Terry v. Hospitality Mutual Insurance Company

• Decision Date: 31 August 2022
• Docket Number: 21-P-530
• Citation: 101 Mass.App.Ct. 597,195 N.E.3d 441
• Parties: William TERRY v. HOSPITALITY MUTUAL INSURANCE COMPANY.
• Court: Appeals Court of Massachusetts

101 Mass.App.Ct. 597

195 N.E.3d 441

William TERRY

v.HOSPITALITY MUTUAL INSURANCE COMPANY.

No. 21-P-530

Appeals Court of Massachusetts, Norfolk.

Argued May 2, 2022

Decided August 31, 2022

John F. Brosnan (James E. Harvey, Jr., also present) Waltham, for the defendant.

Mark A. Aronsson (David M. Bae also present) Boston, for the plaintiff.

Present: Vuono, Sullivan, & Lemire, JJ.

VUONO, J.

The plaintiff, William Terry, was seriously injured in a fight that occurred after he and the two men who assaulted him, Michael Connors and Kilder Cardona, participated in a beer pong tournament at the Canton Junction Sports Pub (Canton Junction) in Canton. After Connors and Cardona pleaded guilty to criminal charges arising from the assault, and after Connors separately pleaded guilty to driving under the influence of alcohol when he fled from the scene, Terry sent a demand letter dated July 30, 2013, to, among others, Canton Junction's liquor liability insurer, Hospitality Mutual Insurance Company (Hospitality). Terry claimed that (1) he suffered a traumatic brain injury

and (2) Canton Junction was liable for serving alcohol to Connors and Cardona when they were visibly intoxicated and for failing to provide adequate security. The letter included a five million dollar settlement demand. After Hospitality declined to settle, Terry filed a lawsuit on September 19, 2013, asserting dram shop negligence and negligent security claims against Canton Junction (dram shop action).¹

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Before the dram shop trial commenced, Terry continued his attempts to negotiate a settlement with Hospitality over Canton Junction's liability and reduced his settlement demand to one million dollars and then to $975,000, but Hospitality's highest pretrial settlement offer was $25,000. The dram shop action proceeded to a jury trial, and Terry was awarded $250,000 in damages.³

Terry then brought this G. L. c. 93A action against Hospitality for unfair and deceptive claim settlement practices, which was tried before a judge of the Superior Court. The judge found that Terry was not credible and had exaggerated his injuries but that, regardless, Hospitality had engaged in unfair and deceptive claim settlement practices by (1) conducting an investigation that focused on disproving Canton Junction's liability instead of objectively assessing all the evidence and (2) failing to offer a fair and equitable settlement once Canton Junction's liability became reasonably clear. The judge concluded that Hospitality's unfair and deceptive claim settlement practices were knowing or willful, and she awarded Terry double damages in the amount of $500,000, plus attorney's fees and costs. Hospitality appeals, arguing that some of the judge's findings of fact are clearly erroneous, that she applied an incorrect legal standard, and that application of the correct legal standard compels the conclusion that Hospitality did not engage in unfair claim settlement practices.⁴ We affirm.

Background. Our discussion of Hospitality's arguments turns on (1) what happened the night of the beer pong tournament; (2) Hospitality's investigation into what happened that night; and (3) Hospitality's settlement offer. We therefore recount in detail the facts found by the judge regarding those events, supplemented by information contained within various exhibits, including Hospitality's claim file, that are consistent with the judge's findings.

1. The night of the beer pong tournament. In the early evening of February 17, 2011, Connors and Cardona went to a bar in Boston where they participated in their first beer pong tournament of the evening. The tournament was filmed by a local production company. The video footage depicted Connors and Cardona drinking, and the judge concluded that both appeared to be intoxicated. At one point, when Connors was asked about his nickname, he turned around to show the back of his shirt, which said "MVD," and explained that "MVD" stood for "most valuable drunk." Toward the end of the video footage, Connors and Cardona spoke in a loud, boisterous manner and made brief sexual gestures.

Connors and Cardona then drove to Canton Junction with their friend, Dave Gaffey, to participate in another beer pong tournament. The tournament at Canton Junction was hosted by Paul Leonard, who was also a participant. Other participants included Leonard's friend, Sebastian Lena; Terry; and Terry's friend, Gary Reinhart.

Around 10:30 P.M. , Connors opened a tab at Canton Junction for himself, Cardona, and Gaffey and ordered six individual beers plus a pitcher of beer. While eyewitness accounts varied, multiple eyewitnesses stated at one point or another that Connors and Cardona were visibly intoxicated. Lena testified before the grand jury that Connors and Cardona became hostile and aggressive as they began losing and that Connors slapped one or more cups off the beer pong table, which prompted Terry to intervene. Connors took offense to this and needed to be calmed down. Lena also testified that Connors and Cardona continued to be argumentative and that a Canton Junction employee asked them to leave.

Connors paid his tab around 1 A.M. , wrote "Canton sucks" on the receipt, and left with Cardona. Terry and Reinhart left shortly thereafter. When Terry and Reinhart entered the parking lot, Connors and Cardona were standing near or sitting on Terry's car. Terry said, "Get the fuck off my car," at which point a fight ensued.

Eyewitness accounts again varied. Terry said that Connors and Cardona attacked him; Connors and Cardona said that Terry punched Connors. Regardless, Terry wound up on the ground, where Connors and Cardona kicked him so hard that photographs taken after the fight showed the imprint of a shoe on his face. The police and emergency medical services were called to the scene, and Terry was transported to the hospital. According to medical records, Terry had abrasions to his knuckles and a right orbital facture.

Before the police and emergency medical services arrived, Connors, Cardona, and Gaffey fled the scene in Connors's truck. Connors drove, but Gaffey had to grab the wheel at one point so Connors would not drive off the road. Around 2 A.M. , after dropping off Cardona and Gaffey, Connors flipped his truck and crashed into a tree in Peabody. Police officers on the scene detected a strong odor of alcohol coming from Connors, who was arrested for driving under the influence after failing multiple field sobriety tests. Booking photographs taken shortly thereafter do not show any injuries to Connors's face, despite Connors's assertions that the fight began with Terry punching him. As we have noted, on August 24, 2011, Connors pleaded guilty to driving under the influence.

On August 17, 2011, a week before Connors pleaded guilty to driving under the influence, Connors and Cardona were both indicted on the following crimes stemming from the fight with Terry: mayhem, assault and battery by means of a dangerous weapon causing serious bodily injury, assault and battery by means of a dangerous weapon, and assault and battery. No charges were brought against Terry. Various witnesses testified before the grand jury and related that Connors and Cardona were intoxicated and upset that they had lost the tournament. Terry and Reinhart also testified how the fight began. Terry testified that Connors and Cardona waited for him in the parking lot, that either Connors or Cardona hit Reinhart, and that Connors and Cardona both attacked Terry. Reinhart testified that he was "sucker punched" in the face and that he saw Terry being held down and repeatedly kicked in the face. As we have noted, Connors and Cardona pleaded guilty to all charges on January 3, 2013.

2. Hospitality's investigation. Hospitality's investigation of the events in question began in or around March 2011, when it learned of the fight. Adjuster Stephanie George was assigned to the claim file.

George began by reviewing a police report of the incident. The report included statements from various witnesses, including the following statement from Leonard:

"[D]uring the tournament [Cardona] and [Connors] got increasingly aggressive with their attitude as they began losing and [Leonard] also noticed that they were both heavily intoxicated on alcohol. Apparently words were exchanged between the parties during the tournament which ultimately caused [Cardona] and [Connors] to leave the bar. [Cardona] and [Connors] waited for [Terry] out in the parking area until closing and attacked him as he was walking through the parking lot. They later sped off from the area in a silver [pickup] truck."

The police report also contained statements from Connors and Cardona made on February 22, 2011. According to Cardona, he and Connors were merely "trash talking" with Terry during the tournament. Cardona stated that after Terry came outside, Terry said "[g]et the fuck off my car" and proceeded to "remove[ ] his hat and punch[ ] [Connors] on the side of the head." Cardona further stated that Terry then "grabbed [Cardona] and fell on top of him," at which point Cardona kicked Terry to free himself. "[Connors] told a similar account" and "stated ... that [Terry] punched him first." After reviewing the police report, George made a notation in the claim file that the report contained Connors's and Cardona's version of the events; George omitted any reference to the significantly different version of the events reported by Leonard.

In early April and late May 2011, George met with Canton Junction's manager and bartender. They denied that Connors and Cardona were visibly intoxicated. While Canton Junction had seventeen surveillance video cameras, some of which covered areas inside the bar where Connors and Cardona may have been videotaped,⁵ George did not ask Canton Junction to preserve or provide her with the surveillance videotapes. At some point, the surveillance video footage was overwritten.

On April 5, 2011, George made notations in the claim file that "...