The only case citing USF Holland in connection with the collateral source rule similarly stated that “the insured in a legal malpractice case is entitled to recover that which it paid in the underlying suit, not the entire amount which was paid to settle or satisfy a verdict.” 19 The overwhelming majority of cases holding that the collateral source rule does not apply in legal malpractice claims arise under claims for negligently incurred judgments or settlements, like Sterling Radios or USF Holland. 20 Conversely, several states apply the collateral source rule to legal malpractice claims in the same manner as any other claim. 21
What is the collateral source rule in a lawsuit?
In other words, the rule prevents payments from an independent source from reducing the amount that the defendant is "on the hook" for in a lawsuit. The collateral source rule is most often applied in cases where the injured person’s insurance paid for medical treatment associated with the injuries.
What is the'collateral source rule'?
What is the 'Collateral Source Rule'. The collateral source rule prevents the reduction of damages awarded to a plaintiff for injury, illness or disability covered by a third party. The rule mandates that damages awarded to a plaintiff in court cannot be reduced by any amount paid by other sources to cover the damages suffered by the victim,...
What are collateral sources for a personal injury claim?
Other than insurance, collateral sources include worker’s compensation, Social Security or Medicaid, and services performed gratuitously that help the injured person. There is a second part of the collateral source rule which concerns the admission of evidence in court during a personal injury trial.
Why is the collateral source payment rule important in Maryland?
Because the rule bars defendants from introducing evidence to show that a plaintiff has received collateral source benefits or payments. There is also a Maryland Pattern Jury Instruction on point that defines a collateral source payment as a payment from an entity "other than the defendant."
What is the collateral source rule and what significance does it have for a plaintiff?
The collateral source rule is a law in state jurisdictions that prevents the reduction of damages awarded to a plaintiff for injury, illness, or disability by the amount already recovered from a third party such as an insurer.
Is the collateral source rule substantive or procedural?
In federal diversity actions, state law governs substantive issues but federal law governs procedural issues. Although Georgia's collateral source rule is a substantive rule of damages, it also had procedural evidentiary implications.
What is the collateral source rule in Massachusetts?
Generally speaking, the collateral source rule says that if an injured person receives compensation from a source other than the tortfeasor, then the damages owed by the tortfeasor should not be reduced by the amount of that compensation.
What is the collateral source rule in South Carolina?
The collateral source rule provides “that compensation received by an injured party from a source wholly independent of the wrongdoer will not reduce the damages owed by the wrongdoer.” Citizens and S. Natl. Bank of South Carolina v.
Is Workers compensation a collateral source in Florida?
Workers' compensation is a collateral source. People hurt in work-related accidents by the negligence of third parties, may be entitled to both workers' compensation benefits and compensatory damages from the tortfeasors (third parties).
Are damages substantive or procedural?
Discovery is properly labeled “procedural” for choice-of-law purposes. What about damages? Heads of damages, the items that a court or jury may include in computing the amount awarded to the plaintiff, are universally regarded as substantive.
Is Connecticut a collateral source state?
2004) (“Prior to the enactment of § 52– 225a in 1985, Connecticut adhered to the common-law collateral source rule, which provides that a defendant is not entitled to be relieved from paying any part of the compensation due for injuries proximately resulting from his act where payment [for such injuries or damages] ...
Is Nevada a collateral source state?
Nevada has adopted a per se rule that bars the admission of a collateral source of payment for a loss or injury into evidence for any purpose.
Is Texas a collateral source state?
In states like Texas that follow the collateral source rule, any compensation to an injured party from a source other than the injuring party does not get deducted from the total amount of damages.
Does NC have a collateral source rule?
Harward. The collateral source rule is a substantive rule concerning damages. It prohibits a plaintiff's recovery from being reduced by some source “collateral” to the defendant.
Does North Carolina have a collateral source rule?
Under North Carolina's “collateral source rule,” the amount of damages that you can receive from the other driver is not reduced by any amounts received by a third party. Here is an example of how North Carolina's collateral source rule works: you are involved in a motor vehicle accident.
Does Georgia have a collateral source rule?
Georgia's Collateral Source rule, like many other states', prevents a defendant from presenting any evidence as to payments by a third party for the expenses of a tortious injury and prevents the defendant from taking any credit toward his liability and damages for such payments. Hoeflick v. Bradley, 282 Ga.
What is the collateral source rule in Virginia?
In negligence actions, Virginia has long adhered to the “collateral source rule” which holds that payments received by an injured plaintiff from a source other than the tortfeasor/defendant are not deducted from the damages owed to the plaintiff by the tortfeasor/defendant.
What is the collateral source rule in Pennsylvania?
Pennsylvania imposes the collateral source rule, which — as in many other states — heavily favors the injured plaintiff by prohibiting the introduction of evidence regarding third-party reimbursements and benefits that cover the losses at-issue.
What is the collateral source rule in Arizona?
The controlling law here is called the Collateral Source Rule (let's call it the CSR for short). The CSR allows an injured person to recover full compensation from the person responsible for the injury, even if another source (a collateral source) has already covered all or part of the costs stemming from the injury.
What is the collateral source rule in Tennessee?
The common law collateral source rule states that if benefits are received by an injured party from a source wholly independent of and collateral to the wrongdoer, the payment should not be deducted from the damages otherwise recoverable from the wrongdoer.
What Does "Collateral Sources" Mean?
Collateral sources are payments received by the victim in a personal injury case for compensation or benefits from a party not involved in the case...
What Is the Collateral Source Rule?
The defendant is liable to the injured victim for his/her injuries, regardless of whether someone else has paid for harms suffered by the victim.
Is the Collateral Source Rule an Evidentiary Rule?
The collateral source rule is an evidentiary rule. Because the rule bars defendants from introducing evidence to show that a plaintiff has received...
Why Is the Collateral Source Rule Good for Victims?
So, in some cases, it essentially permits a plaintiff to recover damages twice for some or all of their economic losses. So in a personal injury ca...
How Does the Malpractice Exception to the Collateral Source Rule Work?
In response to an "alleged" medical malpractice insurance crisis, the Maryland legislature modified the collateral source rule to reduce the award...
What Do Insurance Companies Not Want Victims to Know About This Rule?
It is counter-intuitive to most personal injury victims that the at-fault insurance company is still obligated to pay for lost wages when the emplo...
Does ObamaCare Impact the Collateral Source Rule?
Defense lawyers are scheming that ObamaCare makes healthcare coverage an obligation nullifies the logic of the collateral source rule. Don't be s...
What is collateral source rule?
The collateral source rule is one of the laws that has come under scrutiny from advocates of tort reform. Critics of the rule argue that it is not reasonable to award some plaintiffs double the amount of damages for an injury and that it encourages specious legal claims. Proponents of the collateral source rule argue that a defendant in a suit ...
Why do the proponents of the collateral source rule argue that a defendant in a suit for damages should not?
Proponents of the collateral source rule argue that a defendant in a suit for damages should not escape the consequences of negligence or malpractice just because the damages were covered by the plaintiff's insurer or by government benefits. They maintain that the defendant's irresponsible behavior should not be rewarded because ...
Why do tort reform advocates oppose the collateral source rule?
Tort reform advocates oppose the collateral source rule, arguing that it encourages specious claims by dangling the prospect of double compensation. Depending on state insurance laws, an insurer may have the right to pursue subrogation to obtain reimbursement for claims paid to a policyholder. For example, if a health insurance policyholder is ...
What is subrogation clause?
Some insurance companies have added a subrogation clause to their contracts. This effectively requires a successful plaintiff to reimburse the company by the amount awarded for damages that were covered by the policy.
What happens if an insurance company pays $20,000?
For example, if a health insurance policyholder is injured in an accident and the insurer pays $20,000 to cover the medical bills, the insurer may sue to collect that $20,000 from the at-fault party or that party's insurer.
Can damages be reduced by other sources?
The rule varies by state but generally mandates that damages awarded to a plaintiff in court cannot be reduced by any amount that is paid from other sources, including health insurance and workers' compensation, that cover the damages.
How many states recognize the collateral source rule?
Thirty-eight states recognize some exceptions to the collateral source rule. There are four exceptions that appear with some frequency (1) the Gladden exception, (2) the lien reduced exception, (3) malingering exception and, (4) the malpractice exception.
What is collateral source?
Collateral sources are payments received by the victim in a personal injury case for compensation or benefits from a party not involved in the case to compensate for the damages the plaintiff suffered in the accident or by medical malpractice. What Is the Collateral Source Rule? The defendant is liable to the injured victim for his/her injuries, ...
What is the case of Narayen v. Bailey?
Narayen v. Bailey: After a verdict, a doctor filed a Motion for Remittitur requesting a reduction of damages because the plaintiff medical bills had been paid by Blue Cross Blue Shield. Discusses Maryland law exception in medical malpractice post-verdict proceedings by permitting evidence of such benefits. The big key: if there is a reduction, the subrogation rights of the collateral source are eliminated. Under this scenario, the collateral source is estopped from seeking reimbursement.
What is the collateral source rule in MVA v. Seidel?
MVA v. Seidel: Nice statement of law for your brief: The collateral source rule permits an injured person to recover the full amount of his or her provable damages, " regardless of the amount of compensation which the person has received for his injuries from sources unrelated to the tortfeasor."
Why did Maryland change the collateral source rule?
In response to an "alleged" medical malpractice insurance crisis, the Maryland legislature modified the collateral source rule to reduce the award of damages when payments from a collateral source were available to the plaintiff. So how it works in Maryland is collateral source evidence is still inadmissible during a medical malpractice trial.
Why is Maryland a pattern jury?
Because the rule bars defendants from introducing evidence to show that a plaintiff has received collateral source benefits or payments. There is also a Maryland Pattern Jury Instruction on point that defines a collateral source payment as a payment from an entity "other than the defendant.". This gives you some idea how broad the scope ...
Why is the PIP not introduced to the jury?
A plaintiff's PIP, health insurance, or any other collateral source is not introduced to the jury because of the jury may reduce the damages award when it discovers that the plaintiff's damages have been paid by another source.
Collateral Source Rule in Illinois
Illinois law prevents the defendant in a personal injury case from introducing evidence that establishes the plaintiff received compensation from sources other than the defendant. It does not matter how much compensation was received, or whether the compensation covered the plaintiff’s expenses in full or in part.
Challenges to the Collateral Source Rule
It is not uncommon for defendants to challenge the collateral source rule by claiming that it allows for double recovery of compensation. However, for more than 150 years, Illinois courts have repeatedly upheld the collateral source rule and the protections it provides to plaintiffs.
Documenting Expenses
Thorough documentation and accurate accounting are essential when pursuing a personal injury claim in Illinois. Individuals must maintain an up-to-date accounting of their medical bills, surgical expenses, prescription costs, and therapeutic treatment programs.
What does collateral mean in a civil case?
What does this mean? And how does it impact a civil case involving negligence? Collateral source rule, the word collateral just means somebody other than the person who caused the injury. So this is a rule about what happens if you receive money or benefits from some source other than the person who actually caused the injury. And can you recover that same expense again from the person who caused the injury? So let's put this into some context.
Is health insurance a collateral source?
Let's say that you have health insurance, let's say you were injured by somebody else, all right. And you want to bring a claim against the person who caused the injury. But let's say your health insurance paid for your medical treatment, so they are a collateral source. The collateral source rule says that if you receive money or benefits from somebody other than the person who caused the injury, that does not absolve the person who caused the injury from being obligated under the law to pay you your full measure of damages.
What is the New York law on collateral source payments?
New York’s law on the admissibility of collateral source payments is codified as a rule of evidence at N.Y. C.P.L.R. § 4545. That statute applies to actions for personal injury, property damage or wrongful death where plaintiff is seeking to recover the costs of medical care, dental care, custodial care, rehabilitation services, loss of earnings or other economic loss. N.Y. C.P.L.R. § 4545(a) (McKinney’s 2009). The court can consider evidence that tends to establish that any past or future cost or expense was or will, with reasonable certainty, be replaced or indemnified, in whole or in part, from any collateral source. Id. Collateral sources do not include life insurance or payments for which there is a statutory right to reimbursement. Id. The statute provides specific instructions as to how an award shall be reduced in the event that past or future costs or expenses will, with reasonable certainty, be replaced or indemnified from any such collateral source. Id. The burden is on the defendant to prove that a plaintiff’s award should be reduced by payments received from collateral sources. Damiano v. Exide Corp., 970 F.Supp. 222 (S.D.N.Y. 1997).
What is collateral source in California?
In California the “collateral source rule” tends to favor plaintiffs, in that defendants are barred from introducing any evidence of payment from a collateral source and a plaintiff’s recoverable damages are not reduced by such payments. This rule includes payments from insurance companies who reserve the right to subrogate to the rights of the plaintiff as well as gratuitous sources and insurance companies who are unable to recover any of the money they paid plaintiff. California’s justification for this rule is the desire to encourage charitable/gratuitous action.
What is the common law rule in the Virgin Islands?
In essence, in any case where that court has not definitively stated what the rule is for the Virgin Islands, counsel is required to determine and brief what the majority and minority rules are for a particular legal issue and then argue what the best rule for the Virgin Islands should be. The lower court then must decide what the rule should be based upon these assessments. Unfortunately, until a particular issue is decided by the Virgin Islands Supreme Court, it is difficult to predict what rule will ultimately prevail. As a rule of thumb, however, one should assume that the outcome that is most favorable to a plaintiff will prevail. Thus, one should generally assume that a plaintiff will be permitted a double recovery – once from the collateral source and once from the defendant.
What is collateral source in North Dakota?
In North Dakota, the collateral source statute provides that a party responsible for payment of an award of economic damages may apply to the court for a reduction to the extent the economic damages are covered by payment from a collateral source . A “collateral source” payment is defined to include “any sum from any other source paid or to be paid to cover an economic loss which need not be repaid by the party recovering economic damages.” Explicitly excepted from this definition are “life insurance, other death or retirement benefits, or any insurance or benefit purchased by the party recovering economic damages.” These exceptions are intended to encourage people to secure personal insurance. Over all, the legislative purpose of the collateral source statute is to reduce the size of jury verdicts and control rising insurance rates.
What is collateral source in Massachusetts?
Griffith, 457 Mass. 349, 354-355, 930 N.E.2d 126, 131-132 (2010)(internal citations omitted.) The collateral source rule is a common-law rule that has a substantive and evidentiary component. Id. The stated purpose for the rule is “tort deference” in that the tortfeasor “is not to benefit from either contractual agreements of the injured party with insurers or from any gifts from others intended for the injured party”. Id. “Collateral benefits” could include insurance policies, employment benefits such as workers’ compensation benefits, cash gratuities, gratuitous rendering of services as well as “social legislation benefits” such as welfare or pensions. Id. at 356, 930 N.E.2d 132. See also Goldstein v. Gontarz, 364 Mass. 800 (1974). But see Harris-Lewis v. Mudge, 60 Mass. App. Ct. 480, 803 N.E.2d 735 (2004)(affirming trial court’s admission of life insurance policies as relevant and probative of deceased’s credibility in denying drug use to his doctors).
Can a plaintiff recover from a tortfeasor in New Hampshire?
In New Hampshire, under the collateral source rule, if a plaintiff is compensated in whole or in part for his damages by some collateral source, he is still permitted to make full recovery against the tortfeasor. Therefore, an award of damages may not be reduced by the amount of payments a plaintiff receives from a collateral source.
Is evidence of compensation from a source independent of the tortfeasor inadmissible?
Therefore, evidence of compensation from a source independent of the tortfeasor is inadmissible. The premise underlying this rule is that either the injured party or the tortfeasor will receive a windfall if part of a loss is paid by an independent source, and, as between the injured party and the tortfeasor, the injured party should reap the benefit of the windfall.
When was the common law collateral source rule codified?
Virginia codified the common law collateral source rule in the 1970s. Virginia Code Section 8.01-35, entitled “Damages for loss of income not diminished by reimbursement,” states:
What is the collateral source rule in Virginia?
Virginia courts follow the common law doctrine known as the collateral source rule in personal injury cases based on motor vehicle accidents and defective products. This is a good thing for plaintiffs, accident victims, and injured employees with both workers compensation and third party liability claims.
What is collateral compensation?
In the early cases, the collateral compensation involved was money paid the plaintiff by his own insurer. Later cases have applied the rule to social security benefits, public and private pension payments, unemployment and workers’ compensation benefits, vacation and sick leave allowances, and other payments made by employers to injured employees, both contractual and gratuitous.
Is the collateral source rule inapplicable to Virginia workers compensation claims?
The collateral source rule, however, is inapplicable to Virginia workers compensation claims in that the employer and its insurance carrier have a workers compensation lien against the proceeds from a personal injury or product liability action brought in circuit court.
Can a negligent party deduct the settlement amount?
A negligent party or her insurance carrier, therefore, may not deduct from the settlement or verdict owed an injury party any amount of the benefits the injured party received from the injured party’s contractual arrangement with the injured party’s private health insurance carrier. The injured party may need to negotiate ...
Can a plaintiff keep his own insurance?
If the plaintiff was himself responsible for the benefit, as by maintaining his own insurance or by making advantageous employment arrangements, the law allows him to keep it for himself. If the benefit was a gift to the plaintiff from a third party or established for him by law, he should not be deprived of the advantage that it confers.
Does the Virginia Collateral Source Rule Apply Only to Health Insurance?
No. The collateral source rule applies to more than health insurance payments.
What is the collateral source rule?
As stated in Ashe, the collateral source rule “allows the injured party to recover the full amount of damages from the wrongdoer, irrespective of any funds the injured party may be entitled to from independent sources.”. In Ashe, the trial court issued a blanket order excluding all evidence of the flood claim and payments.
What is the appellate court ruling in the case of the flood?
The appellate court reversed the trial court’s exclusion of evidence on the flood claim, except as to the amount paid by the flood insurer. The court then took a historical journey through the case law on the applicability of the collateral source rule to a first-party breach of contract action.
What was the last major legal issue that was discussed in Ashe?
The last major legal issue that was discussed in Ashe was the evidence of alternate insurance payments. If you recall, in Ashe, a Florida homeowner suffered a hurricane loss and was paid policy limits by his flood insurer, but the amount of damage caused by wind was still in dispute with his wind insurer, Citizens.
Did Judge Van Nortwick disagree with the majority's opinion that allowed evidence of the flood claim?
Judge Van Nortwick disagreed with the majority’s opinion that allowed evidence of the flood claim, and he wrote separately in an eleven-page dissent on this point. He stated that the Hamilton decision allowed evidence of the flood insurance claim only because that evidence was not controverted by the insured in that case, but it was controverted by the insured in Ashe. In effect, the question of excluding evidence of the policy or claim for flood insurance was never before the court in Hamilton, only the amount paid was. He bucked against the majority’s suggestion that the collateral source rule should not apply in contract actions, and went into lengthy discussion as to why it should. Judge Van Nortwick’s dissent is worth a separate post on its own, which will be coming up in one of my next hurricane posts.
When was the collateral source doctrine first established?
The collateral source doctrine was first established in the mid 1800’s as a means of ensuring that the negligent party responsible for someone else’s injuries was not able to avoid financial responsibility for the injuries simply because the injured person’s health insurance or a similar source already paid their medical costs.
What is the disclosure requirement for a plaintiff in a New Jersey lawsuit?
Disclosure Requirements. Under the current collateral source rule in New Jersey, an injured plaintiff is required to disclose to the court any “benefits” they have received in compensation for their injuries from a source other than one of the defendants in their injury lawsuit.
When any of these “benefits” overlap the injury damages awarded by the court, they are to be answer?
When any of these “benefits” overlap the injury damages awarded by the court, they are to be subtracted from the total recovered damages. This is meant to prevent the injured person from being paid twice for the same medical expenses.
