Archive for the ‘Personal Injury’ Category

Accident And Injuries: On February 20, 1997, Jane Hovet was severely injured when her vehicle was struck from behind at high speed by Steven Lujan’s vehicle. Lujan was insured by Allstate Insurance.

Allstate refused to pay Ms. Hovet’s medical bills. Ms. Hovet was forced to file a lawsuit. Mr. Lujan admitted he was at fault for the accident and the Court found him legally liable for her injuries and damages.

Personal Injury Trial: At trial, Ms. Hovet proved she had over $11,000.00 in medical bills from the accident, would need corrective surgery in the future, lost work, was permanently impaired from doing her normal activities of her daily life, and suffered from pain regularly. A jury awarded her $62,050.00 in damages.

Allstate’s highest settlement offer to Ms. Hovet before trial had been $7,200.00, much less than her medical bills alone.

So, Ms. Hovet filed suit against Allstate Insurance for breaching its duty to mediate, resolve and settle her claim against Mr. Lujan, Allstate’s insured. Ms. Hovet claimed Allstate’s conduct violated the New Mexico Insurance Code’s section prohibiting >unfair and deceptive claims practices’ (NMSA 1978, Section 59A-16-20).

Allstate’s Pattern Of Mistreatment: Lawyers argued on behalf of Ms. Hovet: that Allstate’s treatment of her was merely a single instance of a nationwide practice; that Allstate has adopted a Settle for >X’ or Litigate policy for cases where the liability of Allstate’s insured is reasonably clear at the outset; that Allstate makes a one time ‘take-it-or-leave-it’ offer generated by a computer software program that evaluates claims without any real regard for the individual characteristics of any particular claim or claimant; and that settlement offers generated by Allstate’s computer program are approximately 25-40% of the historical values for similar claims, and frequently do not even equal the amount of the claimant’s medical bills.

Insurer Can Be Responsible To Victim Injured By Its Insured: New Mexico Court Of Appeals recently decided that people like Ms. Hovet have the right to directly sue the liable driver’s insurer under our Insurance Code. They decided that injured victims are third party beneficiaries’ of the liable driver’s insurance policy, and thus could go after the driver’s insurer, even though it was not their own insurance company.

Relevant portions of the Insurance Code define unfair and deceptive claims practices to include: not attempting in good faith to effectuate prompt, fair, and equitable settlements of an insured’s claims in which liability has become reasonably clear; or compelling insured to sue to recover amounts due under policy by offering substantially less than the amounts ultimately recovered in actions brought by such insureds when the insureds have made claims in amounts similar to what was awarded them in court.

The Future: This court decision has thrown insurance companies and their lawyers into a tizzy. That is understandable, given how often they mistreat people who have ben injured or whose vehicles have been damaged by the companies’ insureds.

I recently received a brochure for a seminar for lawyers being put on by the association of lawyers who insurance companies hire to defend personal injury lawsuits. The title of the seminar is: Hovet v. Lujan and Allstate: Now What? The brochure’s sub-title claims this is, The Dawning of Third-party Unfair Claims Practices in New Mexico B Chasing Tort Defendants and Insurers Down a One-Way Street.

The brochure encourages lawyers to, “bring a guest from the Insurance Industry for only $49″. The seminar brochure is right when it says that, as long as this decision stands, it will have a major impact on insurance carriers and attorneys. Insurance companies may have to start treating people fairly, not ignoring them, not abusing them, and not >low-balling’ them. Up to now, insurers have known they had all the power, That may be about to change. We will see.

The court decision is Hovet vs. Lujan and Allstate Insurance Company, Court of Appeals Docket Number 22,276, filed February 19, 2003.

We buy insurance hoping we never need it. But when you need it, your insurance company will be there to cover you, right? When Computer Corner, a family-owned personal computer sales and service business needed its insurer, Fireman’s Fund Insurance Co. was not there. Fortunately, a lawyer was there to help Computer Corner and the New Mexico Court Of Appeals forced Fireman’s Fund to provide the insurance coverage Computer Corner had paid for. This is what happened, according to the Court.

The Loss: On May 9, 1995, Charles Henry (Henry) took his personal computer to Computer Corner for service. The computer displayed the error message “major disk error.” At the time, Henry was employed by J.R. Hale Contracting Company (Contracting Company). Various data files that were important to the operation of Contracting Company’s business were stored on the computer hard drive. Henry informed the person who received his computer of the presence of these files and warned this employee that these files were not backed up.

In repairing Henry’s computer, the technician reformatted the hard drive. No backup of data was performed on the hard drive. Henry picked up his computer on May 10, 1995. As a result of the reformatting, Henry was unable to access the data stored on his hard drive. Henry sought advice from Computer Corner. Henry was erroneously told that the data could not be retrieved when in fact, the files still existed on his hard drive and could have been retrieved if certain procedures had been employed.  After receiving the erroneous advice from Computer Corner, Henry used the computer, overwriting the pre-existing files and permanently destroying them.

The loss of the computer files caused serious problems to Contracting Company’s business, and it ended up suing Computer Corner seeking damages for the cost of reconstructing the computer files. Fireman’s Fund agreed to defend Computer Corner, but refused to pay what Computer Corner ended up owing Contracting Company.

Insurer Refuses To Pay: Fireman’s Fund refused coverage because for two reasons: 1) the policy excludes coverage for intentional acts, and Computer Corner had intentionally reformatted the computer; 2) the policy excludes liability coverage for substandard work product or services. (This second exclusion is to prevent the insured from using the policy to underwrite the insured’s business warranties, guarantees, and assurances to customers. is commonly known as the >work product’ or >business risk’

So, Computer Corner had to sue Fireman’s Fund to get the insurer to pay Contracting Company. 1) Computer Corner did not intend to erase the files, even though it intentionally reformatted the computer. 2) The Contracting Company’s files that were erased pre-existed any work done by Computer Corner. Computer Corner was not working on those files, so it was not Computer Corner’s >product’ that was damaged.

Court Disagrees With Insurer: The Court Of Appeals examined Fireman’s Fund’s argument that, Section II.H.1.(m) of the policy provides that “this insurance” does not apply to “Property damage to your work arising out of it or any part of it and included in the products-completed operations hazard.” (Emphasis in original). This provision is greatly complicated by the fact that it incorporates three terms “property damage,” “your work” and “products-completed operations hazard” that are defined elsewhere in the policy. In our view, this exclusion, when read together with the defined terms, is “confusing and open to numerous interpretations.”

The language at issue should be considered not from the viewpoint of a lawyer, or a person with training in the insurance field, but from the standpoint of a reasonably intelligent layman, viewing the matter fairly and reasonably, in accordance with the usual and natural meaning of the words, and in the light of existing circumstances, prior to and contemporaneous with the making of the policy.

Considering the difficulty this provision presents to this Court in its own effort to decode Fireman’s policy, we conclude that this exclusion is unintelligible from the standpoint of a hypothetical reasonable insured operating a computer repair service. We find it difficult to believe that anyone genuinely interested in communicating information to another person whether in a cookbook, a home appliance manual, or a contract would employ the type of convoluted, intractable language used in Fireman’s policy. Fireman’s exclusion appears as much designed to provide Fireman’s lawyers with the widest latitude in making arguments against coverage once a coverage dispute has arisen, as to clearly communicate to lay insureds specific limits on the scope of coverage.

Court Slams Insurance Companies: It would be somewhat ludicrous for us to say this policy is not ambiguous. It is. But no more so than most others. Ambiguity and incomprehensibility seem to be the favorite tools of the insurance trade in drafting policies. Most are a virtually impenetrable thicket of incomprehensible verbosity . . . . The miracle of it all is that the English language can be subjected to such abuse and still remain an instrument of communication.

How could they say that about a nice insurance company? To read more, see Computer Corner, Inc. vs. Fireman’s Fund Insurance Co., 2002-NMCA-054.

Two recent court decisions from our State Supreme Court and Court Of Appeals reveals two more ways some insurance companies take advantage of their own insureds, and what can be done about it.

Insurers Must Make Fair And Honest Disclosure Even Before It Sell Its Policy: In the first case, life insurance policy holders alleged that their insurers had failed to adequately warn them that paying their insurance premiums in installments would cost more than paying the premium in a lump sum once a year. The Court Of Appeals found that insurers have a duty to deal fairly and honestly with customers even before the insurance policy is purchased. Also, an insurer has a duty to disclose important information to customers under New Mexico’s Unfair Practices Act (AUPA; NMSA 1978, Sections 57-12-1 to -22) and under our Unfair Insurance Practices Act (AUIPA; NMSA Sections 59A-16-1 to 30).

Both trade practices statutes specifically prohibit the making of any untrue, misleading, or deceptive statements in connection with the sale of any product. See ” 57-12-2(D); 59A-16-4; 59A-16-5. Under the UIPA, this includes the failure to disclose material facts reasonably necessary to prevent other statements made from being misleading. Section 59A-16-4(G). Under the UPA, this includes >using exaggeration, innuendo or ambiguity as to a material fact or failing to state a material fact if doing so deceives or tends to deceive. Section 57-12-2(D)(14)@

Insurers Should Not Take Advantage Of Their Unfair Bargaining Position When Writing The Insurance Policy: In the second case, Frieda Padilla was in an auto accident and the negligent driver only had $25,000 liability insurance, not enough to pay for all of Ms. Padilla’s injuries. So, Ms. Padilla made a claim against her insurer, State Farm Insurance, under her own $100,000 underinsured motorist coverage (AUIM coverage).

The trouble was that State Farm, like many insurers, had written the insurance policy to make it hard for its insured to collect. The policy required mandatory arbitration of UIM claims (in other words, the insured can not take the claim to a court and jury). The arbitrator’s decision would be binding on both State Farm and its insured for any award of damages of $25,000 or less, but for awards over $25,000, either party could get a new trial in court (thus wiping out the arbitrator’s decision). This is called a de novo appeal.

If you think about it, this is really unfair. If the insured loses, or only gets a small arbitration award, she is stuck with it B there is no right to appeal and get a trial. If the insured gets a bigger arbitration award because she was more seriously hurt, State Farm can have that award wiped out and make its insured go through the whole thing over again, this time in court. Lots more expense and delay before the insured gets anything or finds out she gets nothing. Oh, sure, the policy tries to make it look fair by saying either party can get a trial if the arbitration award is over $25,000 but in practice, the insured is not likely to want to do that, it is the insurer who then wants two bites out of the apple.

Our Supreme Court found this provision creates an unfair limitation on an insured’s access to a de novo appeal and creates an inequity in the certainty of an arbitration award.

Although facially equal, such escape hatch clauses are not truly equal in their effect on the parties. This is true because both parties are bound by a low award, when an insurance company is unlikely to appeal, and not bound when there is a high award, when an insurance company is more likely to appeal. Thus, the benefits of the clause truly only favor the insurer, which can use the clause to escape the unwary claimant.

We believe that this inequity only serves to exacerbate the already unequal bargaining position occupied by the insured, and gives the insurer undue leverage to compel an insured to accept an unfavorable settlement.

The de novo appeal provision forces an insured to undergo costly sequential litigation in order to secure an award of damages, without also receiving the corresponding benefit of being able to seek relief from an unfavorable judgment.

We conclude that the limited de novo appeal provision in the insurance contract violates public policy and is therefore void. AWe hold that the unequal access to an appeal is unenforceable and that the contract thus provides for voluntary binding arbitration.

The first case is Azar vs. Prudential Life Insurance Co., 2003-NMCA-062. The second case is Padilla vs. State Farm Mutual Insurance Co., 2003-NMSC-011.

The Facts: On evening of December 23, 1994, William Benally was driving his brother’s pick up and William Largo was his passenger. They were driving North on a gravel road near Coolidge in McKinley County, returning from a shopping trip. Apparently, Benally had not driven on that road before. It was dark, clear, and dry.

As they approached a railroad crossing, a westbound train was coming at about 70 miles per hour, below the legal speed limit set by federal law. The train’s engineer said he sounded the horn as usual as they approached the crossing. The conductor later said they saw the pick up and it looked like the car was slowing down and possibly going to stop, and just before we got to the crossing, the car took a surge and just jumped out in front of the train. The evidence at the scene suggested the pick up was struck just as it started over the train’s path.

Death Leads To Lawsuit: Benally was killed, and Largo was injured. Largo and the Personal Representative (PR) of Benally’s Estate sued the Atchison, Topeka And Santa Fe Railway Co. (Railroad) and the engineer, alleging negligence. Benally’s PR (but not Largo) settled with the Defendants.

Largo presented the following evidence. The crossing in this case is less than a mile north of Interstate 40. The approach from the south involves a curve, an acute angle, and a hump profile at the crossing itself, all of which make it more difficult for a driver to see a train approaching from the east. Because of the acute angle of the approach, a driver might not see an approaching westbound train while looking straight ahead through his windshield, but would only see it by looking through a rear window. There had been three prior train-vehicle collisions similar to this one at the crossing, in which vehicles heading north were struck by westbound trains. At the time of the accident, there were no warning lights or gates at the crossing. The crossing was marked only with crossbuck signs, reflective black-and-white signs indicating an “X” and stating, “RAILROAD CROSSING.” There was also a small yellow reflective warning sign 100 feet south of the crossing. There were two train-vehicle collisions at the crossing, including this one, in a nine-month period, out of less than twenty-five per year in all of New Mexico. The McKinley County sheriff’s office responded to citizens’ concerns about the dangerousness of the crossing and noted that, because of the angle of approach, drivers would not see a train until they were 0.1 mile from the crossing. Most or all of the other highly traveled McKinley County road crossings had mechanical warning devices. Several years after this accident, gates and flashing lights were installed.

At the Defendants’ request, the Judge entered >Summary Judgment’ for the Defendants and against Largo on Largo’s claims that the warnings at the railroad crossing were inadequate and that the train was traveling too fast under the circumstances. The Judge decided, given that Largo’s negligence claims were based on state law, Largo’s claims were preempted by the Federal Railroad Safety Act, 49 U.S.C. Section 20101.

Plaintiff Largo appealed, and the New Mexico Court of Appeals recently decided that the excessive speed claim is preempted by federal law, but Largo’s claim that the warnings at the crossing were inadequate is not preempted, and the Railroad had a duty to maintain adequate warnings.

Federal Law Does Not Preempt State Law: This is the first time I can remember that a New Mexico Court has said that a railroad can ever have any responsibility for adequately warning of the railroad’s crossings at highways and roads. It seems like the railroads have always been able to escape responsibility by hiding behind federal laws.

But Not Always: This court decision does not say that railroads are responsible for the warnings at all railroad/highway crossings. It seems to depend mostly on whether any federal money paid for any of the warnings at the crossing!

This is what the Court of Appeals said. U.S. Supreme Court decisions make it clear that federal law preempts state law only when federal funds are actually spent on warning devices. In the case at bar, the record does not establish that any federal money was spent installing warning devices at the crossing. In 1978, a federal program provided $2,056 to widen and install sixteen track feet of timber planking at the crossing. However, the record indicates that no warnings were placed at the crossing as the result of the federal program. The minimal level of federal involvement at this crossing does not cover or substantially subsume >the same subject matter as [state] negligence law pertaining to the maintenance of, and the operations of trains at, grade crossings. [quoting the U.S. Supreme Court]

We hold that because federal funds were not actually used to install warning devices at the crossing, preemption does not bar Plaintiff’s state law claim that warnings were inadequate. We reverse summary judgment for Defendants on this claim and remand it for trial.

Railroad Can Be Responsible For Crossing Warnings: The Railroad then argued that they have no duty to install and maintain adequate warning devices at railroad crossings because New Mexico’s state statutes give the state highway department and county and city road departments exclusive authority to place warning devices. The Court of Appeals disagreed: We do not agree with Defendants that Section 66-7-108 prohibits the Railroad from insuring that there are adequate warnings at railroad crossings, or that the legislature intended to absolve railroads of all responsibility for warnings at railroad crossings. Instead, this statute has the obvious purpose of prohibiting false or unofficial traffic signs. While this and other statutes cited by Defendants may place primary responsibility with governmental entities, they do not prohibit railroads from addressing dangerous crossings.

In addition, railroads have a common-law duty to provide and adequately maintain warnings at railroad crossings. While final authority for the installation of particular safety devices at grade crossings has long rested with state and local governments, this allocation of authority apparently does not relieve the railroads of their duty to take all reasonable precautions to maintain grade crossing safety. . . . [quoting the U.S. Supreme Court]

Common Sense: The Court of Appeals also appealed to common sense. Railroad employees are in the best position to evaluate difficulties at crossings and to identify crossings that have presented problems because they use the crossings every day. Railroads also have superior knowledge about accidents at particular crossings, because they must deal with insurance claims and lawsuits arising out of those accidents. Public policy and common sense dictate that when railroads become aware of particular hazards and dangerous conditions, they should at a minimum be required to notify the appropriate governmental authorities that improvements are necessary. We reject Defendants’ argument that railroads have no duty whatsoever to do anything about hazardous crossings.

Maybe this court decision will encourage the railroads to join in the battle to reduce the appalling number of railroad crossing accidents and deaths that happen in New Mexico every year. If you want to read the court decision, it is LARGO vs. THE ATCHISON, TOPEKA AND SANTA FE RAILWAY COMPANY, and J.P. BIGLEY, 2002-NMCA-021.

This column covers what to do if your vehicle is damaged in an accident, and some other suggestions that did not make it into that column.

If you would like a copy of the State Bar of New Mexico’s pamphlet, “What To Do In Case Of An Accident”, email tito@zianet.com or write me (addresses at end of this column) or call 575-524-4540 in Las Cruces or 1-800-310?0555. The pamphlet is free, and there is absolutely no obligation. You might want to put one in vehicle, to have it handy if you ever are in an accident.

Property Damage Claim
If your vehicle is damaged and no one in your vehicle is hurt, you may be able to handle the property damage claim yourself. If your vehicle is damaged, and the accident is entirely the other driver’s fault, he (through his insurer) is supposed to pay for your damages. (If it is only partially his fault, he is liable for the percentage of your damages equal to his share of the fault that caused the accident. For example, if the accident was 50% his fault and 50% your fault, he should pay 50% of your damages.) Hopefully, he has auto insurance, or it will probably be very tough for you to collect from him.

Whether or not the other driver has insurance and even if the accident is all the other driver=s fault, you should report the accident to your auto insurer. Tell your insurer what happened and ask them to remind you of what coverages you have (and look at your policy yourself, because some companies are not good about telling you information when it comes time to pay you money).

Your Insurance Policy
If you are like most people, your auto insurance actually has a number of separate insurance coverages that may be helpful to you now. By law, everyone is supposed to have liability coverage of: $25,000 per person, up to a maximum of $50,000 per accident; and $10,000 property damage. Many people buy more than the basic coverage. It costs little more to increase these liability limits (which protects you from someone executing a court judgment against you personally).

Also, many people buy collision and comprehensive coverages (these pay for repairing your vehicle ? which coverage applies depends on how your vehicle was damaged), towing and rental car coverage. Ask your own insurer to process your property damage claim under your own policy. You should do this even if the other driver’s insurer says it will pay for your vehicle. This way, you can compare what each insurer offers, and pick the deal best for you. Don’t worry ?- by law, your insurer cannot raise your rates if the accident was not your fault. Also, your insurer will contact the other driver or his insurer to be reimbursed for what it pays you, and your insurer must try to collect your deductible from them for you.

Other Driver’s Insurer
You will probably be contacted by an adjuster for the other driver’s insurer, but if not, look at the police accident report. It will tell you what insurance he has. Call any agent for that insurer, and ask how to contact their claims office. You can call his insurer and report the accident yourself. Be careful when you talk to the adjuster, because he/she will take your recorded statement, and may try to get you to say things that hurt your claim. (If you were injured in the accident, do not talk to the other driver=s adjuster about the accident or your injuries until you consult a lawyer.)

Get the estimates the adjuster says, but if you don’t like where the adjuster says to go, get estimates where you like. Request the insurer provide you with a rental car from when the accident happened through to when your vehicle is completely repaired. Don’t let the adjuster ignore you or push you around. If that happens, contact the N.M. Department of Insurance in Santa Fe, 505-827-4601 and tell them you have a complaint against an insurer.

Decreased Value Of Repaired Car
According to New Mexico law, if the accident was the other driver’s fault, his insurer must compensate you for the decreased value of your vehicle after the repair, in addition to paying for all necessary repairs. Insurers usually refuse to pay this, but it’s been the law here since at least 1909 (see DePalma v. Weinman, 15 N.M. 68, 103 P. 782). Think about it ? if you were buying a used vehicle and had a choice between two identical cars, would you pay the same price for one you know has been wrecked, even if it has been fully repaired?

If Your Car Is Totaled
If the adjuster tells you your vehicle is “totaled”, watch out. Often, insurers use this to cheat people. They get away with it because most people don’t know their rights or what to do, and they are afraid of the insurance company. Or think they have to take whatever the company offers.

If your vehicle is four years or older, or it has a lot of damage, it may be “totaled.” This does not mean it is not repairable or even undriveable; it just means the cost of repairing may be more than its pre?accident “fair market value”. If your vehicle is totaled, you almost always get less for it than if it is repaired, so don’t accept that it has been totaled unless you agree. Ask the adjuster for documentation of how they valued your vehicle, and then verify it by calling their sources.

Get your own evidence of what your vehicle was worth by going to car lots; tell them you will be needing a new vehicle, and ask them for a written estimate of what your vehicle was worth before the accident. If your vehicle is totaled, but you want to keep it anyway, all you get is the pre?accident value of it minus its “salvage” value, and the Title will be marked “salvage”.

People frequently complain to me that their car was damaged in an accident and the insurance company will not pay for the lost value of their car after it has been repaired.

It is only common sense that a repaired car is worth less than it was before it was damaged. Think about it this way – you are interested in buying a good used car. The car lot has two similar cars that are just what you want. The price is the same for each car. The salesperson tell you the white car had damage that has been repaired and the blue car has never been damaged. Which one would you buy? Everyone would take the blue car. Anyone would want a substantial discount to take the white one with the repaired damage.

So, it seems only reasonable that the auto insurer should pay for the car’s repair and pay the lost value. Only this way would you be “made whole” or returned to about the same position you were in before the accident.

But, in my experience auto insurers uniformly refuse to pay the lost value of the repaired car. They say things like, ‘we can’t do that’, ‘we never pay that’, etc.

The law in New Mexico says you can recover the lost value of your repaired vehicle if you are collecting from the insurer of the person who was at fault in causing the accident. Our official Court Jury Instructions say: “In determining damages to personal property, you may award the reasonable expense of necessary repairs to the property, plus the decrease, if any, in the fair market value of the repaired property as compared to its fair market value before the occurrence.” [UJI- Civil 13-1817]

Unfortunately, the New Mexico Court of Appeals recently decided you cannot recover the lost value of your repaired car from your own auto insurance under your collision coverage. All your own insurer has to pay is the cost of adequately repairing your car. Robert Davis v. Farmers Insurance, 2006-NMCA-099.

All this assumes your vehicle is not “totaled”. If your vehicle is “totaled’, all any insurer has to pay you is the fair market value of your car before it was wrecked. You might think a “totaled” vehicle is one that is wrecked beyond repair. That is usually not true. A car is “totaled” if the cost of repairing it is more than the pre-collision value of the car. In other words, the insurer can “total” your car if the value of it is less than the cost to repair it. This can really hurt.

Auto insurers often come up with values that are ridiculously low. They claim they hire “independent contractors” to determine your car’s pre-collision value, but these “independent contractors” are not really independent. They depend almost entirely on auto insurers for business, and they know whom they must please. Also, these “independent contractors” do not do a good job of researching the car sales market , and we find that their “comparables” used to determine values are often non-existent or wildly mis-stated.

In Dellaira v. Farmers Insurance Exchange, 2004-NMCA-132, the New Mexico Court of Appeals decided you can sue your auto insurer under our Unfair Practices Act for “lowballing” the value of your totaled vehicle. Dellaira’s lawsuit Complaint alleged: that their insurance adjuster was obligated to indemnify Dellaira for the total loss of the vehicle in an amount that would enable the purchase of like kind and comparable vehicle; that the adjuster failed to do so, and that the adjuster had contracted with an appraiser it knew to be lowballing. The Court of Appeals decided Dellaira’s Complaint stated a cause of action under NMSA 1978 § 57-12-2(D) (2003), which makes actionable knowingly false statements in connection with the sale of services in regular course of trade or commerce which “may, tends to or does deceive or mislead.”

If your car is an older one, but is in good shape, it probably has little fair market value, even when honestly valued. Thus, if it is wrecked, it will be easily “totaled” because even just a little needed repairs will cost more than it’s value. You get a small check, they take your car. You had good transportation, now you have nothing but a check that is too small pay for replacement car.

To add ‘insult to injury’, if you had financed the purchase of your prior car and you owe more on the auto loan than your car was worth (in the industry, this is called being “upside down”), you will not even get the small check. It will go to the auto finance company, and you will still owe the balance of your auto loan, you just won’t have an auto. You will be walking.

I hate property damage claims because of all this. I tell people that all one can do is minimize the screwing you are going to get if your car is wrecked.

I have written a column that suggests how to handle your own property damage claim. The article is called Somebody Hit My Car. Good luck.

Unfortunately, some insurance companies’ poor treatment of their customers never seems to stop. It was recently reported in the newspapers that one of the biggest auto insurers in the country has been cheating its customers, underpaying insurance claims, and destroying important documents. The company even had the gaul to investigate the sex life of one of its own employees, their claims adjuster. The employee was a whistleblower, who had testified about what the insurer did to people.

Big Bucks For Bad Conduct: Last month, the Utah Supreme Court ordered State Farm to pay $145 million in punitive damages to one of its customers. The Court sharply rebuked State Farm Mutual Automobile Insurance Co. for malicious, reprehensible and wrong tactics, and reinstated a 1996 jury verdict against the insurer.

The Utah Supreme Court approved the large award punishing State Farm in part because Aa larger than normal punitive damage award is necessary to attract the attention of State Farm officials and deter the company from further bad conduct. Utah is a very conservative State, and I assume its Supreme Court is conservative and usually pro-business too. So, what did State Farm do that was so bad?

What State Farm Did: State Farm had refused to pay $50,000 to settle a claim from a 1981 auto accident, in which one driver was killed and another driver was left disabled. State Farm refused to settle in spite of the fact that its own investigator found State Farm’s insured, Curtis Campbell, was at fault for the auto accident.

Because State Farm would not settle for that relatively small amount (given the injuries), Mr. Campbell was sued, and the jury found him personally liable for $130,000 more than his $50,000 limit of coverage in his State Farm auto policy. Campbell then sued State Farm and claimed the company’s refusal to settle the claim against him was part of the company’s nationwide scheme to limit how much it paid on claims, so State Farm could meet its corporate fiscal goals.

Another Utah jury awarded Campbell $2.6 million in compensatory damages, plus the extra $145 million to punish State Farm and deter it from cheating future customers. The Utah appeals courts reduced the compensation award to $1 million, but upheld the $145 million punitive award. The Utah Supreme Court said State Farm had long engaged in reprehensible conduct. State Farm repeatedly and deliberately deceived and cheated its customers. For over two decades, State Farm set monthly payment caps and individually rewarded those insurance adjusters who paid less than the market value for claims. Agents changed the contents of files, lied to customers, and committed other dishonest and fraudulent acts in order to meet financial goals.

State Farm’s lawyer said the company now guarantees its customers it will pay any court judgment against a customer that is over policy limits, if State Farms takes a case that is against one of its customers to trial and loses.

The Utah Supreme Court decision is Campbell vs. State Farm Mutual Automobile Insurance Company, 2001 UT 89, filed October 19, 2001.

Sex:  State Farm even investigated the sex life of a former adjuster who had provided evidence to government officials that State Farm had underpaid the claims of California earthquake victims.

The Future: State Farm’s ads say, >like a good neighbor, State Farm is there.’ With neighbors like that, a person does not need enemies. In these troubled times for our country, we do not need to have even more worries than we already have. What about the victims of the September 11th terrorist attacks? How are the families of those innocent victims being treated by their own insurance companies?

It might be tempting to ask one’s agent if his (few agents are women) company has been sued by its own customers lately. On second thought, it may not be a good idea to make your insurance company mad at you…. You can contact the State of New Mexico’s Insurance Division and ask them about any complaints they have received against an insurer. The State keeps track of these complaints.

I limit my law practice to helping people who have been injured because of someone else’s misconduct – usually people who have been injured in motor vehicle accidents because of another driver’s negligence. Here is an update of some things I have learned.

Claims Adjusters
Most insurance claims adjusters are honest, hard working, people who do a good job. But, this does not take away from the fact that, when it comes to auto accident claims, you and the adjuster do not have the same interest. As lawyers say, you are “at arms length” from each other. The adjuster works for a company that wants to pay out as little as possible, and wants to close claims as soon as possible. Document everything, keep copies, get copies, and do not just accept what the adjuster says if it does not sound fair to you. While you should be extra vigilant when dealing with an adjuster for the other driver’s insurer, you should be careful even when dealing with your own insurer’s adjuster.

Liability Insurers
Some insurance companies, Allstate Insurance comes to mind, have a policy of actively discouraging people who are making auto accident claims against Allstate’s insureds from consulting their own lawyer. A cynic might question Allstate’s motives here, but Allstate claims people do not end up with any more money after they pay their lawyer. The trouble is, the liability insurer is not on your side and probably will not tell you what all of your rights and options are. They will certainly not tell you what the full dollar value of your damages is.

I remember an article in Lawyers Weekly USA, that had this headline: “Allstate Sued for Urging Claimant Not to Hire Lawyer”. According to the article, a Washington state judge held Allstate, “is guilty of practicing law without a license because one of its claims adjusters persuaded an accident victim not to hire a lawyer and to settle her claim directly with Allstate”.

Bad Advice
In that case, a woman was hit by an Allstate-insured driver. The woman’s Chrysler minivan’s seatbelt gave way upon impact and she was thrown from her minivan. She lost an eye and had other serious injuries, the article says. Three days later, while still in the hospital, the Allstate adjuster called her husband and sent brochures about ‘whether to hire a lawyer’. Later, the woman signed a general release of liability and Allstate paid her its $25,000.00 policy limit. The victim’s medical bills alone exceeded $75,000.00.

Shortly thereafter, Chrysler recalled the minivan because of a safety belt problem. The article goes on to say the Allstate adjuster had failed to tell the woman she had a good products liability claim against the manufacturer. Because the woman had signed a general release, she was precluded from suing the manufacturer and from collecting the full amount of her damages.

The woman then sued Allstate for the unauthorized practice of law. The article says, “Allstate may have to pay any money the plaintiff was precluded from recovering from a third party”. (Jones vs. Allstate, No. 99-2-02212-2SEA, Washington Superior Court, King County.)

Free Advice
In the past, the State Bar Of New Mexico published a pamphlet, “What To Do In Case Of An Accident”. It is a handy thing to carry in your car or truck’s glove compartment.  While the State Bar no longer publishes this pamphlet, I still have it. E-mail me at <tito@zianet.com> , write me or call me and I will send you a free copy.

More Advice
Every plaintiff’s personal injury lawyer I know does not charge for a brief initial consultation. We often tell people they do not need a lawyer, or tell them what they need to do. Be careful what lawyer you contact. While almost all personal injury lawyers (including me) advertise, some of the lawyers who advertise A LOT do not have the best interests of their clients at heart.

I never offer to represent a person injured in an accident unless I believe the client will receive more money than they would probably obtain without a lawyer. I use a one page written lawyer-client contract, and my fee is always contingent on obtaining a money recovery for the client, which means I do not get paid a fee unless and until the client gets a recovery. Out-of-pocket costs are not contingent, which means the client is ultimately responsible for paying the costs.

Most people who have been in accidents do not need a lawyer but, everyone could use helpful advice. Whether you are talking with a lawyer or an insurance claims adjuster, when thinking about the advice you’re getting, remember who the person works for.

Year in and year out, over 200 New Mexicans die because of crash caused by a drunk driver. That is almost half of the people killed here in any kind of motor vehicle crash each year. (I am told these figures come from the National Highway Traffic Safety Administration.)

And it gets worse. Approximately 1745 New Mexicans were hospitalized with a brain injury in 2001, and alcohol was a significant factor in approximately 50% of those brain injuries. (Most of the statistics in this article come from a very useful handbook: the New Mexico Traumatic Brain Injury Resource Manual (“TBI Manual”), available from the New Mexico Brain Injury Advisory Council, <www.nmbiac.com> or 1-800-311-2229)

I represent, and have represented, many persons who have been injured because of people driving while DWI and DUI, and numerous families of those who have died because of a drunk driver. It isn’t pretty. Often, families are torn apart because of the death of a loved one, or sometimes maybe even worse, because a loved one has suffered a devastating “traumatic brain injury” (“TBI”).

One of the ironies of drunk driving crashes is that it is often not the drunk driver himself who is killed or who suffers the brain injury. Why? Because the drunk is nice and relaxed when the impact happens, while the innocent victims often see the car coming at them and naturally tense up. This can lead to more serious injuries and death.

Why do we have such a problem with drunk driving in New Mexico and why are there so many DWI & DUI crashes? I am not going to try to answer those questions in this article, concentrating more here on the effects of those drunk driving crashes. But, I cannot resist making a few comments from personal observations. In New Mexico, especially outside the Albuquerque/Santa Fe area, there has been a love-hate relationship with drinking alcohol. We say we disapprove of it and pass laws restricting the sale and use of alcohol. But, we love to drink beer and other alcoholic beverages.

I have lived in Southern New Mexico for most of my life. Until a few years ago, if most anyone I knew was going to go out-of-town, say to Albuquerque, or even up the road to Elephant Butte, the last stop on the way out of town was at a drive-thru window at a package liquor store or supermarket. A 6-pack per person was needed for the drive there. While it is now illegal to have an ‘open container’ in a vehicle, if one goes to a party or goes out for an evening on the town, someone who had a few ‘open containers’ may now be driving.

And our roads make it especially dangerous to be on the road at the same time as a drunk driver. For instance, we have had a rash of bad crashes because of cars going the wrong way on the Interstate, then hitting victims’ cars head-on. These kind of crashes often lead to death or ‘traumatic brain injuries’. The drivers of the wrong-way vehicles are usually drunk. So, it is their fault, but that is little consolation to the victims and their families.  In the newspaper articles about these head-on Interstate crashes highway officials are often quoted that they checked, and all the warning signs that are supposed to be up were properly located and installed. So, I guess the state highway department concludes there is nothing they need to do. Well, given how often people go the wrong way, by definition there must be more the highway department needs to do to protect us. By definition, there are more or different signs, warnings, or other protective devices called-for. But do not hold your breath waiting for them to do anything, because they have checked, and all the signs that they put up are still up, so no more needs to be done. My guess is we will have to wait until a family member of a state highway official gets maimed or killed before they do something.

Oh that’s right, I was going to talk about the effects of drunk driving crashes on the victims. The effects on the victims’ families are pretty clear when the victim dies. But, what about when the victim lives, but has a ‘traumatic brain injury’?

First, what is a ‘traumatic brain injury’? This is what the TBI Manual says:

“The brain controls everything we do, say, feel, and think. It controls the very functions that keep us alive including our breathing, circulation, digestion, hormones, and immune system. The brain allows us to experience emotion and express ourselves. Damage to this vital organ can have far reaching implications and significantly impact an individual’s life and the lives of those around them for the rest of their lives.

A traumatic brain injury (TBI) is an insult to the brain caused by an external physical force that can produce a diminished or altered state of consciousness (such as a coma). A TBI can result in physical, psychological, behavioral or emotional impairments and may be temporary or permanent. It can cause partial or total disability. A TBI does not include degenerative (brain disease) or congenital (hereditary) injuries. Causes of TBIs include motor vehicle accidents, assaults, falls, sports injuries, bicycle and pedestrian accidents, and shaking babies.”

The TBI Manual lists many interesting statistics, including: Every year, one and a half million Americans sustain a TBI, and more than 50,000 of them die. Alcohol is involved over half the time, and males between 15 to 24 years old are at highest risk of a brain injury, because of their risk-taking behaviors and lifestyles. “Vehicle crashes are the primary cause of brain injury for all age groups.”

The “Social Implications” of Traumatic Brain Injuries are stunning. The TBI Manual lists:

• The divorce rate for individuals with a traumatic brain injury is significantly higher than for the rest of the population.
• Loss of employment or not being able to hold a job is significantly higher than for the non-brain-injured population.
• Social reasoning skills are diminished in individuals with brain injury. They may not be able to consider alternative approaches to a situation, are not able to plan ahead and may respond to a situation so that they may receive immediate gratification without thinking of the consequences of their actions. They may not be able to process more long-term goals.
• Judgment can change and they make poor decisions.
• Social isolation is significant. Individuals withdraw form family, friends and others.

Participation in social activities can be one of the greatest challenges to people with brain injury. Social understanding and judgment involves complex thinking processes. Even several years post-injury, many people with traumatic brain injury continue to experience problems with social interactions. These social implications are startling and have devastating effects on the individual with a brain injury, family members, friends and others with whom the individual comes in contact. Brain injury impacts countless people across the country every year. Many will experience social challenges for the rest of their lives.

People who receive a traumatic brain injury can be successfully treated. For many years, I have been helping people who have been injured by negligent truckers and others get the money they need to get the treatment they need.