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Athridge v. Aetna Casualty and Surety Co.

February 9, 2007

THOMAS P. ATHRIDGE, ET AL., PLAINTIFFS,
v.
AETNA CASUALTY AND SURETY COMPANY, DEFENDANT.



The opinion of the court was delivered by: John M. Facciola United States Magistrate Judge

MEMORANDUM OPINION

This case has been referred to me for all purposes including trial. Currently pending before me in anticipation of trial are four motions in limine: Plaintiffs' Motion in Limine No.1 (Hypothetical Testimony about Permission) [#214], Plaintiffs' Motion in Limine No. 2 (Aetna's Contingent Exhibits and Related Testimony) [#215], Plaintiffs' Motion in Limine No. 3 (Prior Trial Testimony) [#226], and Defendant's Motion in Limine [#216]. For the reasons stated in this Memorandum Opinion, Plaintiffs' Motion in Limine No. 1 will be granted in part and denied in part; Defendant's Motion in Limine will be granted in part and denied in part; Plaintiff's Motion in Limine No. 2 will be granted in part and denied in part; and Plaintiffs' Motion in Limine No. 3 will be granted.

I. Introduction

The facts and protracted history of this case have been detailed in multiple prior opinions. Nearly two decades ago, then-sixteen-year-old Jorge Iglesias ("Jorge"), who was unlicensed, took the car of his aunt and uncle, Hilda and Francisco Rivas ("the Rivases"), and was involved in an accident that severely injured his friend, Tommy Athridge ("Tommy"). In various proceedings, Tommy's parents ("the Athridges") sued Jorge, Jorge's parents, the Rivases, and pertinent insurance companies. Ultimately the Athridges were successful in a lawsuit against Jorge for approximately $5.5 million dollars, after which Jorge declared bankruptcy. The Athridges then succeeded in a lawsuit against the Rivases for the judgment; following the jury verdict in favor of the Athridges, that judgment is currently on appeal in this Circuit. To date, then, the judgment for the Athridges has not been paid.

This action is one for indemnification of Aetna Casualty and Surety Company ("Aetna"), the automobile insurer of Jorge's father at the time of the accident. The initial complaint included claims for breach of fiduciary duty, bad faith violations, intentional infliction of emotional distress, indemnification, and unfair trade practices. In separate opinions, this Court previously entered summary judgment in favor of Aetna for all counts. See Athridge v. Aetna Cas. & Surety Co., 163 F. Supp. 2d 38, 48 (D.D.C. 2001); Athridge v. Aetna Cas. & Surety Co., No. CIV. A. 96-2708, 2001 WL 214212, at *5-12 (D.D.C. Mar. 2, 2001). On appeal, the D.C. Circuit reversed and remanded only the indemnification claim upon a finding of a genuine issue of material fact as to whether Jorge had a reasonable belief in his entitlement to use the car on the day of the accident, which determines Aetna's policy coverage. Athridge v. Aetna Cas. & Surety Co., 351 F.3d 1166, 1169-70 (D.C. Cir. 2003). If Jorge did not have a reasonable belief that he could drive the car, then Exclusion 11 of Aetna's policy eliminates coverage of Jorge, and consequently the Athridges cannot succeed on their indemnification claim. As I have promised the plaintiffs, if the Athridges are unsuccessful in their claim at the present trial, a second trial will address Aetna's alleged role in the defense of Jorge in the bench trial before Judge Greene. The only issue before the Court at the present time is whether Jorge had a reasonable belief he was entitled to operate the vehicle in the accident that injured Tommy Athridge. It is in this context, therefore, that I rule on the current motions in limine.

II. Plaintiff's Motion in Limine No. 1 (Hypothetical Testimony)

Plaintiff's Motion in Limine No. 1 ("Pls. Mot. #1") seeks to preclude witnesses for Aetna from testifying that, if the Rivases had been home on the date of the accident, they would not have allowed Jorge to use the car. Pls. Mot. #1 at 1. Plaintiffs' argue such testimony is speculative and not based on the witness's perception, rendering it inadmissible under Federal Rules of Evidence 602 and 701. See Memorandum of Points and Authorities in Support of Plaintiffs' Motion in Limine No. 1 ("Pls. Mem. #1) at 1. In response, Aetna argues that because the Rivases would speak from their own perceptions and personal knowledge of their relationship with Jorge, their testimony would not be barred under Federal Rules of Evidence 602 and 701. Those rules, argues Aetna, "do not impose a blanket prohibition on lay witnesses testifying as to what they would have done under different circumstances." Defendant's Memorandum of Points and Authorities in Opposition to Plaintiffs' Motion in Limine No. 1 ("Defs. Opp. #1") at 1.

Aetna attempts to include hypothetical testimony by the Rivases in order to aid the jury in deciding the fifth factor in the objective test for "reasonable belief" outlined by Gen. Accident Fire & Life Assurance Corp., Ltd. v. Perry, 541 A.2d 1340, 1349-50 (Md. Ct. Spec. App. 1988). Defs. Opp. #1 at 4. The fifth factor focuses on whether the relationship between Jorge and the Rivases would have caused Jorge to reasonably believe he was entitled to drive their car. Id. Aetna argues the hypothetical testimony offered by the Rivases as to whether they would have given permission if asked goes to whether the relationship between Jorge and the Rivases gave rise to implied permission. Id. at 5.

As the plaintiffs point out, this Court held the same hypothetical testimony inadmissible in the previous related Rivas trial. Pls. Mem. #1 at 1, citing Athridge v. Rivas, Memorandum Opinion at 4 (Dec. 21, 2004); see also Athridge v. Rivas, 421 F. Supp. 2d 140 (D.D.C. 2006). Though Aetna cites to a 1966 case where the owner of a van involved in an accident apparently testified as to whether he would have allowed the driver permission to use the car at the time of the accident, nothing in that case indicates an evidentiary question was raised. See Webb v. Moreno, 363 F.2d 97, 100 (8th Cir. 1966) (if asked, the owner testified, "he probably would have given [his son's friend] permission to drive"). Similarly, the second case cited by the defendant, American Fire and Cas. Co. v. Buckreis, No. 95-6427, 1997 WL 164239, at *1 (E.D. Pa. Apr. 2, 1997), refers to deposition testimony for the purposes of summary judgment and lacks any kind of evidentiary analysis.

Under Federal Rule of Evidence 602, witnesses must have personal knowledge about which they testify. Fed. R. Evid. 602. Additionally, under Rule 701(a), a lay witness's testimony must be "rationally based on the perception of the witness." Fed. R. Evid. 701(a). Speculative testimony as to what a witness would have done under different circumstances cannot possibly be based on the witness's perception. See Washington v. Dep't of Transp., 8 F.3d 296, 300 (5th Cir. 1993).

Aetna may certainly ask the Rivases questions based on their personal knowledge, such as "whether they ever knew of Jorge driving their vehicles, whether they allowed unlicensed and underage family members to take their vehicles, etc." Defs. Opp. #1 at 6. Testimony as to what the Rivases would have done had they been home the day of the accident is purely speculative. For the Rivases to testify as to what the Rivases would have done, in retrospect, cannot be probative of any reasonable belief of Jorge, and therefore shall not be admitted. Plaintiffs' first motion in limine as pertains to testimony by the Rivases is therefore granted.

Similarly, Aetna seeks to elicit from Jorge testimony as to whether Jorge thought that, if he had asked the Rivases for permission to drive their vehicle, he would have received that permission. Defs. Opp. #1 at 4. Under Perry, the first question for the jury is whether Jorge "knew he was not entitled to drive [the car] and not whether he knew he was entitled to drive." Perry, 541 A.2d at 1350. The question of whether Jorge thought he would have received permission had he asked is relevant to whether he knew he was not entitled to drive the car. His testimony is therefore admissible and that aspect of Plaintiffs' Motion in Limine No. 1 is denied.

III. Defendant's Motion in Limine

Defendant's Motion in Limine ("Defs. Mot.") proceeds in two parts. First, Aetna seeks to open and close the evidence and argument before the jury pursuant to Federal Rule of Evidence 611 because Aetna bears the burden of persuasion as to the inapplicability of the policy exclusion at issue. Defs. Mot. at 1. Second, Aetna seeks to exclude twelve categories of evidence from admission at trial under the Federal Rules of Evidence. Id. at 1-2.

A. Order of Trial

Aetna moves to open and close the evidence and argument at trial under Federal Rule of Evidence 611, which grants the court broad discretion in exercising "reasonable control over the mode and order of interrogating witnesses and presenting evidence so as to . . . make the interrogation and presentation effective for the ascertainment of the truth." Fed. R. Evid. 611. Aetna argues that, because it bears the burden of persuasion to show that Jorge did not have a reasonable belief to operate the car and therefore Aetna is not obliged to pay on the policy, the Court should exercise its discretion and allow Aetna to present its case first and thus to present rebuttal. Memorandum of Points and Authorities in Support of Defendant's Motion in Limine ("Defs. Mem.") at 3-4.

The Athridges argue their own burden of proof still exists to achieve indemnification under the terms of Aetna's policy, and so the Court should follow the traditional order of trial and allow plaintiffs to proceed first. See Plaintiffs' Memorandum in Opposition to Aetna's Motion in Limine ("Pls. Opp.") at 2-4. But none of the issues the Athridges present are in dispute for the purposes of the present trial. See Reply Brief in Support of Defendant's Motion in Limine ("Defs. Reply") at 3. Aetna concedes that Jorge would be covered under the policy but for the "reasonable belief" exclusion, and thus the only matter of proof at trial is for Aetna to show that Jorge did not have a reasonable belief he was entitled to operate the vehicle at the time of the accident. Defs. Mem. at 3-4; Defs. Reply at 4. Quite simply, contrary to the plaintiffs' assertion of their own "more general" burden of production, the plaintiffs have absolutely nothing to prove in this case. See Pls. Opp. at 4. Indeed, the majority of plaintiffs' arguments against allowing Aetna to proceed first focus on the need for plaintiffs to establish Aetna's control of Jorge's defense, which will be dealt with only at a later trial if necessary.

Aetna argues further that to allow plaintiffs to open the trial would result in "their arguing a double-negative to the jury, i.e., Jorge Iglesias was not using the Jetta without a reasonable belief that he was entitled to do so." Defs. Mem. at 5. The plaintiffs claim that to permit Aetna to proceed first "manifestly would be highly prejudicial to Plaintiffs' right to present their case in an orderly fashion." Pls. Opp. at 4. Plaintiffs fail to indicate, however, how allowing Aetna, with the burden of persuasion, to open and close argument and presentation of evidence would interrupt the plaintiffs' own presentation of their case.

Moreover, the legal authority provided by both parties supports Aetna's motion to present its case first. Courts have repeatedly granted insurers the opportunity to open and close a case where the insurer bears the sole burden of proof on an exclusion or some other policy issue. See Dishman v. American Gen. Assur. Co., 193 F. Supp. 2d 1119, 1127-28 (N.D. Iowa 2002) (allowing insurer, "the party bearing the burden of proof on the only issues remaining, to open and close the case"); Clemmons v. Allstate Ins. Co., 388 S.E.2d 357, 358-59 (Ga. Ct. App. 1989) (allowing defendant insurer to open and close case where only factual issues remaining were affirmative defenses). Precedent provided by plaintiffs is inapposite. In Rowan Cos., Inc. v. Ainsworth, 50 F. Supp. 2d 588, 590-91 (W.D. La. 1999), the court placed the burden of proof on an employer seeking a declaratory action denying its liability. But Aetna is not seeking a declaratory action to avoid liability; Aetna in fact concedes liability unless it shows Jorge did not have a reasonable belief that he was entitled to drive the Rivases' car. Nor did the court re-align the parties in L-3 Comm. Corp. v. OSI Sys., Inc., 418 F. Supp. 2d 380, 383 (S.D.N.Y. 2005), finding "both parties bear the burden of proof on distinct counts of their causes of action," which is decidedly not the case before this Court, where plaintiffs bear no burden of proof whatsoever.

The only issue for the present case is one where Aetna bears the burden of proof in establishing the applicability of the exclusion. All other points for which the plaintiffs assert their burden are either ones conceded to by Aetna, such as Jorge's status as a "covered person" under the policy and the applicability of Exclusion 11, or, as with the issue of estoppel, ones that will not be addressed until a later trial if necessary. The defendant could not be any clearer: "Aetna admits that, but for the 'reasonable belief' exclusion, Jorge Iglesias would have qualified as a 'covered person' under the Policy and been entitled to coverage, up to policy limits, for the judgment against Jorge Iglesias." Defs. Mem. at 4-5. For these reasons, Aetna's motion to open and close the evidence and argument is granted.

B. Aetna's Objections to Plaintiffs' Proposed Evidence

The remainder of Aetna's motion in limine seeks to exclude a wealth of evidence proposed by the plaintiffs. These bodies of evidence include: (1) evidence relating to Paul Pearson's assistance in Jorge's defense; (2) testimony from Roger Heald and evidence regarding his communications with Aetna; (3) evidence relating to Tommy's injuries and damages; (4) evidence relating to the verdict and judgment in plaintiffs' lawsuit against the Rivases, (5) Judge Greene's opinion in plaintiffs' lawsuit against Jorge; (6) evidence regarding statements made by Jorge to John Bruce Thornburg about prior instances where Jorge drove the Rivases' vehicle; (7) evidence relating to pleadings in the D.C. Superior Court case, Aetna v. Iglesias, Civ. No. 90-011645; (8) evidence regarding the Rivases' first-party insurance coverage; (9) evidence regarding the transfer of Jorge's rights to ...


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