settlement delay question

[fcobarr]

What is the name of your state? NJ

I’m being sued by a family member (legitimately, no fraud involved) for car accident with major injuries.

Liability was established by the court (100% my fault), court ordered arbitration took place and damages determined by arbitrator at approx 2+ times my policy limit (over $700K). Arbitrator advised my attorney (insurance assigned counsel) to settle and avoid trial…and quote “you don’t want “her” testifying (referring to injured party)”. NJ apparently has some law stating that if policy limit isn't offered and case goes to trial and an award of more than the policy limit is made. Then, the insurance must pay amount above policy limit. Rova Farms decision (or something like that).

Now, my attorney has filed a motion deNovo – or something like that (not sure what it is). Injured party attorney says this is a typical stall tactic and the trial date will get postponed several times before anything else happens. Does an arbitration meeting occur before every trial date? Or, is this case destined for trial at this point? No offer has been made.

Knowing it’s family, my attorney is not very forthcoming about strategy and time line.

My question is…how long can this delay of settling continue? If anyone has advice or experience with these types of situations, thanks for sharing.

 

[Texas Pooh]

You need to get your own lawyer and get some advice. It is well worth the money to get some counsel that is independent of the insurance company.

The doctrine that you are referring to is the "Stowers doctrine" (although it has another name in New Jersey). In a typical case YOU would be responsible for damages over the insurance limit. Therefore, if an insurance company has the opportunity to settle at the policy limits, but refuses, and a jury later awards damages that exceed that, the insurance company is liable. However, you must properly put the insurance company on notice (hence the need for an independent lawyer). A "stowers" demand will typically speed up settlement because it is a hugh risk for the insurance company not to settle.

Of course, in your situation, it may not be realistic that family member sues you for the damages over the insurance limit, but I've seen family members do weirder things (visit the wills, trust line forum ).

These are pretty complicated concepts. Please see a lawyer.

 

[fcobarr]

Texas - thanks for your thoughts.

The "Stowers" demand as you call it has been sent and conveyed in a number of correspondances between counsel. I think they are just waiting for the 11th hour to offer a settlement...even if it's the day of the trial.

I guess what I'm wondering is how long can they postpone the inevitable settlement.

 

[Rachel.M]

The settlement can be delayed as long as the court will allow, which depends on the particular court hearing the case... So - no easy answer. <Edit: The longer the insurance company delays, the longer they can collect interest on the money... So they will drag this out as long as possible.>

Texas Pooh is right: don't trust this to an attorney who is paid by the insurance company. In theory, he is supposed to represent you and what is best for you. In practice, he is protecting the insurance company first and you second. You have other options available to you that the insurance company may not want you to pursue and you should obtain your own legal counsel to advise you.

Unless you have an umbrella policy, you could be facing a huge judgement against you, even with the legal representation provided by your insurance company. Don't risk having to pay a family member $600,000 - or any amount of money. Call a reputable attorney ASAP.