O'Meara, Leer, Wagner & Kohl, P.A. News

The Minnesota Supreme Court Interprets Minnesota’s Statutory Dram Shop Notice Requirement

April 6th, 2018

In Buskey v. Am. Legion Post # 270, ___ N.W.2d ___ (Minn. April 4, 2018), a divided Minnesota Supreme Court reversed the trial court’s and court of appeals’ interpretation of the Minnesota Civil Damages Act “dram shop” statutory notice requirement and held:

(1) the statutory notice requirement only requires the liquor licensee to possesses knowledge of “sufficient facts” to put it on actual notice of a potential dram shop claim; and

(2) the notice requirement is satisfied if a dram shop claimant provides notice to a liquor licensee’s agent or if the licensee’s agent possesses the aforementioned actual notice of a potential claim.

Read the full summary here.

Our Retail and Hospitality Group is happy to answer any questions you may have about Buskey or any other Liquor Liability-related issues.

Schools and Public Safety: Minnesota Doesn’t Have to Stoop to Arming Teachers

March 2nd, 2018

Following the school shooting tragedy in Parkland, Fla., President Donald Trump said that teachers who have “natural talent like hitting a baseball or hitting a golf ball” should be armed in schools. Rather than rushing to such extremes, there must be a meaningful dialogue about school safety. Fortunately, Minnesota schools have listened, incorporating significant federal guidance as part of their approach to emergency management.

Within an 18-month period from September 2003 to March 2005, Minnesota suffered two school shootings, with 12 dead. Minnesota school districts; federal, state and local law enforcement agencies; and the Minnesota and U.S. Departments of Education worked together to prevent further violence in our schools.

Emergency concepts used by fire and police agencies became part of emergency planning for schools. In addition, standards issued by the National Fire Protection Association, OSHA and FEMA guide how schools now approach emergency management. These important principles do not include arming teachers.

Following the Minnesota school shootings, I served on a legislative school safety task force. We recommended creating a Minnesota School Safety Center as a centralized resource for planning. Over the years, this center provided best-practice recommendations for crisis teams, lockdown protocols, security technology, suspected threats and programs to improve school culture as a violence deterrent.

The task force also recommended using the federal “all hazards” approach to prepare schools for any emergency, whether a natural disaster, pandemic flu or an act of violence. We suggested that student safety teams evaluate student behavior to prevent violence. Many schools now partner with local law enforcement agencies, health professionals, students and families to share information.

The task force also recommended that schools be given additional school safety levy authority. Remarkably, years later, Minnesota school districts still can’t use that authority to improve the security of their buildings. The Legislature should act to correct this and provide sufficient funding for school security infrastructure costs.

After Sandy Hook, the security of school buildings became a focus within school communities. School leaders sought the guidance of architects and security experts to assess building designs for protection against intruders. Design professionals now use a federally recommended process termed Crime Prevention Through Environmental Design (CPTED).

Rather than concentrating on single-source security measures, such as cameras or arming teachers, CPTED focuses on changes to the physical and social environment to reinforce positive behavior. Design teams evaluate the relocation of offices, improved sight lines, bulletproof glass, integrated cameras and lighting, vestibule protection, and reconfigured traffic patterns. Schools also quickly remove graffiti and repair vandalism to promote a culture of responsibility.

The presence of law enforcement officers has become an important part of school emergency plans. However, many school districts cannot afford to pay for a school resource officer or security presence despite an identified need. In such situations, our federal and state governments should support funding for trained police officers, either serving as school resource officers or through local law enforcement agencies under a joint powers or mutual aid arrangement.

After the Minnesota tragedies, the U.S. Department of Education, in coordination with the Secret Service, worked with the U.S. Attorney’s Office and the Minnesota Department of Public Safety on a well-received publication for school administrators and law enforcement officials. It focused on identifying threats and responding to potential violence within schools, based on national studies of school shootings and the behavior of students who carried them out, and why other students with information about an attack did not tell authorities.

Importantly, the message was not to arm teachers, but to help build a positive school climate to establish trust and respect among students and staff and to encourage sharing information about threatening behavior before an incident occurs.

Working together, our schools and community partners have focused their emergency planning using time-tested national guidance. The clear message from our shared experience is that arming teachers has no place in any emergency management plan.

This article was written by O’Meara leer Wagner & Kohl shareholder Shamus O’Meara. It was originally published in the Opinion section ( page 7A) of the Star Tribune Friday, March 2nd, 2018.

 

Mens Rea of Unidentified Driver Irrelevant for “Hit-and-Run Motor Vehicle” Coverage under UM Policy

January 12th, 2018

In Minnesota, mandatory “uninsured motorist coverage” includes coverage for bodily injury caused by “hit-and-run motor vehicles.”  But until this past week, it wasn’t clear exactly what constitutes a “hit-and-run motor vehicle.”

A worker power washing the interior of a parking ramp was injured when an SUV caught and drug the hose of the power washer, which then struck and knocked the worker to the ground.  The SUV did not stop, and its driver was never identified.  The injured work made a claim for uninsured-motorist (UM) benefits, but her insurer denied coverage, arguing the insured could not prove the SUV was a “hit-and-run vehicle” because she could not show that the driver fled the scene to avoid liability.  The insurer also argued that the insured failed to produce evidence that the SUV driver was negligent.

The district court granted summary judgment for the insurer, and the insured appealed.  The court of appeals reversed.  Russell v. Sentinel Ins. Co., Ltd., ___ N.W.2d ___, 2018 WL 256728 (Minn. App.).  Because neither the insured’s policy nor the Minnesota No-Fault Automobile Insurance Act defined “hit-and-run vehicle,” the court turned to dictionary definitions and case law to determine the ordinary meaning of the term.  Relying on Halseth v. State Farm Mut. Auto. Ins. Co., 268 N.W.2d 730 (Minn. 1978), in which the supreme court announced that for hit-and-run UM coverage, the phrase hit-and-run is more expansive than the literal meaning of “hit,” the court of appeals held that the phrase hit-and-run was also more expansive than the literal meaning of “run.”  In so holding, the court of appeals declined to follow the Halseth court’s interpretation of “run” in dictum to mean “flee” and determined that the mens rea of the unidentified driver was irrelevant.

In sum, an insured is not required to show that an unidentified driver fled, or left, with the intent to escape liability.  The insured must simply prove that the driver did not stop and cannot be identified.

The court of appeals also determined there was a genuine issue of material fact as to whether the unidentified driver was negligent and remanded the case back to district court.

If you have questions regarding the court of appeals’ decision or any other UM or other motor vehicle insurance issues, please contact Dale O. Thornsjo, Lance D. Meyer, Michael M. Skram, or one of the other members of our Firm’s Insurance Coverage and Motor Vehicle Practice Groups at (952.831.6544).

 

Come Visit OLWK at Booth 404 Tomorrow at the MSBA 97th Annual Leadership Conference!

January 10th, 2018

We’ll be at the Minneapolis Convention Center from 8am-5pm January 12th and from 7:30am- 10:30am January 12th. Stop by and say hello!

Please Join OLWK at the 2018 Minnesota School Boards Association 97th Annual Leadership Conference in Minneapolis on January 11-12, 2018

January 5th, 2018

O’Meara, Leer, Wagner & Kohl is proud to participate in the 2018 Minnesota School Boards Association 97th Annual Leadership Conference at the Minneapolis Convention Center on January 11-12, 2018.

Please be sure to stop by Exhibit Hall A and visit us at Booth 404 on January 11 all day, and on January 12 until noon.  We are also proud to announce that we will be conducting two seminars this year:

January 11, at 3:45 p.m. (Room L100F) – “Investigation of Employee Complaints of Discrimination; Essentials for Districts” presented by Morgan Godfrey.

January 12, at 9:15 a.m. (Rom L100F) – “Transportation of Students – What You Need to Know” presented by Mark Azman.

Hope to see you there!

OLWK Attorney Rachael Hafdahl Interviews Judge Thomas Conley

January 2nd, 2018

OLWK Attorney Rachael Hafdahl Interviews Judge Thomas Conley in the January / February edition of Hennepin Lawyer.  Read the article here.

Happy Holidays from O’Meara Leer Wagner & Kohl, P.A.

January 2nd, 2018

As 2017 Comes to a Close, Minnesota’s Appellate Courts Continue to Grapple with the Issue of Foreseeability in Tort Cases

December 27th, 2017

In 2017, the Minnesota Supreme Court has grappled with the issue of foreseeability in a variety of tort cases.  In particular, the supreme court has been asked in product- and premises-liability cases to determine whether the issue of foreseeability should be decided by the court as a matter of law or submitted to the jury.  While acknowledging that if clear the issue of foreseeability should be decided by the court as a matter of law, the supreme court has consistently favored submitting foreseeability issues to the jury in recent cases, citing misleading “close case” language from the court’s foreseeability jurisprudence.

In Montemayor v. Sebright Products, Inc., 898 N.W.2d 623 (2017) (previously discussed here), a product-liability case, the Minnesota Supreme Court held that there was a genuine issue of material fact as to whether it was reasonably foreseeable to the manufacturer of a high-density food extruder that a person would physically enter the extruder while another person activated it from the control panel, making the issue of foreseeability “close” and thus an issue for the jury.  The dissenting justices in Montemayor rightfully took issue with the “inartful” “close case” language applied by the majority, noting that it was inconsistent with the court’s well-established summary judgment standard.  Nevertheless, the supreme court concluded a few months later that the issue of foreseeability was again “close” and thus an issue for the jury in Senogles v. Carlson, 902 N.W.2d 38 (2017), a premises-liability case in which a premises owner argued that it was unforeseeable that a four year old would enter a river to swim unaccompanied by an adult.  Together, the court’s decisions in Montemayor and Senogles signal a shift in the court’s approach to foreseeability issues in tort cases in favor of submitting foreseeability issues to a jury for determination.

And it is likely the trend will continue as the supreme court has accepted further review of the court of appeals’ determination that an automobile accident was unforeseeable in Fenrich v. Blake Sch., 901 N.W.2d 223 (2017).  In Fenrich, the court of appeals conceded that in “close cases” the issue of foreseeability should be submitted to the jury but concluded that the case before it was not a “close case.”  Specifically, the court concluded that a school did not assume a duty of reasonable care to the general public by agreeing that one of its students could drive himself and other students to an out-of-town, extra-curricular activity in his family’s vehicle because the risk of an automobile accident was not foreseeable.  In petitioning for further review (Petition available here), the appellant relied heavily on the supreme court’s decisions in Montemayor and Senogles, suggesting that the supreme court may be poised to continue the trend of deferring foreseeability issues to the jury in “close cases.”

As it closes out 2017, the court of appeals again grappled with the issue of foreseeability in a published decision in Cashman v. Uptown Drink, ___ N.W.2d ___ (2017), a dram-shop case.  The supreme court may thus have a second opportunity in 2018, in addition to Fenrich, to further solidify its recent approach to the issue of foreseeability.

In Cashman, co-trustees for the estate of a bar patron sued the bar after the decedent fell and fatally hit his head while helping an employee of the bar escort another patron out of the bar following a fight.  The co-trustees claimed the bar was negligent and violated Minnesota’s dram-shop statute—Minn. Stat. § 340A.502—by providing liquor to an obviously intoxicated person.  The bar moved for summary judgment, and the district court dismissed the co-trustees’ claims, concluding that the negligence claim was barred by the decedent’s primary assumption of the risk and the dram-shop claim was barred because the intoxication of the patron the decedent was escorting out of the bar was not the proximate cause of the decedent’s injuries.

The court of appeals reversed.  With respect to the negligence claim, the court determined that the foreseeability of the decedent’s injuries and applicability of primary assumption of the risk presented questions of fact that precluded the court from resolving such issues as a matter of law.  Following the supreme court’s lead, the Cashman court employed “close case” language in discussing the issue of foreseeability and determined the issue of foreseeability was an issue for the jury.  In terms of primary assumption of the risk, the court observed that application of the doctrine is uncommon and concluded that genuine issues of material fact existed as to whether the decedent had actual knowledge of the particular risks or dangers of assisting with another patron’s removal from the bar and also whether the bar’s conduct enlarged the inherent risk assumed by the decedent, which would preclude application of primary assumption of the risk.

The court of appeals also reversed the district court’s dismissal of the co-trustees’ dram-shop claim, concluding that a genuine issue of material fact remained as to whether the intoxication of the patron the decedent was escorting out of the bar was a proximate cause of the decedent’s injuries.  Consistent with its reasoning as to the foreseeability of the decedent’s injuries, the court of appeals determined that there was sufficient evidence of a direct link between the patron’s intoxication and the decedent’s injuries to submit the issue of proximate cause to the jury.  In so holding, the court observed that the lack of proximate cause may be decided by the court as a matter of law in cases in which “intoxication is entirely unrelated to the injury”—i.e., cases in which the intoxicated party’s impaired faculties could not have directly caused an injury because it resulted from the actions and choices of another person.  The court further observed that there is no requirement that “intoxication must be the sole proximate cause of injury in the dram shop context” and that “a defendant is liable under the dram shop act when the allegation is that intoxication was only a contributing cause of the injury.”  Quoting Osborne v. Twin Town Bowl, Inc., 749 N.W.2d 367, 374-75 (Minn. 2008).  “Intoxication need only be a substantial factor in bringing about the injury.”  Citing id.

If the bar appeals and the supreme court grants further review, the supreme court will have another opportunity to further solidify its recent approach to the issue of foreseeability.  But it will also have the opportunity to address the primary assumption of the risk and proximate cause issues that were the primary focus of the court of appeals’ decision.  Notably, if accepted by the supreme court, the Cashman case would join Buskey v. Am. Legion Post #270, 2016 WL 7338739 (Minn. App. 2016), rev. granted (Mar. 14, 2017) (previously discussed here), a dram-shop case involving the 240-day notice-of-claim provision of Minn. Stat. § 340A.802 that is currently pending before the supreme court.

If you have questions regarding the Minnesota supreme court’s recent handling of the issue of foreseeability, the dram-shop issues at play in Buskey and Cashman, or any other general or liquor liability issues, please contact Dale O. ThornsjoBrian M. McSherry, Lance D. Meyer, or one of the other members of our Firm’s General Liability and Liquor Liability Practice Groups at (952.831.6544).

Applying Illinois law, Seventh Circuit broadly applies “Damage to Property” Exclusion to Bar Coverage for Damaged Grain Bin

December 22nd, 2017

The “Damage to Property” exclusion in the standard commercial general liability policy excludes coverage for “property damage” to:

(5)        [t]hat particular part of real property on which you or any contractors or subcontractors working directly or indirectly on your behalf are performing operations, if the “property damage” arises out of those operations; or

(6)        [t]hat particular part of any property that must be restored, repaired or replaced because “your work” was incorrectly performed on it.

Because the phrase “that particular part” is not defined in the standard CGL policy, the applicability of the exclusion often hinges on how broadly the court interprets the phrase.  As highlighted recently by the Seventh Circuit Court of Appeals in West Side Salvage, Inc. v. RSUI Ind. Co., ___ F.3d ___, 2017 WL 6422107, certain courts have interpreted the phrase and thus the exclusion narrowly to apply only to property damage caused by work on the particular piece of property that is damaged, while others, including Illinois courts, have interpreted the phrase more broadly to apply to property damage caused by poor workmanship.

ConAgra hired West Side Salvage to fix a hot grain bin, and the grain bin exploded while West Side Salvage was performing its work, causing extensive damage to the grain bin.  West Side Salvage was found liable for the explosion and sued its excess carrier RSUI for coverage.   RSUI reserved its rights and ultimately argued that coverage was excluded by the “Damage to Property” exclusion in West Side Salvage’s excess policy.  The Seventh Circuit agreed.

Rejecting the district court’s reliance on the Missouri Supreme Court’s narrow interpretation of the exclusion, the Seventh Circuit concluded that under Illinois law, “[t]he exclusion [ ] do[es] not exclude coverage for damage done only to the precise area of the property being worked on.  Rather, the exclusion[ ] appl[ies] to property damage caused by poor workmanship.”  2017 WL 6422107, at *4 (quoting Pekin Ins. Co. v. Willett, 301 Ill.App.3d 1034, 235 Ill.Dec. 350, 704 N.E.2d 923, 926 (1998)).  In other words, “ the exclusion does not apply only to the precise area of the property being worked on if the work performed was poor.”  Id.  The court thus concluded that it was immaterial whether West Side Salvage was only working on the grain (and not the grain bin) when the explosion occurred.  Id.

The Seventh Circuit went a step further, however, and observed in general that holding otherwise “would undermine the basic premise of the damage-to-property exclusion: that general liability policies are not intended to protect the insured from the normal risks of its business.”  Id.  Accordingly, the court concluded that the exclusion applied because “[t]he damage that West Side caused was one of the normal risks associated with its business of remedying hot grain bins before they explode.”  Id. (citing AutoOwners Ins. Co. v. Chorak & Sons, Inc., No. 07 C 4454, 2008 WL 3286986, at *4 (Ill. App. Ct. 2008) (noting that the insured was asking the insurer to provide coverage for damage that was the result “of the normal risks associated with” the activity the insured was performing and holding that the damage-to-property exclusion applied to bar such coverage)).

In general, the West Side Salvage decision highlights the importance choice-of-law determinations can play in insurance-coverage cases.  But, more importantly, the decision illustrates that the applicability of the “Damage to Property” exclusion may hinge on which state’s law governs the interpretation of the phrase “that particular part.”  In fact, West Side Salvage argued that Iowa law should govern the applicability of the exclusion but failed to demonstrate that a conflict existed between Illinois and Iowa law, leaving the court to apply the law of the forum state.

If you have questions regarding the Seventh Circuit’s decision, how different courts have interpreted the “Damage to Property” exclusion, or any other insurance-coverage issues, please contact Dale O. Thornsjo, Lance D. Meyer, or one of the other members of our Firm’s Insurance Coverage Practice Group at (952.831.6544).

Minnesota Court of Appeals defines who is an “insured” for purposes of Minn. Stat. § 60A.41(a) subrogation bar

December 22nd, 2017

In Minnesota, an insurer is prohibited by statute from subrogating against its “insured” for a loss caused by the non-intentional acts of the “insured.”  Minn. Stat. § 60A.41(a).  But who is an “insured”?

The Minnesota Court of Appeals recently answered this question in Depositors Ins. Co. v. Dollansky, ___ N.W.2d ___, 2017 WL 6273144.  The court held that for purposes of Section 60A.41(a), an “insured” is any person or organization qualifying as an insured under the policy, not just a “named insured.”

Craig Dollansky rented a motor home from Karavan Trailers pursuant to a contract that obligated Dollansky to provide insurance for the motor home and made Dollansky responsible for any damage to the motor home.  The motor home subsequently caught fire while Dollansky was driving it, resulting in substantial damage to the motor home.  Dollansky’s automobile insurer, American Family Insurance, paid Karavan part of its insurance deductible but denied responsibility for the balance of the damages, leaving Karavan’s insurer, Depositors Insurance Company, to cover the loss.  Depositors paid and brought a subrogation action against Dollansky.

The district court granted summary judgment in favor of Dollansky, concluding that Depositors was prohibited by Section 60A.41(a) from subrogating against Dollansky because Dollansky was an “insured” under the Depositors’ policy.  The court of appeal agreed.

Initially, the court determined that the Depositors’ policy controlled and that the term “insured” in the statute could not be read to mean “named insured.”  The court then turned back to the Depositors’ policy and determined that Dollansky was an “insured” under the policy because he was using with permission the motor home owned by Karavan.  And it concluded that because Dollansky was an “insured” under the Depositors’ policy, Depositors was prohibited by the plain language of Section 60A.41(a) from subrogating against Dollansky.

In so holding, the court determined that Dollansky’s status as an “insured” was enough to trigger application of the statute and refused to consider whether Dollansky would actually have coverage for the loss under the Depositors policy.  The court also declined to consider Depositors’ public policy arguments because the statute unambiguously addressed the question before it.

If you have questions regarding the court of appeals’ decision, the statute, or any other subrogation issues, please contact Dale O. Thornsjo, Lance D. Meyer, or one of the other members of our Firm’s Subrogation Practice Group at (952.831.6544).