This is the review of a Court of Appeals decision we reported here.

20-259.01 requires automobile insurers to offer uninsured and underinsured coverage. Cases had said that the offer must be reasonably calculated to come to the insured’s attention. Ballesteros claimed that American Standard’s offer wasn’t because its UM/UIM offer form was in English and his “primary language” is Spanish. American Standard argued that the English form is required and approved by the Department of Insurance so using it should be a “safe harbor.” The trial court granted Ballesteros summary judgment; American Standard appealed. The Court of Appeals reversed, holding that the form wasn’t a safe harbor and that there questions of fact about whether American Standard had done enough to make Ballesteros aware of the offer.

The Supreme Court holds that using the State-approved form satisfies the statute.

The statute says that the insurer “shall make available” UM/UIM coverage and “by written notice offer” it. The Court notes that the “make available” language in the statute’s predecessors had been interpreted as not requiring action by the insurer to instruct the insured about the coverage. To make the coverage available therefore does not mean to explain it. The “offer” is measured by contract law, under which an effective offer depends not on the offeree’s actual understanding of its terms but on his reasonable understanding that an offer of some sort has been made that would bind the offeror. The Plaintiff did not dispute than an offer had been made; he therefore didn’t need something in Spanish to explain that.

The Court further notes that the statute does not require a Spanish form even though other statutes do. Moreover, it once did require a Spanish form but that requirement was dropped.

Finally, the Court reviews legislative history to conclude that by certain amendments to the statute the legislature intended that obtaining a signature on the DOI-approved form be in itself sufficient compliance with the statute. (The Court avoids using the problematic term “safe harbor.”)

The Court is careful to say, though, that “we express no opinion whether tort law may impose [the requirement of a Spanish form] . . .  in certain circumstances” (Ballesteros is also making the usual claims of negligence, bad faith, etc.)

The Court vacates the Court of Appeals’ decision and remands for entry of summary judgment for American Standard on the statutory claim.

(link to opinion)

We blogged the Court of Appeals opinion in this case here (and its slightly revised version here). The Supreme Court vacates that opinion; it reaches the same result but for a different reason.

DeSela was injured at school in November 2004. Her mother assigned to her the mother’s claim for her medical expenses. In December 2007 she filed suit for personal injury, having turned 18 the year before. The District argued that the claim for medical expenses was barred by the statute of limitations. The trial court agreed and dismissed it. The Court of Appeals reversed, concluding that although she had received the cause of action by assignment from her mother the statute of limitations applies as though it were her own, i.e., it abated until her majority.

The Supreme Court outflanks the assignment issue, holding that DeSela herself owned the cause of action. The assignment was therefore irrelevant. This overturns earlier cases to the contrary; the Court feels the old rule – that the parents own the claim for medical expenses –  outmoded and inconsistent with a child’s rights nowadays to make various other sorts of claims. The right to recover medical expenses, says the Court, belongs to both parent and child, although no double recovery may occur. The Court reverses the trial court and remands.

This has the advantage of not running roughshod over the law of assignments, as the Court of Appeals did. Instead, it runs roughshod over the idea that you’re supposed to raise issues in the courts below. The argument it adopts was not raised until the case was before the Supreme Court. It was raised by DeSela, not by the Petition for Review. The Court considers it for two reasons. First, the issue is “of great public importance or likely to recur.” How that is true here isn’t entirely clear since the precedent being overturned is from the 1940’s; that’s about how often it comes up. Second, the Court of Appeals would have been bound by the precedent anyway. But isn’t that always true? Doesn’t this create a rule de facto that an argument for change of Supreme Court precedent needn’t be made until the case is before that court? And why is it a good idea to decree that granting review, instead of limiting the issues to those on which it is granted, expands them?

No doubt the Court thinks it has changed the law in a good way. But the impulse for immediate gratification – either of the law or of a particular claimant – should rarely be indulged. The traditional and proper solution is to signal an argument’s future acceptance by discussing it, briefly but favorably, before announcing that it was untimely. That gets the law changed. permits (when someone eventually bothers to fight the issue) full review all the way along – which, when you’re  changing seventy-year-old precedent (just to posit a random example) is not a bad idea – and respects important procedural principles. The failure to do so suggests arbitrariness, if not whimsy.

(link to opinion)

This is a disciplinary decision. The issues involve ER 5 – a lawyer must make reasonable effort to ensure that his firm and those he supervises act ethically – and what the sanction should be.

Phillips runs one of those high-volume, high-advertising firms.  In 2002 he was put on probation because the firm was doing most of the things those firms can have problems with. The terms of probation included, basically, making sure that it didn’t do them. His suspension ended but the complaints didn’t, so the Bar sought discipline again. The Hearing Officer recommended a six-month-and-a-day suspension; the Disciplinary Commission accepted it by a vote of 6-2, the minority wanting the suspension reduced to ninety days. Phillips sought review. (Arentz, another member of the firm, was also involved in this and also sought review; the court denied his petition.)

What the firm did wrong takes five pages to summarize (boiled down from a Hearing Officer report well over 100 pages long). Read the opinion if you want the gory details; basically, it’s a laundry list of the pitfalls in running those firms (if you don’t know how they work then this opinion will be an eye-opening education). What they have in common is that Phillips didn’t do any of the individual acts (he no longer represents clients) but was responsible for the policies and procedures that allowed them to occur.

Phillips’ argument was that he therefore shouldn’t be responsible for them, that the Hearing Officer merely found him vicariously liable for the offenses of others. But the Hearing Officer “clearly understood and correctly applied” the law that Phillips was liable for his own ethical breaches in not enforcing proper policies and procedures. ER 5 (the opinion deals specifically with 5.1 and 5.3) says so.

That was the legal issue on which the court granted review. The analysis takes about a page. What takes the remaining 11 pages of the majority opinion? The sanction. But the court agrees with the Hearing Officer’s findings and conclusions on everything except the issue of proportionality.

On that the court first says that a case “involving a ‘consumer law firm’ and a high volume practice . . .  is difficult to compare with others.” That is worth a long article. But the short version is: no, it isn’t, unless the suggestion is that “consumer” law firms (whether “consume” refers to lawyer or client isn’t clear) needn’t follow the same rules of ethics as the rest of us.

But rejecting  proportionality allows the court to address “internal proportionality” – i.e., to compare Phillips’ sanction to Arentz.’ Arentz had 19 ethical violations; Phillips scored only 12. Arentz was more directly involved with his violations. But Arentz got only sixty days. And the reason for Phillip’s “and a day” sanction was because that means he would have to go through a formal reinstatement process, lengthening the sanction. Although the court agrees that Phillips deserves worse that Arentz, it concludes that six months – without the complication of the extra day – is enough. (There is also probation, the 21 conditions of which are stated in the appendix. In addition, while suspended “Phillips’s [sic] name may not be used in firm advertisements, letterhead, or other communications” – stand by for some Glen Phillips commercials – and he can’t take any firm income.)

Judge Weisberg, sitting by designation, writes separately to support the stiffer “and-a-day” sanction. “Phillips is not being sanctioned for his second ethics violation [as the majority suggests]. He is being sanctioned for his ethics violations eighteen through twenty-nine.” If you’re keeping score, Phillips’ 29 beats Arentz’ 19.  Phillips had been on probation once already. And Arentz was “working in a system that was developed, implemented, and supervised by Phillips.” He does agree, though, that you can’t compare “consumer” law firms (the court at least has the grace to put that in quotation marks) with the rest of us, who presumably exist merely to grind the faces of the poor.

Now, regardless of what you think of this type of firm or this type of law or this type of lawyer, you have to wonder what was going on here. The court denies Arentz’ petition, grants Phillips’ petition purportedly for an issue that it spends about ten seconds on, then reduces Phillips’ sanction not because of what he did but supposedly because it wasn’t proportional to a sanction it had denied itself the opportunity to review (which, as Judge Weisberg tries to point out, was too light), by pretending that comparing one case to one other is a proportionality analysis. This is one of those times when you don’t know what to hope – that the court didn’t realize how bad this would stink, or that it did.

(link to opinion)