Over and Over.
Until they start listening.

This has never been my experience, especially with children. Many/most courts hold that the parents cannot sign away the rights of a minor child.

In a comment on Overlawyered, Ted Frank points to his draft paper (with Marie Gryphon), Negotiating in the Shadow of ‘Bad Faith’ Refusal to Settle: A Game Theory Model of Medical Malpractice Pre-Trial Settlements and Insurance Limits: Recent empirica…

A little bit, in reality, is not so little, and a significant number of charities have had to close their doors or offering services because of liability insurance premiums. You say “if the charity is negligent” as if an award is based on that. Juries award millions all the time in situations where no one was “negligent”. Perhaps the lawyer was able to convince the juryr that they were “negligent”, but that doesn’t mean they did anything bad or wrong.

The way you write you seem to believe that an alleged bad legal defense means the defendant gets millions. Just because a legal team blows the case does not mean the isurance company should have to pay millions. The award should have been a much more reasonable amount. All awards of this kind should take into account their chilling affect on the people who sacrifice so much to try to help people out. That chilling affect is real and even if the law doesn’t care about it, it hurts millions of people through lost donated man hours.

I don’t know why you keeping bringing up Lloyd’s belief that the verdict was wrong. An insurer doesn’t care whether verdicts are right or wrong: it just cares about losses. There’s absolutely no inconsistency in Lloyd’s saying, “We think this verdict was an injustice” and simultaneously saying, “Yet we must charge more for fear of similar, equally unjust, verdicts.”

Anyway, it seems to me you’re no longer disputing Walter’s point. Walter claimed that this sort of verdict “will discourage charity programs.” You acknowledge that “the verdict might raise the charity horse ride premiums as a class.” Higher costs discourage things. Perhaps the increase will be small, but only because it is spread over many insureds, and thus affects many people.

(You then go on to note that the verdict won’t hurt “the charity itself.” This is an odd thing to say, because the charity is a member of the “charity horse ride” class, which you acknowledge will be hurt. It also strikes me as dubious: insurance premiums, in my experience, depend both on class experiences and on individual insureds’ loss histories. Again, the insurer doesn’t care whether a verdict was right or wrong; it just cares about whether a claim had to be paid.)

Anyway, thanks for your reply.

In addition, it is NOT the case that parental waivers of claims for injuries to children are “routinely upheld.” In fact, they are unenforceable in many states.

See bolding. See my prior remark:

… at most, their premiums might rise, but that, too, is unlikely if the insurer genuinely believes that the charity wasn’t at fault, which apparently they do.

Lloyd’s hiking up the premiums specifically for the charity due to this loss is incompatible with a good faith belief that the charity was not at fault. Assuming Lloyd’s believes, in good faith, that the individual charity was not at fault, they then assess the charity based not on this particular loss, but on losses to the class as a whole.

Ergo, the verdict might raise the charity horse ride premiums as a class, but not the charity itself.

Again, all of this could have been avoided if (i) the charity hadn’t been negligent and (ii) the insurer had acted in good faith and settled within the policy limits. If there’s discussion of bad faith, it means the plaintiff did indeed make a demand within the policy limits.

Police investigation of bank robberies serves, in part, a deterrent purpose. Egro, that’s an argument in favor of increased tort recovery as a method for deterring tortfeasors from future negligent conduct, which doesn’t seem to be what you want.

If you mean to characterize my remarks as being that “rare” risks shouldn’t be guarded against, that’s incorrect. I’m not saying charities or people shouldn’t be insured, I’m saying that “losing your house for negligent charity work” is an extraordinarily unlikely event.

Of course, “not being negligent” is the best way to protect your assets and your insurance policy. Also, “not making up your defense” is the best way to avoid an above-average verdict; from the little bit we know here, it seems the charity defended itself not by noting that horse kicks were a possibility that participants assume the risk of (which is probably why you and most readers assume this case is meritless), but instead by inventing a story whereby the boy runs over to the trailer and starts whacked the horse for the heck of it. Once the jury rejected that as incredible, they likely rejected defendant’s damages arguments as well.

The fees for signing up a child for soccer or baseball nowdays is getting ridiculous because of the greedy tort lawyers and their desire for more wealth redistribution.

You could always ask the parents to sign a waiver prior to participating. They’re typically upheld and will reduce premiums.

That said, what’s so bad about contributing a little bit to ensure (by insuring) that, if the charity is negligent and hurts someone, the injured participant will be compensated? A little risk-spreading is not always a bad thing, particularly in countries like the US without universal health care.

Of course, Lloyd’s could have evaluated the claim in good faith. That would have helped. Ted’s paper on using game theory to model the role of third-party bad faith claims looks interesting; I’d imagine there’s a double-distorting effect of the current system, such that plaintiffs with above-policy claims are typically short-changed, but have a higher likelihood of settlement than do plaintiffs with below-policy claims.

You see, insurance companies don’t have a magic money machine. When they have to pay a claim, they pay using money that they collected from their insureds. How do they know how much to charge, you ask? Ah, that’s a fascinating question. What they do is, they look at their loss history with that particular insured and with similar classes of insureds. This kind of verdict will effect those loss histories. It thus makes it more expensive to run a charity because it makes the charity’s insurance more expensive.