16 Trial Lawyer • Spring 2023 By Richard Spier In almost all the first party cases I mediate, I see emotions run high. The insureds (not only homeowners and renters, but also business owners) feel overwhelmed and disrespected by the “system.” Not only the fire or other loss itself but also the claims process can ruin quality of life and challenge family relationships. I see the tears and stressed-out body language. I hear about the marriages and domestic partnerships that are “on the rocks” due to the delay and perceived unfairness of the process. Even though there is no bodily injury, the emotional distress can be as pervasive and life changing as in a catastrophic bodily injury case. A current issue is whether a Moody claim must allege not only emotional distress, but also bodily injury or at least physical contact. The emotional issues can be as important to the insureds as the dollar amounts of demands and offers, resulting in challenging negotiating environments for the lawyers on both sides of a claim. This is not to say that insurers are always wrong in disputing coverage or value — quite the contrary. But the emotional context of these cases requires great sensitivity not only by the claimant’s counsel but also by the defense counsel. Sincere expressions of respect get these cases in reasonable settlement ranges. The claimants’ counsel, especially, have the challenge of balancing empathy with candid evaluation of litigation risk. This goes both ways. I’ve had claims representatives tell me they are paying “more than I think the claim is worth” because the insured’s lawyer has been “reasonable.” And I’ve had insureds (the client, not just the client’s attorney) tell me they’ll accept the disappointing “highest and best offer” because “finally someone (the defense counsel and the senior claims representative who comes with authority, not just the mediator) is listening.” The mediator’s role Having recognized the foregoing, I want to emphasize that a lawyer-mediator is not engaged to “get a good deal” for either the insured or the insurer. The mediator is neutral and doesn’t have a “dog in the fight.” Instead, the mediator’s job is to facilitate the parties reaching a mutually-agreeable resolution, with sense of closure for each side — financial, emotional and legal. Policy provisions Commercial property policies are a challenge to interpret. There are the policy forms, forms amending the forms, exclusions, exceptions to exclusions and impenetrable policy language. Residential policies are often almost as bad. For the benefit of yourself, your client, the mediator and opposing counsel, take the time to prepare a coherent, integrated restatement of applicable coverage provisions. This means working your way through the various provisions, cutting and pasting, to assemble a comprehensive and comprehensible single statement of the provisions that matter. Then send it on to opposing counsel. There can be debatable issues over what the applicable language means, but it is helpful to agree on what is the applicable language. Premediation submissions The narrative portions of premediation submissions that I receive in first party cases are usually succinct and helpful, but sometimes I receive unnecessarily voluminous exhibits. A mediation is not an arbitration. It’s not necessary to make a record. For example, it’s rarely necessary to provide the entire insurance policy. The declarations sheet and the few pages with the key provisions can be sufficient. Or Richard Spier Emotions Run High SETTLING FIRST PARTY CLAIMS
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