Uninsured/Underinsured Automobile Insurance Coverage

If you are injured in a motor vehicle accident in which another driver is at fault, you may be surprised to learn that the other driver does not have sufficient insurance to compensate you for your injuries. Under Virginia law you are entitled to payment for medical expenses, lost wages, pain & suffering as well as damages for change of lifestyle. However, Virginia only requires drivers to have a $25,000 bodily injury policy and in some circumstances, even allows drivers to be uninsured. If you are seriously injured, your total losses could easily exceed the financial cap of the other driver’s insurance policy. How do you protect yourself from drivers who have inadequate insurance?

The answer is to purchase uninsured/underinsured coverage from your own insurance provider. All insurance companies offer uninsured/underinsured coverage. This coverage provides compensation to individuals injured as a result of another driver’s negligence when the driver at fault does not have adequate coverage to compensate you for all of your injuries.

Beware! Uninsured/underinsured coverage can be tricky. Virginia law only requires payment from this coverage after all available third party insurance is exhausted. For example, if you sustain $50,000 in injuries and the responsible driver has $50,000 of insurance available and you purchased $50,000 of uninsured/underinsured coverage, you will receive nothing from your own policy. On the other hand, if you sustain $100,000 in injuries and the responsible driver only has $50,000 of insurance available and you have $100,000 of uninsured/underinsured coverage, you may be able to recover up to $50,000 from your own insurance policy. We recommend that you purchase $1 million or the most uninsured/underinsured coverage that you can afford.

Virginia Case Allows Stacking of uninsured/ underinsured coverage

In the 2009 case of Virginia Farm Bureau Mutual Insurance Company v. Williams, the Virginia Supreme Court held that an individual injured in a car accident may “stack” the insurance coverage available under her own automobile insurance policies. In this case, a passenger was injured in an automobile collision. The combined insurance policy limits of the two automobiles involved in the accident was insufficient to cover her losses. The Virginia Supreme Court permitted the injured person to combine (or “stack”) the uninsured/underinsured policy limits from the three automobiles owned by her father. Because the Court permitted stacking, the total benefits available to her were increased and available to compensate her for the injuries she suffered in the accident.

The case is significant because in the past Virginia courts disallowed stacking. However, it is important to note that the decision was based on contract interpretation and not public policy. Many insurance companies have changed their policy language to avoid stacking. Nevertheless, the case demonstrates why it is so important to have adequate uninsured/underinsured coverage and a knowledgeable attorney on your side.

Hire A Personal Injury Lawyer With Experience

If you are injured in an automobile accident, it is critical that you hire an experienced law firm, such as Gross & Romanick. The Virginia insurance scheme is complex and extraordinarily difficult for an individual to navigate. Beware of lawyers who take automobile injury cases on an occasional basis but do not know how to seek the maximum insurance coverage that is available to the injured person.

What to do if you are involved in an automobile accident

Gross & Romanick, P.C. recommends:

 

At scene of collision:

1. Call for medical assistance if anyone is hurt;
2. Call the police. Obtain the responding officer's business card and any information exchange form;
3. Exchange insurance and contact information with the other driver;
4. Obtain all available Witness information including a name and phone number (police do not always put this information in their reports);
5. Take pictures of cars at the scene of the accident and photograph the surrounding area - if not possible at the scene, do it later so long as it can be done safely. 

Within 24 hours: 

1.     Seek medical attention - your health is irreplaceable;

2.     Document lost wages or, if self-employed, you will need documentation of economic losses;

3.     Contact and notify all insurance carriers - your own auto insurance carrier and the carrier of the responsible parties;

4.     Start the process of repairing your vehicle and/or obtaining a rental car;

5.     Do not give formal statements to anyone without consulting a lawyer first – insurance companies will use your statements against you if it will save them money;

6.     Find an experienced Personal Injury Lawyer if you have injuries.

Within the first week: 

1.     Medical treatment - if you are hurting or think you may be injured do not wait too long or insurance company will claim that you were not injured in the accident or you would have sought care;

2.     Medical records - be very careful what you say to medical providers. It will be written down and may be used against you later by the insurance defense lawyers. Make sure all of your injuries are documented. Make sure records state that you are seeking treatment due to auto accident;

3.     Start a pain diary – a pain diary can be used as proof of the problems and discomfort you experienced and will help you recall and accurately describe the suffering you experienced;

4.     Repair or replace your car - try to get responsible party’s insurance to pay. If the other party’s insurance is not cooperating or is being difficult, make a claim against your own insurance company, it is one of the reasons you bought insurance . Demand new parts and quality work. It is best if you can use a dealer or shop that works with the insurance company.   If the vehicle is very substantially damaged - try to recover the diminished value of the vehicle. If the car is a total loss - you are only entitled to fair market value and unfortunately not entitled to any amount based upon the balance of any loan on the car. Research the value of the car online and in the newspapers;

5.     Do not sign any releases or other document until you have spoken to a lawyer.  If you do not have a lawyer, then only release information regarding vehicular damage and loss of property. Do not release any claims for personal injury. Be sure to read any release very carefully.  

Within 30 days:

1.     Hire a lawyer if you have any personal injury. Don't wait to hire a lawyer or you may harm your legal case and not receive the full compensation you deserve for your injuries;

2.     Obtain the Police Accident Report;

3.     Attend all court proceedings if the other party was charged with a traffic violation;

4.     Locate all insurance available to pay for your medical bills;

5.     Always remember that the insurance companies are more concerned about minimizing their payout than helping you. Virginia has a very complex insurance scheme and the insurance companies will not tell you how to navigate the maze and in some cases may even misrepresent your rights.

Winning your PI case at Trial

               Trial of a personal injury case, like the trial of any other type of case that proceeds through the judicial system, is governed by laws developed over hundreds of years.  Accident victims can only recover a money judgment upon proper proof at trial.

                The accident victim must prove that the other driver was negligent and that the other driver’s negligence caused the accident victim’s particular injuries.  A plaintiff cannot recover for injuries existing prior to the accident, but can recover for an exacerbation of pre-existing injuries.  If the other driver (the defendant) can demonstrate that the injury was not the result of the accident, but rather from some other cause, then the plaintiff cannot recover for that injury.

               The personal injury plaintiff must prove the case by a preponderance of the evidence.  This means that the plaintiff must prove that it is more likely than not (1) that the defendant breached some duty of the road, such as ignoring a stop sign or failing to pay full time and attention; (2) that the defendant’s breach of such duty caused the plaintiff’s damages; and (3) that the plaintiff’s injuries are related exclusively to the accident or were exacerbated by the accident.

A major concern for accidents that happen in Virginia is that Virginia is a “contributory negligence” state, which means that the plaintiff must be entirely free of fault for the accident.  If the Plaintiff contributed to the accident in any way, then the Plaintiff is barred from recovery.  This does not mean that the Plaintiff needs to be free of any violation of traffic laws, only that the Plaintiff be free of negligence that causes the accident.  By way of example, consider a Plaintiff that is texting at a red light when she is rear ended by a Defendant.  Texting in Virginia while driving (even if stopped at a light) is against the law. However, the Plaintiff in this case may still recover because the Plaintiff’s texting did not cause the Defendant to rear-end the Plaintiff’s vehicle.  Rather, the cause of the rear-ender was the Defendant’s failure to keep a proper lookout and failure to brake in a timely manner.  However, one should note that even a subtle change in the facts could bar Plaintiff’s recovery.  If the Plaintiff failed to accelerate when the light turned green because she was texting and did not notice the light change, then the Plaintiff may be prevented from recovery. 

               The most important issue in the vast majority of personal injury cases are the issues of damages and causation.  Most of the time, the Defendant will concede negligence.  In a great number of cases, the Defendant will concede that the Plaintiff was not contributorily negligent.  However, the Defendant will vehemently suggest that the Plaintiff’s injuries are inflated, nonexistent or not a result of the accident.  Since the injuries in an automobile accident case results in medical expenses, it is imperative that anyone considering a personal injury case ensure that the medical documentation regarding treatment correctly and accurately reflect that nature and cause of injury.  Medical documentation that suggests, even off-handedly, that a concussion, for example, was caused by a fall rather than the automobile accident at issue can present a large hurdle to overcome at trial.  Additionally, in the event that the injured party loses time at work, an employer that fails to document that the reason for missing work resulted from injuries sustained in the accident can reduce the likelihood of recovering lost wages. 

               In order to be successful at trial, it is imperative that the potential personal injury plaintiff prepare proof that the other driver’s negligence caused the accident, and secure documentation of damages (medical, employment, etc.) resulting from the accident.  This evidence, combined with a skilled trial lawyer should result in a personal injury verdict that is full and fair compensation for any victim of an automobile accident.

If you are injured in an accident, consider using an experienced law firm, such as Gross & Romanick, P.C.  Call us at 703-273-1400 or send us an e-mail to law@gross.com.  Visit our website at www.gross.com and download our Personal Injury App to your smartphone or iPad.

The Basics of Contractor Bonding

There are a great many types of bonds that are utilized in the construction industry: performance bonds, payment bonds, maintenance bonds, subdivision bonds and the list goes on. This article will attempt to provide some clarity to the confusion by defining the basic parties to a bonding agreement and laying out the specifics of various types of bonds.

First, a bonding agreement, in any form, is essentially a contract between three parties. The first is the Obligee. The Obligee is the party that is the beneficiary of the bond or the recipient of any monies to be paid pursuant to the bond. The Obligee is sometimes also called the beneficiary of the bond. Typically, in the construction context, the Obligee is the party that is going to pay for the construction services which is usually the owner of the property. The second party is the Principal. The Principal is the contractor or the party that is to perform services pursuant to the construction contract. The final party to a bonding agreement is the Surety. The Surety is the party that will pay in accordance with the terms of the bond.

The idea behind a performance bond is that the surety will pay the Obligee some amount of money to compensate the Obligee if the Principal fails to perform the contract with the Obligee. The benefits in the construction industry are fairly obvious. When a general contractor wins a construction contract, the property owner cannot be certain that the construction company will complete the project in conformance with the contract. Accordingly, the property owner requires the construction company to obtain a performance bond. The construction company will approach a bonding company and the cost for the construction company to obtain the bond will depend upon the construction company’s rating as well as the size of the job and the size of the bond. The bonding company, upon receipt of the cost of the bond and sufficient assurances from the contracting company that it can complete the job, will agree to guarantee the construction company’s performance of the job. Accordingly, the bonding company will agree to pay the property owner in the event that the construction company fails to complete work. This is what is called a performance bond.

A payment bond follows the same pattern, except that the bonding company guarantees that the construction company will pay all of its suppliers and subcontractors, not completion of the project as in performance bond.

In a maintenance bond, the surety guarantees that a contractor will maintain the owner’s property in an agreed condition for a specified period of time. If you are involved in a construction project, it can be very valuable to have an appropriate bond.

As with any contractual relationship, the terms of the bonding agreement are extremely important. Speak with an experienced lawyer about the terms and use a reputable bonding company.

If you need a assistance with obtaining or enforcing a bond, Gross & Romanick, P.C. can assist you. Contact us at 703-273-1400 or law@gross.com. Check out our website at www.gross.com.

Owner of Construction Company Escapes Large Jury Verdict Piercing the LLC

In a recent case out of the Chesterfield County Circuit Court, a jury entered a sizeable verdict against the owner of a construction limited liability company that breached a contract with the plaintiff homeowners. The jury determined that the homeowners were entitled to “pierce the corporate veil” of the limited liability company and hold the owner personally responsible for damages caused by his company, notwithstanding the limited liability protections afforded by law. The trial Judge subsequently set aside the jury verdict, ruling that the homeowners were not permitted to pierce the corporate veil of the company since the owner was not the “alter ego” of the company. The main piece of evidence upon which the plaintiff homeowners relied was a single check paid directly to the owner in connection with the construction project (as opposed to his company). The trial Judge ruled that this evidence alone was insufficient to demonstrate that the owner was the “alter ego” of the company. For business owners, this case demonstrates the importance of maintaining corporate formalities. In Virginia, a corporate entity can be disregarded (and the owners held personally liable for the debts/obligations of the entity) if the unity of interest and ownership is such that the separate personalities of the entity and the individual no longer exist and to adhere to that separateness would work an injustice. C.F. Trust, Inc. v. First Flight Ltd. P'ship, 266 Va. 3 (2003). To maintain the appropriate legal separateness, business owners should always do the following (which list is not intended to be all-inclusive): • Register the legal entity in all states where it is doing business, and maintain/update the state registrations. • Maintain a separate bank account for the legal entity and deposit all entity receivables into the entity’s account. Do not co-mingle personal funds and entity funds. • File appropriate tax returns for entity and separate personal tax returns. • Identify legal name of entity on website, business cards, and all advertising materials. If you are using business tradenames which are different from the legal name of the entity name, register those tradenames in the jurisdictions where they are being used. • Identify the legal entity on all contracts and only execute contracts as an agent for the entity. The attorneys at Gross & Romanick, P.C. have significant experience organizing business entities and assisting their clients in adopting financial, marketing and contractual policies that will protect the integrity of the limited liability form. We can help you ensure that the corporate veil of your entity will not be pierced.

Construction Bonds and Arbitration

A large percentage of construction contracts require arbitration if there is a dispute between the owner, general contractor and/or a subcontractor.  At the same time, many general contractors have payment and performance bonds in place for the construction project which do not have mandatory arbitration provisions.  If the owner or subcontractor seeks to call on the payment or performance bond, must the parties resolve the bond claim in arbitration? At the most basic legal level, arbitration is only available with the consent of the parties to the dispute.  Therefore, a court cannot compel a reluctant party to arbitrate a dispute absent a clear agreement requiring arbitration.  Typically, this agreement takes the form of a written contract between the parties to the dispute, whether signed before or after the dispute originated.  Bond claims, however, take a somewhat different form.

Consider the usual scenario for a construction bond.  A contractor enters into a contract with a bonding company for two purposes: (1) to ensure the contractor’s performance of the construction job to the owner of the property (a performance bond); and (2) to ensure payment to  subcontractors (a payment bond).  If a subcontractor is not paid for their work, they are permitted to pursue an action against the bonding company for payment as a “a third party beneficiary”.  If the subcontractor is successful in their claim, then the bonding company will pay the claim and pursue the prime contractor for the amount paid.  Notice that the subcontractor is permitted to claim against the bonding company despite the fact that the subcontractor’s agreement is with the prime contractor, not the bonding company. Most bonding agreements contain language that specifies how an individual or an entity becomes a “claimant” to the bond. 

Contractor Bonding: Defined and Explained

Guest contributer: Danielle Rodabaugh
Construction professionals in the D.C. area are probably familiar with the district's various surety bond requirements. Unfortunately, most contractors have a limited knowledge of contractor bonding beyond the fact that they need it before working on certain construction projects. Contractors should fully understand the legal implications of bonds before they purchase them so they know what they're getting into — otherwise they might find themselves in court.

How do surety bonds work?

Although insurance companies typically underwrite contractor bonds, the protection they provide is very different from insurance policies. When underwriting insurance policies, companies assume a certain amount of risk is involved. This is not the case with surety bonds. Unlike insurance companies, surety providers intend to avoid any and all claims, which is why getting a surety bond is often much more difficult than getting an insurance policy. Furthermore, whereas insurance policies involve only the policy holder and the insurance company, surety bonds involve three entities.

• The obligee, typically a government agency, requires the bond to regulate the market and protect against financial loss.
• The principal, a construction professional, buys the bond as a legal guarantee of future work performance.
• The surety financially backs the construction bond as a show of good faith in the principal's ability to complete the project.

No matter the specific bond type that's issued, every surety bond functions in the same basic way: as a legally enforceable contract. If contractors fail to fulfill the contractual terms of their bonds, they face legal action. To avoid the costly and troublesome claims process, contractors should be sure they fully understand the legal language of each surety bond they purchase.

Letters of Credit

Letters of credit have been in use for over two thousand years, in one form or another. From the time of ancient Greece and Rome up through the present, letters of credit have been mainly used to finance shipping contracts. However, letters of credit have uses that go far beyond just transportation. In a letter of credit arrangement, the issuing party, usually a bank or insurance company, contracts with one party to pay funds to a third party upon the fulfillment of certain conditions specified in the agreement. Most commonly, they are employed to finance a sale of goods where the buyer and seller have limited contact and experience with each other, such as an international transaction. Because letters of credit are employed so extensively in international trade, they are governed by an international treaty ("Uniform Customs and Practices Governing Documentary Credits"). But utility of letters of credit is not confined to international shipping; they can be quite useful right here in Virginia. A tenant can obtain a letter of credit which will become payable to the landlord upon a certification from the landlord that the tenant has defaulted on his rent. This arrangement has several advantages over a conventional security deposit. The landlord can demand a much larger security deposit in the form of a standby letter of credit than he could in cash, and the tenant does not have to use his valuable cash reserves to satisfy the security deposit, assuming the tenant has a reliable credit history. In addition, the tenant will not be at risk of losing his security deposit if a foreclosure occurs. *** The above is not meant to replace legal counsel. If you'd like to speak to one of the lawyers at Gross & Romanick, please call us at 703-273-1400 or fill out our online information request form.

Liquidated Damages

Liquidated Damages is a dollar amount stipulated in a contract which the parties agree is a reasonable estimation of the damages that would be owed to one party in the event of a breach by the other party. Companies often rely on liquidated damages clauses to assure performance of the contract.

Since the amount of damages is often difficult to ascertain when there is a breach, a liquidated damages provision attempts to fix the amount. Even if the parties agree to a liquidated damages clause, the Court will only award the actual damages suffered if they can be ascertained. In theory, the clause also saves litigation time and legal fees.

WHEN VALID: The Commonwealth of Virginia recognizes liquidated damages clauses in contracts as valid under the following conditions: (1) The figure must be a reasonable amount contemplated at the time of contract to be the probable loss to the non-breaching party in the event of a breach; (2) The amount cannot be punishing or punitive damages, grossly in excess of the actual damages; and (3) The damages must not be susceptible of a definite measurement.

The Court examines the conditions at different times of the contracting parties' relationship. When looking at the first and third conditions, the court examines them from the time of the contract. The second is examined at the time of breach.

ACTION ADVICE: In order to improve the likelihood of enforcement of a liquidated damages provision, a contract clause should state that the opposing party waives their right to contest the enforceability of the liquidated damages clause. In Gordonsville Energy v. Virginia Electric & Power (1999) the Virginia Supreme Court upheld such a waiver of rights provision.

***

The above is not meant to replace legal counsel. If you'd like to speak to an attorney, please contact Gross & Romanick at 703-273-1400 or by filling out our online information request form.

The Statutory Lien: Send Your Bills

Whatever difficulties a doctor may encounter in collecting a bill owed by a patient who was negligently injured, he is assured of as much as $500 under Virginia law. Section § 8.01-66.2 of the Virginia code provides for a lien for his "just and reasonable charge" up to that amount on the claim of an injured person whose injuries are alleged to have been caused by another's negligence.

In order to assert your lien, send copies of your bills to the attorney representing the patient. If the attorney is uncooperative (refusing to sign a lien/assignment), it might be prudent to send copies to the negligent party's insurance company.

***

The above is not meant to replace legal counsel. If you'd like to speak to an attorney, please contact Gross & Romanick by calling 703-273-1400 or by filling out our Online Information Request Form.

Summer Venues and Marijuana Possession

Summer in Northern Virginia is synonymous with the start of the concert season at the Wolftrap National Park for the Performing Arts. It is also the time of year when area residents plan to camp in the Prince William National Forest and take weekend drives along the George Washington Memorial Parkway. Unlike Jiffy Lube Live, the Patriot Center, and the multitude of state parks in the Northern Virginia area, Wolftrap, the Prince William National Forest and the GW Parkway are “federal enclaves”. This means that misconduct at these venues can result in facing criminal charges in the United States District Court for the Eastern District of Virginia, Alexandria Division.

In other words, possession of just a small amount of marijuana can literally become a federal case. The United States Park Police routinely patrol the parking areas, overlooks and camp grounds. Often officers are dressed in plainclothes and are not easily identifiable. These federal officers can be aggressive in their efforts to uncover marijuana and alcohol possession.

In a case recently handled by our lawyers, we successfully persuaded the United States Attorney’s Office that the arresting officer’s aggressive behavior violated our client’s constitutional rights. In another recent case, an attorney at our law firm convinced a federal judge to suppress evidence of marijuana possession because the traffic stop which lead to the discovery of marijuana exceeded the permissible scope of the stop under the US Constitution. It is extremely important that every individual charged in federal court retain an experienced attorney to fully protect his or her rights.