With a heap of expenses piled up from the recent holiday season, what better way to recoup some them than by starting a lawsuit or two. For what other reason do insurance carriers exist?
When in doubt sue. As has been noted in past columns, the amount of litigation which is becoming extant is slowly starting to rise. The so-called Americanisation of litigation in the UK is proceeding apace.
What readers of local newspapers are about to find out is that if you wish to sue, there is no longer a reason not to do so. Buoyed by solicitors who have most likely thrown caution to the winds, the litigation `demon' is about to burst upon the scene until `demon slayers' in the guise of legislators will stand up and be counted.
At the beginning of this year, the BBC ran a story pertaining to a hotel chef who, having sliced a series of avocados in furtherance of his livelihood, came upon an unlikely adversary to his knife - an unripe avocado.
The avocado apparently decided to fight back, causing the chef to lose control of his "dangerous instrumentality" (as we say in the law biz) and hence, the knife to slip and slice his little finger.
The chef, according to the news report, now claims he cannot pursue his dream of being a chef in the RAF. He is suing the hotel for which he worked for £25,000.
To begin with, were this America, and particularly, New York, the amount sued for would probably be more like $2,500,000.
The hotel is getting off cheaply. As noted, previously, the American system encourages litigation.
In New York, the defender of the lawsuit may raise the defence of contributory negligence or assumption of risk. At one time a carrier defending a claim would merely have to show the slightest bit of negligence on the part of the claimant to win the lawsuit.
Not any more. The defence of contributory negligence which favoured the carrier has been changed to comparative negligence, which merely assigns values to the blame, by trying the liability aspect.
Afterwards (in what is called a bifurcated trial), the damages are tried by the same jury. The damage award is then `percentaged' in accordance with the findings of liability in the first part of the trial.
What does this mean for instance to a Lloyd's carrier defending claims in New York? Clearly, whereas before there was a good chance that a concentrated defence meant complete absolution from damages, now in most cases there will be some recovery. This, again, gives us the lesson which underpins all litigation in New York- `tis better to settle than to defend, "as attorneys do not come cheap".
I recall a case decided in San Francisco when your writer was studying Law (stone age days). A young woman sued after having been in an auto accident. Her claim for damages was based on psychological injuries, to wit: she developed nymphomania as a result of the accident. Needless to say, (Americans like a unique story), she won.
This brings us to the point of the tenacity of lawyers in prosecuting cases in the US and the futility of writing policies and using logic to determine risk.
The highest court in the State of New York is the Court of Appeals; the lowest court of general jurisdiction in New York State is the Supreme Court of the State of New York.
A good many years ago, your writer represented a high risk client operating a fleet of taxis. Each taxi had a self insured retention of $100,000, supplemented by a policy of $1m in excess of the $100,000.
One evening a young woman with some friends left a club in the early morning hours and hailed a taxi. The first thing she did was negotiate a "flat rate" with the driver. In other words, she told him her destination and negotiated a price rather than his using the meter in the taxi.
This driver by accepting this means of payment was in total disregard of the rules governing taxis in New York City and the conditions of the driver's employment by the taxi fleet.
After her friends were dropped off, the young woman remained as the sole passenger in the taxi. The driver, seeing a romantic possibility, volunteered to take the young woman home in his private car. She agreed and the driver took the taxi back to the garage, turned in his (declared) receipts and put the woman in the passenger side of his private vehicle. On the way to her house, he had a horrific accident and the young girl suffered heavy facial scarring.
Her lawyers sued the taxi company in New York Supreme Court, claiming that once she entered the taxi she was the responsibility of the company until she arrived at her destination.
The case was interesting in that there was a question of, among other things, whether a contract of carriage had ever been entered into, with the defendant, taxicab company, simply because the negotiation of the flat rate was done privately by the driver in disregard of company rules.
In any event, a motion was made (for summary judgment) to dismiss and was granted in the lowest court. An application was made to reconsider and, because the law firm representing the young lady was "well connected" politically, the judge reversed himself.
An appeal was then filed, the first appellate court (New York Appellate Division) reversed and dismissed the action, and then it was carried to the Court of Appeals, where it was finally dismissed.
Clearly from the facts, there was no case vis-à-vis the taxi company, and yet a great deal of time and money was spent by both sides in litigation. In a case such as this, there is the great question of weighing the monies to be expended. Certainly your writer was gratified at the outcome, but was the client happy when faced with massive appeals bills? One has to wonder.
We shall treat the prospect of British lawsuits following American footsteps in future columns. Suffice it to say at this moment, that it is incumbent upon Lloyd's of London to carefully consider the possible liabilities from insuring in America, not only from the point of view of logic, but also with a view towards the persistence of American lawyers in bringing lawsuits that make no logical sense at all.