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Last Post 06/07/2008 3:04 PM by  Ray Hall
Liability Claim Releases
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Ray Hall
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05/30/2008 5:23 PM

    Many of us have worked are still work liability claims on a regular basis. This was a new experience for me. I have been working CGL claims for one carrier for about 2 years who have their own release. Most of the settlements are on questionable liability or almost 50/50 comparitive negligence and fall into the "nuisance value" settlements with plaintiff attorneys.

    "It is expressly understood and agreed that each of the parties hereto, their heirs, successors, attorneys and assigns, will keep confidential and will not disclose or reveal directly or indirectly to any person or entity, this settlement, the contents or this Release and Settlement Agreement, or any details relating thereto, unless under legal obligation to make such disclosure.

    The claim was settled for xxxxx amount. The attorney wanted another xxxx to leave the confidentual agreement in. He also agreed to accept the original xxxxx, but would strike out the above paragraph. The carrier would not agree to strike out, but did pay an additional $1,000.00 to leave the paragraph in. It was settled.

    Is this a new thing that the web sites  and TV adds have created?  It was a first for me, but I will discuss this topic next time. Please lets hear some comments if this is a new wave. I do have to confess I did not read my own carriers release before sending it out.

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    MalviLennon
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    05/30/2008 5:55 PM
    Confidentiality agreements are nothing new depending on the type of case. For example, I handle claims for cities and towns, and some of those claims generate publicity. Town officials want to minimize the possibility that the amount of the settlement (or the terms in some cases) will be disclosed (people will come out of the woodwork). They also want to keeps under wraps that some claims are settled, because where there is smoke there was fire. Depending on what the case was about the carrier may have been wise to pay out a little extra to keep the language in.
    Malvi
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    Ray Hall
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    05/30/2008 8:09 PM

    Good post malvi, How many times have you DISCUSSED confidentualy will be added to the release, or was it a two step settlement.

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    HuskerCat
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    05/30/2008 9:40 PM

    Malvi's response was exactly what tripped my trigger when I got about half way thru your post, Ray.  It's been a few years back when I was a staffer for a certain carrier that we insured a large governmental entity.  There was a "special" release of all claims that did exactly the same thing you're talking about.  But, I'm not so sure it accomplished all it was intended to, since it seemed like 75% of the time the same plaintiff atty was representing the slip & fall victim.  This atty's office was located within a birdseye view of the property, and it always made me wonder if he had an intern that did nothing but look out the window to find their next new client.  How does one present or prove an assumed violation of a confidentiality agreement, when the subsequent claimant has atty/client confidentiality protection?     

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    MalviLennon
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    05/31/2008 11:00 AM
    I have never negotiated a confidentiality agreement in a slip and fall case. For those types of claims Connecticut has a strong defective highway statute (includes sidewalks, potholes, etc) to where someone has to give formal notice to the Town (in a very specific manner) within 90 days or they are SOL. Even when proper notice has been given, the claimant must prove that the specific defect complained about is the sole proximate cause of the accident. That is a tall order. Most of the times we can settle slip and fall cases for pennies on the dollar (IE: I settled a fractured hip for $10K). We usually use confidentiality agreements in cases of police misconduct, or claims of misconduct against teachers. We also use them in employment cases. There is a way to get around a confidentiality agreement in a case involving a public entity and/or an elected official. About four years ago, I handled a case against a local police department. The atty representing the plaintiff had a personal vendetta against the chief of police. He did not want the confidentiality agreement in the release because he was planning a press conference, but we held firm and eventually he caved. However, behind closed doors he tipped off a reporter whom in turn requested information on the case under the Freedom of Information Act. Because some of the Town’s own money went into the settlement, the information had to be released and of course, it was made public. Therefore, as the saying goes “when there is a will, there is a way”.
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    Ray Hall
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    05/31/2008 1:12 PM

    This argument was. I publish my settlement amounts on my web site. The settlement we worked out was for a compromise of a claim that you did not want a suit file on and a consideration was paid by you stop litigation. However, neither of us ever discussed confidentially, therefore if you insist. it will cost you. I have settled thousands of cases with attorneys that were settled before suit was filed, but this was a first for me.

    Several years ago a risk manager for a small Texas retail grocery chain in East Texas and I had a claimant in common and when the grocery store settled their BI with the plaintiffs they used their standard release in matters like this that stated "the claimant will never step inside one of their stores again" ( and their store was the largest in small towns)

    We still settle a few odd first party claims down this way... fire/V&MM/water with a policy holders release. We resist third party (dog) cases and many go away and never go to court. When we go to court we usally get a goose egg or a very good verdict. I really think in the long run the confidentially paragraph will end up costing more.

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    HuskerCat
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    05/31/2008 11:47 PM

    Malvi...your state's "defective highway statute" may be the same or just another name for what is otherwise commonly known as the Political Subdivision Tort  Claim Act.   It can vary as far as time limits go, but  the claimant makes their loss known to the governmental entity and then that entity has the clock running to either respond with a settlement offer or to deny the loss, or neither.  If the jurisdiction says it is 1 year, and no action or settlement has taken place, then suit must be filed by the claimant to protect the statute of limitations or their claim goes away.  Most of the regulars here probably already know this if they have liability background, but you never know.  I remember a few years back a county judge filed a claim for a knee injury alleged during a slip.  Both the judge & the judge's attorney failed to follow up and file any petition before the 12 month statute ran...even though numerous attempts were made to obtain their side of the story & evaluate the validity of the claim.  The song "Please Release Me, Let Me Go" never had to be sung.  And I had a closed file.

    It is in those situations prior to court actions where the slip & fall, medical malpractice, sexual harrassment, molestation, discrimination, etc., type of allegations might come under the "confidentiality" release.   I do agree with you that the slip & fall seems to be a little extreme for this type of release, but with the particular insureds I was often involved with on losses, they did prefer to utilize it on all cases if at all possible.

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    Ray Hall
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    06/07/2008 3:04 PM

    I can see a good reason for the confidentialty agreement in a 3rd party settlement now, after reading the replys to my post. Now I am thinking about first party settlements of some disputed scopes/cost amounts with a Policy Holders Release should have this clause for the same reasons as third party claimants.

    Also it should show good faith and fair dealing, which always has some risk in first party buy the peace type compromise settlements. Many of these cases that have been tried have gone against the defendant.

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