NOVEMBER 2007 - MASSACHUSETTS SJC RULING FACILITATES EXCHANGE OF INFORMATION AMONG CO-DEFENDANTS

The Supreme Judicial Court has adopted the common interest doctrine relating to the attorney client privilege. See Hanover Insurance Company v. Rapo & Jepsen Insurance Services, Inc, 449 Mass. 609 (2007). The attorney client privilege protects communications between attorneys and their clients from disclosure. Normally, disclosure of the communication to a third party waives the privilege so that the privilege no longer protects that communication. Under the common interest rule adopted by the SJC, however, the attorney client privilege continues to apply if a privileged communication is “shared with another represented party's counsel in a confidential manner for the purpose of furthering a common legal interest.” Id. at 602 (citation omitted) In other words, the common interest doctrine “prevents waiver of the attorney-client privilege when otherwise privileged communications are disclosed to and shared, in confidence, with an attorney for a third person having a common legal interest for the purpose of rendering legal advice to the client.” Id. at 614.

The court explained that the common interest doctrine can apply even if the client does not consent in advance to the attorney’s sharing of information with a third party. Also, the common interest doctrine can apply, even in the absence of a written joint defense agreement. It is also not necessary for the interest of the separate parties to be “entirely congruent.”

The court’s decision is important because it makes it possible for co-defendants to communicate on common strategy while keeping these communications privileged so that they do not have to be disclosed to the plaintiff..

NOVEMBER 2007 - INSURANCE BROKER NOT LIABLE FOR FAILING TO DISCLOSE POTENTIAL COVERAGE LIMITATIONS ON CERTIFICATE OF INSURANCE

In Vargas v. Sylvia & Co. Insurance Agency, Inc., 69 Mass. App. Ct. 1105 (2007), the Appeals Court reinforced limitations on the extent to which the holder of a certificate of insurance may reasonably rely upon the certificate to establish the scope and applicability of available insurance coverage. Before hiring a contractor, Roberto Barbosa, to build their new home, the plaintiffs were given a certificate of insurance issued by the defendant insurance agency, indicating that Barbosa had liability insurance. When the home developed structural problems due to shoddy construction, the plaintiffs sued Barbosa. Barbosa’s insurer refused to provide coverage, because the insurance had been issued based upon an application in which Barbosa had represented himself as a painter only, and not as a builder. Lacking any insurance to cover the plaintiffs’ claim, Barbosa declared bankruptcy, and the plaintiffs were left without a means of recovery for a substantial portion of their damages.

Unable to recover from the contractor himself, the plaintiffs turned their attention to Barbosa’s insurance broker, Sylvia. They claimed that Sylvia, which assisted Barbosa in the preparation of the application, knew or should have known that Barbosa was engaged in construction, and therefore should have known that his application was inaccurate and his insurer might refuse to provide coverage for construction activities. They argued that Sylvia had a duty to disclose the potential vulnerability of the insurance on the certificate of insurance which it issued to them, and that the failure to do so constituted a negligent misrepresentation. A jury agreed, and judgment entered in favor of the plaintiffs.

The Appeals Court reversed, ruling that the certificate was facially accurate, and that the plaintiffs could not reasonably or justifiably have relied upon the certificate to suggest that Barbosa would be covered for any claims which might arise from the construction of their home. The Court focused upon the standard disclaimer language in the certificate, warning the holder that the certificate was issued “as a matter of information only,” and that the insurance listed on the certificate was “subject to all the terms, exclusions and conditions of such policies.” In light of this language, the Court held that the plaintiffs could not “rely on the certificate for an understanding of what risks were or were not covered.”

TOP

NOVEMBER 2007 - MASSACHUSETTS APPEALS COURT REFUSES TO IMPOSE SOCIAL HOST LIABILITY ON FRIENDS WHO SHARE COST OF DRINKS AT A BAR

In Dube v. Lanphear, 69 Mass. App. Ct. 386 (2007), the Appeals Court refused to expand the concept of social host liability.

Previous cases established that a social host could be liable for furnishing alcoholic beverages if he knew or should have known that the drinker was intoxicated. In this case, a group of four friends regularly went out for drinks after work. They rotated paying for the drinks, with one of the friends usually paying the bill for a particular night. Alternatively, they would divide the bill evenly.

On the night in question, defendant Lanphear paid the bill after the group had been at the bar for about four hours. Bhoge then had some additional drinks but it was unclear who paid for them. The three defendants saw Bhoge after he left the bar and a jury could infer that he appeared intoxicated at that point. He was subsequently involved in an accident that resulted in injuries to the plaintiff.

The Appeals Court held that the three defendants were not liable as social hosts. The court concluded that they did not really control Bhoge’s liquor supply, emphasizing that “[w]hile they could refuse to continue to pay for Bhoge's drinks, they could not require that he be ‘shut off’ by the bar; relinquish his drinks; or be ejected from the premises.” The court explained that “[s]haring a check is not the equivalent of being a host.”

OCTOBER 2007 - MASSACHUSETTS SJC CLARIFIES LAW ON COMMERCIAL LANDLORD'S DUTY

The Supreme Judicial Court has ruled that a lessor of a commercial premises did not owe a duty to maintain the leased premises unless it agreed to do so. See Humphrey v. Byron, 447 Mass. 322 (2006). Although the court has held that a residential landlord owes a duty of reasonable care with respect to the leased premises, the same rule does not apply to commercial tenancies. The court emphasized that commercial tenancies are significantly different from residential tenancies because commercial tenants tend to have more bargaining power.

The court reaffirmed that "a lessor of commercial premises is liable in tort for personal injuries only if either (1) he contracted to make repairs and made them negligently, or (2) the defect that caused the injury was in a ‘common area,' or other area appurtenant to the leased area, over which the lessor had some control." This rule "recognizes a distinction between the leased premises themselves and ‘common' or ‘appurtenant' areas outside the leased premises, such that ordinarily, the tenant is responsible for the leased premises and the landlord, perhaps jointly with the tenant, is responsible for common or appurtenant areas." In this case, the landlord was entitled to summary judgment because the tenant was solely responsible for maintaining the leased premises where the accident occurred.

TOP

OCTOBER 2007 - MASSACHUSETTS SJC HOLDS THAT HOMEOWNER CAN BE LIABLE FOR NEGLIGENTLY STORING FIREARM

The Supreme Judicial Court has rule that a homeowner can be liable for the death of a police officer shot with a firearm stored on the homeowner's premises. See Jupin v. Kask, 447 Mass. 141 (2006). The assailant, Jason Rivers ("Jason"), had a history of violence and mental instability. His father, Willis Rivers ("Rivers"), was the boyfriend of the defendant, Sharon Kask ("Kask"), and lived with her at a single family home that she owned. Rivers had a collection of guns that Kask permitted him to store in the basement of the home. Rivers built a gun cabinet made of particle board and secured with a padlock and hasp. The hasp had exposed screws so someone could remove the hasp and reach the guns. Kask had seen the gun cabinet but did not assume any responsibility for its construction, maintenance or security.

Jason had a key to the home, and he took a gun from the cabinet. When he did not appear for a probation violation hearing, a warrant was issued for his arrest. Officer Jupin and his partner saw Jason and discovered that he had a hunting knife. While they were running a warrant check, Jason fled. The officers gave chase, and Jason shot and fatally injured Jupin using the gun he had taken from the cabinet.

Jupin's estate filed suit against Kask, and the trial court granted her motion for summary judgment. Reversing that order, the Supreme Judicial Court held that it was a question of fact whether Kask was negligent. Kask's own deposition testimony showed that she had foreseen that an improperly stored gun might be stolen and improperly used. Furthermore, she could have foreseen that Jason, given his history of violence, his recent problems with the law and his history of psychiatric observation, "might use his unsupervised access to the house to take a weapon from the basement gun cabinet, and subsequently use this weapon in the commission of a violent crime." As a result, Kask "owed a duty of reasonable care to the plaintiff relative to the storage of firearms kept in her home," and she was not entitled to summary judgment on the negligence claim.

The court did, however, reject the plaintiff's strict liability claim. Storing guns is not an ultra hazardous activity that would support a strict liability claim. Furthermore, the court rejected the plaintiff's public nuisance claim, because unloaded firearms "do not inherently interfere with or threaten the public safety..."

TOP

OCTOBER 2007 - MASSACHUSETTS SJC REVERSES ORDER GRANTING NEW TRIAL IN MEDICAL MALPRACTICE CASE BASED ON ALLEGED PERJURY BY DEFENDANT'S EXPERT

The Supreme Judicial Court has reversed an order granting a new trial to a plaintiff who claimed that the defendant's expert had committed perjury during the original trial. See Wojcicki v. Caragher, 447 Mass. 200 (2006).

The plaintiff alleged that the defendant physician was negligent in treating his wife after she suffered an ischemic stroke. The plaintiff's expert testified that the defendant should have administered tissue plasminigen activator (t-PA) to the patient and deviated from the standard of care by failing to do so. The National Institute of Neurological Disorders and Stroke (NINDS study) showed that t-PA may reduce the disability that often results from ischemic stroke. The drug did create a risk of intracranial bleeding, so the study recommended that patient with a higher risk of such bleeding not receive the drug.

The defendant testified that the decedent was not a proper candidate for t-PA because she had recently been diagnosed with breast cancer. One of the defendant's experts, Dr. Paul Hochberg, testified that no cancer patients were included in the NINDS study.

After the jury found for the defendant, plaintiff's counsel learned that 59 of the 624 participants in the study had been diagnosed with cancer at some point in their lives. Plaintiff then moved for a new trial, arguing that Hochberg have given false and misleading testimony. After conducting a hearing on this issue, the trial judge granted the motion, finding that Hochberg tried to create the impression that CD-ROMS from the study showed that no cancer patients participated, when he in fact did not know that was true and had not reviewed the data. She also imposed sanctions on Hochberg and the defendant.

On appeal, the SJC reversed. The evidence in the record did not show that there had been a fraud on the court, which occurs "where ‘it can be demonstrated, clearly and convincingly, that a party has sentiently set in motion some unconscionable scheme calculated to interfere with the judicial system's ability impartially to adjudicate a matter by improperly influencing the trier or unfairly hampering the presentation of the opposing party's claim or defense.'" The court explained that even perjury does not constitute fraud on the court "when there is no evidence that the judicial process itself was corrupted."

Although the court acknowledged that portions of Hochberg's testimony were misleading, the court stressed that the evidence did not show that any patients with active cancer had participated in the study; instead, it merely showed that fifty-nine participants in the study did have some history of cancer. It was, therefore, difficult to conclude that the testimony was false.

TOP

OCTOBER 2006 - MASSACHUSETTS SJC ADOPTS SOPHISTICATED USER DEFENSE IN PRODUCT LIABILITY CASES

The Supreme Judicial Court has adopted the sophisticated user defense in product liability cases. See Carrel v. National Cord & Braid Corporation, 447 Mass. 431 (2006). Under this rule, a manufacturer is not liable in negligence or warranty "for failing to warn of a product's latent characteristics or dangers when the end user knows or reasonably should know of a product's dangers." Id. at 440-441 (quotation marks omitted).

The plaintiff attended a camp that was operated under the auspices of the Old Colony Council, which was alleged to the regional authority of the Boy Scouts of America. ("Boy Scouts") He participated in a zip line course, in which campers "ascend to a high platform, are attached by harness to a cable, and travel down the cable (or zip line) to a lower platform." He "stood on the ground below the ‘zip line' and pulled a bungee cord tied to the course's brake block..." The knot attaching the bungee cord to the block came undone, and the bungee cord struck the plaintiff in the eye, severely injuring him.

The plaintiff filed suit against several defendants, but all of the claims settled except for the ones against National Cord & Braid Corporation ("National Cord"), the alleged manufacturer of the bungee cord. National Cord did not place any warnings on the cord, or its container. National Cord sold the bungee cord to Project Adventure which in turn supplied it to the Old Colony Council. There was evidence that Project Adventure and the Boy Scouts had extensive experience in setting up zip lines.

Over the plaintiff's objection, the trial judge instructed the jury that National Cord's "duty to warn might be lessened or might not exist if the user's experience, expertise and knowledge far exceeds the manufacturer's." The jury found for the defendant and the plaintiff appealed. The Supreme Judicial Court rejected the plaintiff's appeal, concluding that the instruction was appropriate pursuant to the sophisticated user defense. As a result of this decision, defendants in product liability cases should raise the sophisticated user defense whenever there is evidence that the end user had significant knowledge about the product or its dangers.

MAY 2006 - MASSACHUSETTS SJC CLARIFIES STATUTE OF LIMITATIONS IN FIDUCIARY DUTY CASES

Reversing a decision by the Appeals Court, the Supreme Judicial Court has held that the statute of limitations barred a sexual abuse claim based on a breach of fiduciary duty theory. See Doe v. Harbor Schools, Inc., 446 Mass. 245 (2006). The plaintiff alleged that her former counselor, Glen Freeman, had breached his fiduciary duty to her by engaging in a sexual relationship with her in 1993, when she was 18. She did not file suit until January 1997, so Freeman and his employer, Harbor Schools, Inc., argued that the statute of limitations barred her claim. A Superior Court judge granted summary judgment for the defendants on each of the plaintiff’s claims, but the Appeals Court reversed on the breach of fiduciary duty claim, holding that the statute of limitations did not begin to run until the plaintiff knew that Freeman had breached his fiduciary duty to her.

The Supreme Judicial Court disagreed with the Appeals Court and held that the statute of limitations barred the fiduciary duty claim. In 1992, the plaintiff was placed in a group home, and Freeman became her counselor. He attempted to develop a close relationship with her, and eventually began having sexual contact with her. In June, 1993, Doe moved out of the group home and into another facility operated by Harbor that provided a more independent living situation. A Harbor social worker told the plaintiff that she could no longer see Freeman, and Freeman was instructed not to see her. The plaintiff testified that she knew at this point that Freeman "was taking advantage of [her]", but that the prospect of losing him made her "distraught" because he was "the only person [she] had." In June, 1993, she attempted suicide.

In July 1993, she decided to end the relationship, and she began dating "Joseph", who warned her about Freeman, and said that she should stay away from him. In November, 1993, Doe told Freeman that she did not want to see him any more. In July, 1994, Doe told Joseph about the sexual contact between her and Freeman. According to the plaintiff, she first became angry with Freeman sometime after those disclosures to Joseph.

In September, 1994, she began seeing a social worker to help her with her emotional problems. According to an August, 1999 treatment summary, she was "only able to recognize that the relationship was an abusive one ‘over the last two years.’"

The Supreme Judicial Court concluded that Freeman clearly had a fiduciary relationship with the plaintiff because of his role as counselor. It was equally clear that he breached that duty by engaging in sexual contact with her.

It was, however, also apparent that the statute of limitations barred her fiduciary duty claim. The court explained that the statute of limitations on a fiduciary duty claim is tolled "until a plaintiff has actual knowledge that she has been injured by the fiduciary’s conduct." (Emphasis added). Under this standard, it is not enough that the plaintiff should have known that she was harmed. The court also noted, however, that "[a]ctual knowledge of injury suffered at a fiduciary’s hands, not knowledge of the consequences of that injury (i.e. a legal claim against the fiduciary) sets the three-year statute of limitations in play."

Applying that test in this case, the court concluded that the statute of limitations barred the claim. The evidence established that, "by the fall of 1993, Doe realized that Freeman had abused his position and that she was harmed by his conduct. Her actual knowledge then triggered a duty to investigate further and started the limitations period running." Since she did not file suit until more than three years later, the statute of limitations barred her claim.

APRIL 2006 - SJC ENFORCES MEDICAL MALPRACTICE STATUTE OF REPOSE TO BAR CLAIMS

The Supreme Judicial Court has issued two decisions enforcing the medical malpractice statute of repose in G.L. c. 260, § 4, and rejecting arguments that attempted to create exceptions to the statute. See Joslyn v. Chang, 445 Mass. 344 (2005); Rudenauer v. Zafiropoulos, 445 Mass. 353 (2005).

G.L. c. 260, § 4 states, in part, that:

Actions of contract or tort for malpractice, error or mistake against physicians, surgeons, dentists, optometrists, hospitals and sanitoria shall be commenced only within three years after the cause of action accrues, but in no event shall any such action be commenced more than seven years after occurrence of the act or omission which is the alleged cause of the injury upon which such action is based except where the action is based upon the leaving of a foreign object in the body. (Emphasis added).

The emphasized language creates a statute of repose places "an absolute time limit on the liability of those within its protection" and "abolish[es] a plaintiff’s cause of action thereafter, even if the plaintiff’s injury did not occur, or is not discovered, until after the statute’s time limit has expired." Joslyn, 445 Mass. at 347 (citation omitted).

In Joslyn, the plaintiffs argued that the statute of repose should be tolled if the defendant fraudulently concealed the plaintiff’s claim. In October, 1992, the defendant doctors performed heart surgery on the plaintiffs’ daughter. During the surgery, the child’s heart and coronary artery were punctured, resulting in significant blood loss, an injury that caused her to die one hour and ten minutes after the beginning of the procedure.

Dr. Chang told that plaintiffs that their daughter died because "her heart was ‘too weak to withstand the procedure.’" He did not tell them about the puncture and significant blood loss, and the plaintiffs did not obtain the results of an autopsy or the hospital records at that time.

In 2001, the plaintiffs finally obtained the records, because a physician suggested that they might be relevant to the treatment of their other daughter. They then filed suit, arguing that the statute of repose was tolled because the defendants had fraudulently concealed their claim.

The Supreme Judicial Court rejected their contention, concluding that the stature of repose was absolute and did not have an exception for fraudulent concealment. The court emphasized that the Legislature had created only one exception to the statute of repose - for cases involving foreign objects left in a patient’s body, and the court concluded that it was not free to imply any other exceptions into the statute.

In Rudenauer, the plaintiff alleged that the defendant doctor negligently failed to monitor her husband’s kidney condition so that his cancer was not detected until much later, and he died from the disease.

On February 10, 1990, the decedent saw the defendant for the first time, complaining of left flank pain. The defendant ordered a CT scan which showed that the decedent had "a mass legion most consistent with an intrarenal hematoma, but with a recommendation for follow-up scans to rule out a renal mass of a different type." The decedent continued to see the defendant for 21 months, until an ultrasound taken on November 8, 1991 "revealed a very nodular left kidney with no definite mass seen."

On February 21, 1995, the decedent returned to the defendant, complaining of left side pain, and outflow obstruction. The defendants conducted a series of tests which ultimately showed that the decedent had cancer in his kidney, and in 1996, another physician removed the kidney. In 2000, another physician discovered that the cancer had metastasized, and the decedent died in October, 2000.

In 2001, the plaintiff filed suit against the defendant, but the defendant argued that the statute of repose barred any claims arising out of the 1991 treatment because more than 7 years had passed since the 1991 treatment. The plaintiff had evidence that the defendant was negligent in 1991, but there was no evidence that any negligence in 1995 caused the decedent’s death. The plaintiff argued that the statute of repose should be tolled because the defendant had continued to treat the decedent until 1995. Rejecting this contention, the Supreme Judicial Court held that the stature was absolute and did not have an exception for continuing treatment. The court reasoned that "the Legislature intended to extinguish malpractice claims seven years after negligent acts or omissions even when a doctor’s treatment of, or responsibility for, a condition continued beyond the alleged negligence."

TOP

APRIL 2006 - APPEALS COURT REVERSES SPOLIATION SANCTION

The Appeals Court has held that a Superior Court judge abused his discretion in a product liability case by sanctioning a party which had failed to preserve the chair that was involved in the accident. See Westover v. Leiserv, Inc.; Regal Manufacturing, 64 Mass. App. Ct. 109 (2005). The plaintiff was injured at a Brunswick bowling alley as she pulled out a chair in the lounge so that she could sit down. "[T]he leg of the chair separated from the seat and a sharp piece of metal cut off the tip of her index finger." Michael Gaul, Brunswick’s general manager, inspected the chair and noticed that "the weld of the chair was broken and that the chair seat was detached from the front of the metal chair frame on both the left and right sides." Gaul intended to preserve the chair, but another employee of the bowling alley discarded it.

Gaul found other chairs that had the same defect and secured those chairs. The plaintiff agreed that the chairs were substantially similar to the accident chair.

The plaintiff sued the bowling alley, Brunswick, which brought a third-party claim against Regal, the chair manufacturer. Brunswick had an expert who would testify that there was a design defect in all the chairs of the product line.

A Superior Court judge entered summary judgment for Regal, ruling that: (1) Brunswick had spoliated evidence by not preserving the chair involved in the accident; (2) Brunswick should be precluded from introducing evidence about the condition of the chair; and (3) Regal was entitled to summary judgment because Brunswick could not prove its case without such evidence.

The Appeals Court reversed, ruling that the sanction was too harsh. The court emphasized that other substantially similar chairs were available, and that Regal’s experts could examine those chairs to determine if Regal had manufactured them. Furthermore, the court thought that examination of the original chair involved in the accident was less important because Brunswick was making a design defect claim and other chairs had the same design.