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Posted April 16:

Dear Overlawyered.com: I am in liability shock.  I recently learned that our liability insurance is going from $70,000 to $140,000.  I am executive director of a highly regarded nonprofit agency that provides housing and services to the homeless and low income families and individuals.  We own and manage about 500 apartments and houses in Westchester County and Long Island, New York.

The reason for this increase is our loss: $300,000 paid in a settlement (before trial) to a man who fell off a ladder and broke his leg while renovating one of our houses for the homeless.  What seemed hard to believe about the suit is that this guy wasn't working for us at all; instead, he worked for an independent contractor who was renovating our property.  At first I thought perhaps my property manager had violated our policy by not getting the contractor to provide a certificate of insurance but he had done that, even getting our nonprofit agency added as a named insured.  It was then that I saw the letter in the file from the contractor's insurance agency stating that bodily injury to an employee on the job was excluded from coverage!  My insurance agent explained that an employee can collect for his injuries from workmen's comp, and in exchange can't sue his employer; but under New York state law he can sue the homeowner for whom the work is being done, for unlimited amounts, and the agent continued that a smart lawyer will do exactly that to collect more.  This is crazy! 

The result is that $70,000 more will go into paying for insurance, instead of helping the homeless.  The taxpayer will be hit because our agency will pass along that extra cost to our government contracts.  -- Alec Roberts, New York 

I want a t-shirt!  Do you offer one that has OVERLAWYERED.COM on it? -- Vincent Suro, Monterey, Calif.

[We're thinking of doing T-shirts and coffee mugs with the Overlawyered.com logo at some point in the future, but don't have them yet. -- ed.]

Just a response to "No More Indian Team Names?" (March 15):  So, what about all of the states and cities and streets named after Indian leaders and nations?  Will there be a mandate to rename them?  -- John in New Orleans

I have never understood the American reluctance to adopt the loser pays principle, which is the most fair way, fundamentally.  Any resistance to it defies logic.  Why should any person be subjected to frivolous or fanciful litigation, win, then have to bear his own costs? It simply does not make sense. In Canada we have a loser-pays principle, but unfortunately, as we become more American, it is being eroded. -- Jacques LaFontaine, Ontario

You covered the increase in the size of employment jury verdicts (March 29), but did not note the Supreme Court's decision in Circuit City v. Adams, March 21, 2001.  In the November 3, 2000 New York Times, the counsel for the Equal Employment Opportunity Commission said that, if the Court decided for Circuit City (which the Court did) that "every business" would start using arbitration clauses in all employment documents, putting an end to these jury verdicts.

Professor Jean Sternlight called arbitration "do it yourself tort reform.”  She complained that, from her point of view, arbitration had terrible things, like "loser pays" and no class actions.  See, "As Mandatory Arbitration Meets the Class Action, Will the Class Action Survive?" 42 Maryland Law Review 1(October 2000).  -- Edward C. Anderson, National Arbitration Forum

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