This is published for its holding that 12-821 (one-year limitation for suit against public entity) doesn’t violate equal protection. There is nothing novel about the analysis except that it apparently hasn’t been done yet for the present version of the statute. Preliminarily, the court addresses old arguments made by people who made old mistakes.

Plaintiff was injured in a fall at the town cemetery. He submitted, at the town’s request, a written notice of claim, though the town never responded to it; the town’s claims people did open a file and collect his medical bills. He filed suit just short of two years after the accident, which was a year too late. The trial court dismissed. He appealed. The Court of Appeals had to kick the case back to let the parties get Rule 54(b) language into the judgment. Now it affirms.

Plaintiff first argued equitable estoppel – that by dealing with the claim the town led him to expect that he wouldn’t need to file a timely suit. The court cites a few of the several cases on point in summarizing: a plaintiff bears the burden of presenting evidence of the defendant’s specific, affirmative acts that reasonably led the plaintiff not to file. In this case the town hadn’t done anything – hadn’t admitted liability, hadn’t negotiated, hadn’t mentioned the statute of limitations. And because there is a statute on point, by not responding to the notice of claim the town had denied it as a matter of law – which the plaintiff knew, also as a matter of law.

Plaintiff argued that he should be entitled to wait to bring suit until he finished treating (which was longer than one year) and knew the full extent of his damages. The court gets mixed up on whether this is an issue of tolling or accrual. The argument is wrong either way but the court analyzes it as accrual before concluding that “the statute is not tolled simply because he did not know the full extent of his damages.”

Plaintiff argued that the one-year statute is unconstitutional, first because it violates anti-abrogation. Like all of the above, this was settled long ago. Statutes of limitations are – surprise! — constitutional; they regulate, not abrogate.

Finally, Plaintiff relied on equal protection. He argued for strict scrutiny but the court applies rational basis, that being the test that applies to statutes that merely regulate the right to sue. The state has a legitimate interest in “protecting public entities from stale claims and in being able to investigate claims and plan budgets in light of a proposed suit.” For the most part this incorporates similar analyses that earlier cases had used to uphold the notice-of-claim statute (12-821.01). 

(Opinion: Viniegra v. Town of Parker)

This is about the extent to which the nature of an insurer’s business practices can make it liable for punitive damages in a bad-faith case.

Plaintiff, riding a motorcycle, was seriously injured when he hit an uninsured car that slowed suddenly in front of him. He made a UM claim to Defendant. Its claims rep talked to the car’s driver, who claimed that she signaled a turn and had to slow for a pedestrian. The representative didn’t talk to the three motorcyclists with Plaintiff, who would have cast doubt on the driver’s story, on the theory that they would be “biased” – in other words, that they would have cast doubt on the driver’s story. (Plaintiff himself didn’t remember what happened.) The representative assigned 100% of the fault to Plaintiff and closed the claim. A year later, Plaintiff’s lawyer sent a policy-limits demand; a new claims rep reviewed the file, didn’t interview any of the witnesses, and denied the claim again. Plaintiff sued for breach of contract; the car driver was found 40% at fault. That was enough to exceed Defendant’s limits, which it paid. Plaintiff then sued for bad faith; a jury awarded compensatory damages and $1 million in punitives. Defendant appealed.

The Court of Appeals affirms the compensatory damages. Plaintiff had “presented sufficient evidence from which the  jury could conclude that [Defendant’s] investigation of the claim was not reasonable.”

The real issue was punitive damages. Plaintiff’s theory on punitives was that the claims reps denied it because of “undue pressure . . . to promote company profits at the expense of insureds.” Plaintiff relied on Nardelli, which allowed punitives when the company made the income and even the job of each claims rep contingent on strictly limiting each claim. Plaintiff contended that various aspects of Defendant’s practices were as bad; examining them at length (“each case will depend on its own distinct facts”), the court disagrees.  “An insured seeking punitive damages must show clear and convincing evidence that the insurer’s concern for profits drove the company to breach its duty . . . .” There was no evidence that, as in Nardelli, adjusters were pressured to reduce claims for reasons of profit. Their manger was given goals and strategies for monitoring claims but “keeping statistics on resolution of claims and looking to their ‘bottom line’ are reasonable internal procedures.” That defendant had a profit-sharing plan for all its employees was not the same as basing adjusters’ pay on their claims payouts.  

Plaintiff also argued that Defendant knew he was in particular need because had been out of work for a year because of the accident. “But knowledge of the harm that denial of a claim will cause an insured, without evidence without evidence the insurer deliberately ignored the insured’s ‘rights and needs,’ is not sufficient to establish . . . ‘evil mind’. . .”  It would be more accurate to point out that the justifiable denial of a claim does not cause harm in any legal sense but the opinion is paraphrasing Linthicum, the author of which paid rare attention to such minutiae.

The court affirms the trial court’s award of Rule 68 sanctions but in light of the reversal of punitive damages remands its award of attorney’s fees for reconsideration.

(Opinion: Sobieski v. American Standard)

The question is “whether an employer owes a duty of care to the child of an employee who contracts mesothelioma from asbestos brought home on the employee’s work clothes.” The answer is “no.”

Plaintiff lived with his father from 1952 to 1966. He was diagnosed with mesothelioma in 2013 and sued the successor of his father’s employer, alleging negligence. Defendant argued that it owed him no duty; the trial court agreed and granted summary judgment. Plaintiff appealed.

The Court of Appeals affirms.The court recognizes, and in fact insists upon, what our courts often still do not: in Arizona duty is based not, as of old, on the foreseeability of  injury but instead on the relationship between the parties and on public policy.

Plaintiff tried to establish a special relationship using property theories. Restatement (Third) 54 imposes a duty on landowners for “artificial conditions or conduct” posing a risk of harm to persons not on the land. But, this, according to the Restatement, is “special application” of Rest. 7, which imposes a duty on everybody whenever there’s a risk of harm, which effectively writes “duty “ out of the law, and which our Supreme Court has rejected for that reason. Restatement (Second) 371 is similar to 54 but requires that the landowner realize or should realize that his activity poses an unreasonable risk. “Section 371 thus hinges on foreseeability, which is not part of the duty analysis under Arizona law. . . . We thus decline to apply” it. Burns v. Jaquays (1987) discussed liability for asbestos blown from one property to another, which Plaintiff argued also applied to his case, but the court says that Burns was not a negligence or duty opinion.

“A duty of care can also originate in public policy arising from statutes or common law . . . . Absent either, we typically will not find a duty based in public policy.” Plaintiff did not cite statutes or common law other than as mentioned above. He argued instead that he satisfied some additional public-policy factors mentioned in Bloxham (2002) (which in turn had quoted them from an out-of-state case). The court disagrees, being primarily concerned with the huge and unlimited liability involved in giving a claim to anyone who is around anyone who was on anyone else’s property and allegedly came into contact with some substance.

The mesothelioma industry has litigated these “take-home exposure” cases in other jurisdictions, with varying results. Plaintiff of course cites those favorable to the theory. The court reviews them  and concludes that they based duty on foreseeability of harm. “Those courts that do not focus on foreseeability have declined to find a duty.”

(Opinion: Quiroz v. Alcoa)