Tall tale from tow trucker
On March 9, 2005, Mark Silva, a tow truck operator, was assisting a vehicle stuck in a snowdrift on Route 6 in Provincetown, Massachusetts. Silva had pulled his truck to the side of the road and hooked up a tow line to the disabled car. The road conditions were “snowy, slushy, and icy.” Dorothy McQuinn was driving on Route 6 with her fogged-up windshield obstructing her view of the road when she rear-ended Silva, who “was tossed inside the truck.” The next day Norfolk & Dedham Mutual Fire Insurance Company, McQuinn’s insurer, was informed of the collision and opened a claim. McQuinn had bodily injury coverage of $250,000 per person and $500,000 per accident.
Norfolk & Dedham gathered information that cast doubt on the genuineness of Silva’s claimed injuries. The judge found that “[t]his series of events occurring between 2006 and 2008 gave Norfolk & Dedham reason to doubt Silva’s general veracity and be suspicious of not only his wage claim but also his claims of bodily injury.”
Silva argued that Norfolk & Dedham’s pretrial handling of his personal injury claim violated the Massachusetts law that governs unfair methods of competition and unfair or deceptive acts or practices in the conduct of any trade or commerce.
On the first day of trial of the personal injury suit, the presiding judge held a conference to discuss the possibility of settlement. Silva’s attorney said that no offer had been made, and McQuinn’s attorney responded that he had never received a demand. He had made two settlement offers during the personal injury trial—$25,000 and $60,000—both of which were rejected.
The jury returned a verdict for Silva and awarded damages of $818,000.
After a jury-waived trial in the Superior Court on claims of unfair settlement practices, the judge found that Norfolk & Dedham did not engage in unfair practices in its handling of Silva’s personal injury claim against McQuinn. The judge also found, however, that after Silva obtained a substantial jury verdict on his personal injury claim and while the appeal from that judgment was pending in this court, Norfolk & Dedham violated a section of the unfair practices law when it offered to settle the claim for the policy limit without also offering post-judgment interest.
Silva appealed, and Norfolk & Dedham cross appealed.
On appeal, the court noted that the judge in the lower court found that “there was no testimony at trial identifying specific steps that Norfolk & Dedham should have taken but did not in investigating Silva’s bodily injury claim.” The court held that the judge did not err in determining that Norfolk & Dedham was not “inattentive” or “unreasonable” in its investigation of the accident.
With respect to Silva’s argument that Norfolk & Dedham failed to offer a settlement, the court found that the insurer “had multiple reasons to be skeptical of [Silva’s] damage claims” from the inception of its investigation just days after the accident. Within one month of the accident, a private investigator informed Norfolk & Dedham that Silva “was observed at [his automobile service station] and it appeared he was working a very full and busy schedule.”
Norfolk and Dedham’s skepticism continued when “Silva waited a year after the accident to claim disability from performing work as a tow truck driver, continued to work a full towing schedule while claiming he could only perform desk work, [and] sought workers compensation benefits while collecting unemployment benefits.” Norfolk & Dedham also learned that Silva’s workers compensation insurer questioned the existence of causation between the accident and Silva’s claimed injuries.
The court stated that, although fault for the accident may have been clear, the “damages attributable to [McQuinn] … [were] still the subject of good faith disagreement.” Here Norfolk & Dedham “had a reasonable basis for resisting liability.”
Silva also argued that the judge erred in excluding the testimony of an expert witness; the appellate court disagreed.
While the appeal from the personal injury verdict was pending, Silva informed Norfolk & Dedham that he was “willing to settle his claim for the entire amount of the judgment plus interest, $1,011,873.37.” Norfolk & Dedham responded in a letter dated June 2, 2010, offering to settle the case for $250,000, the policy limit, “in exchange for a release of its insured.” The judge determined that “the failure to include post-judgment interest in the June 2, 2010, settlement offer violated Chapters 176D and 93A,” but also that the “violation of Chapter 93A was not knowing and willful so as to warrant punitive damages.” Norfolk & Dedham argued that the judge erred as a matter of law in finding a violation. Silva argued that the judge erred by finding that the violation was not knowing or willful and declining to order double or treble damages. The court agreed with Norfolk & Dedham.
The court reversed the portions of the amended judgment entered on November 23, 2015, awarding Silva damages, prejudgment interest, costs, and attorney’s fees for Norfolk & Dedham’s failure to include post-judgment interest in its settlement offer. In all other respects the amended judgment was affirmed.
Silva vs. Norfolk & Dedham Mutual Fire Insurance Company-Appeals Court of Massachusetts, Barnstable-April 26, 2017- No. 16-P-150.