Bailey v. Metropolitan Property and Liability Ins. Co.
Decision Date | 29 May 1987 |
Citation | 24 Mass.App.Ct. 34,505 N.E.2d 908 |
Parties | Robert BAILEY v. METROPOLITAN PROPERTY AND LIABILITY INSURANCE COMPANY. |
Court | Appeals Court of Massachusetts |
James N. Wittorff, Milford, for plaintiff.
John G. Bagley, Worcester, for defendant.
Before GREANEY, C.J., and GRANT and PERRETTA, JJ.
The plaintiff has appealed from a judgment of the Superior Court which declared that he was barred from proceeding against the defendant to recover on underinsurance clauses in two of the defendant's automobile insurance policies. See G.L. c. 175, § 113L. The judge based his decision on provisions of the policies which required the plaintiff to exhaust the limits of other applicable underinsurance coverages before proceeding against the defendant on its underinsurance coverage. Since the plaintiff had not done so, the judge ruled that he could not pursue his claims against the defendant. We conclude that it is not necessary to reach the question of the validity or application of that provision because the plaintiff is barred from recovery under principles of issue preclusion.
The facts have been agreed. On June 5, 1983, the plaintiff was injured when an automobile in which he was a passenger collided with a utility pole. The automobile was insured by Allstate Insurance Company, which paid the plaintiff the limits of its insured's personal injury protection ($2,000), medical payment coverage ($5,000), and optional bodily injury coverage ($25,000). Allstate, however, refused to pay the plaintiff any of the $10,000 available under the owner's underinsurance coverage. The plaintiff, through his counsel, filed a request with the American Arbitration Association demanding payment by Allstate of its $10,000 underinsurance coverage. After an evidentiary hearing, the arbitrator awarded the plaintiff $7,500 of that coverage.
Some time later the plaintiff made claims against the defendant for payment of additional sums under the underinsurance provisions of two motor vehicle insurance policies. One policy covered the plaintiff's automobile, and the other provided coverage to him under his mother's policy. The defendant denied the claims on two grounds: (1) that the arbitrator's award precluded the plaintiff from further pursuing the issue of damages and (2) that the plaintiff was also barred by reason of limitations in the defendant's policies. 1 As has been indicated, the judge decided that the limitation was valid and that because the plaintiff has not exhausted the underinsurance available under Allstate's policy, he was prohibited from pursuing his claims against the underinsurance available under the defendant's policies.
We think the case should be decided solely on the ground of issue preclusion. Fidler v. E.M. Parker Co., 394 Mass. 534, 539, 476 N.E.2d 595 (1985). For this principle of preclusion to operate it is no longer necessary that there be an identity of defendants. In Home Owners Fed. Sav. & Loan Assn. v. Northwestern Fire & Marine Ins. Co., 354 Mass. 448, 455, 238 N.E.2d 55 (1968), it was held that "one not a party to the first action may use a judgment in that action defensively against a party who was a plaintiff in the first action on the issues which the judgment decided." The core inquiry is whether the issue on which preclusion is sought has been "the product of full litigation and careful decision." Ibid.
An arbitration decision can have preclusive effect in the sense described. Restatement (Second) of Judgments § 84 (1982). See Louison v. Fischman, 341 Mass. 309, 168 N.E.2d 340 (1960) ( ). Restatement (Second) of Judgments § 84, comment c. The decisional law strongly supports this rule. See cases collected in the Reporter's Note to Restatement (Second) of Judgments § 84, comment c, and in Kemling v. Country Mut. Ins. Co., 107 Ill.App.3d 516, 518, 63 Ill.Dec. 331, 437 N.E.2d 1253 (1982). We see no reason why the rule should not extend as well to "a defendant who was not a party to the earlier [arbitration] ... if the plaintiff had a full and fair opportunity [in the arbitration] to litigate the issue, and if equitable considerations otherwise warrant precluding relitigation." Fidler v. E.M. Parker Co., 394 Mass. at 541, 476 N.E.2d 575. See Schwartz v. Public Admr. of the County of Bronx, 24 N.Y.2d 65, 298 N.Y.S.2d 955, 246 N.E.2d 725 (1969). See also G.L. c. 251, § 14, which provides upon the confirmation of an arbitration award for the entry of a judgment which "shall ... be enforced as any other judgment."
We conclude that a party not involved in a prior arbitration may use the award in that arbitration to bind his opponent if the party to be bound, or a privy, was before the arbitrator, had a full and fair opportunity to litigate the issue, and the issue was actually decided by the arbitrator or was necessary to his decision. See Schwartz v. Public Admr. of the County of Bronx, supra; Greenblatt v. Drexel Brunham Lambert, Inc., 763 F.2d 1352, 1360 (11th Cir.1985). See also Albano v. Jordan Marsh Co., 5 Mass.App.Ct. 277, 279, 362 N.E.2d 219 (1977). The burden of showing that the issue in question was actually decided or necessary to the arbitrator's decision is on the party asserting preclusion while the party potentially subject to preclusion has the burden of showing that he did not have a full and fair opportunity to litigate the issue previously. Cf. Mayers v. D'Agostino, 87 A.D.2d 519, 447 N.Y.S.2d 926 (1982) ( ).
The plaintiff had a "full and fair opportunity" to litigate the issue of damages, the only question of relevance here. 2 He raises no issue about the choice of forum, having initiated the arbitration by means of a request by his lawyer. Liability was conceded, and the arbitrator's only task was the assessment of damages above the amount already paid that would make the plaintiff whole for his personal injuries. The arbitrator was a lawyer. The arbitration was conducted pursuant to the rules of the American Arbitration Association for commercial arbitration. 3 The plaintiff testified and was given the opportunity to call any witnesses he might desire, including expert witnesses on the issue of damages. It appears that his physician had concluded that the plaintiff had reached an "end result." All the medical evidence was submitted without objection, and the plaintiff agrees that that evidence encompassed all the medical facts and opinions concerning his personal injuries that he possessed and wished to present to the arbitrator. Based on all the evidence before him, the arbitrator made a finding of damages which, in form, was like the general verdict of a jury or the finding that would have been made had a District Court judge heard the case. There was a right to review of the arbitrator's decision pursuant to G.L. c. 251, § 12. As far as we know, no such review was sought. Even though such review, had it been pursued, probably would not have reached issues of law or fact (being confined to the issues set forth in G.L. c. 251, § 12), the plaintiff's counsel concedes that, in calculating the sum due, the arbitrator applied the law of damages correctly to the facts as he found them. 4
The plaintiff's reason for wanting to proceed against the defendant's policies is that after the arbitrator's award he has had (to quote his brief) "a worsening of his condition, leading to additional medical bills, loss of earning capacity, and future disability." The general rule is, of course, that a plaintiff is entitled to one recovery in a personal injury action for all past and reasonably expected future losses and injuries. An exception may be allowed in an extraordinary case, upon timely action by a plaintiff, when a new and unforeseen medical condition arises after the conclusion of the trial. See, e.g., VanAlstyne v. Whalen, 15 Mass.App.Ct. 340, 445 N.E.2d 1073 (1983). The plaintiff's allegation, however, would not provide a basis in a...
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