Maryland High Court Finds Good Cause To Excuse Lack of Notice To The Housing Authority of Baltimore City In Lead Paint Case

A $690,000.00 lead-paint verdict was at stake in Maryland’s high court in the Hous. Auth. of Balt. City v. Woodland case. Hous. Auth. of Balt. City v. Woodland, 2014 Md. LEXIS 162 (2014). In a reported opinion authored by Judge Sally D. Adkins, the Court of Appeals of Maryland held that Amafica Woodland’s mother and grandmother had good cause for not substantially complying with the 180-day deadline in the Local Government Tort Claims Act (“LGTCA”) to notify the Housing Authority of Baltimore City (“HABC”) of their claim for damages. Id. at 6-7. The LGTCA, outlined in section 5-304 of the Courts and Judicial Proceedings Article of the Maryland Code, states that an action for damages cannot be brought against a local government entity unless notice of the claim is given within 180 days after the injury. Md. Code Ann., Cts. & Jud. Proc. § 5-304(b). The notice must be in writing and include the time, place, and cause of the injury. Id.

Amafica Woodland (“Woodland”) lived at 127 Albemarle Street (“the Residence”) with her mother, Tanderlara Monterio (“Monterio”), and her maternal grandmother, Dale Williams (“Williams”) from 1995, when she was born, until November of 1997. Woodland, at 1-2. The Residence was owned and managed by the HABC. Id.  In the Fall of 1997, Woodland had her blood tested twice for lead and received readings of 13 and 11 milligrams per decileter, at a time when 10 was considered an elevated blood level. Id. at 2-3. Following the testing, Williams and Monterior met with Robin Mack (“Mack”), a property manager for the HABC. Id. At the meeting, Mack had Monterior complete a lead questionnaire and gave her an informational booklet on lead. Id. at 3. The meeting was also recorded in a “Summary of Interviews,” and Mack subsequently requested lead testing of the home. Id. Tests were conducted at the property in October of 1997, where chipping paint was noted throughout the house. Id. at 3-4. Following the testing, the HABC quickly relocated the family. Id. at 4.

Woodland’s family filed suit against the HABC in April of 2009, alleging that the conditions of the home led to Woodland’s ultimate lead poisoning and related cognitive impairment. Id. The HABC filed a motion for summary judgment alleging that the family failed to comply with the 180-day notice requirement in the Local Government Tort Claims Act, and that there was no good cause for the failure to comply. Id. Judge Pamela J. White of the Circuit Court for Baltimore City ultimately denied HABC’s motion, finding that the family had substantially complied with the notice requirements. Id. at 4-5. At trial, the jury entered a verdict in favor of Woodland, along with a judgment that ultimately amounted to $690,000.00 after the statutory non-economic damages caps were applied. Id. at 5. The Court of Appeals granted certiorari, superseding the Court of Special Appeals. Id.

The Court upheld the trial court’s ruling; however, it did so on slightly different terms. The Court disagreed with the trial court and held that a simple meeting with the HABC property manager absent an “explicit or implicit threat of legal action,” or some other written notice, did not constitute substantial compliance. Id. at 13-14 (citing Ellis v. Hous. Auth. of Balt. City, 436 Md. 331, 82 A.3d 161 (2013) (stating that even a verbal complaint of chipping paint coupled with a threat to sue did not qualify as substantial compliance with the LGTCA)). Turning next to the “good cause” exemption, the Court held that the meeting in person with Mack about the lead tests, coupled with the subsequent investigation and ultimate housing transfer, was enough for the family to reasonably believe that they had put the HABC on notice of their claims. Id. at 23-24, 29-30.

Ultimately, the Court of Appeals’ decision in Woodland allows for a broader interpretation of the good cause exception to the notice requirement in the LGTCA, which will weaken motions for summary judgment filed by government entities in future cases. Additionally, the Court’s decision will ultimately allow for many others to claim ignorance when found in violation of the notice requirements, putting the pressure on government agencies and local governments to thoroughly investigate every potential claim in a timely manner.  

Article contributed by Catherine A.B. Simanski

Governor O'Malley Signs Compromise Dog Bite Bill

In 2012, in the case of Tracey v. Solesky, 427 Md. 627, 50 A.3d 1075, the Maryland Court of Appeals held that pit bulls and cross-bred pit bulls are “inherently dangerous” and imposed a strict liability standard on owners and landlords. The highest court’s ruling resulted from a pit bull attack in 2007 in Baltimore County in which a 10-year-old boy was severely injured by his neighbor’s pit bull.

The ruling regarding pit bulls and cross-bred pit bulls faced great criticism from pet owners and animal rights activists because of its focus on a single breed. In addition the ruling was criticized for making it more difficult to find adoptive homes for pit bulls.

In response to the pit bull ruling and its subsequent criticism, and after failed attempts to pass legislation the Maryland General Assembly approved a compromise measure. Under this legislation all Maryland dog owners, regardless of breed, would be held to the same negligence standard for dog bites and owners would be allowed to defend themselves in actions arising out of their dog biting others. Thus, rather than strict liability for dog bites by pit bulls and cross-bred pit bulls, the determination of an owner’s liability regarding the dangerousness of their dog will be left to a jury determination, however, a strict liability standard applies to all dogs if an injury resulted while that dog was running at large.

In early April 2014, Governor Martin O’Malley signed the legislation into law. Thus, overturning the Court of Appeals decision in Tracey v. Solesky and ending the shirt lived era of a strict liability standard applied only to dog bites by pit bull and cross-bred pit bulls. Under Maryland’s new law, bites by pit bulls and cross-bred pit bulls will be treated the same as dog bites by any other breed. 

General Release with Liability Insurer Does Not Preclude Recovery of Uninsured/Underinsured Payments from UM Carrier

The Brethren Mut. Ins. Co. v. Ember Louise Buckley, 2014 Med. LEXIS 140, 86 A.3d 665 (2014).

In an opinion issued in March of 2014, the Court of Appeals of Maryland held that UM carriers may be required to issue uninsured/underinsured payments to their insured, even if the insured has signed an agreement with a liability insurer releasing claims against known or unknown parties.  

 

Ember Buckley was involved in a single car automobile accident in which her boyfriend, Harvey L. Betts, was the driver.  As a result of the accident, Buckley sustained serious injuries, with medical bills relative to the accident exceeding $200,000.00.  Betts was covered by a liability insurance policy issued by GEICO with policy limits of $100,000.00.  Buckley had a policy with Brethren Mutual Insurance Company that included uninsured/underinsured motorist coverage.  GEICO offered policy limits to settle Buckley’s claim.  Buckley sent notice of the settlement offer from GEICO to Brethren, and Brethren agreed to waive any subrogation actions against Betts.  Buckley then signed a release of all claims against Harvey Betts, as well as a hold harmless agreement in favor of Betts and GEICO.  The language of the release provided that Buckley would release “…all other persons, firms or corporations of and from any and every claim…” resulting from the underlying accident.  Buckley then unsuccessfully tried to recover under the uninsured/underinsured provision of her policy with Brethren.  After Brethren denied her claim, Buckley filed suit in Baltimore County Circuit Court for breach of contract.   

At the trial level, both parties filed motions for summary judgment.  Brethren argued that Buckley signed a general release which released all parties, firms and corporations from future claims, regardless of being parties to the Release.  Buckley argued that the Release only applied to Betts and his insurer.  She further argued that the execution of the Release was in compliance with section 19-511 of the Insurance Article of the Maryland Annotated Code, which provides in pertinent part:

            (e) Acceptance of settlement offer.—The injured person may accept the liability insurer’s settlement offer and execute releases in favor of the liability insurer and its insured without prejudice to any claim the injured person may have against the uninsured motorist insurer:

            (1) on receipt of written consent to acceptance of the settlement offer and to the execution of releases; or (2) if the uninsured motorist insurer has not met the requirements of subsection (b) or subsection (c) of this section.

Md. Code Ann., Ins. § 19-511.

The Circuit Court granted summary judgment in favor of Brethren, and Buckley appealed.

The Court of Special Appeals, enforcing a strict interpretation of section 19-511, held that “executing a boilerplate, general release in favor of the liability insurer does not relieve the UM carrier from its contractual duty to issue a UM payment to its insured.” Buckley v. Brethren Mut. Ins. Co., 207 Md. App. 574, 587, 53 A.3d 456, 463 (2012).    The Court held that the executed Release was insufficient to relieve Brethren of its duty to pay under the uninsured/underinsured policy.  Brethren appealed to the Court of Appeals, which granted certiorari. 

Brethren argued that the language in the Release executed by Buckley was clear, and that Buckley released all future claims in connection with the accident, including claims against uncontemplated parties.  Brethren also argued that Buckley was not protected by section 19-511 because the Release was outside of the parameters of the statute. 

           

The Court of Appeals applied section 19-511 of the Insurance Article to the facts of the underlying case.  The Court referenced section 19-511, subsection (e), and found that the language of the statute does not require that the language of a release must be narrow in scope in order to fall within the statute’s protection.  The Court cited its opinion in Erie Ins. Exch. v. Heffernan for support, where it held that “the purpose of the uninsured motorist statute is to provide minimum protection for individuals injured by uninsured motorists and should be liberally construed to ensure that innocent victims of motor vehicle collisions are compensated for their injuries.” Erie Ins. Exch. v. Heffernan, 399 Md. 598, 612, 925 A.2d 636, 644 (2007). 

Ultimately, the Court could not find that the Release relieved Brethren of its duty to pay under the uninsured/underinsured provisions of Buckley’s policy.  To find that the Release relieved Brethren of its duty would not be consistent with the legislative intent of section 19-511.  Judgment of the Court of Special Appeals was affirmed. 

Ordinarily, a general release of all claims in favor of the liability insurer and signed by the UM carrier’s insured will likely not be a successful defense for the UM carrier in denying uninsured/underinsured payment.  Section 19-511 of the Insurance Article does not leave the UM carrier without options.  Those options include the ability to pursue any subrogation claims against the liability insurer.  Additionally, the statute requires the insured to inform the UM carrier of the liability insurer’s settlement offer.  The insured’s failure to comply with the requirements set forth in the statute may be used by the UM carrier as a defense for the denial of the claim. 

Contributed by Danielle Williamson, Esq.