Erie Insurance Exchange v. Heffernan, II, et al. (Court of Appeals)

Filed April 10, 2007 --Opinion by Judge Clayton Greene

The parents of a child killed in an automobile accident when the driver fell asleep sued for benefits, pursuant to two policies of insurance issued to them by Erie Insurance Exchange. The Court of Appeals held that, in a breach of contract action for benefits, pursuant to the uninsured/underinsured provisions of an automobile insurance contract executed in Maryland, what the parents were "entitled to recover" was determined by Delaware substantive law because the law of the situs of the accident controlled the tort aspects of the claim, including questions of liability and damages raised in an uninsured motorist claim.

Prior to filing the contract action, the parents had settled the underlying tort claim against the underinsured tortfeasor. Because Erie approved the settlement with the tortfeasor, the Court noted that Erie was bound by that settlement and, therefore, liability was not at issue. The Court also concluded that Maryland's public policy exception to the doctrine of lex loci delicti does not require the application of Maryland's statutory cap on non-economic damages or application of Maryland's contributory negligence principles.

The opinion is available in PDF.

Brown v. Smith (Ct. of Special Appeals)

Filed: March 29, 2007--Opinion by Judge Sally Adkins

In a case arising from disputed use of a right-of-way, the Court of Special Appeals examined the nature of a nominal damages award, and whether there is a maximum limitation on the dollar amount that can be considered nominal damages.

Appellants, the Browns, were determined by the lower court to have been trespassing on property owned by the Smiths, by traveling over a farm lane to access a public road from the Browns’ property. The Browns appealed both the decision that they had no right to use the farm lane and an award of $8,350 in “nominal damages.”

The Court first determined that there was a final appealable judgment, even though no judgment had been entered on a third party complaint against a neighbor of both parties. Next the Court agreed that the common grantor of the original deeds in 1875 had not intended to create mutually reciprocal rights of way appurtenant to the Smith and Brown properties. The Court also held that the trial court did not err in admitting expert testimony or in denying injunctive relief. On the issue of damages, however, the Court concluded that an $8,350 damage award on the trespass count was too high to be a “nominal damages” award. Because the Court could not determine from the record whether there may or may not be justification for compensatory damages, it remanded for reconsideration of that issue.

The opinion is available in PDF.