Confidential
Settlement – $7,000,000Court
King Superior
Attorneys
Plaintiff
Defendant
Gary R. Selvin
(Selvin Wraith Halman LLP)
Experts
Plaintiff
Casey Garland
(technical)
Paul A. Greenberg
(technical)
Richard C. Eymann
(technical)
Rocco Altobelli
(technical)
James M. Moore
(technical)
Robert Schoene
(medical)
Jim Greenway
(technical)
Jerome Modell
(medical)
Kirk Greiner
(technical)
Defendant
Jan Viny
(technical)
Frederick Meyers
(technical)
David R. Knowles
(technical)
Jim Moss
(technical)
Jack R. Miller
(technical)
R. Bruce Carlson
(technical)
Facts
On June 4, 1994, the defendant church sponsored its annual river rafting trip and decided for the first time to take the confirmation class (comprised of children 11 and 12 years of age) on the river rafting outing. The defendant church used the defendant rafting company owned by a potential new recruit to the church. The defendant rafting company allegedly did not have enough guides and hired a new guide the day before the scheduled trip. The guide had just completed his training and the plaintiffs claimed he was inexperienced. The new guide was placed in charge of the confirmation boys and given a raft that had more children than foot straps. His raft was also rigged by the owner to have a ôsuicideö line down the middle, which the plaintiffs claimed most experienced guides would not run. The raft was overloaded with children and unable to maneuver away from a bridge pillar, resulting in the raft up-ending and wrapping around a pillar. The 12-year-old decedent and the 38-year-old decedent were allegedly trapped by the ôsuicideö line that ran down the middle of the raft. The plaintiffs claimed that the decedents struggled to exhaustion for five to 10 minutes before drowning. The church had $1 million of primary insurance and a $10 million umbrella policy. Defendant insurance company #1 denied coverage under the umbrella policy based upon an endorsement excluding watercraft liability that it intended to take effect the year of this accident. Defendant insurance company #1 filed a declaratory judgment lawsuit against the church and the plaintiff heirs of both decedents, in an effort to deny umbrella policy coverage. The plaintiffs, the heirs of the decedents, brought a counter-action for bad faith. One of the defendant owners of the defendant rafting company had $500,000 in primary insurance through an insurance group and a $1 million personal umbrella policy with defendant insurance company #2. Defendant insurance company #2 denied coverage under the umbrella policy based upon a business pursuits exclusion, arguing that business activities were not covered unless there was an underlying policy listed on the declaration sheet. The defendant owners of the rafting company claimed that when defendant insurance company #2Æs agent came to their home to sell them insurance (following a cold call), the agent represented that defendant insurance company #2Æs umbrella policy would cover the river rafting and home business pursuits. The agent failed to list the underlying river rafting policy with the insurance group on the declaration sheet. The agent later denied that he told the defendant owners that their business activities would be covered. He claimed that he told them he was uncertain of coverage when he learned that one of the defendant owners was involved in the defendant river rafting business. Discovery revealed that the agent had listed the defendant ownersÆ river rafting activity on his application for life insurance which was filed with defendant insurance company #2 at the same time as the umbrella application.
Settlement Discussions
The defendant church, the defendant owner and the rafting company settled with the both heirs of the decedent for the total primary policy limits of $1.5 million. The settlement was by way of assignment of all claims or causes of action the church and the defendant owner of the rafting company had against their insurance carriers and agents arising under their umbrella insurance policies, as well as stipulated judgments of $5 million for each claim and an agreement not to execute on those judgments except against the insurance companies.
Damages
The plaintiff heirs of the 12-year-old decedent claimed $5 million in damages. The plaintiff heirs of the 38-year-old decedent claimed $5 million in damages.
Injuries
Death of a child. Death of a husband/father.
Other Information
The settlement was reached approximately two years after the case was filed. A mediation was held on June 6, 1996, before Charles Burdell of JAMS/Endispute resulting in the reported settlement totaling $7 million.
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