr. Fornari and St. Mary’s summary judgment appropriate and affirmed the decision. However, the Court reversed the trial court’s grant of Dr. Shook and Dr. Miller’s motion for summary judgment. The Court knew of the Farleys’ motion to extend their expert disclosure deadline and that their request was denied by the circuit court. The Court believed consideration of the circuit court’s denial of said motion was pivotal in determining the appropriateness of the summary judgment. The Court noted that under West Virginia Rule of Civil Procedure 16(e) trial courts are vested with the discretion to modify scheduling orders and that in reviewing such a decision the Court must apply an abuse of discretion standard.
The Farleys sought additional time to find and disclose expert witnesses for a number of different reasons. First, the Farleys had not been able to depose the defendant doctors. Second, the Farleys suggested that they could not disclose expert witnesses until they deposed the experts identified by Dr. Shook and Dr. Miller. Moreover, the record revealed that on two separate occasions, the defendant doctors requested an extension of their expert disclosure deadline. Counsel for the Farleys agreed to the request as a matter of professional courtesy. However, during the hearing on the motion, counsel for the Farleys conceded that they made no reciprocal request for an extension of time to disclose the Farleys’ expert witnesses. Counsel for the Farleys stated to the trial court that he anticipated no opposition to his own request for an extension of time since he had granted extensions to the defendant doctors on two separate occasions. The defendant doctors did oppose the Farleys’ motion for an extension of time.The trial court ruled that the Farleys were not entitled to an extension of time in which to identify experts.
The Court found that because of the impediments to the Farleys’ ability to identify a podiatric expert, the trial court abused its discretion in denying their motion to extend the time in which to identify experts. The Court found that the situation against Dr. Shook and Dr. Miller was very different than the case against Dr. Fornari and St. Mary’s. As against Dr. Fornari and St. Mary’s, the Farleys were able to identify an expert; however, while competent to testify, that expert was not able to tie any breaches of the standard of care by Dr. Fornari or St. Mary’s to the Farleys’ injuries. Nonetheless, as against Dr. Shook and Dr. Miller, the Farleys were not afforded adequate time to identify experts in light of the impediments with which they were faced. Under said circumstances, the Court held that summary judgment for Dr. Shook and Dr. Miller was improper because the circuit court abused its discretion in deny the Farleys’ motion for an extension of time to disclose an expert who could testify against said doctors. Commercial Litigation
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Ryan v. Ryan, 640 S.E.2d 64 (W. Va. 2006).
The litigants divorced in 1993 and entered into a property settlement agreement on March 1, 1994, which required the ex-husband to pay the ex-wife alimony for 12 years, ending in February 2006. However, if the ex-wife sold stock she owned before March 1, 2004 for $80,000 or more, then the ex-husband’s obligation to pay alimony would end with his February 2004 alimony payment. On May 28, 1999, the parties amended their property settlement agreement and acknowledged that the ex-wife had sold her stock for more than $80,000 and that the ex-husband’s last alimony payment would be in February 2004.
On January 12, 2004, the ex-wife filed a petition in the Family Court of Kanawha County seeking to modify the agreement because she and her ex-husband had labored under a mutual mistake of fact when they entered the agreement and when they amended it, specifically that her sale of stock would generate sufficient income to support her, making alimony payments unnecessary. The ex-wife claimed that her investment income had fallen short of what she and her ex-husband had anticipated. The Family Court denied the ex-wife’s petition and concluded that mistakes of fact concerning future events will not permit the voiding of contracts and that the ex-wife failed to prove by a preponderance of the evidence that the ex-husband shared in the ex-wife’s mistaken future expectations. The ex-wife appealed to the Circuit Court of Kanawha County, which affirmed the Family Court’s decision and agreed with the Family Court’s determination that only mistakes concerning past or present, rather than future, events will render a contract voidable.
In an opinion by Justice Benjamin, the West Virginia Supreme Court of Appeals affirmed the Circuit Court’s decision and held that a contract may not be reformed or rescinded based upon a mutual mistake of fact if the mistake relates to a mistaken belief, judgment or expectation as to future, rather than past or present, facts, occurrences or events. The Court, joining a number of other states, adopted the position taken by the Restatement (Second) of Contracts § 151 that a party’s prediction or judgment as to events to occur in the future, even if erroneous, is not a mistake of fact for the purpose of reforming a contract or making it voidable. The Court reasoned that if a party to a contract could reform or rescind a contract because of a mistaken expectation as to future results or occurrences, the reliability of many contracts would be destroyed. Copier Word Processing Supply, Inc. v. WesBanco Bank, Inc., 640 S.E.2d 102 (W. Va. 2006).
In 1985, a company hired an employee who was ultimately promoted to office manager. In May 2003, the company discovered that the office manager had been embezzling its funds for several years and fired her. The office manager embezzled the company’s funds by intercepting checks mailed to the company, zeroing out the corresponding invoice, signing the back of the check with the company’s name, the company president’s name and her own name, as company treasurer, and depositing the check into her personal bank accounts at WesBanco. The company believed that the office manager repeated this process at least 721 times, embezzling approximately $472,000 and that no one at WesBanco questioned her authority to deposit company checks into her personal accounts.
On October 6, 2003, the company filed suit in the Circuit Court of Wood County against the office manager for conversion and against WesBanco for conversion and negligence. WesBanco filed its answer and asserted a cross-claim against the office manager. The office manager did not file an answer and default judgment was entered against her. The company filed a motion for summary judgment against WesBanco asserting that the acts of conversion amounted to a continuing tort which would prevent the statute of limitations from running until the date of the last act of conversion. WesBanco filed a motion for judgment on the pleadings claiming that the statute of limitations set forth in W. Va. Code § 46-3-118(g) barred the company’s claims with respect to any negotiable instrument negotiated more than three years prior to filing suit. Following a hearing on both motions, the Circuit Court denied the company’s motion for summary judgment and granted WesBanco’s motion for judgment on the pleadings. The Circuit Court entered partial judgment in favor of WesBanco and dismissed the company’s claims with respect to any negotiable instruments allegedly negotiated prior to October 6, 2000. The Circuit Court then certified two questions, at the company’s request, to the West Virginia Supreme Court of Appeals: (a) whether the continuing tort theory applies to the alleged conversion of multiple, separate negotiable instruments; and (b) whether the statute of limitations runs from the date of the negotiation of each separate instrument.
In an opinion by Chief Justice Davis answering the certified questions, the Court held that the equitable tolling theory of continuing torts does not apply to the conversion of multiple, separate negotiable instruments. The Court also held that in an action alleging conversion of multiple, separate negotiable instruments, and governed by the three-year statute of limitations set out in W. Va. Code § 46-3-118(g), the cause of action accrues and the limitations period begins to run from the date of the negotiation of each separate instrument. The Court found that extending the continuing tort theory to the conversion of multiple, separate negotiable instruments was not supported by prior West Virginia case law, the clear legislative intent expressed in W. Va. Code § 46-3-118(g) or the policy and purposed underlying the Uniform Commercial Code. The Court concluded the conversion of multiple, separate negotiable instruments does not amount to a continuing tort because prior cases extending the continuing tort theory involved a wrongful act, sustained over time, which caused continuing damages. Conversion of multiple, separate negotiable instruments is not a situation where events, which for all practical purposes are identical, occur repeatedly, at short intervals, in a consistent, connected, rhythmic manner, which the Court considered to be characteristic of a continuing tort. Instead, each conversion is a discrete act involving a specific negotiable instrument with similar, but separate, injuries each giving rise to a separate and distinct cause of action. The Court also found that the Legislature had plainly expressed its intention that each act of conversion be treated as a separate violation for limitations purposes and that it rationally follows that a cause of action for conversion accrues at the time the instrument is negotiated. In a dissent joined by Justice Albright, Justice Starcher argued that the Court confused the concepts of the continuing tort and equitable tolling and that the issues raised by WesBanco should have been resolved at trial.
Smith v. Smith, 219 W. Va. 619, 639 S.E.2d 711 (2006).
By deed dated August 21, 2001, the grantors conveyed real estate that adjoined real estate where their house was located to the grantee. The deed conveying the real estate to the grantee recited a metes and bounds description that had been used in successive deeds conveying the same real estate since the 1800s. The deed contained two reservations, including one that reserved to the grantors the right to use a parking lot located on the conveyed real estate. At the time of the conveyance, the grantors hosted an annual apple butter festival on the parking lot. The lawyer who prepared the deed reviewed the metes and bounds description with the grantors at the closing.
Three years later, the grantors filed suit in the Circuit Court of Summers County against the grantee, alleging that the deed conveyed more real estate than they had intended to convey or that the grantee had intended to receive and asked the Circuit Court to reform the deed to reflect an agreement between the parties as to what was to have been conveyed. In her answer, the grantee denied that any such agreement existed between her and the grantors. The grantors also asserted that they had an agreement with the grantee to use a parking lot located on the conveyed real estate. The grantee responded that the reservation to use the parking lot was to create a right of way for access. Following a bench trial, the Circuit Court determined that the deed was clear and unambiguous and refused to admit parol evidence to show that a mutual mistake as to what was to be conveyed and acquired. The Circuit Court also ruled that the right to use the parking lot reserved to the grantors in the deed was limited to ingress, egress and occasional parking. The grantors appealed.
In an opinion by Justice Benjamin, the West Virginia Supreme Court of Appeals affirmed in part and reversed in part the Circuit Court’s decision and held that if an unambiguous deed fails to express the obvious intention of the parties, a court may seek to arrive at the intention of the parties by resort to parol evidence. The Court also held that a mutual mistake is one which is common to all parties, wherein each labors under the same misconception respecting a material fact or provision within the agreement. However, the burden of proof of a mutual mistake which a party to a deed must provide in order to have a deed reformed because of the mistake is high. The Court held that to justify the reformation of a clear and unambiguous deed for mistake, the mistake must be one of fact, not of law; the mistake must be mutual and common to both parties to the deed; the unambiguous deed must fail to express the obvious intention of the parties; and the mutual mistake must be proved by strong, clear and convincing evidence.
The Court affirmed the Circuit Court’s decision that the grantors were bound by the metes and bounds description of the conveyed property because the grantors fell far short of meeting their burden of proof for reformation of a clear and unambiguous deed. Additionally, the Court found that if a mistake occurred, it was not a mutual mistake, but a mistake by the grantors alone. The Court reversed the Circuit Court’s decision to limit the use of the parking lot to ingress, egress and occasional parking. The Court determined that the parking lot reservation was ambiguous and strictly construed the reservation against the grantors. The Court further clarified the reservation by resorting to the intention of the parties ascertained from the deed itself, the circumstances and situation of the parties at the time of execution. As such, the Court interpreted the reservation to allow the grantors ingress, egress and occasional parking, as well as use of the parking lot during the grantors’ annual apple butter festival so long as the grantors own the adjoining property or until the death of either of the grantors.
State ex rel. W. Va. Dept. of Transp. v. Cookman, 219 W. Va. 601, 639 S.E.2d 693 (2006).
As part of the construction of Corridor H in Hardy County, the Department of Transportation condemned 48.24 acres owned by a landowner. In a civil action filed in the Circuit Court of Hardy County to determine the value of the condemned real estate, the landowner served the Department of Transportation with two interrogatories which asked the Department of Transportation to identify: 1.) each and every expert witness or potential expert with which the Department of Transportation had consulted or communicated or retained in connection with the condemnation action regardless of whether the Department of Transportation intended to call that witness at trial and 2.) any person identified as an expert appraisal witness or potential expert appraisal witness who had appraised properties of a similar nature within one-half mile of the condemned real estate and to provide a copy of any appraisal report. The Department of Transportation objected to the interrogatories as beyond the scope of permissible discovery. The landowner filed a motion to compel answers to its interrogatories. The Circuit Court of Hardy County found that the information sought was relevant, that it was not unduly burdensome and that it constituted proper discovery and ordered the Department of Transportation to immediately produce to the landowner copies of all appraisal reports and other evaluations prepared for the Department of Transportation by all experts and consultants and copies of all appraisal reports and evaluations pertaining to other properties acquired for Corridor H located within one-half mile of the condemned property. The Department of Transportation then sought a writ of prohibition.
In an opinion by Justice Benjamin, the West Virginia Supreme Court of Appeals granted the writ of prohibition and held that a circuit court is required, pursuant to Rule 26(b)(4)(B) of the West Virginia Rules of Civil Procedure, to make specific findings regarding the existence of exceptional circumstances justifying the discovery of facts known or opinions held by an expert or consultant who has been retained or specially employed by a party in anticipation of litigation or preparation for trial and who is not expected to be called as a witness at trial before the circuit court may compel such discovery over a party’s objection. The Courtremanded the matter and permitted the landowner to renew its motion to compel and instructed the Circuit Court to hold a hearing and make appropriate findings regarding the existence of exceptional circumstances before it may compel the production of appraisal reports and other evaluations prepared by person who have not been designated as Department of Transportation witnesses.
In an opinion concurring in part and dissenting in part, Justice Starcher approved of the Court’s holding, but dissented as toits application to the facts presented by the case. In Justice Starcher’s opinion, a landowner in a condemnation proceeding should be entitled to any materials the Department of Transportation may have consulted in determining the value of condemned real estate because a condemnation proceeding is inherently an exceptional circumstance. In a lengthy dissenting opinion, Chief Justice Davis criticized the Court’s ruling and considered several issues raised by the parties, but not addressed by the Court’s opinion.
McConaha v. Rust, 219 W. Va. 112, 632 S.E.2d 52 (2006).
On January 30, 1962, a father died intestate survived by his wife and seven children. At the time of his death, the father owned three parcels of real estate totaling approximately 55.18 acres. On October 16, 1992, his widow died, extinguishing her dower interest in the real estate. On March 5, 1997, one of his sons, who was also an heir, died, leaving his interest in the real estate to his adopted son.
On September 29, 1999, the administrator of the father’s and mother’s estates, who was also a daughter and heir, filed suit in the Circuit Court of Kanawha County against the other five living children and the heir of the one deceased child seeking partition of the land by sale or in kind. The case was referred to a special commissioner to determine the state of the legal interests in the real estate. Objections were raised to the special commissioner’s report and the Circuit Court convened a hearing. At the hearing, the administrator of the estates accepted as her one-seventh share of the property a 10 acre parcel. However, the administrator objected to other findings made by the Circuit Court regarding the interests of the other children and appealed.
In an opinion by Justice Albright, the West Virginia Supreme Court of Appeals found that the administrator lacked standing to assert her objections to the Circuit Court’s findings regarding the interests of the other heirs. In her argument to the Court, the administrator implied that she was coerced by the Circuit Court into entering the settlement agreement. The Court noted that the administrator, with the advice of competent counsel, had informed the Circuit Court that she would accept the 10 acre parcel as her one-seventh interest in the real estate to be partitioned and the Court could find no reason to create an exception to the generally applicable rule that where parties have made a settlement, the settlement is conclusive absent proof of accident, mistake, or fraud in making the agreement. The Court held that, when reviewing an action in partition, it generally will not disturb a settlement agreement reached before and/or ratified by the circuit court where the party seeking relief was represented by counsel and freely entered into the agreement.
Hardwood Group v. LaRocco, 219 W. Va. 56, 631 S.E.2d 614 (2006).
A guarantor signed a promissory note with a creditor guaranteeing repayment of a specific sum of money to allow the guarantor’s company to continue its business. On September 19, 2003, the creditor filed suit in the Circuit Court of Greenbrier County against the guarantor alleging that she had defaulted on her personal guaranty of the debt. On October 1, 2003, the guarantor signed for the summons and complaint. On December 3, 2003, the creditor moved for default judgment pursuant to Rule 55 of the West Virginia Rules of Civil Procedure because the guarantor had failed to file an answer or other responsive pleading to the complaint. On December 9, 2003, the Circuit Court entered an order granting default judgment, after which the creditor then sought execution of the judgment. On February 3, 2004, the guarantor filed a motion to set aside the default judgment and to quash the suggestion of execution. The guarantor argued that her failure to respond was justified by excusable neglect and that meritorious defenses existed to the default action commenced by the creditor. The Circuit Court found that the guarantor had not shown good cause for her failure to respond to the complaint and denied her motion to set aside the default judgment. The guarantor appealed, arguing that the default judgment should be set aside for excusable neglect pursuant to Rule 60(b) and that she was not required to meet a separate threshold of “good cause” before prevailing on her motion to set aside the default judgment.
In an opinion by Chief Justice Davis, the West Virginia Supreme Court of Appeals affirmed the Circuit Court’s decision and held that when addressing a motion to set aside an entry of default, a trial court must determine whether “good cause” under Rule 55(c) of the West Virginia Rules of Civil Procedure has been met. In analyzing “good cause” for purposes of motions to set aside a default, the trial court should consider: (1) the degree of prejudice suffered by the plaintiff from the delay in answering; (2) the presence of material issues of fact and meritorious defenses; (3) the significance of the interests at stake; (4) the degree of intransigence on the part of the defaulting party; and (5) the reason for the defaulting party’s failure to timely file an answer. In addressing a motion to set aside a default judgment, “good cause” requires not only considering the facts set out in Syllabus Point 3 of Parsons v. Consolidated Gas Supply Corp., 163 W. Va. 464, 256 S.E.2d 758 (1979), but also requires a showing that a ground set out under Rule 60(b) of the West Virginia Rules of Civil Procedure has been satisfied.
In a concurring opinion joined by Justice Starcher, Justice Albright noted that default judgments have been a disfavored mechanism for case resolution and worried that the Court’s holding did not sufficiently emphasize the traditional liberal interpretation of “good cause” for purposes of vacating default judgments. T. Weston, Inc. v. Mineral County, 219 W. Va. 564, 638 S.E.2d 167 (2006).
In November 2002, at the suggestion of the Mineral County Planning Commission, the Mineral County Commission passed an ordinance regulating exotic entertainment businesses in Mineral County. The ordinance exempted businesses that existed prior to the ordinance’s passage and required an annual application for a permit and an application fee for all businesses providing exotic entertainment. It also prohibited anyone under the age of 21 from being on the premises of an establishment providing exotic entertainment. In 2004, the Mineral County Sheriff conducted a sting operation in which two undercover sheriff’s deputies accompanied two 21-year olds into the Ridgeley Saloon. On May 6, 2004, the Mineral County Prosecuting Attorney sent a demand letter to the owner, alleging that the owner had admitted persons under twenty-one to its establishment in violation of the county’s ordinance.
The owner filed suit in the United States District Court for the Northern District of West Virginia challenging the constitutionality of the ordinance and the county’s authority to enact such an ordinance and alleging that Mineral County was improperly seeking to restrict or terminate the owner’s business operations. In a certified question to the West Virginia Supreme Court of Appeals, the federal court inquired whether a county commission, which has created a planning commission, is precluded from adopting a county ordinance limiting the areas of the county in which a business may offer exotic entertainment pursuant to West Virginia Code Section 7-1-3jj(b). In an opinion by Justice Starcher, the Court held that a county commission that has created a planning commission pursuant to W. Va. Code § 8-24-1 et seq. does not have authority under W. Va. Code § 7-1-3jj(b) to adopt a county ordinance limiting the areas of the county in which a business may offer exotic entertainment. However, the Court declined to address whether the county had such authority pursuant to some other legislative provision. In a dissenting opinion, Justice Benjamin argued that W. Va. Code § 7-1-3jj(b) applied only to counties without planning commissions.
Heartland, L.L.C. v. McIntosh Racing Stable, L.L.C., 219 W. Va. 140, 632 S.E.2d 296 (2006).
On January 12, 2003, the buyers entered into a written agreement to purchase a horse stable and real estate from the seller. In February 2003, a severe snow storm caused a portion of the stable’s roof to collapse, requiring extensive repair. On April 4, 2003, a dry closing was conducted. At the dry closing, one of the original buyers was replaced by a new buyer. The two remaining original buyers planned to join with the new buyer to form a limited liability company which would own the stable and the real estate. The articles of organization for the limited liability company were signed at the dry closing in the presence of the seller. On April 18, 2003, the stable was condemned. The purchase was never completed. On August 15, 2003, the seller sought to rescind the agreement to sell to the limited liability company because the limited liability company had not been properly organized under West Virginia law at the time of the closing. Further, the seller contended that it had not entered into a binding contract with a competent party since the limited liability company did not technically exist at the time the deed was signed. On October 1, 2003, the limited liability company’s articles of organization were filed with the West Virginia Secretary of State’s office.
On October 2, 2003, the limited liability company and the other buyers filed suit in the Circuit Court of Jefferson County seeking specific performance and alleging breach of contract against the seller. The Circuit Court granted the seller’s motion for summary judgment and found that the limited liability company was not a party to the contract since it did not exist until October 1, 2003, the limited liability company had unreasonably delayed in filing articles of organization after the documents were signed at the dry closing, and the buyer was justified in rescinding the contract because the initial purchasers did not attempt to close the transaction within a reasonable period of time.
In an opinion by Justice Albright, the West Virginia Supreme Court of Appeals held that a deed drawn and executed in anticipation of the creation of the grantee as a corporation, limited liability company, or other legal entity entitled to hold real property is not invalidated because the grantee entity had not been established as required by law at the time of such execution, if the entity is in fact created thereafter in compliance with the requirements of law and the executed deed is properly delivered to the entity, the grantee, after its creation. The Court reserved the Circuit Court’s entry of summary judgment and remanded the case.
In re Tawney v. Columbia Natural Res., L.L.C., 219 W. Va. 266, 633 S.E.2d 22 (2006).
Since 1993, an oil and gas lessee had taken deductions from oil and gas lessors’ 1/8 royalty for “post production” costs. These costs included the lessee’s delivery of gas from the well to the transmission company’s point of delivery, the lessee’s processing of the gas to make it satisfactory for delivery into the transmission line and losses of volume of gas due to leaks in the gathering system and other volume losses from the well to the transmission line. The deductions included both monetary and volume deductions and were taken in equal amounts regardless of the distance from the well to the transmission line. The oil and gas lessee did not disclose on the accounting statements attached to the royalty checks that these deductions were taken.
The oil and gas lessors filed a class action in the Circuit Court of Roane County against the oil and gas lessee for damages due to allegedly insufficient royalty payments. At issue were at least 1,382 leases with language indicating that the royalty payment was to be calculated “at the wellhead,” “at the well,” “net all costs beyond the wellhead,” or “less all taxes, assessments, and adjustments.” The lessee moved for summary judgment because the lease language was clear and unambiguous. According to the lessee, the lease language permitted it to deduct the royalty owner’s proportionate share of post- production expenses, provided such expenses were actual and reasonable. The lessors argued that the language at issue was either silent or ambiguous as to the allocation of post-production costs between the lessor and the lessee and the lease language should be construed against the lessee. The lessors also argued that without language expressly addressing the allocation of post-production costs, the lessee must bear all costs incurred in marketing and transporting the gas to the point of sale. On October 14, 2005, the Circuit Court denied the lessee’s motion for summary judgment and certified two questions to the West Virginia Supreme Court of Appeals which the Court reformulated into one question, namely whether such lease language was sufficient to indicate that the lessee may deduct post-production expenses from the lessor’s 1/8 royalty, presuming that such expenses are reasonable and actually incurred.
In an opinion by Justice Maynard, the Court held that the term “ambiguity” is defined as language reasonably susceptible of two different meanings or language of such doubtful meaning that reasonable minds might be uncertain or disagree as to its meaning. The Court also held that language in an oil and gas lease that is intended to allocate between the lessor and the lessee the costs of marketing the product and transporting it to the point of sale must expressly provide that the lessor shall bear some part of the costs incurred between the wellhead and the point of sale, identify with particularity the specific deductions the lessee intends to take from the lessor’s royalty (usually 1/8), and indicate the method of calculating the amount to be deducted from the royalty for such post- production costs. The Court also held that language in an oil and gas lease that provides that the lessor’s 1/8 royalty (as in this case) is to be calculated “at the well,” “at the wellhead,” or other similar language, or that the royalty is “an amount equal to 1/8 of the price, net all costs beyond the wellhead,” or “less all taxes, assessments, and adjustments” is ambiguous and, accordingly, is not effective to permit the lessee to deduct from the lessor’s 1/8 royalty any portion of the costs incurred between the wellhead and the point of sale. Deliberate Intent Update
Christopher D. Pence Jackson Kelly PLLC 1600 Laidley Tower P.O. Box 553 Charleston, WV 25322 (304) 340-1088 - Direct Dial (304) 340-1050 - Facsimile [email protected]
I. The Statute
A. The Current W. Va. Code §23-4-2(d)(2)(ii)
Deliberate intention litigation is governed by statute, W. Va. Code §23-4-2(d)(2). Most litigation arises under W. Va. Code §23-4-2(d)(2)(ii). The current version of this Section, applicable to injuries occurring and cases filed on or after July 1, 2005,1 provides as follows, with the changes to the pre-Amendment statute appearing in bold type:
(d)(2) The immunity from suit provided under this section and under sections six and six-a, article two of this chapter may be lost only if the employer or person against whom liability is asserted acted with "deliberate intention". This requirement may be satisfied only if:
(ii) The trier of fact determines, either through specific findings of fact made by the court in a trial without a jury, or through special interrogatories to the jury in a jury trial, that all of the following facts are proven:
(A) That a specific unsafe working condition existed in the workplace which presented a high degree of risk and a strong probability of serious injury or death;
(B) That the employer, prior to the injury, had actual knowledge of the existence of the specific unsafe working condition and of the high degree of risk and the strong probability of serious injury or death presented by the specific unsafe working condition;
(C) That the specific unsafe working condition was a violation of a state or federal safety statute, rule or regulation, whether cited or not, or of a commonly accepted and well-known safety standard within the industry or business of the employer, as demonstrated by competent evidence of written standards or guidelines which reflect a consensus safety standard in the industry or business, which statute, rule, regulation or standard was specifically applicable to the particular work and working condition involved, as contrasted with a statute, rule, regulation or standard generally requiring safe workplaces, equipment or working conditions;
1 W. Va. Code §23-4-2(d)(2)(f) (2005). (D) That notwithstanding the existence of the facts set forth in subparagraphs (A) through (C), inclusive, of this paragraph, the employer nevertheless intentionally thereafter exposed an employee to the specific unsafe working condition; and
(E) That the employee exposed suffered serious compensable injury or compensable death as defined in section one, article four, chapter twenty-three whether a claim for benefits under this chapter is filed or not as a direct and proximate result of the specific unsafe working condition.
B. The Practical Effect of the Amendment
The changes highlighted above are significant. The language in §23-4-2(d)(2)(ii)(B) now requires actual knowledge of the specific unsafe working condition and of the strong probability of serious injury or death presented by the condition as opposed to a “subjective realization and appreciation” required by the pre-Amendment version. Although “subjective realization and appreciation” has been equated with “actual knowledge,” Blevins v. Beckley Magnetite, Inc., 185 W. Va. 633, 408 S.E.2d 385 (1991) and Mumaw v. U.S. Silica Co., 204 W. Va. 6, 511 S.E.2d 117 (1998), the new codification may make it easier for a jury to understand what type of knowledge is required. An allegation that the employer “should have known” of the unsafe condition was likely insufficient under the pre-Amendment version of the statute and is insufficient in most instances under the new version.
It is important to note that the new version of the statute requires that the employer have “actual knowledge” of both the existence of the unsafe condition and of “the strong probability of serious injury or death presented by the specific unsafe working condition.” The Supreme Court’s recent decision in Ryan v. Clonch Indus., Inc. discussed below, modifies the actual knowledge requirement in the pre-Amendment statute and likely has the same effect on the post-Amendment statute.
The changes to §23-4-2(d)(2)(ii)(C) are perhaps most significant. In order to satisfy subsection (C) by proving the unsafe working condition violated a “commonly accepted and well-known safety standard within the industry or business of the employer,” the plaintiff must now offer “competent evidence of written standards or guidelines which reflect a consensus safety standard in the industry or business.”2 Essentially, the applicable industry standard must now be 1.) a consensus safety standard in the industry or business and 2.) must be in writing. Prior to this change, a plaintiff was able to meet his burden by alleging an applicable industry standard, often with expert testimony. The plaintiff could satisfy his burden by proving “that an equal or similar standard was in place or recognized at a business or industrial entity conducting the same or similar activities as the defendant.” Handley v. Union Carbide Corp., 804 F.2d 265, 273 (4th Cir. 1986). Expert testimony is still preferred when relying on a consensus safety standard to satisfy this section, but the expert must now identify a written standard.
2 W. Va. Code §23-4-2(d)(2)(ii)(C) (2005). In addition to the changes highlighted above, the new version of Section 23-4-2(c) clarifies that an underlying workers’ compensation claim is not a condition precedent to a deliberate intention suit. However, even if a workers’ compensation claim is not filed, the employer may enjoy an offset equal to the value of the workers’ compensation claim had it been filed. The new version of Section 23-4-2(c) provides that, in a deliberate intent suit, the amount recoverable is equal to “any excess of damages over the amount received or receivable in a claim for benefits under this chapter, whether filed or not” (emphasis added).3 The Court has not yet addressed whether, under the new statute, a defendant is entitled to an offset when the plaintiff fails to file a workers’ compensation claim. This year, the Court may consider the question of whether a workers’ compensation claim is a condition precedent to a deliberate intention suit under the pre- 2005 changes to Section 23-4-2. Fullen v. Philips Elect. N. Am. Corp., Supreme Court of Appeals of West Virginia, No. 060555.
The Amendment to §23-4-2(d)(2)(ii)(E) provides that the plaintiff’s serious injury or death must be compensable as defined by W. Va. Code §23-4-1 (2005). This language likely exists to ensure that, even if the plaintiff failed to file an underlying workers’ compensation claim, the injury was one that would have been compensable as defined by §23-4-1 (2005).4 When a workers’ compensation claim is not filed, the plaintiff will likely be required to prove in the deliberate intent action that his injuries were compensable. This prevents the filing of deliberate intent lawsuits based on non- compensable injuries and places yet another burden on plaintiffs.
II. Cases
Savilla v. Speedway SuperAmerica, LLC, 219 W. Va. 758, 639 S.E.2d 850 (2006).
In Savilla, the Court reconciled the language of W. Va. Code §23-4-2(c) and §55-7-6, the Wrongful Death Statute, in determining the class of people that may recover in a deliberate intention action involving the death of the employee. Section 23-4-2(c) identifies a more narrow class of beneficiaries than is identified in §55-7-6.
In Savilla, Linda Kannaird drowned during a rescue attempt from the convenience store where she worked, Speedway SuperAmerica (“Speedway”). Ms. Kannaird was not married and had only one child, Eugenia Moschgat, who originally filed the suit as personal representative and administratrix of Ms. Kannaird’s estate. Among the allegations against several defendants was deliberate intent against Speedway. When a dispute arose between Ms. Moschgat and one of Ms. Kannaird’s siblings, Diana Savilla, Ms. Kannaird’s sister, replaced Ms. Moschgat as the administratrix of the estate and plaintiff in the lawsuit.
3 W. Va. Code §23-4-2(c) (2005).
4 Compensable injuries are those which occur “in the course of and resulting from . . . covered employment.” W. Va. Code §23-4-1(a). Also included are occupational pneumoconiosis and other occupational diseases as defined by §23-4-1. W. Va. Code §23-4-1(b). Ms. Moschgat, independently of Ms. Savilla, entered into an agreement with Speedway whereby Ms. Moschgat would release her claims against Speedway, Speedway would pay her a sum of money, and Speedway would be dismissed from the lawsuit. Subsequent to this agreement, Speedway filed a Motion to Dismiss arguing that Ms. Savilla lacked standing to prosecute a deliberate intent cause of action under W. Va. Code §23-4-2(c). At issue was the language of W. Va. Code §23-4-2(c), which provides that a “widow, widower, child, or dependent” has the privilege to take and a cause of action against an employer for the death of an employee resulting from the employer’s deliberate intention.5 On the other hand, the West Virginia Wrongful Death Statute, W. Va. Code §55-7-6, provides that damages in a wrongful death action shall be distributed to “spouse and children . . . brother, sisters, parents” and any other dependent of the deceased. Speedway argued that §55-7-6 did not apply to deliberate intent cases.
The Court agreed with Speedway and held that, pursuant to §23-4-2(c), only the “widow, widower, child, or dependent” has a right to recover damages for an employee’s death in a deliberate intent case. To hold otherwise would nullify the explicit directive of §23-4- 2(c). The Court also held that the distribution provided for in §55-7-6 applies to non- deliberate intent cases. According to the Court, under this interpretation, the language of both statutes is given effect.
The Court also addressed the issue of whether a representative of an estate who is not a beneficiary set forth in §23-4-2(c) has standing to prosecute a deliberate intention action. Section 55-7-6 provides that every Wrongful Death action shall be brought by the duly appointed personal representative of the deceased. Section 23-4-2(c) is silent on who has standing to prosecute the action. Therefore, the Court held that the personal representative of an estate –now Ms. Kannaird –has standing to prosecute the deliberate intent action despite the fact that she may not share in the proceeds of any recovery, which are distributed in accordance with §23-4-2(c). The situation thus arises that the course of the litigation and the decision to settle or proceed to trial may rest in the hands of a personal representative who has no stake in the outcome and who may desire that the beneficiaries have no recovery.
Justice Davis, joined by Justice Maynard, wrote a lengthy dissent noting numerous errors in the majority opinion and urged the Court to reconsider its holding. Justice Davis noted that many lawyers have misunderstood that W. Va. Code §23-4-2(c) sets out two causes of action –one for injury and one for death of an employee –and four classes of plaintiffs –the widow/widower, child, dependent, and estate of the deceased. Even though deliberate intent actions are frequently filed only in the name of the personal representative in cases involving a deceased employee, Justice Davis contends that the widow/widower, child, and dependents also have separate causes of action. Should the estate recover, the proceeds should be distributed according to the deceased’s will or pursuant to the principles of intestate succession codified in W. Va. Code §41-1-1, et. seq. Justice Davis does not believe the Wrongful Death Statute applies in any respect to a deliberate intent case. The majority opinion is silent as to distribution when the
5 The 2005 Amendment made no changes to this statutory language. personal representative, on behalf of the deceased, recovers in a deliberate intent suit but there is no “widow, widow, child, or dependent” to collect the proceeds. The majority opinion also eliminates the separate causes of action enjoyed by the widow/widower, children, and dependents.
Justice Davis also contends that the majority opinion violates Rule 17 of the West Virginia Rules of Civil Procedure. Rule 17 provides that “[e]very action shall be prosecuted in the name of the real party in interest.” This Rule allows courts to “hear only those suits brought by persons who possess the right to enforce a claim and who have a significant interest in the litigation.”6 The purpose of the Rule is threefold: “to enable a responding party [defendant] (1) to avail him/herself of evidence and defenses that he/she has against the real party in interest, (2) to assure him/her of finality of judgment, and 3) to protect him/her from another suit later brought by the real party in interest on the same matter.”7 Justice Davis contends these protections afforded by Rule 17 are now gone. The West Virginia Supreme Court denied a Petition for Rehearing on this case on January 11, 2007.
Ryan v. Clonch Indus., Inc., 219 W. Va. 664, 639 S.E.2d 756 (2006).
The Supreme Court decided Ryan v. Clonch on October 27, 2006. This Opinion addresses W. Va. Code §§23-4-2(c)(2)(ii)(B) and (C) (1998), elements two and three of the “five-part test.”Although this Opinion addresses the pre-2005 Amendment statute, it is likely that its holding will apply in some respect to the current statute.
Mr. Ryan filed suit after losing sight in his left eye after being struck by a sharp piece of metal banding material. He was employed by Clonch as a stacker at a lumber yard. After three weeks, he began work as a “banding man,” responsible for measuring, cutting, and placing metal bands around pallets of lumber. He claimed he was not provided and was not wearing safety glasses on the day of his accident. Clonch Industries did not perform any inspection of the work area prior to Mr. Ryan’s work. Mr. Ryan filed a “deliberate intent” suit against Clonch pursuant to W. Va. Code §23-4- 2(c)(2)(ii) (1998).
Judge Johnson granted summary judgment in favor of Clonch because he found no evidence that Clonch had a subjective realization and an appreciation of the existence of the specific unsafe working condition and of the high degree of risk and strong probability of serious injury or death presented by that condition. Judge Johnson also found that Mr. Ryan failed to establish that Clonch violated a safety statute specific to the band cutting process. Mr. Ryan appealed.
6 Savilla, supra at 10 (Davis, J., dissenting) (citing Cleckley, Davis and Palmer, Jr., Litigation Handbook on West Virginia Rules of Civil Procedure, §17(a) at 528-29).
7 Id. Although Mr. Ryan presented expert testimony that Clonch violated several regulations, the Supreme Court focused its attention on the OSHA regulation found at 29 C.F.R. §1910.132(d) (2006). Section 1910.132(d) provides as follows:
(d) Hazard assessment and equipment selection.
(1) The employer shall assess the workplace to determine if hazards are present, or likely to be present, which necessitate the use of personal protective equipment (PPE). If such hazards are present, the employer shall:
(i) Select, and have each affected employee use, the types of PPE that will protect the affected employee from the hazards identified in the hazard assessment;
(ii) Communicate selection decisions to each affected employee; and,
(iii) Select PPE that properly fits each affected employee.
(2) The employer shall verify that the required workplace hazard assessment has been performed through a written certification that identifies the workplace evaluated; the person certifying that the evaluation has been performed; the dates of the hazard assessment; and, which identifies the document as a certification of hazard assessment.
In discovery, Clonch conceded it did not perform the hazard assessment mandated by Section 1910.132(d)(1) and did not require Mr. Ryan to wear safety goggles or other personal protective equipment. Clonch argued that this regulation is one “generally requiring safe workplaces, equipment or working conditions”which was insufficient to satisfy W. Va. Code §23-4-2(c)(2)(ii)(C) (1998).
The Supreme Court found that Section 1910.132(d)(1) is not a regulation “generally requiring safe workplaces, equipment or working conditions” simply because it fails to expressly identify the banding process. According to the Court, only regulations that mention safety in a broad sense and do not impose an affirmative duty on an employer are regulations “generally requiring safe workplaces, equipment or working conditions.”8 To the contrary, the Court found that Section 1910.132(d)(1) imposes a specific duty on employers to assess the workplace for hazards, assess the need for protective equipment, and provide the equipment when needed. The Court noted that because §1910.132 states the employer shall inspect, it is mandatory.
The Court also concluded that Section 1910.32 was specifically applicable to the banding process, finding the circuit court’s interpretation too narrow. The Supreme Court held
8 As an example of such a regulation, the Court cited a regulation that requires employees to be furnished with Aemployment and a place of employment which are free from recognized hazards that are causing or are likely to cause death or serious physical harm to employees.@ that W. Va. Code §23-4-2-(c)(2)(ii)(C) only requires that a statute, rule, or regulation be capable of application to the specific type of work at issue. To clarify, the Court noted that a coal mining regulation cannot be used to impose liability upon a company operating in the lumber industry while a regulation specific to “labor” may apply to several different industries.9
In order to satisfy his burden under W. Va. Code §23-4-2(c)(2)(ii)(B), Mr. Ryan contended he need only show Clonch had a subjective realization that Mr. Ryan was using tin snips to cut metal banding without using eyewear. The Court rejected this interpretation because the statute requires a subjective realization of the “high degree of risk and the strong probability of serious injury or death presented by the specific unsafe working condition.” W. Va. Code §23-4-2(c)(2)(ii)(B). Clonch argued that Mr. Ryan was unable to prove that a Clonch supervisor believed the act of cutting metal banding without safety goggles was an unsafe condition that posed a high degree of risk and a strong probability of serious injury or death. The Court agreed with Clonch on this point, but was troubled by the fact that Clonch had failed to conduct a hazard evaluation.
The Court found that had Clonch complied with the mandatory assessment regulation, it would have either documented evidence that the banding operation was not hazardous and required no PPE or would have discovered the hazards and been required to provide PPE. Essentially, Clonch failed to conduct the hazard assessment and sought to avoid liability based on the lack of a “subjective realization” of a hazard. The Court described this conduct as “unconscionable.” The Court noted that an employer cannot avoid deliberate intent liability by conducting itself “like the proverbial ostrich who sticks his head in the sand to avoid seeing the obvious.” The Court held that where a statute, rule, or regulation imposes a mandatory duty on an employer to assess the workplace for hazards and where the employer fails to conduct the assessment, the performance of which may have identified certain hazards, the employer is estopped from denying it possessed “subjective realization” of the hazard and the employee has met his burden pursuant to W. Va. Code §23-4-2(c)(2)(ii)(B). This appears to be an exception to the “actual knowledge” requirement enunciated in Blevins and Mumaw.
Ryan v. Clonch narrows the type of statute, rule, or regulation that qualifies as “generally requiring safe workplaces, equipment or working conditions” and doesnot satisfy W. Va. Code §23-4-2(c)(2)(ii)(C) (now §23-4-2(d)(2)(ii)(C)). If a statute, rule or regulation imposes a specific affirmative duty on an employer and is capable of application to the work and working condition involved, it is sufficient to satisfy W. Va. Code §23-4- 2(c)(2)(ii)(C). This definition is quite broad and plaintiffs will argue that only the most general industry-specific regulations will now satisfy W. Va. Code §23-4-2(c)(2)(ii)(C). The requirement of a “specific affirmative duty” will likely be the point of argument.
The Court’s holding relating to “subjective realization and appreciation” could be very broad in scope. Essentially, if a statute, rule or regulation imposes an affirmative duty on an employer to conduct an assessment or an inspection and the employer fails to do so,
9 This aspect of the Court’s Opinion applies to cases filed before and after the July 1, 2005, Amendment because the Amendment did not change this section of the statute. and if doing so would arguably have disclosed the situation complained about, the employer is estopped from denying it had a “subjective realization” of any hazard that may have been identified regardless of whether the employer would have determined that condition or practice was actually unsafe. In short, if an inspection was required and the employer failed to conduct the inspection, and the inspection may have revealed the hazard, the plaintiff has met her burden under W. Va. Code §23-4-2(c)(2)(ii)(B). Presumably, if the employer conducts the assessment/inspection and either does not find the condition or does not find it to be unsafe, it may still argue that it did not possess a “subjective realization” or actual knowledge of the condition.
The unresolved issue is whether the estoppel aspect of Ryan v. Clonch applies to the current version of §23-4-2(d)(2)(ii)(B) where “actual knowledge” is required. The argument to the contrary centers on the fact that Ryan v. Clonch was decided under the pre-2005 version of the statute and the Legislature has changed the knowledge requirement. However, this argument may not be adopted by the Court because the previous versions of Section 23-4-2(d)(2)(ii)(B) interpreted “subjective realization and appreciation” as requiring “actual knowledge.” See Blevins and Mumaw, supra. If “actual knowledge” was required when Ryan was decided, there is little reason to believe the estoppel aspect of Ryan v. Clonch will not apply to cases arising under the current version of W. Va. Code §23-4-2(d)(2)(ii).
Sedgmer v. McElroy Coal Co., 640 S.E.2d 129 (W. Va. 2006).
West Virginia Code §23-4-2(d)(2)(ii)(D), the “fourth element” of the deliberate intention statute, requires that the employer intentionally expose the employee to the alleged unsafe condition despite the existence of the first three elements. In Sedgmer, the plaintiff was injured when cars diverted on underground track at a coal mine and his transport vehicle (“man bus”)was struck by the diverted cars. Prior to the accident, an incident involving a derailment occurred resulting in the implementation of company regulations requiring that people disembark the man bus to a safe location when waiting for haulage equipment to pass. State regulations required that persons should move to a safe area when in the vicinity of a switch on the track.
The Court affirmed the grant of summary judgment in favor of McElroy Coal Company. The Court found that, although McElroy was aware of the danger of collisions, they implemented policies to guard against this possibility. The Court found that there was no unsafe working condition and that there was no violation of a federal or state safety statute, rule, or regulation. According to the Court, at most, it was negligence on the part of the foreman to fail to instruct the men to disembark the man bus.
Perhaps most significant in this Opinion is footnote 3, which states the following: “[w]e observe that Appellee, Eugene Sanders, who was Appellant’s foreman, was exposed at all relevant times herein to the same potential risks as Appellant. There is no indication that can be gleaned from the record that Mr. Saunders intended himself or anyone else be injured.” Based on this language, defendants will have strong arguments for summary judgment when the foreman was exposed to the same condition that ultimately injured the plaintiff. Rarely will there be evidence that a foreman intended to injure himself.
Marcus v. Holley, 217 W. Va. 508, 618 S.E.2d 517 (2005).
The Supreme Court’s Opinion in Marcus v. Holley addresses issues ranging from heightened pleading standards to unsafe working conditions to constitutional equal protection. As the holding relating to equal protection is not directly applicable to deliberate intent litigation, it will not be discussed.
The Marcus case arose when Tonya Marcus was riding in a car driven by co-worker Roger Holley and owned by Winans Sanitary Supply, their employer. Although Winans employees typically used their personal vehicle for work-related travel, this instance proved to be an exception because of problems with Mr. Holley’s vehicle. Ms. Marcus was severely injured in a motor vehicle accident that occurred when she and Mr. Holley were returning to Winans after completing a job. Mr. Marcus contended the accident was caused by problems with the brakes, steering, and clutch, which had previously been reported to a Winans supervisor. Winans disputed these claims.
When Winans moved for summary judgment, Mr. Marcus included a claim for deliberate intent, for the first time, in her Response. The trial court entered summary judgment in favor of Winans after thoroughly examining the claim. The Supreme Court first examined the issue of whether Ms. Marcus properly raised a deliberate intent claim. The Court noted that, where immunities are implicated, “the trial court must insist on heightened pleading by the plaintiff.” Id. at 517 (citing Hutchinson v. City of Huntington, 198 W. Va. 1391, 479 S.E.2d 649 (1997); Tolliver v. Kroger Co., 201 W. Va. 509, 498 S.E.2d 702 (1997)). Although Tolliver specifically addressed the pleading requirements under W. Va. Code §23-4-2(d)(2)(i), the pleading requirements also apply to W. Va. Code §23-4-2(d)(2)(ii) pursuant to Marcus.
The Tolliver Court held that pleading the elements of W. Va. Code §23-4-2(d)(2)(i) was sufficient, i.e., that the “employer acted with a consciously, subjectively, and deliberately formed intention to produce the specific result of injury.” Presumably, language in the Complaint mirroring the language of W. Va. Code §23-4-2-(d)(2)(ii)(A-E) is sufficient to satisfy this “heightened pleading” requirement in cases arising under W. Va. Code §23-4- 2(d)(2)(ii). The Court has never delineated the type of allegation that satisfies W. Va. Code §23-4-2(d)(2)(ii)(A-E). At the very least, the Complaint should contain an allegation that the defendant violated each section of 23-4-2(d)(2)(ii)(A-E) and should include the language of each section. The Marcus Court, despite dicta in Tolliver, also held that a deliberate intention allegation must be presented in a Complaint, as opposed to a Response.
Despite finding the claim was improperly raised, the Supreme Court nevertheless discussed the propriety of the deliberate intent claim. The Court noted that the trial court found that the mechanical defects, if they existed, “may create some degree of risk, but certainly do not create a high degree of risk or strong probability of serious injury or death.” Marcus, 618 S.E.2d at 531. The lower court also found that there was insufficient evidence to establish a prima facie case of “subjective realization” under §23- 4-2(d)(2)(ii)(B) (2004). The Supreme Court did not comment on the propriety of this decision.
Instead, the Supreme Court agreed with the trial court’s decision relating to a working condition. The trial court found that, because Mr. Holley only borrowed the employer’s vehicle because his vehicle was experiencing mechanical problems, it was not a “working condition” for Ms. Marcus to ride in the vehicle. The Court cited no cases supporting this finding. This finding is somewhat surprising given that Ms. Marcus was riding in an employer-owned vehicle and, as she was traveling back to her employer’s location from a jobsite, was acting in the course of her employment. This aspect of the opinion is likely dicta, but nevertheless persuasive.
Bias v. Eastern Associated Coal Corp., 640 S.E.2d 540 (W. Va. 2006).
This case stems from an incident which occurred on September 18, 1999 at Eastern Associated Coal’s Harris No. 1 Mine. The plaintiff and two co-workers were working in a section of the mine when they observed a cloud of smoke. A slip switch short circuited and caused the smoke. If operable, the slip switch would have shut the belt down and would have prevented the smoke. The plaintiff and his co-workers, after contacting the supervisor, were instructed to shut down the main belt, which they did. The plaintiff went through several areas of the mine, trying to escape and testified he was very afraid during this time. The plaintiff eventually ran into two mechanics who walked him out of the mine. The plaintiff alleged that he was trapped in smoke for an hour and a half. However, the plaintiff worked the next two days and alleged he became very distraught on the third day. He testified that he began to lose a lot of sleep and had nightmares about being trapped in the mine. He eventually spent nine days in Highland Hospital because of emotional injuries.
The plaintiff filed suit against Eastern Associated Coal Company, his employer, for “deliberate intention” pursuant to West Virginia Code §23-4-2 and also asserted common law claims for intentional and negligent infliction of emotional distress. A question was certified to the West Virginia Supreme Court regarding whether the plaintiff may bring a common law negligence claim against his employer. The plaintiff asserted he was permitted to bring a common law negligence action because West Virginia Code §23-4- 1(f) precludes him from recovering workers’ compensation for “mental-mental” injuries, which are psychological injuries without a physical manifestation.
The Court first held that §23-4-1(f) is a narrowly drawn statute providing that psychological claims without a physical manifestation of an injury are not compensable. The Court determined that this section had no bearing on immunity from common law actions. The Court recognized that an employer can lose the immunity provided by West Virginia Code §23-2-6 by 1) defaulting on payments required by the Workers’ Compensation Act or who is otherwise out of compliance with the Act, 2) by acting with deliberate intention as provided by §23-4-2, and 3) by engaging in other intentional actions, such as discriminatory practices set forth in the Human Rights Act, which the Legislative specifically determines are actionable.
The Court concluded that West Virginia Code §23-2-6 provides sweeping immunity from common law tort liability and negligently caused work-related injuries. Any exception to this rule must be expressly provided by the Legislature. The Court reiterated the three methods by which an employer may lose its common law liability and held that the plaintiff cannot maintain a common law negligence action against his employer for infliction of emotional distress. The fact that the plaintiff is precluded from receiving Workers’ Compensation benefits for this “mental-mental” injury is independent of a plaintiff’s right to file a common law action and is not justification to permit a common law action to be maintained against the employer. Evidence Update
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State ex rel. Allstate Ins. Co. v. Gaughan, 640 S.E.2d 176 (W. Va. 2006).
Defendant below/Petitioner, Allstate Insurance Company (“Allstate”) sought issuance of a Writ of Prohibition arising out of the Circuit Court’s discovery order, which Allstate alleged was overbroad and unduly burdensome.
Plaintiff below/Respondent, Arsenburg’s house was damages as the result of a fire. Arsenburg was an insured of Allstate. Allstate’s adjustor inspected Mr. Arsenburg’s house following the fire as did a contractor. The contractor’s repair estimate was $21,330.48. Allstate approved payment of this amount. Arsenburg decided that instead of hiring the contractor, he was going to perform the repair work himself. Allstate paid the contractor for its initial involvement ($3,957.56) and issued a check to Arsenburg for $14,357.74 or $3,015.18 less than the approved payment of $21,330.48. Arsenburg’s lawyer requested an explanation for the difference and in response Allstate sent the lawyer a check for $993.46 as the “balance of the claim.”
Arsenburg filed a lawsuit against Allstate for beach of contract, breach of the duty of good faith and fair dealing and violation of the West Virginia Unfair Trades Practices Act, W. Va. Code 33-11-1 to 33-11-10. Arsenburg served discovery requests on Allstate, which specifically requested:
[a]ll claims files wherein Allstate deducted and/or withheld monies for alleged profit and/or overhead on first party claims for damage to real property, including dwellings and other structures, in West Virginia for the period from 1983 to the present.
Arsenburg subsequently agreed to limit this request to “first-party, real property damage claim files” in “West Virginia with settlements greater than $2,500.00.” In response, Allstate only provided ten (10) files for 2000 and 2001. Arsenburg requested any additional files for 1993 through 1999 and 2002 and 2004. In response, Allstate filed a Motion for Protective Order and Mr. Arsenburg filed a Motion to Compel. After a hearing on the respective Motions, the Circuit Court granted Arsenburg’s Motion to Compel, finding that although the discovery requests “are burdensome, the discovery requests are not overly burdensome and do not qualify as oppressive.”
The evidentiary issue upon which the petition for Writ was predicated was the application of the factors set forth in Syllabus Point 3 of State Farm Mut. Auto. Ins. Co. v. Stephens, 188 W. Va. 622, 425 S.E.2d 577 (1992), which provided:
Where a claim is made that a discovery request is unduly burdensome under Rule 26(b)(1)(iii) of the West Virginia Rules of Civil Procedure, the trial court should consider several factors. First, a court should weigh the requesting party’s need to obtain the information against the burden that producing the information places on the opposing party. This requires an analysis of the issues in the case, the amount in controversy, and the resources of the parties. Secondly, the opposing party has the obligation to show why the discovery is burdensome unless, in light of the issues, the discovery request is oppressive its face. Finally the court must consider the relevancy and materiality of the information sought.
In affirming the breadth of discovery relative to matters of relevancy and materiality, the Supreme Court of Appeals upheld the Circuit Court’s order. The breadth of this conclusion establishes a direct nexus between Rule 26 and subsequent Evidentiary Rules 401, 402 and 403 balancing tests. Once established as a part of discovery as “relevant” and “material”, subsequent evidentiary challenges to admissibility should be predicated upon other Rules and not the discretionary Rules 401, 402, and 403.
Hatcher v. McBride, No. 32977, 2006 WL 3456480 (W. Va. Nov. 21, 2006).
Appellant, Frederico Hatcher filed a habeas corpus petition, which was denied by the governing Circuit Court. The Supreme Court granted Hatcher’s Petition for Appeal only for the issue of “[w]hether Mr. Hatcher’s sentencing was unfairly prejudiced by highly prejudicial statements made by a Circuit Judge.”
Appellant, Hatcher was indicted by grand jury for the October 22, 1995, murder of a Convenient Food Mart clerk in Huntington, West Virginia. Hatcher was tried and convicted of first degree murder. During the penalty phase of his trial, Judge Alfred Ferguson was called as a witness to testify regarding his “experience with the defendant as a juvenile… .”
The prosecution identified this witness about three (3) hours prior to the penalty phase of the trial. Throughout his testimony, the prosecuting attorney repeatedly referred to him as “Judge Ferguson.” The jury did not recommend mercy and the Circuit Court sentenced Hatcher to “‘Life Without a Recommendation of Mercy.’” The issues presented were whether the: “probative value of the judge’s testimony was grossly outweighed by its unfair prejudice to the appellant” under Rule 403 of the West Virginia Rules of Evidence; whether the “judge’s testimony revealed the judge’s mental thought process in forming an official opinion”; and whether “he [the judge] was testifying beyond his expertise when providing an opinion on the future dangerousness of the appellant.”
The Supreme Court of Appeals found that “there is a potential for abuse through the use of judicial testimony.” Relying on two federal cases, U.S. v. Frankenthal, 582 F.2d 1102 (7th Cir. 1978) and U.S. v. Roth, 332 F. Supp.2d 565 (S.D.N.Y. 2004), the Court held that:
…judges are not per se disqualified from being called as witnesses, but should be called as witnesses with caution.
…a judge who is requested to testify as a witness shall discourage the party from requiring him or her to testify; however, the judge may testify when properly summoned upon approval of the trial court and with such limitations as may be imposed by the trial court.
…in the event a party persists in its effort to require the judge to testify the trial judge shall conduct a hearing and apply the balancing test in Rule 402 of the West Virginia Rules of Evidence. At the hearing, the party calling the witness must (a) state the testimony expected from the judge; (b) explain why the judge’s testimony is relevant and necessary to the party’s case; and (c) describe the efforts made to obtain the same evidence from alternate sources. The party seeking the judge’s testimony must show that the testimony it seeks to introduce is material and favorable to its case, that the testimony is the only possible source of the testimony on the relevant information, and, if the case is being tried before a jury, that the testimony is highly pertinent to the jury’s task. If the judge is called to be a character witness or to give opinion evidence before a jury, the trial judge shall limit the judge’s testimony to a minimum required to assure compliance with Rule 701 of the West Virginia Rules of Evidence.
…when a judge testifies as a witness the examining attorney, the testifying judge and the trial judge shall not refer to the fact that the judge-witness is a ‘judge’ except when the judge’s testimony relates to the exercise of the judge’s judicial function the examining attorney, the testifying judge, and trial judge may refer to the judge by his or her title only to the extent necessary to identify the judge at the beginning of his or her testimony.
… when a judge testifies as a witness before a jury and the testifying judge’s title is expected to be known by members of the jury or is disclosed to the jury, the trial judge shall, both before the judge testifies, and again before the case is submitted to the jury, give a cautionary instruction advising the jury that a judge’s testimony is not entitled to greater weight merely because the witness is a judge.
Kitzmiller v. Jefferson Supply Co., No. 2:05-CV-22, 2006 WL 2473399 (N.D. W. Va. 2006).
In this toxic tort/chemical aerosol exposure claim, plaintiffs alleged that Mrs. Kitzmiller was exposed to toxic cleaning agents during her employment with the Grant County Board of Education, which caused her severe and permanent injury, including severe and chronic respiratory problems, acute chemical sensitivity and nerve damage. The defendant supplier disclosed a toxicologist/pharmacologist as an expert witness. Plaintiffs filed a Motion to Strike Defendant’s toxicologist as an expert witness, because toxicologists are not medical doctors and are not qualified to offer causation opinions.
The issue presented was the threshold competency determination of expert witnesses under Federal Rules 702 and 703 (which are comparable with the West Virginia state rules).
The District Court considered the reasoning in two Third Circuit decisions, In re Paoli R.R. Yard PCB Litigation v. Monsanto Co., 916 F.2d 829 (3d Cir. 1990) and Genty v. Resolution Trust Corp., 937 F.2d 899 (3d Cir. 1991), and an Eight Circuit decision, Marmo v. Tyson Fresh Meats, Inc., 457 F.3d 748 (8th Cir. 2006), since there was no Fourth Circuit case on point.
In In re Paoli R.R. Yard PCB Litigation,
[t]he Third Circuit held: In light of the liberal rule 702 expert qualification standard, we hold that the district court abused its discretion in excluding portions of [the experts’] testimony simply because the experts did not have the degree of training which the district court apparently thought would be most appropriate.
In re Paoli R.R. Yard PCB Litigation, 916 F.2d at 855-56. The Third Circuit considered this issue again in Genty, holding that:
Medical doctors, however, are not the only experts qualified to render an opinion as to the harm caused by exposure to toxic chemicals. The trial court’s exclusion of Brubaker [a toxicologist identified as an expert in this case] without considering his credentials as a doctor of toxicology, simply because he did not possess a medical degree, is inconsistent with expert witness jurisprudence.
Genty, 937 F.2d at 917.
In Marmo, 457 F. 3d at 758, the Eighth Circuit held,
[w]e have previously held that toxicologist may testify that exposure to a chemical caused a person’s symptoms and injuries. Bonner v. ISP Techs., Inc., 259 F.3d 924, 928-31 (8th Cir. 2001); Loudermill v. Dow Chem. Co., 863 F.2d 566, 569-70 (8th Cir. 1988); see also Reference Manual on Scientific Evidence, 401-31 (2d ed. 2000) (recognizing that toxicologists may offer expert opinions on whether exposure to chemicals caused an individual’s injury.)
The Kitzmiller District Court found the “Third and Eighth Circuit cases well-reasoned and instructive” and held that a toxicologist, “may offer expert opinions on whether exposure to [the] chemical[s] caused [Plaintiff’s] injury.” Id.
State v. Bolen, 219 W. Va. 236, 632 S.E.2d 922 (2006).
The Defendant below/Appellant, Matthew Bolen, appealed his conviction of two counts of first degree sexual assault and concurrent terms of fifteen (15) to twenty-five (25) years in prison for this conviction.
Bolen was indicted on two counts of sexual assault and was found guilty of the same by a jury. The issue in this case involved the admissibility of evidence of the personality and religious beliefs of the victim.
During the State’s opening statements, case in chief and closing argument, the prosecuting attorney, referenced, on multiple occasions, “the victims religious beliefs in order bolster the victim’s credibility.” For instance, in opening statements, the prosecuting attorney stated, over the objection of appellant’s counsel:
I believe that the evidence will show you that he is a sensitive man – young man … I believe that the evidence will show you that he has evil in his heart [sic], and I believe for the State that the evidence will show you for the State [sic] that any young man who would come in here before a judge he doesn’t know, before two able and capable public defenders waiting to get at him and before you twelve utter strangers to tell you what occurred in order to get himself straight with himself, to get himself straight with God, and to get himself aligned with the law is courageous and there is no other rationale, no other action that you all can take but believe him under oath and -
In closing arguments, the prosecuting attorney stated:
The verdict shouldn’t really be guilty or not guilty. It should be, ‘We believe [C.J.], seven or eight years old,’ or [C.J.] is a liar, and under the principles of his church, a person who said, ‘I wanted to take up my cross for Christ’ would bear the responsibility of lying to God and to man. That’s your decision. … He is not telling the truth because he wants to come in here and tell twelve people of a perverse act performed on him by a perverse person ten years ago. He is telling it because it’s God’s commandment and the consequences of that brings it here. … Your duty is to find out in your mind as a body to deliberate, is [C.J.] telling the truth or is [C.J] a liar who is going to go to Hell? And I tell you, Ladies and Gentlemen of the Jury, he is carrying his cross every day and hew ill for the rest of his life.
Appellant argued that these comments by the prosecution were offered primarily for the purpose of bolstering his credibility with the jury. The State argued that the evidence was offered to explain why the victim took eight years to come forward with his claims regarding the appellant.
The West Virginia Supreme Court of Appeals agreed with the defendant/Appellant’s argument, applying the factors in Syllabus Point 5 of State v. Potter, 197 W. Va. 734, 478 S.E.2d 742 (1996)10 regarding the admissibility of religious beliefs and/or religious affiliation. The Supreme Court of Appeals concluded that evidence of the victim’s beliefs was not relevant and should have been excluded. The Court stated that the Circuit Court “committed plain error in allowing evidence of a witness’s religious affiliation and
10 Syllabus Point 5 of State v. Potter, 197 W. Va. 734, 478 S.E.2d 742 (1996), provides:
For religious belief or affiliation to be admissible, the trial court must make the following findings: (1) the evidence of religion is offered for a specific purpose other than to show generally that the witness’s credibility is impaired or enhanced; (2) the evidence is relevant for that specific purpose; (3) the trial court makes an on-the-record determination that under Rule 402 of the West Virginia Rules of Evidence that the probative value of the evidence was not substantially outweighed by its potential for unfair prejudice; and (4) the trial court, if requested, delivers an effective limiting instruction advising the jury of the specific purpose(s) for which the evidence may be used. If these elements are met, it may be presumed that the complaining party was protected from undue prejudice. belief and because the State acted improperly in presenting said evidence and in vouching for the victim’s credibility.”The matter was remanded for a new trial.
State v. Ricketts, 219 W. Va. 97, 632 S.E.2d 37 (2006).
The Defendant below/Appellant, Damien Ricketts appealed his conviction for misdemeanor battery. Ricketts had been involved in an altercation with a female roommate and was indicted for malicious assault. Prior to trial, the Circuit Court ruled that the state could not offer evidence of Ricketts’ previous conviction of a felony for delivery of a controlled substance.
During direct examination, counsel for Ricketts did not raise any issues that would have opened the door for this type of evidence. On cross examination, and over objection, the prosecution specifically inquired about the previous conviction.
Q: You were convicted of trafficking in controlled substances, weren’t you?
A: No ma’am.
Q: Distributing control [sic] substances?
A: I don’t believe those are the exact words in the statute, but I believe the wording was possession or-it might’ve been distribution. You might be right ma’am. You know better than I would. … Q: So, you were selling drugs, correct?
A: Not exactly ma’am. I smoked marijuana.
Q: So, you’re saying you weren’t convicted of –
A: I didn’t say I wasn’t convicted, ma’am. What I said is that I wasn’t exactly selling drugs, ma’am.
Q: And your conviction was for delivery a controlled substance?
A: Yes ma’am
Q: That wasn’t possession of a controlled substance?
A: No, ma’am.
Q: That means you were transmitting it to somebody else. A: Yes ma’am.
The State raised the issue of the conviction again during closing arguments. Following closing arguments, the Court gave a limiting instruction regarding the admission of the felony conviction:
Ladies and Gentlemen of the jury, I’m going to do something a bit unusual at this point in the trial. I am going to instruct you to disregard some of the evidence which you heard during the trial of this case, and I’m going to strike that evidence from the record at this point and tell you not to consider it for any purpose whatsoever in your deliberations in this case, and that is the evidence of Mr. Ricketts’ prior conviction. The court has reconsidered an earlier ruling. It’s not admissible and is not to be considered by you for any purpose whatsoever in your deliberations in this case. You are to decide this case based upon all of the other evidence and all of the other evidence alone.
The West Virginia Supreme Court of Appeals found that the Circuit Court erred and held:
… in light of its previous ruling on the matter, the court’s decision to allow the evidence of Ricketts’ prior conviction over the objection of the defense was certainly, ‘arbitrary and irrational’ and represented an abuse of discretion. See State v. McGinnis, 193 W. Va. at 159, 455 S.E.2d at 528. Although the court later realized its mistake and instructed the jury not to consider the evidence, we conclude in view of the prejudicial nature of the evidence, the irreparable harm to Ricketts’ defense had already occurred. Labor & Employment Update
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Mayflower Vehicle Sys., Inc. v. Cheeks, 218 W. Va. 703, 629 S.E.2d 762 (2006).
This case involves claims of race discrimination by two African-American employees against a private employer, on the basis that they were penalized more severely than white employees had been in the past. The Supreme Court of Appeals upheld the Human Rights Commission’s determination that discrimination occurred, where the evidence of record showed that exceptions to the policy in question had been made for white employees, but there was no record of exceptions ever being made for African-American employees.
Mayflower Vehicle Systems, Inc. (“Mayflower”) operated a vehicle-parts manufacturing facility in South Charleston, West Virginia. Pursuant to company policy, employees were allowed to incur eight unexcused absences per year. Upon the occurrence of a ninth unexcused absence, employees were subject to termination. Over the years, Mayflower terminated at least 86 employees under this policy. In some cases, however, employees who violated the policy were not terminated, were terminated and then rehired, or were asked to sign “last chance agreements.”
In 2001, two African-American employees, Cheeks and Lewis, were terminated for violation of the unexcused absence policy. Both employees believed that extenuating circumstances existed which entitled them to rehiring. However, the company refused to reconsider. The employees then filed separate suits with the West Virginia Human Rights Commission, which ultimately consolidated the suits for public hearing. During the hearing, Mayflower introduced evidence of its past termination of employees for the same behavior. The two employees presented evidence that many white individuals had been given multiple chances under the policy, but no African-Americans had ever been rehired or otherwise given a second chance after violating the policy. The Commission found that unlawful discrimination had occurred and awarded back pay, incidental damages, and reinstatement for both employees.
Mayflower appealed the decision to the Circuit Court of Kanawha County, which has jurisdiction over Human Rights Commission appeals where the amount of damages other than back pay exceeds $5,000 or the amount of back pay exceeds $30,000. Otherwise, a petition must be filed directly with the Supreme Court of Appeals. The Commission argued to the Circuit Court that the cases were separate and, therefore, only the Cheeks case met the requisite jurisdictional amount. The Circuit Court agreed and refused to hear Mayflower’s appeal of the Lewis case. The Circuit Court affirmed the Cheeks decision.
Mayflower appealed both decisions to the Supreme Court of Appeals. The Court held that the Commission had consolidated the cases and had never entered an order separating them. Therefore, it was improper for the Circuit Court to treat the cases as separate. Consequently, the Court considered the merits of both cases.
The Court held that the Commission had made out a prima facie case of race discrimination. That is, the Commission had shown that (1) the plaintiffs were members of a protected class, (2) an adverse employment decision had been made, and (3) but for the plaintiffs’ protected status, the decision would not have been made. The Court was persuaded by the fact that the company had often made exceptions to the policy, but “none of those employees who were rehired were African-American.” According to the Court, this evidence was “sufficient to create an inference that unlawful discrimination on the basis of race had occurred.” The Court noted that the justification given by Mayflower -- that the plaintiffs had not fully utilized the grievance procedure whereas the named white employees had -- could not be used to distinguish the cases. Moreover, the Court found sufficient evidence of pretext, given testimony that Mayflower had made false representations about the timeliness of Cheeks’ providing paperwork relating to his absences, and testimony by Lewis that Mayflower officials refused to assist him in fixing absences erroneously recorded as unexcused. As a result, the Court affirmed the Commission’s finding of unlawful race discrimination. However, the Courtdid reverse the award of back pay to Cheeks, and remanded the case to the Circuit Court for a determination of the date when the unlawful discrimination against Cheeks occurred.
Johnson v. Killmer, 219 W. Va. 320, 633 S.E.2d 265 (2006).
This case involves a claim of age discrimination by a woman hired at age 51 and fired ten months later at the age of 52. The Supreme Court of Appeals affirmed summary judgment in favor of the employer, noting that it is very difficult for someone hired and fired by the same decision-maker within a short period of time to claim that their discharge was motivated by age discrimination.
Johnson was hired to work as a billing supervisor for Dr. Killmer, a physician. She was 51 years old at the time of the hiring. She was terminated ten months later and subsequently filed a suit alleging age discrimination. In the suit, Johnson presented evidence of various comments made to her by co-workers and Killmer. Some of the comments did not have anything to do with age. However, on one occasion, a co-worker stated “I can’t believe you’re having sex with your husband. God you’re older than my mother.” Johnson did not report this comment to Killmer. On another occasion, Killmer advised the plaintiff that she had to earn her co-workers’ respect because she was “older.” The plaintiff also alleged that Killmer treated her for a minor procedure one time, and had a hard time inserting the needle in her vein. He allegedly stated “that’s what happens when you get old, your skin gets tough and rubbery.” About six months after beginning her employment with Killmer, Johnson was promoted to the position of office manager “expressly for the purpose of resolving the interpersonal conflicts with the other employees.” After the promotion, two employees threatened to quit if Johnson remained employed. Killmer refused to take any action and those two employees did in fact quit. Johnson continued to have interpersonal problems with other co-workers, none of which appeared to be related to her age. As a result, Killmer demoted her. Then, a day after the demotion, Killmer terminated Johnson on the basis that she had missed work in order to look for another job, and had removed documents from the office.
Johnson filed suit alleging that (1) she was terminated due to her age, and (2) that she had been subjected to age-based harassment during her employment. The Circuit Court of Raleigh County granted summary judgment in favor of Killmer on the basis that the plaintiff could not set forth a prima facie case of age discrimination, and that “no reasonable jury” could find that Johnson had been subjected to “severe and pervasive” harassment based on her age.
On appeal, the Supreme Court of Appeals first noted that Johnson’s claims were based on the West Virginia Human Right Act, and that the Act applied only to employers of twelve or more. Because Killmer had no more than five employees, he was not subject to the Act. Moreover, the Court noted that it had never held that there is a public policy against age discrimination. In any event, the Court addressed Johnson’s two claims “assuming for the sake of argument” that causes of action existed.
The Supreme Court of Appeals affirmed the lower court’s judgment as to both claims. Regarding the termination claim, the Court held that Johnson had not established any evidence that age was a reason for her termination. The Court reasoned that it was especially problematic for a person who was hired at age 51, and then fired ten months later by the very same decision-maker, to prove animus based on age. “Under this set of facts alone, it would be ‘irrational’ to infer that Johnson was fired because of her age.” Moreover, the Court noted that Johnson had actually been promoted at one point, and that Killmer had let two other employees resign instead of firing Johnson earlier. Thus, “in view of Johnson’s lack of evidence on the ‘but for’ element, the circuit court was correct in disposing of this claim at the summary judgment stage.”
In addressing the harassment claim, the Court noted that not every comment about a worker’s age is direct evidence of harassment. In the case at hand, the Court noted that only one of the comments could be considered an “impolite remark to [the plaintiff] concerning her age.” Thus, the Court agreed that Johnson’s complaints mostly related to office pettiness or politics. According to the Court, there was simply no evidence of severe or pervasive age-related harassment.
An interesting part of this case is the Court’s statement that it has never recognized a public policy against age discrimination. However, the Court did not mention that in Syllabus Point 8 of Williamson v. Greene, 200 W. Va. 421, 490 S.E.2d 23 (1997), it held that the Human Rights Act is a source of public policy in the context of a sex discrimination case.
Kalany v. Campbell, 640 S.E.2d 113 (W. Va. 2006).
Mrs. Kalany worked as a part-time waitress and bartender for Campbell, the owner of “Irene’s Bar.” She alleges that, on one occasion,Campbell grabbed her against her will and kissed her on the lips. She claims that she told him to stop it and not to do it again. She completed her shift and then went home and told her husband. Several days later, Mr. Kalany met with Campbell and, after a discussion, the two men “purportedly shook hands.” Several days after this, Campbell laid off Mrs. Kalany “based partly on [her] poor work performance and partly because of the false allegations she made against him.”
The Kalanys filed a complaint against Campell in the Circuit Court of Ohio County. They asserted claims of hostile work environment sexual harassment, retaliatory discharge, battery, intentional infliction of emotional distress, and loss of consortium as to Mr. Kalany. The Human Rights Act and intentional infliction claims were dismissed on motion for judgment as a matter of law. Irene’s Bar did not employ 12 or more people and, therefore, Campbell was not an employer for purposes of the Act. However, the Circuit Court allowed common law claims of sexual harassment and retaliatory discharge, as well as the battery claim to go to the jury. The jury found in favor of Campbell on the sexual harassment and battery claims, but found in favor of Mrs. Kalany on the retaliation claim. Campbell’s post-verdict motion for judgment as a matter of law was denied, and he appealed.
On appeal, Campbell argued that, because the jury found against Mrs. Kalany on the sexual harassment claim, the factual predicate for a retaliation finding was missing. The Supreme Court of Appeals disagreed and upheld the jury verdict, noting that one does not have to prove that actual harassment occurred in order to be successful on a retaliation claim. They need only prove that they were retaliated against for “expressing opposition to a practice that he or she reasonably and in good faith believes violates the provisions of the West Virginia Human Rights Act.” Even though Campbell was not subject to the Human Rights Act, the Court pointed out that it has previously held that “sex discrimination and sexual harassment in employment contravene the public policy of this State.” See Williamson v. Greene, 490 S.E.2d 23 (W. Va. 1997). And, of course, it would be illegal for Campbell to retaliate against someone who alleged that he violated this public policy. Thus, it was legally permissible for the jury to find in Mrs. Kalany’s favor on the retaliation claim even though they found against her on the harassment claim. Although the Court upheld the jury’s verdict on the retaliation claim, it did reverse that portion of the Circuit Court’s order which awarded the Kalanys attorney fees under the Human Rights Act. The Court held that the Act did not apply to this case for any purpose because Campbell had less than twelve employees. Legg v. Felinton, 219 W. Va. 478, 637 S.E.2d 576 (2006).
This case involves the drug testing and subsequent termination of an employee by a public employer. The Supreme Court of Appeals held that a firefighter was properly terminated where he faked his drug test by providing water instead of urine.
Huntington firefighter, Michael Giannini, who will be the subject of the next case summary, was arrested for possession of crack cocaine in April of 2004. Mr. Giannini subsequently implicated Captain Earl F. Legg, Jr. in the smoking of crack cocaine and consumption of beer while on duty. Based on this information, along with the fact that Mr. Legg had sustained a prior DUI, had used a lot of sick leave, and had exhibited an “alteration in personality,” the City determined that it had the right to drug test Mr. Legg on the basis of “reasonable suspicion.” The test was performed, but a review of the results revealed that Mr. Legg had provided water, and not urine, to the lab. A retest confirmed this finding. Thus, Mr. Legg was suspended without pay pending termination. Under applicable state law, punitive action is not normally allowed until after a hearing. However, the City cited “exigent circumstances,” which allowed them to institute punitive action prior to a hearing.
A hearing board composed of three firefighters found a lack of reasonable suspicion for the drug test. On appeal from this decision, the Firemen’s Civil Service Commission found that reasonable suspicion for the drug test did exist, and also that exigent circumstances existed for suspension prior to the hearing. The Circuit Court of Cabell County reversed and the City appealed to the Supreme Court of Appeals.
The Supreme Court of Appeals reversed, and reinstated the Commission’s termination of Mr. Legg. First, the Court found that the lower court had incorrectly applied the “exigent circumstances” requirement to the actual drug test. According to the Court, this language in the West Virginia Code actually applied to the decision to suspend without first holding a hearing. The Court noted that the test for drug testing was whether “reasonable suspicion” existed. Further, the Court stated that judicial review of the Commission is limited to circumstances in which the Commission’s decision is clearly erroneous, arbitrary, capricious, an abuse of discretion, or otherwise contrary to law. Based on this standard, the Court held that the Circuit Court should have upheld the City’s decision to drug test Mr. Legg, based on the extensive evidence and testimony of record that Mr. Legg had exhibited “actions and behaviors” consistent with illicit drug use.
Second, the Court held that the Commission’s order regarding the existence of exigent circumstances justifying punitive action prior to a hearing must stand. “Safety issues have consistently been identified as paramount concerns where an employee is possibly using illicit drugs.” The Court cited testimony from the Fire Chief that the safety of other firefighters, as well as citizens of Huntington, would have been endangered by the continued employment of Mr. Legg. Thus, Mr. Legg’s termination was reinstated. Would Mr. Giannini fare any better? Giannini v. Firemen’s Civil Service Comm’n of Huntington, 640 S.E.2d 122 (W. Va. 2006).
In this case, the Supreme Court of Appeals held that a firefighter was properly terminated after being arrested for possession of crack cocaine.
Huntington Firefighter Michael Giannini was arrested on April 10, 2004 for possession of crack cocaine. On April 14, 2004, Mr. Giannini’s employment with the City of Huntington Fire Department was suspended. On July 14, 2004, the Firemem’s Hearing Board reinstated Mr. Giannini based on his history as an “exemplary firefighter,” the fact that he had no prior disciplinary action against him, and the fact that he had not actually been under the influence while on the job. Upon appeal by the City, the Firemen’s Civil Service Commission reversed the Hearing Board, finding that Mr. Giannini had violated the General Rules and Regulations of the Fire Department. On further appeal, the Circuit Court of Cabell County reversed the Commission, finding that the City lacked just cause to terminate Mr. Giannini’s employment. The City appealed to theSupreme Court of Appeals, asking that its termination decision be reinstated.
On appeal, the Court noted that a Commission decision should not be reversed “unless it is clearly wrong or is based upon a mistake of law.” The Court held that the Circuit Court’s reversal of the Commission’s decision was improper. “This Court holds that a firefighter’s possession of cocaine or crack cocaine constitutes misconduct of a substantial nature specifically related to and affecting the ability to perform tasks inherent in the employment and directly affecting the rights and interests of the public. A firefighter’s job is characterized by his or her responsibility to the public, and the health and mental acuity of public safety personnel are of utmost significance.”
In addressing Mr. Giannini’s argument that the City disciplined him more harshly than other employees who had been found guilty of DUI and not terminated, the Court stated that these were two entirely different violations: “one involves abuse of a legalsubstance and one involves acquisition and possession of an illegal substance.”
The Court was also unpersuaded by Giannini’s argument that the lack of laboratory testing on the substance found in his possession should have impacted the termination decision. The Court noted that, although the substance in question was only field tested, the administrative proceeding was not burdened by the criminal standard of “beyond a reasonable doubt.” Thus, testimony from a police officer on the accuracy of field testing of drugs was enough for the Commission to find that the substance was cocaine, based on a preponderance of the evidence.
Based on these findings, the Court held the “Commission’s findings were not clearly wrong, based upon mistake of law, arbitrary, capricious, an abuse of discretion, or otherwise contrary to law.” Therefore, the Circuit Court’s decision was reversed and the City’s termination of Mr. Giannini was reinstated. Insurance Law Update
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Strahin v. Sullivan, No. 33091, 2007 WL 559219 (W. Va. Feb. 21, 2007).
In this case, the court held that in order for an insured or an assignee of an insured to recover the amount of a verdict in excess of the applicable insurance policy limits from an insurer pursuant to Shamblin v. Nationwide Mut. Ins. Co., 183 W. Va. 585, 396 S.E.2d 766 (1990), the insured must be actually exposed to personal liability in excess of the policy limits at the time the excess verdict is rendered.
Daniel Strahin was shot by Robert Cleavenger in 1998 while he was a guest on property owned by Earl Sullivan. The Strahins sued both Mr. Cleavenger and Mr. Sullivan. Mr. Sullivan was insured under a homeowner’s policy issued by Farmers & Mechanics Insurance Coverage. That policy had a $1,000,000.00 policy limit. Prior to trial, the Strahins made two formal policy limits demands, which he would accept in exchange for a full and final release of Mr. Sullivan. Farmers & Mechanics rejected the demands.
Prior to trial, the Strahins, Mr. Sullivan, and Mr. Sullivan’s automobile insurer, Erie Insurance Company, entered into an Assignment and Covenant not to Execute. Pursuant to the assignment, the Strahins received $25,000.00 which represented the automobile bodily injury liability limits. In addition, Mr. Sullivan assigned to the Strahins
all of his rights, presently existing or which may hereafter arise, whether in contract or tort, to seek compensation indemnity, defense, compensatory damages, punitive damages, relating to or arising from the Farmers & Mechanics Policy, including but not limited to all claims based on unfair settlement practices, Bad Faith, or refusal to provide defense and/or indemnity.
In exchange, the Strahins promised not to execute upon the personal assets of Mr. Sullivan to recover payments to satisfy any judgment that may be entered against him. The assignment also stated: “Any judgment which may hereinafter be acquired by plaintiffs against Earl Sullivan, shall not be at any time recordable by any party nor at any time become recordable in any county clerk’s office in West Virginia or in any other place where it would become a public document.” Approximately one year later, the case proceeded to trial and a jury awarded a verdict of $1,060,556.00 in favor of Mr. Strahin against Mr. Cleavenger and Mr. Sullivan. The jury assessed 70% of the fault on Mr. Cleavenger because of his intentional act and 30% of the fault on Mr. Sullivan. The court found Mr. Sullivan jointly and severally liable for the entire verdict. Thereafter, while the appeal of that matter was pending, Mr. Strahin amended his complaint to assert a claim against Farmers & Mechanics Insurance Company, Mr. Sullivan’s homeowner’s insurer, pursuant to Shamblin v. Nationwide Mut. Ins. Co., 183 W. Va. 585, 396 S.E.2d 766 (1990), which had been assigned to him prior to trial. The trial court granted summary judgment in favor of Farmer’s & Mechanics on the Shamblin claim. The Strahins appealed.
The West Virginia Supreme Court of Appeals held that the trial court’s grant of summary judgment was appropriate because the Strahins could not satisfy that the insured was protected by the covenant not to execute and, therefore, was not damaged by the insurer’s failure to settle within the policy limits. In reaching its decision, the court noted that Shamblin cases are assignable. However, the assignee must still satisfy all of the elements of the cause of action. The court reasoned that, under Shamblin, the insurer has the duty to prove, “by clear and convincing evidence, that it attempted in good faith to negotiate a settlement, that any failure to enter into a settlement where the opportunity to do so existed was based on reasonable and substantial grounds, and that it accorded the interests and rights of the insured at least as great a respect as its own.” Shamblin, Syl. Pts. 3-4, 183 W. Va. 585, 396 S.E.2d 766. The Court recognized that the Shamblin standard is a “hybrid negligence-strict liability” standard, the cause of action requires that there be a negligent refusal to settle the claim and a subsequent harm to the insured. Therefore, in order to state a Shamblin claim, “the insured’s personal assets must be at risk.”
The Agreement entered into between the Strahins, Mr. Sullivan and Erie, however, provided that Mr. Sullivan’s personal assets would never be at risk. “As a result, Mr. Sullivan was not ‘injured’ when the jury returned a verdict against him in excess of his homeowner’s policy limits.”
Gauze v. Reed, 219 W. Va. 381, 633 S.E.2d 326 (2006).
In this case, the Court held that when an insurance company (a) issues a primary liability insurance policy; and (b) has contracted for and received a premium for a risk as though it were a primary insurer; but (c) the insurance company has become a secondary insurer by operation of an “other insurance” clause in the policy and the existence of another primary insurance carrier, then if that other insurance carrier is declared insolvent, the insurance company is responsible for coverage of the loss as though it were the sole primary liability insurer.
Walter Gauze filed a complaint relating to an automobile accident that occurred on September 4, 2001, wherein he alleged that Chidetta Reed negligently operated a 1993 Ford Escort, causing him to be ejected from the front passenger seat and sustain injuries. The Ford Escort was owned by the Human Resource Development Foundation (“Foundation”), a non-profit agency that manages the state-funded “Wheels to Work Program.” The vehicle was leased to Ms. Reed prior to the accident and, as part of the lease agreement, the Foundation agreed to provide insurance coverage on the vehicle. Pursuant to that agreement, the Foundation purchased auto liability coverage from Oak Casualty Insurance Company, with per person liability limits of $100,000.00.
The Foundation also qualified for insurance coverage provided through the State by the Board of Risk and Insurance Management (“BRIM”). The coverage purchased by BRIM for the Foundation is provided by National Union Fire Insurance Company (“National Union”) and has limits of liability of $1,000,000.00 per occurrence.
After the accident, Oak Casualty Insurance Company was declared insolvent. As a result of the insolvency order, the West Virginia Insurance Guaranty Association stepped into Oak Casualty’s place and defended Ms. Reed. Since West Virginia law requires that a plaintiff exhaust all potential sources of coverage before recovering from the Guaranty Association, W. Va. Code §33-26-12(a), the Guaranty Association moved to compel Mr. Gauze to serve the other solvent insurers of the Wheels-to-Work Program. Specifically, the Guaranty Association claimed that the liability policy provided by National Union contained solvent coverage for the claims that required exhaustion before any monies could be recovered from the Guaranty Association.
National Union objected, contending that the policy was an excess policy, excess to the Oak Casualty policy issued to the Foundation, and that its responsibilities would only be triggered when the Guaranty Association exhausted its obligation to provide primary coverage. As part of its argument, National Union referenced the “other insurance” clause, which provided:
For any covered “auto” you own, this Coverage Form provides primary insurance. For any covered “auto” you don’t own, the insurance provided by this Coverage Form is excess over any other collectible insurance.
The trial court rejected National Union’s argument that its policy was nothing more than an excess policy. The West Virginia Supreme Court of Appeals affirmed the trial court’s summary judgment decision in favor of the Guaranty Association.
The court recognized that the general rule is that a pure excess carrier does not “drop down” into the shoes of a primary carrier who has become insolvent and, therefore, become a layer of insurance that requires exhaustion prior to any obligation by monies available through a guaranty fund. In that instance, the guaranty association is obligated to step into the shoes of the insolvent carrier and fulfill that carrier’s obligations prior to invoking any obligation on the part of the excess carrier. The court then look at the issue of whether the National Union policy is a primary or an excess policy, the court noted that the National Union policy is not a “pure excess” policy. First, the policy does not provide specific coverage above a defined underlying limit of primary insurance. Moreover, there is nothing in the policy that indicates the insured was required to maintain a certain level of primary insurance in force. Conversely, the court found that the policy bears all of the characteristics of a primary policy –it provides for the first layer of coverage unless there is some other insurance; the premium was consistent with the greater liability exposure of a primary policy. The court characterizes National Union as a “secondarily liable carrier” and states that, accordingly the “drop down” rules applicable to pure excess carriers are not applicable.
Erie Ins. Prop. & Cas. Co. v. Smith, No. 5:05-CV-01137, 2006 WL 3733319,(S.D. W. Va. Dec. 15, 2006).
In this case the court ruled that the insurer had no duty to defend or indemnify under homeowner’s policy with respect to a claim that the insured intentionally misrepresented the condition of a condominium to a seller prior to the sale of the condominium because the alleged misconduct was not an “occurrence” that caused any “property damage.”
On April 29, 2004, Juanita Smith entered into a contract for the purchase of a condominium owned by Kenneth and Gwendolyn Cooper. At the time, the Coopers executed a disclosure statement that stated that they had no knowledge of any “leaks, backups or other problems relating to any plumbing, water and sewage related items.” On June 1, 2004, the parties to the contract executed a deed of conveyance, formally conveying the condominium to Ms. Smith. Soon after, Ms. Smith sued the Coopers, alleging that they intentionally failed to disclose defects during the sale. Specifically, she alleged that the Coopers failed to disclose that the plumbing pipes and components beneath the condominium unit were installed with an improper backfall and that the surface water runoff on the exterior of the condominium unit caused flooding.
The Coopers forwarded a copy of the complaint to their homeowners’ insurer, Erie Insurance Property & Casualty Co. (“Erie”). Erie then filed a declaratory judgment action, seeking that it had no duty to defend or indemnify under the policy. The court granted Erie’s motion for summary judgment.
First, the court recognized that Ms. Smith’s complaint sought damages for economic losses she sustained as a result of the alleged intentional failure. Second, the court then that the damages sought do not fall within the policy’s definition of “property damage” because the complaint (1) did not involve allegations of physical injury to or destruction of property and (2) did not allege the loss of use of tangible property that resulted from an “accident.” The court recognized, in reaching the holding, that the allegations were that the Coopers intentionally failed to disclose the condition. Third, the court held that the complaint did not allege facts that would trigger the policy’s coverage for bodily injury because it did not allege any physical harm, sickness, disease or mental anguish as a result of the alleged misconduct. Finally, the court noted that the allegations in the complaint did not fall within the policy’s definition of “personal injury.”
The allegations of intentional misconduct, according to the court, did not satisfy the policy definition of “occurrence” and, therefore, fell outside the scope of available coverage. Under the policy, an “occurrence” is defined as “an accident, including continuous or repeated exposure to the same general harmful condition.” Intentional conduct, the court noted, can never be “accidental.”
Elkins v. Nationwide Mut. Ins. Co., 2006 U.S. Dist. LEXIS, No. 5:05-0684 (S.D. W. Va. Mar. 10, 2006).
In this case the court held that an insurance company has no duty to pay a claim under an automobile liability insurance policy if the claimant will not release its insured from liability for the accident giving rise to the claim.
On November 3, 2002, Kelly Elkins was a passenger in her own vehicle, which was traveling southbound lane of I-77. Rebecca Lewis was driving her vehicle in the northbound lane of I-77, crossed the median and collided with the Elkins vehicle in the southbound lane of I-77. Nationwide Mutual Insurance Company (“Nationwide”) insured the Lewis vehicle under liability limits of $100,000 per person and $300,000 per occurrence. Nationwide accepted that it was accepting 90% of its insured fault for the accident and offered to pay its full $100,000 policy limit to Ms. Elkins, conditioned upon her execution of a full release of its insured. A couple months later, Ms. Elkins rejected that offer and offered to execute a partial release in favor of Ms. Lewis, but only for the first $400,000 of any judgment obtained, in exchange for the $100,000 policy limit. Nationwide rejected the demand and maintained its previous settlement position.
Nationwide made the same offer several times, but Ms. Elkins refused to release its insured in exchange for the payment.
Thereafter, Ms. Elkins filed suit against Nationwide for violations of the Unfair Trade Practices Act, W. Va. Code § 33-11-4(9). As a basis for her claim, Ms. Elkins cites that Nationwide asked her to execute a full release in exchange for the tender of policy limits.
Following the decision of the United States District Court for the Northern District of West Virginia in Gallagher v. Allstate Ins. Co., 74 F. Supp.2d 652, 656 (N.D. W. Va. 1999), the court held that it is not a violation of the West Virginia Unfair Trade Practices Act for an insurer to refuse to settle for policy limits if the claimant will not execute a full release for its insured. The court’s reasoning was based on the settled principle that an insurance company “must accord its insured’s interests at least as much respect as its own.” Recognizing the adversarial nature of a third-party claim and the fact that the insurer has a duty to its insured, the court stated: “the law does not expect a defendant to subordinate its interests, or those of its insured, to parties situated as a plaintiff.”
Grubbs v. Westfield Ins. Co., 430 F. Supp.2d 563 (N.D. W. Va. 2006).
In this case the court held that an insurance adjuster employed by an insurer cannot be held personally liable for common law bad faith because the adjuster is not a party to the insurance contract. The Grubbs purchased a home on September 19, 2002, from the Sokos. After moving in, the Grubbs discovered structural damage in the home. In August, 2003, they submitted a property damage claim to their homeowners insurer, Westfield Insurance Company. In December, 2003, Westfield denied the claim. Thereafter, the Grubbs filed suit against the Sokos and their home inspector alleging the failure to properly disclose the damaged condition of the home. The Sokos filed a counterclaim, alleging breach of contract, intentional and negligent infliction of emotional distress and malicious prosecution. He Grubbs submitted the counterclaim to Westfield, asking for coverage for the allegations contained therein. The Grubbs settled with both the inspector and the Sokos. In exchange for a release from the Grubbs of any claims against him, the home inspector bought the home from the Grubbs for the initial purchase price. Several months later, the Grubbs and Sokos settled their dispute, and agreed to dismiss all pending claims with prejudice. Thereafter, Westfield denied the Grubbs’ claim for reimbursement of legal expenses.
The Grubbs then sued Westfield and its adjuster, John Drennan, asking for a declaration as to Westfield’s rights and obligations under the policy. Westfield removed the case to federal court, asserting that Drennan, a West Virginia resident, was fraudulently joined as a defendant and, therefore, should be disregarded for purposes of determine whether the Court has diversity of citizenship jurisdiction. The Grubbs moved to remand, arguing that the complaint was intended to seek a declaratory judgment against Westfield and common law bad faith against Westfield and Drennan.
The Court denied the motion to remand, finding that Drennan was fraudulent joined. The court based its decision on the fact that, because insurance adjusters are not parties to an insurance contract, no cause of action for common law bad faith can lie against them. The court then noted that West Virginia law prohibits an insurance adjuster from representing both a claimant and an insurer on the same claim, in order to avoid creation of a conflict of interest. The court stated: “West Virginia’s law clearly indicates that, while insurance companies owe a duty of good faith and fair dealing to their insureds, agents and adjusters owe their allegiance solely to the insurance company.” In its analysis of the issue, the court distinguished claims against an adjuster that are brought under the West Virginia Unfair Trade Practices Act by noting that liability of an adjuster under that Act “arises from a positive duty created by statute and not from the common law.” The court then held: “[b]ecause common law bad faith is not an independent tort that can be established outside a contractual relationship and Drennan is not a party to any contract between the Grubbs and Westfield, he cannot be held personally liable under West Virginia law for performing the assigned duties of his employment.” Accordingly, the court held that Drennan was fraudulently joined as a party, denied the Grubbs’ motion to remand and entered an order dismissing the claims against Drennan. Horace Mann Ins. Co. v. General Star Nat’lIns. Co., No. 1:04-CV-163, 2006 U.S. Dist. LEXIS 72245 (N.D. W. Va. Sept. 29, 2006).
In this case the court ruled that West Virginia law does not support the application of the “Allstate Rule” to a policy that was never designed to provide primary coverage, but was designed only to provide excess coverage to the primary and umbrella coverage.
In January, 2004, the parents of a DuVall High School student sued the Lincoln County Board of Education and several of its employees, alleging that, during the 2002-2003 school year, the student, then a seventh-grade student, was sexually abused by a teacher. The plaintiffs also alleged that the Lincoln County Board of Education and/or its employees breached their duties of care by negligently failing to supervise the teacher.
The State Board of Risk and Insurance Management is required, by West Virginia law, to purchase at least one million dollars of primary liability insurance coverage and at least five million dollars of excess coverage on behalf of all county boards of education and their employees. See W. Va. Code §29-12-5a (2000). In accordance with the statutory mandate, the Lincoln County Board of Education had a primary liability policy, with a $1 Million policy limit, covering the claims asserted in the underlying action against employees of the Lincoln County Board of Education, including David Bell. In addition and also in accordance with the statutory requirement, the Lincoln County Board of Education was insured under an excess policy issued by General Star, which has a policy limit of $5 Million (the “General Star Policy”). The General Star Policy stated in pertinent part:
If other valid and collectible insurance with any other insurer is available to the insured covering a loss also covered by this Policy, other than insurance that is in excess of the insurance afforded by this Policy, the insurance afforded by this Policy shall be in excess of and shall not contribute with such other insurance. Nothing herein shall be construed to make this Policy subject to the terms, conditions, and limitations of other insurance, reinsurance or indemnity.
Horace Mann issued a National Education Association Educators Employment Liability Insurance Policy to Unified Members of the National Education Association, including David Bell. The Horace Mann Policy provided in pertinent part:
This is a manuscript contract and is personal to the individual named herein. It was written and priced to reflect the intent of all parties that this policy is in excess of any and all other insurance policies, insurance programs, self-insurance programs, and defense and indemnification arrangements whether primary, excess, umbrella or contingent and whether collectible or not, to which the insured is entitled or should have been entitled, by contract or operation of law, to coverage or to payment including, but not limited to, payment of defense and/or indemnification. Further, it is the intent of the parties that the coverage afforded in this policy does not apply if the insured has other valid and collectible insurance of any kind whatsoever whether primary or excess, or if the insured is entitled to defense or indemnification from any other source whatsoever, including, by way of example only, such sources as state statutory entitlements or provisions, except any excess beyond the amount which would have been payable under such other policy or policies or insurance program or defense or indemnification arrangement had this policy not been in effect. Other valid and collectible insurance includes, but is not limited to, policies or insurance programs of self-insurance purchased or established by or on behalf of an educational unit to insure against liability arising from activities of the educational unit or its employees regardless of whether or not the policy or program provides primary, excess, umbrella, or contingent coverage. The insured shall cooperate with the Company to determine the existence, availability and coverage of any such other insurance policy, insurance program or defense or indemnification arrangement.
This policy is specifically excess over coverage provided by school district or school board errors and omissions or general liability policies purchased by the insured’semployer or former employer and it is specifically excess over coverage provided by any School Leaders Errors and Omissions Policy purchased by the insured’semployer or former employer and it is specifically excess over coverage provided by any policy of insurance which purports to be excess to or recites that it is excess to a policy issued to the insured for the benefit of members of the National Education Association.
Following mediation on April 29, 2004, the claims asserted in the underlying civil action were settled in consideration for the payment of the limits of the National Union Fire Policy and a contribution from the General Star Policy, which contribution did not exhaust the policy limits of the General Star Policy. General Star claimed that it is entitled to contribution from Horace Mann.
Horace Mann filed its amended complaint seeking declaratory relief on August 24, 2004. On September 13, 2004, General Star filed its answer to Horace Mann’s amended complaint and its counterclaim for declaratory relief and for contribution to the settlement in the underlying Civil Action. On cross-motions for summary judgment, the District Court granted Horace Mann’s motion and denied General Star’s motion, holding that the policy issued by Horace Mann was excess to the policy issued by General Star and that Horace Mann, therefore, has no obligation to reimburse General Star for monies it paid in settlement of the underlying civil action.
The court held that the facts of the case and the “total policy insuring intent” of both the General Star Policy and the Horace Mann Policy do not support the application of the “Allstate Rule,” which provides that where an automobile policy providing primarily primary coverage that is made excess by operation of the fact that a non-owed vehicle is involved in an accident and an umbrella policy are in conflict, the umbrella policy need not contribute until after the primary and ordinary excess coverages are exhausted. See Allstate Ins. Co. v. Am. Hardware Mut. Insu. Co., 865 F.2d 592 (4th Cir. 1989). The court noted that overall insuring schemes of the policies at issue demonstrate that the Horace Mann Policy is contractually excess to the General Star Policy. The court noted that the language of the “other insurance” provision of the Horace Mann Policy plainly establishes that the Horace Mann policy can never be primary to any other policy. The General Star Policy, in contrast, provides that “if other valid and collectible insurance with any other insurer is available to the insured covering a loss also covered by this Policy, other than insurance that is excess of the insurance afforded by this Policy, the insurance afforded by this Policy shall be in excess of and shall not contribute with other such insurance.” The court specifically noted in its decision the fact that the policy language comports with the legal requirements for liability insurance coverage placed on boards of education is further evidence that the Horace Mann Policy is excess to the General Star Policy. See W. Va. Code § 29-12-5a (requiring that the Lincoln County Board of Education, through the Board of Risk and Insurance Management, carry a package of insurance with minimal limits of one million dollars of primary coverage and five million dollars of excess coverage). The court then noted that the National Union Fire Policy satisfied the $1 Million primary liability coverage requirement, and the General Star Policy satisfied the excess requirement.
In addition to the distinguishable nature of the insuring schemes at issue, the court noted that the cases cited in support of the “Allstate Rule” are factually distinguishable from this case because those cases involved primary coverage that became excess by virtue of the fact that a non-owned vehicle was involved in the accident. In contrast, the Horace Mann Policy was always intended to provide excess coverage to the umbrella insurance provided by the General Star Policy.
The court’s reasoning also recognized that there is no ambiguity in the “other insurance” clause of the Horace Mann Policy that would render it excess to the General Star Policy. The court first held that the “other insurance” provision’s language which states the policies to which the Horace Mann Policy should be considered excess does not create an ambiguity in the policy language. Moreover, the “other insurance” provision of the Horace Mann Policy does not contain an “escape clause” that would render the Horace Mann Policy primary to the General Star Policy. Mass Tort & Class Action Update
Matthew A. Kelly Erik W. Legg Farrell, Farrell & Farrell, PLLC Post Office Box 6457 Huntington, West Virginia (304) 522-9100 –Telephone (304) 522-9162 –Fax [email protected] [email protected]
In re Tobacco Litigation, 218 W. Va. 301, 624 S.E.2d 738 (2005).
On January 11, 2000, the Circuit Court of Ohio County, Judge Arthur Recht presiding, entered a “Case Management Order/Trial Plan” that ordered the consolidation of all pending personal injury tobacco cases into a single consolidated trial, with the trial issues to be bifurcated into two phases. Phase I of the trial would decide certain elements of liability and a punitive damages multiplier, and Phase II of the trial would decide for each plaintiff compensatory damages and punitive damages based upon the punitive damages multiplier determined in Phase I.
After motion by the defendant tobacco companies, the circuit court vacated and set aside the January 11, 2000 trial plan order. The circuit court then certified the question below to the Supreme Court.
The issue in the case was: Does the Due Process Clause of the Fourteenth Amendment to the Federal Constitution, as interpreted by State Farm v. Campbell, 543 U.S. 874 (2004) precluded a bifurcated trial plan in a consolidated action consisting of personal injury claims of approximately 1,000 individual smokers, where Phase I of the trial would decide certain elements of liability and a punitive damages multiplier and Phase II of the trial would decide for each plaintiff compensatory damages and punitive damages based upon the punitive damages multiplier determined in Phase I?
The Court held that it did not. The Supreme Court emphasized that the question before the court was narrow. It found nothing in Campbell that: 1.) mandated a reexamination of the existing system of mass litigation; or 2.) per se precluded a bifurcated trial plan in which a punitive damage multiplier is established prior to the determination of individual compensatory damages.
The Supreme Court noted that Campbell stands for the principle that “a defendant’s dissimilar acts, independent from the acts upon which liability was premised, may not serve as the basis for punitive damages. A defendant should be punished for the conduct that harmed the plaintiff, not for being an unsavory individual or business.” In application of this principle, it is the role of the circuit court to ensure that the plaintiff’s evidence is relevant, reasonably related to the acts upon which liability is premised, and supports their clam for punitive damages.
The Supreme Court disagreed with the contention that by determining a punitive damages multiplier prior to determining individual compensatory damages, there is no way to ensure the proper ratio between the two. It noted its prior recognition of a trial court’s duty to review punitive damage awards, and stated its confidence that once compensatory and punitive damages awards are determined, the trial court can review each of the awards to ensure that it comports with the principles articulated in Campbell and other cases.
State ex rel. Taylor v. Nibert, No. 33175, 2006 WL 3456645 (W. Va. Nov. 30, 2006).
Petitioners were plaintiffs in three separate cases where Nationwide Mutual Insurance Company was named as a party defendant for its alleged failure to pay the full amount of uninsured and underinsured motorist coverage benefits under certain automobile insurance policies. Petitioners claimed that their cases were transferred from their chosen forums to Roane County without any prior notice and that their cases were consolidated with twenty other civil actions around West Virginia into a pending class action by Transfer Order entered on January 27, 2005.
The Transfer Order indicated the cases were transferred and consolidated pursuant to W. Va. R. Civ. P. 42(b) for “the purpose of enabling the Settlement Parties to proceed with a settlement of this matter.” On the same day the Transfer Order was entered, the circuit court also entered a Class Certification Order which conditionally certified two classes based upon a stipulation between Nationwide and the class representatives.
The petitioners’ objections to the transfer of their cases was rejected. Thereafter, they filed a motion to decertify the class action into which their cases had been consolidated, which was denied. In its order, the circuit court stated that its class certification was truly unique and that it amounted to a “temporary certification” with “no binding effect” and was “geared solely to the limited goal of putting the entirety of this litigation on a proper platform and schedule [for discovery purposes].” The petitioners then filed a petition for writ of prohibition.
The issue in this case was whether the circuit court exceeded its legitimate powers by transferring the petitioners’ cases to Roane County pursuant to W. Va. R. Civ. P. 42(b). The Court found that it did. The Supreme Court ruled that the petitioners’ cases should not have been transferred, and granted the writ of prohibition as moulded. The Court held that when a motion is made to have an action transferred pursuant to W. Va. R. Civ. P. 42(b), the movant must give notice to all parties in the cases to be transferred, and the parties in the cases to be transferred must be given the opportunity to object prior to the transfer. If requested, the transferring court shall hold a hearing to determine whether the transfer is proper under Rule 42(b). W. Va. R. Civ. P. 42 (b) only mandates transfer when cases arise out of the same transaction or occurrence. Utilizing the “logical relationship” test, the Court was unable to find that the cases were related in such a way such that it can be said that they arose out of the same transaction or occurrence. The claims did not arise out of the “same aggregate of operative facts” because the petitioners’ claims for uninsured or underinsured motorist coverage arose as a result of separate motor vehicle accidents involving an uninsured or underinsured motorist. Thus, the operative facts in each civil action were different. The fact that the petitioners received offers for uninsured or underinsured motorist coverage from Nationwide is not the “transaction or occurrence” which gave rise to their civil actions. The Court stated that while it is true that common questions of law may arise regarding whether Nationwide made commercially reasonable offers of uninsured and underinsured motorist coverage to insureds such as the petitioners, such inquiries alone cannot be the basis for transfer under Rule 42(b).
The Court also specifically commented that the decision to transfer the cases without giving an opportunity to the petitioners to object was unfair and contrary to the purposes of Rule 42(b). It noted that transferring cases pursuant to Rule 42(b) without giving an opportunity to the parties in the cases being transferred to object has an opposite effect on the purpose of the rule, which is to avoid unnecessary cost or delay and to avoid the necessity of two trials instead of one, therefore avoiding the possibility of judgments in direct conflict.
In re Tawney v. Columbia Natural Res., 219 W. Va. 266, 633 S.E.2d 22 (2006).
Approximately 8,000 plaintiffs (oil and gas lessors), with 2,258 leases of varying forms and types, brought class action against lessee (Columbia Natural Gas) for damages due to allegedly insufficient royalty payments. At least since 1993, Columbia took deductions from plaintiff’s 1/8 royalty payments for “post-production” costs (which include transmission, processing, and volume loss adjustments). At least 1,382 leases at issue had language indicating that the royalty payment is to be calculated “at the well,” “at the wellhead,” “net all costs beyond the wellhead, or “less all taxes, assessments and adjustments.” Columbia moved for summary judgment on the basis that this lease language was clear and unambiguous and allowed it to deduct the royalty owners’ proportionate share of post-production expenses, provided such expenses are actual and reasonable. The Circuit Court of Roane County denied Columbia’s motion for summary judgment, and certified two questions to the Supreme Court, which the Supreme Court then consolidated.
The Supreme Court recognized that traditionally in West Virginia the landowner has received a royalty based on the sale price of the gas received by the lease. Accordingly, it decided the dispute boiled down to whether the “at the wellhead” type language is sufficient to alter the generally recognized rule that the lessee must bear all costs of marketing and transporting the product to the point of sale. The Court concluded it is not. It stated that the “wellhead” type language is ambiguous. It explained that it lacked “definiteness” and that the language did not indicate “how or “by what method” the royalty is to be calculated or the gas is to be valued. It also noted that Columbia did not begin deducting post-production costs from the lessors’ royalty payments until about 1993. Therefore, the Court was unable to conclude that at the time of execution, the lease language at issue was originally intended to allocate post-production costs between the lessor and the lessee. Additionally, the Court adhered to its traditional rule and construed the language against the lessee. As Columbia drafted the language, if it intended the lessors to bear a portion of the transportation and processing costs of the oil and gas, specific language could have been included which would clearly have informed the lessors exactly how their royalties were to be calculated and what deductions were to be taken form the royalty payments for post-production expenses.
Adams v. Ins. Co. of N. Am., 426 F. Supp.2d 356 (S.D. W. Va. 2006).
Prior to 2005, plaintiffs filed four separate lawsuits in West Virginia circuit courts, alleging that the defendants engaged in unfair claims settlement practices in their handling of asbestos personal injury and wrongful death claims filed by plaintiffs and other claimants. The actions were then consolidated in the Circuit Court of Kanawha County. In June, 2005, plaintiffs moved to amend their complaints. The defendants removed each of the consolidated actions to the United States District Court for the Southern District of West Virginia, the Honorable John T. Copenhaver, Jr., presiding. Defendants based their assertion of federal jurisdiction on the Class Action Fairness Act of 2005 (“CAFA”). Defendants asserted that plaintiffs’ amended complaints significantly expanded the definitions of the putative classes and added new claims and new defendants to the actions. Plaintiffs moved to remand the actions, arguing that their amended complaints related back to the filing of the original actions, which were filed prior to CAFA’s enactment and, therefore, were not subject to CAFA. Defendants also asserted the actions were related to certain bankruptcy proceedings and were therefore removable pursuant to 28 U.S.C. § 1334.
There were two issues in this case:
1. Whether CAFA shifts the burden of demonstrating federal jurisdiction from the party asserting federal jurisdiction to the party contesting it? Court held no.
2. Whether a putative class action filed prior to CAFA’s effective date of February 18, 2005, becomes removable under CAFA where plaintiffs amend their complaint after February 18, 2005? Court held no, not under these facts.
After analyzing a split of authority in the federal courts as to whether CAFA shifted the burden of proof to the non-removing party, Judge Copenhaver concluded that CAFA’s legislative history –in the form of a Senate Judiciary Committee report advocating that the party seeking remand bears the burden of demonstrating that CAFA does not supply federal jurisdiction for the action - did not have the binding effect of law. Consequently, the Court held that CAFA did not alter the long recognized general rule that the proponent of federal jurisdiction bears the burden of demonstrating its legitimacy. On this point, the Court specifically adopted the analysis of the Seventh Circuit Court of Appeals in Brill v. Countrywide Home Loans, Inc., 427 F.3d 446 (2005) (holding that CAFA did not shift the burden of proof to the non-removing party).
Turning to the central issue before him, Judge Copenhaver found CAFA inapplicable to the plaintiffs’ claims. The Court acknowledged that on its face, CAFA does not apply to actions “commenced” prior to its effective date and that, in West Virginia, an action is commenced when the complaint is filed. The Court’s opinion featured a detailed discussion of cases from other jurisdictions considering whether an amended complaint that adds a new defendant or asserts new claims not present in the initial complaint constitutes the commencement of a new action for CAFA purposes. The Court then went on to consider not only whether the claims asserted in the amended complaints related back to the original complaints under Rule 15 of the West Virginia Rules of Civil Procedure, but also the extent to which the amended complaints added “new” defendants to the actions. Under these facts, relying considerably upon what it deemed the very broad allegations in the initial complaints, the Court concluded that the purportedly new defendants had been involved in the claims even before the filing of the amended complaints, and that plaintiffs’ amendments were not sufficiently prejudicial to the defendants so as to fail the “relation back” test. The Court found that the allegations characterized by the removing defendants as new claims were essentially expansions of the factual allegations in the claims as originally pled. The Court found that the amended complaints were based upon the same core of operative facts as, and did not fundamentally change the nature of, the original actions. The Court concluded that the addition of numerous insureds of the defendants by virtue of the amended complaints, and the additional details of the allegations, did not alter the claims, the parties or the core issues in the case. Therefore, the Court concluded, the amended complaints related back to the original complaints. Consequently, CAFA did not apply to plaintiffs’ claims.
Finally, the Court concluded that to the extent that federal jurisdiction would be appropriate under 28 U.S.C. 1334, equitable remand pursuant to 28 U.S.C. 1452(b) would be in order. The Court remanded the four consolidated actions to the Circuit Court of Kanawha County. Statutes of Limitations Update
Alexis B. Elswick Huddleston Bolen LLP 611 Third Avenue Post Office Box 2185 Huntington, West Virginia 25722 (304) 529-6181 (304) 522-4312 [email protected]
Stand Energy Corp. v. Columbia Gas Transmission Corp., No. 2:04-CV-0867, 2006 U.S. Dist. LEXIS 4511 (S.D. W. Va. 2006).
The plaintiffs asserted against the defendants, among other claims, a claim for unjust enrichment arising out of an alleged illegal scheme in the gas marketing industry. One defendant, Howard Energy Co., Inc., argued that, as against it, the plaintiffs’unjust enrichment claim was barred by the applicable 5-year statute of limitations. Based on this argument, Howard filed a motion to dismiss the unjust enrichment claim. The court initially denied the motion to dismiss. However, upon reconsideration, the court held that the unjust enrichment claim against Howard was barred by the statute of limitations and, therefore, it granted Howard’s motion to dismiss.
The court reasoned that an unjust enrichment claim is quasi-contractual in nature and, therefore, the discovery rule that applies in tort actions to toll the statute of limitations was inapplicable. Since the court found the discovery rule inapplicable, the court further found that the plaintiffs’ unjust enrichment claim arose on the day that Howard allegedly committed the wrongful act giving rise to the claim. Therefore, because the plaintiff asserted its unjust enrichment claim more than 5 years after Howard’salleged wrongful act, the claim was barred by the statute of limitations.
Merrill v. W. Va. Dept. of Health & Human Res., 219 W. Va. 151, 632 S.E.2d 307 (2006).
The plaintiffs, two sisters, asserted against the defendant, West Virginia Department of Health and Human Resources, claims of negligence, violation of substantive due process, denial of equal protection, breach fiduciary duty, and violation of the right from affirmative protection from harm arising out of the defendant’s alleged failure to protect them from abuse by their father when they were children. The defendant argued that the plaintiffs’claims were barred by the applicable statutes of limitations and filed a motion for summary judgment based on this argument.
The court agreed with the plaintiffs that since the alleged conduct forming the basis for the claims occurred during the plaintiffs’ infancy, the statutes of limitations for these claims did not begin to run until the plaintiffs reached the age of majority. The court further agreed with the plaintiffs that since the plaintiffs’ claims were tort claims, the discovery rule would toll the statutes of limitations if all of the elements were met.
The court held, however, that plaintiffs failed to satisfy the elements of the discovery rule to toll the statutes of limitations and reasoned that the plaintiffs’ ignorance of the duty owed to them by the defendant did not operate toll the statutes of limitations. Therefore, since the elements necessary to invoke the discovery rule were not met, and since the plaintiffs did not assert their claims within 2 years of reaching the age of majority, the court granted summary judgment to the defendant.
Davey v. Haggerty, 219 W. Va. 453, 637 S.E.2d 350 (2006).
The plaintiffs filed a declaratory judgment action against the defendant estate, arguing that the will presented to probate by the defendant was fraudulent and unenforceable. The defendant argued that the action was not brought within the applicable 2-year statute of limitations for a common law fraud claim, and the defendant filed a motion for summary judgment based on this argument.
On appeal, the court held that the discovery rule applied to toll the statute of limitations. The court reasoned that since the will was a “sophisticated forgery,” and since the court had before it no facts to suggest that the plaintiffs could or should have discovered the forgery at an earlier date, the discovery rule must apply to protect the interests of justice.
Benson v. CSX Transp., Inc., NO. 3:05-CV-0384, 2006 U.S. Dist. LEXIS 30407 (S.D. W. Va. 2006).
A year after filing suit against several defendants for allegedly sustaining work-related injuries from a hydrochloric acid leak, the plaintiff amended his complaint to assert claims for negligence, strict liability, and breach of warranties against another defendant not previously named in the action. The newly named defendant filed a motion to dismiss, arguing that the plaintiff’s claims against it were barred by the applicable statute of limitations.
The court denied the defendant’s motion to dismiss, holding that the discovery rule applied to toll the statute of limitations. The court reasoned that although the plaintiff knew of his claims against some defendants, and although the newly named defendant did nothing to prevent the plaintiff from knowing of its identity or alleged involvement in the incident, the defendant had not presented the court with any evidence to show that the plaintiff should have been on notice of the newly named defendant’s identity or involvement in the incident.
Thomas v. Branch Banking & Trust Co., 443 F. Supp.2d 806 (N.D. W. Va. 2006).
The plaintiff asserted against the defendant claims for breach of contract and breach of a secured party’s duty to preserve collateral under Article 9 of the Uniform Commercial Code, and both claims arose out of a series of commercial transactions in which the plaintiff was the borrower and the defendant was the lender. The defendant filed a motion to dismiss, arguing that both claims were barred by the applicable statutes of limitations.
The court held that neither claim was barred by the applicable statutes of limitation. Regarding the breach of contract claim, the court found that a 10-year statute of limitations applies to actions on written contracts and that the plaintiff had brought this claim within 10 years of her claim accruing.
Regarding the UCC claim for breach of a secured party’s duty to preserve collateral, the court held that the same 10-year statute of limitations for actions on written contracts, although the defendant argued that the 2-year statute of limitations applicable to tort actions should apply. The court reasoned that since the UCC provides for a contract based measure of damages with respect to this claim, the statute of limitations applicable to actions on written contracts applied. The court further found that the plaintiff had brought this claim within 10 years of her claim accruing.
Wahi v. Charleston Area Med. Ctr., 453 F. Supp.2d 942 (S.D. W. Va. 2006).
The plaintiff asserted against the defendants, among other claims, a claim for violation of civil rights under 42 U.S.C. § 1981. The defendants filed a motion for summary judgment, and they argued that the § 1981 action was barred by the applicable statute of limitations.
The court held that the § 1981 action was barred by the statute of limitations and, thus, it granted the defendants’ motion for summary judgment with respect to this claim. The court reasoned that § 1981 does not have a statute of limitations of its own and that if § 1981 was enacted prior to December 1, 1990, the court should apply the most analogous state statute of limitations. If § 1981 was enacted after December 1, 1990, however, the court should apply the 4-year catchall statute of limitations in 28 U.S.C. §1658. The court held that because the plaintiff’s claim was based on 1991 amendments to § 1981, the 4-year catchall statute of limitations was applicable. Lastly, the court held that the plaintiff filed his action more than 4 years after his § 1981 action accrued and, thus, it was barred by the statute of limitations.
Copier Word Processing Supply, Inc. v. WesBanco Bank, Inc., 640 S.E.2d 102 (W. Va. 2006).
The plaintiff asserted a claim for conversion against the defendant banking institution for its role in an embezzlement scheme carried out by one of plaintiff’s employeesin which the plaintiff’s employee cashed and deposited several corporate checks into her personal checking account. The plaintiff filed a motion for summary judgment and argued that the claim for conversion was a continuing tort and, therefore, the 3-year statute of limitations applicable to actions for conversion of negotiable instruments would begin to run only when the last act of conversion occurred. The defendant then filed a motion for judgment on the pleadings. The circuit court denied the plaintiff’s motion, granted the defendant’s motion, and then certified to the Supreme Court of West Virginia questions regarding the continuing tort theory.
The court held that the continuing tort theory was inapplicable because the acts involved consisted of converting multiple and separate negotiable instruments. Furthermore, the court reasoned that, in enacting the applicable statute of limitations, the legislature clearly intended for each act of conversion to be treated as a separate act for statute of limitations purposes. Lastly, the court reasoned that applying the continuing tort theory to these separate acts would be contrary to the Uniform Commercial Code because the Code disfavored such open-ended liability on negotiable instruments. The court, therefore, held that each act of conversion was a separate cause of action and, thus, the acts would have different statutes of limitations periods. Workers’ Compensation Update
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Bias v. Eastern Associated Coal Corp., 640 S.E.2d 540 (W. Va. 2006).
The plaintiff and two co-workers’, employees of a coal mine owned by the defendant, were given an assignment to install a “belt take-up” in a specific portion of the mine. The plaintiff and his co-workers’ became trapped when a cloud of smoke filled the area. While the two co-workers’ escaped, the plaintiff became trapped when he attempted to shut down the main belt. The plaintiff ultimately escaped after being trapped in smoke for an hour and a half. Unbeknownst to the plaintiff, the smoke was the result of a belt slippage caused by a slip switch that had been short circuited. The defendant was issued a federal citation for the short circuited switch. The plaintiff reported to work for two days immediately following the incident, but on his third day at work became very distraught. The plaintiff, who was suffering from nightmares and also in a poor emotional state, was transported to Charleston Area Medical Center and then to Highland Hospital, where he was admitted for nine days. The plaintiff brought this action alleging his employer is liable for emotional injuries under the deliberate intention exception to the West Virginia Workers’ Compensation Act, W. Va. Code §23-4-2, and also under the common law for its intentional and negligent infliction of emotional injuries.
An employee who sustains a mental injury without physical manifestation is precluded from receiving Workers’ Compensation benefits pursuant to West Virginia Code §23-4- 1(f), but the issue in this case is whether he/she can maintain a common law negligence action against his employer, despite immunity afforded by West Virginia Code §23-2-6? The Court answered this question in the negative.
An employee precluded from receiving workers’ compensation benefits for a mental injury without any physical manifestation (i.e. a “mental-mental injury”) cannot maintain a common law negligence action against his employer. The Court held that an employer who is otherwise entitled to the immunity provided by W. Va. Code §23-2-6 (1991) may lose that immunity in only one of three ways: 1.) by defaulting in payments required by the Workers’ Compensation Act; 2.) by acting with “deliberate intention” to cause an employee’s injury as set forthin W. Va. Code §23-4-2(d); or 3.) in such other circumstances where the Legislature has by statute expressly provided an employee a private remedy outside the workers’ compensation system. Further, an employee who is precluded by W. Va. Code §23-4-1f (1993) from receiving workers’ compensation benefits for a mental injury without physical manifestation cannot, because of the immunity afforded employers by W. Va. Code §23-2-6 (1991), maintain a common law negligence action against his employer for such injury.
The Court stated that W. Va. Code §23-4-1(f) is a narrowly drawn statute intended by the Legislature to focus solely on whether psychological claims can be compensable. The plain language of the statute makes clear that workers’ compensation benefits for a psychological claim can only be recovered when there is a physical symptom or physical injury. Further, the court noted that W. Va. Code 23-4-1(f) is silent as to employer immunity from common law actions. On the other hand, W. Va. Code §23-2-6 expressly provides employers with “immunity from common lawsuit” and “litigation” for common law claims. It is this statute, and not W. Va. Code §23-4-1(f), that the Legislature enacted to provide qualifying employers with immunity from common law tort liability for negligently caused work related injuries. The only way an employer can lose the immunity granted is through the three exceptions outlined in the plain language of W. Va. Code §23-2-6.
Crist v. West Virginia Ins. Comm’n, 632 S.E.2d 358 (W. Va. 2006).
The plaintiffs in this case are widows of employees who died as a result of compensable work related injuries. All plaintiffs received an award of dependent benefits which included notice from the former Workers’ Compensation Commission that they would receive benefits until their death or re-marriage. In 2003, sweeping reforms to workers’ compensation statutes by the Legislature included a plan to privatize the fund and open the market to competition. (Following privatization, the regulating agency for workers’ compensation purposes became the West Virginia Insurance Commission, the defendant in this case.) With regard to the legislative reforms, there were no substantive changes to the dependents benefits statute outlined in W. Va. Code §23-4-10. The Workers’ Compensation Commission subsequently promulgated an internal policy, however; that changed the manner in which dependent benefits would be awarded. Specifically, under the new policy, dependent benefits would be paid to widows or widowers until the date their deceased spouse would have become ineligible to receive Workers’ Compensation permanent total disability benefits (i.e. the date in which they are eligible to receive federal old age retirement benefits). Consistent with this new policy, the plaintiffs received a second letter in 2004 which stated that their award would terminate on the date their spouse would have reached the age to receive social security retirement benefits. The plaintiffs challenged the application of this new policy to their claims, as they had previously been notified that they would receive benefits until their death or remarriage.
The Court held that based upon the plain language of the dependents benefits statute, the policy of the former Workers’ Compensation Commission, and now the policy of the Insurance Commission, is at odds with the statute governing dependents’ death benefits. The statute makes clear that dependents benefits are to be paid until the death or remarriage of the widow or widower.
It has been speculated that the Court purposefully left open the opportunity to revisit this issue in cases where an original award letter gives the widow or widower notice that his or her benefits will terminate when the spouse would have reached retirement age. This scenario is distinguished from the facts of Crist on the basis that benefits had not been previously been promised for the duration of life or until remarriage. However, this speculation fails to take into consideration the Court’s heavy emphasis on the plain language of the dependents benefits statute and the fact the language expressly provides that an award be granted “until death or remarriage.” There is no language in the statute, whatsoever, which expressly or implicitly permits the cutoff of benefits at the age when the deceased employee would have reached the age to receive social security retirement benefits. Given the Court’s holding, it appears the only relief from an award of lifetime dependents benefits is a legislative amendment.
Fitzgerald v. Fitzgerald, 219 W. Va. 774, 639 S.E.2d 866 (2006).
The parties, husband and wife, were married on May 10, 1989. On June 20, 1990, the husband sustained serious personal injuries in the course of, and as a result of, his employment. The parties separated on January 4, 2002 and thereafter, the wife sought a divorce. During the course of the marriage, the husband was awarded $90,654.27 in workers’ compensation benefits. Following the separation, the husband was granted a permanent total disability award for which he received an additional $106,406.62 in back pay benefits to compensate him for the period of December 1, 1992 through October 24, 2001. Actual receipt of the additional funds was acquired by the husband after the marriage, but during the time of the parties’ separation. The husband argued that the additional money he received was to compensate him for pain and suffering and thus, should be declared separate property not subject to equitable distribution. The wife argued that the additional money is marital property acquired during the course of their marriage and thus, should be equally divided between the parties in their divorce proceeding.
The Court held that in a divorce proceeding, that portion of a lump sum workers’ compensation permanent total disability award that represents wages the injured spouse would have earned, but for his/her work-related injury, while the parties were married and cohabitating constitutes marital property subject to equitable distribution pursuant to W. Va. Code §48-7-101, et seq.
Pursuant to W. Va. Code §48-1-233 (2001) (Repl. Vol. 2004), all property acquired during the marriage is marital property except for certain categories of property which are considered separate or non-marital. Separate property consists of the following: 1.) property acquired by a person before marriage; 2.) property acquired by a person during marriage in exchange for separate property which was acquired before the marriage; 3.) property acquired by a person during marriage, but excluded from treatment as marital property by valid agreement of the parties entered into before or during the marriage; 4.) property acquired by a party during marriage by gift, bequest, devise, descent or equitable distribution; 5.) property acquired by a party during a marriage, but after the separation of the parties and before ordering an annulment, divorce or separate maintenance; and 6.) any increase in valuate of separate property as defined this section which is due to inflation or to a change in market value resulting from conditions outside the control of the parties. The Court noted that the statute expresses a marked preference for characterizing the property of the parties to a divorce action as marital property, rather than separate, and therefore, to be divided equally between the parties.
The husband argued that the additional award was property he received as a result of a personal injury and thus, must be considered separate. The Court disagreed with the husband’s conclusion. The Court agreed that a workers’ compensation award is an employee’s exclusive remedy against his or her employer and therefore has characteristics of other types of damages. However, a permanent total disability award is considered to be wage replacement for the wages the injured employee would have earned but for his or her work-related injury. The award is not considered to be an award for the injured employee’s pain and suffering resulting from the work-related injury. The Court noted that there is a recurring theme in their prior opinions that workers’ compensation law fails to provide compensation for elements of damages such as pain and suffering. Critical to determining whether an award is martial or separate property is when the award was received and for what period of time such award was intended to serve as compensation for lost wages. Under the facts of this case, while the husband received the money at the time of the parties’ separation, the award constituted wage replacement for a period of time when the parties were married, when the husband’s injuries prevented him from working. The award must be considered wage replacement earned during the parties’marriage. Thus, the award is marital property subject to equitable distribution. The Court concluded that to hold otherwise would be to ignore the statutory preference for classifying property as marital property, rather separate property. ABOUT THE AUTHORS:
Neisha Ellis Brown
Neisha Ellis Brown is an associate with Farrell, Farrell & Farrell, PLLC in Huntington, West Virginia, where she has practiced law since May, 2003. The focus of her practice is medical malpractice and product liability defense. Ms. Brown is a member of the West Virginia State Bar. She is admitted to practice in West Virginia, as well as the United States District Court for the Northern and Southern Districts of West Virginia.
Jamison H. Cropp
Jamison H. Cropp is an attorney with Steptoe & Johnson PLLC in Clarksburg, West Virginia, specializing in the representation of insurers on matters relating to insurance coverage, bad faith and unfair trade practices. Ms. Cropp also works with the firm's Appellate Practice Group. She received a Bachelor of Science degree from James Madision University, with majors in English and Polictical Science, and her law degree from West Virginia University. While in law school, Ms. Cropp served as a member of the Moot Court Board and was awarded the Best Brief Awards in the 1999 Rabbi Seymour Siegel Memorial Moot Court Competition at Duke University and the 1998 Baker Cup Moot Court Competition at West Virginia University. Upon graduation, Ms. Cropp was inducted into the Order of the Barristers. After graduation, Ms. Cropp served in Huntington, West Virginia as a Law Clerk to the Honorable Robert C. Chambers, United States District Judge for the Southern District of West Virginia. Ms. Cropp is admitted to practice before the West Virginia Supreme Court of Appeals, the United States District Courts for the Southern and Northern Districts of West Virginia and for the Northern District of Ohio, and the Fourth Circuit Court of Appeals. Ms. Cropp is a member of the West Virginia State Bar, West Virginia Defense Trial Counsel and Defense Research Institute. Ms. Cropp has served as an adjunct lecturer in Appellate Advocacy at the West Virginia University College of Law.
Alexis B. Elswick
Alexis B. Elswick is an associate in the litigation department of Huddleston Bolen L.L.P. in Huntington, West Virginia. Her practice is devoted to the defense of complex litigation, mass torts, and toxic tort cases. She is a 2003 graduate of Roanoke College in Salem, Virginia and a 2006 graduate of the University of Kentucky College of Law in Lexington, Kentucky. She is admitted to practice in the state courts of West Virginia and the United States District Court for the Southern District of West Virginia. She is a member of the West Virginia State Bar, the Cabell County Bar Association, and the Defense Trial Counsel of West Virginia.
Andrew S. Graham
Mr. Graham is an associate in the Clarksburg office of Steptoe & Johnson PLLC and practices primarily in the areas of coal, oil and gas, real estate and commercial transactions and commercial litigation. He graduated from Shepherd College and the West Virginia University College of Law, where he was inducted into the Order of the Coif and served as the president of the law school chapter of the Defense Trial Counsel of West Virginia.
Matthew A. Kelly
Matt is an associate with Farrell, Farrell & Farrell, PLLC in Huntington, West Virginia. His primary areas of practice include medical malpractice defense, class action litigation, insurance coverage, employment litigation and appellate advocacy. A native of Huntington, Matt attended the University of Notre Dame, graduating cum laude with a Bachelor of Arts degree in Government. He then continued his education at West Virginia University College of Law, earning his Juris Doctorate in 2002. While in law school, he was a member and office holder of the Moot Court Board. Matt is admitted to practice in the state courts of West Virginia, the United States District Court for the Southern District of West Virginia and the United States Court of Appeals for the Fourth Circuit. Matt is a member of the West Virginia State Bar, the American Bar Association, the West Virginia Bar Association, the Cabell County Bar Association, the Defense Trial Counsel of West Virginia and DRI. In addition to his professional activities, Matt has been involved with the United Way of the River Cities in a number of different capacities, and was most recently selected to serve on its board.
Erik W. Legg
Erik is a Member of Farrell, Farrell & Farrell, PLLC in Huntington, West Virginia. His primary areas of interest and experience include pharmaceutical and medical products liability, medical professional malpractice, workplace exposure and injury litigation, and employment discrimination and wrongful discharge claims. He is a graduate of the West Virginia University College of Law, where he was awarded a position on the Moot Court Board in recognition of his appellate advocacy skills, and where he was a member of the Marilyn E. Lugar Moot Trial Association. He is admitted to practice in the state and federal courts of West Virginia and in the state courts of Ohio. Erik is a member of the American, West Virginia and Cabell County Bar Associations as well as Defense Trial Counsel of West Virginia and DRI. Erik has lectured on medical malpractice avoidance strategies and documentation issues to healthcare professionals. He has also lectured on the topics of electronic discovery and federal jurisdiction for the West Virginia College of Law sponsored continuing legal education program. In addition to his professional activities, Erik is active in various civic and charitable programs, including the “Make A Wish”Foundation of Southern West Virginia, the Kiwanis Club of Huntington and the Salvation Army Advisory Board.
Brian J. Moore
Brian J. Moore is an attorney with Jackson Kelly PLLC in Charleston, West Virginia, specializing in Labor and Employment Law. He received his accounting and law degrees from West Virginia University. Mr. Moore is licensed to practice in West Virginia and Kentucky, the Southern and Northern Districts of West Virginia, and the Fourth Circuit Court of Appeals. He is a member of the West Virginia State Bar, Kentucky Bar Association, and West Virginia Defense Trial Counsel. Mr. Moore has lectured on various employment law topics, and has served as an adjunct professor at the University of Charleston, where he taught a course on compensation and benefits.
Christopher D. Pence
Christopher D. Pence is an attorney with Jackson Kelly PLLC in Charleston, West Virginia. Mr. Pence practices general litigation with an emphasis on defense of deliberate intention actions. He received a B.A. in Political Science from Marshall University and his law degree from West Virginia University. Mr. Pence is licensed to practice in West Virginia and the United States District Court for the Southern District of West Virginia. He is a member of the West Virginia State Bar and the Defense Trial Counsel of West Virginia.
Rebecca A. Roush
Rebecca Roush is an attorney with Bowles, Rice, McDavid, Graff & Love in Charleston, West Virginia, specializing in workers’ compensation. She received a Bachelor of Science from the University of Rio Grande in Ohio in 1995 and her law degree from Capital University, also in Ohio, in 2001. Ms. Roush is admitted to practice in West Virginia and before the United States District Court for the Southern District of West Virginia. She is a member of the Defense Trial Counsel of West Virginia and its Workers’ Compensation Committee. Ms. Roush is a former Assistant Attorney General for West Virginia, a Managing Attorney for the Occupational Pneumoconiosis Unit at the West Virginia Attorney General’s Office and has taught business law at the Marshall University Mid-Ohio Valley Campus.
Tiffany Swiger
Tiffany A. Swiger is an attorney with Steptoe & Johnson PLLC in Clarksburg, West Virginia, specializing in general litigation. She received her political science and law degrees from West Virginia University. Ms. Swiger is licensed to practice in West Virginia and the Southern and Northern Districts of West Virginia. She is a member of West Virginia Defense Trial Counsel.
Tamela J. White
Tamela J. White, RN, JD, Esq., is a member of Farrell, Farrell & Farrell, PLLC, in Huntington, West Virginia. Ms. White’s practice includes defense trial practice and client counseling in complex litigation matters including medical professional liability, nursing home/elder care defense, health care law and compliance, privacy, product liability and drug and device litigation and mass and toxic tort class actions in West Virginia, Eastern Kentucky and Southern Ohio. ABOUT THE EDITOR:
Laurie K. Miller
Laurie K. Miller is a senior associate in the Charleston office of Jackson Kelly PLLC. Her litigation practice involves products liability, pharmaceutical and medical device litigation, commercial transactions and class actions. She is a 2001 graduate of the University of Dayton School of Law in Dayton, Ohio. Ms. Miller is admitted to practice in the State of West Virginia and before the United States District Courts for the Northern and Southern Districts of West Virginia, as well as the Supreme Court of the United States. Ms. Miller is an active member of the DRI Young Lawyers Steering Committee and is currently serving as Vice-Chair of the Marketing Subcommittee. Ms. Miller serves as the Vice President of the Board of Directors for the Ronald McDonald House of Southern West Virginia and is a member of the Board of Governors of the Defense Trial Counsel of West Virginia.