Federici v. U-Haul

by Jason Barney on October 25, 2007

Here is an interesting but tragic case currently in trial in King County, Washington. Maria Federici, a then 24-year-old woman was gravely injured when an entertainment center flew from a U-Haul trailer attached to a vehicle operated by another motorist. It smashed through the windshield of Federici’s following vehicle, striking her in the face crushing every bone in it. She suffered blindness and permanent disfigurement. Media accounts are here, here and here.

I’m not posting to criticize Federici’s suit per se. It has noteworthy flaws to be sure–for instance there is evidence suggesting her blood alcohol content (BAC) was above the legal limit while she was driving, but the BAC was obtained under circumstances suggesting the results were unreliable (the injury trauma and resultant blood loss may have affected the BAC.) And her boss testified that she had only one glass of wine prior to the accident. Notably, the court disallowed the BAC evidence at trial.

So, Federici sues the motorist who failed to tie down the entertainment center, U-Haul and the rental company for alleged design flaws in the trailer and alleged negligent rental practices. Okay, so the motorist can own up for his negligence and U-Haul and the agency can own up for theirs, right? Not so fast. Washington State allows for a fault-free plaintiff to recover all damages from any defendant even 1% at fault.

With or without evidence of intoxication I wonder if Federici could have avoided anything flying toward her while traveling at freeway speeds. So, let’s assume the jury assigns her zero fault. That leaves 100% of potential fault for the defendants. Now, if you read the media accounts it seems to me that the motorist carries the majority of any fault for failing to secure his load, causing the accident. But, who has the deepest pockets? Let me help you: it’s not the motorist.

The plaintiff attorney in this instance will pull out the stops–do anything–to implicate U-Haul, and to a lesser extent the rental agency for any little amount of liability they can so that his client can collect the entire judgment from them (I suspect U-Haul has sufficient assets; the rental agency, if the Mom-and-Pop type, maybe not.) I don’t blame the plaintiff’s attorney, really–he has to advocate his client’s interests. But, it shows how twisted and wrongheaded the joint & several statute is in Washington. Nothing against Federici here, she’s suffered enough. But I struggle with holding some people accountable for damages caused by others. Does this make any sense to you?

Let’s look at the Mission Statement for the American Association for Justice (formerly the Association of Trial Lawyers of America):

The Mission of the American Association for Justice is to promote a fair and effective justice system – and to support the work of attorneys in their efforts to ensure that any person who is injured by the misconduct or negligence of others can obtain justice in America’s courtrooms, even when taking on the most powerful interests.

I’m all for that! Especially that part that says “fair”. Is it fair to hold a 1% wrongdoer accountable for 100% of the damages? If so, why? Because I don’t agree and I’d like to know if I’m wrong. And, I just know the AAJ would scream bloody murder if anyone tried to amend that statute.

{ 22 comments }

1 Tom T. 10.25.07 at 8:02 am

Does the state law permit a contribution claim by U-Haul against the driver?

2 Mahhlon 10.25.07 at 11:04 am

And the moral of this story is, if you want to own a business, don’t move to Washington. This is the legislature’s, and ultimately the voters’, fault. It is their right to destroy the economic underpinnings of their economy. They’re welcome to it.

3 Jason Barney 10.25.07 at 11:13 am

Yes, but if he has no assets or is uninsured, the contribution claim is worthless. So, U-Haul is stuck with the entire judgment if found 1% or more at fault, and the plaintiff is fault-free.

4 Ubu Walker 10.25.07 at 11:49 am

Is it fair to hold a 1% wrongdoer accountable for 100% of the damages?

Well, is it fair to allow an innocent person who has been hurt to not receive restitution because one of two wrongdoers is insolvent?

The fact of the matter is that U-Haul (and the insurance company who is actually paying the money) will sue the co-defendant and probably receive a small amount of money.

If we as a society find that it is objectionable that someone who is at fault has to pay a disproportionate amount of a judgment, perhaps we need to switch to a more socialistic medical and insurance system where everyone chips in so that everyone is monetarily able to pay for catastrophic expenses and damages.

5 robin 10.25.07 at 1:05 pm

Ubu Walker:

Yes, it is fair to allow an innocent person who has been hurt not to receive (full) restitution because the wrongdoers have insufficient money.

Therefore, we don’t need a more socialistic medical and insurance system!

6 Ian 10.25.07 at 1:05 pm

Is this not a risk that U-Haul must realize often? I would be curious to see more cases like this. Consider what U-Haul is. A person who can barely drive a car, can go and rent a truck, with no experience, and no questions asked. Not to mention that the trucks are poorly maintained and prone to highway breakdown. Sounds risky.

7 Dick 10.25.07 at 1:08 pm

I’mn surprised they didn’t think to include the automaker for not making the windshield stronger, or the oil company that sold the fuel to the auto pulling the trailer. Or even local police for not stopping the driver. Or blame it on Bush, since his administration didn’t provide a safe highway for her to drive on????

8 Alton 10.25.07 at 1:17 pm

Ubu:

Your view of fairness to the victim may be different if you were the wealthy one percenter.

U-Haul will not recieve a dime from the at fault party – all avialable assets will be paid to the victim.

If by “socialistic system” you mean a “wealth redistribution” system, well that is pretty much what a “joint and several” system does with these facts.

A “fairer” system is one which would prohibit recovery against a defendant greater than their allotted percentage of fault – and one that would allow the injured party to purchase their own insurance to pay those alloted damages unrecoverable from tortfeasors.

9 nevins 10.25.07 at 1:43 pm

Ubu:
You are proposing that payment should come from those with means, because they have the means, not because they have the guilt.
Though you are certainly guiltless in this unfortunate case, perhaps you have the financial means to compensate this victim…

10 jb 10.25.07 at 2:30 pm

If we limited liability to degree of fault, wouldn’t juries just assign larger degrees of fault to the deeper pockets?

11 nevins 10.25.07 at 4:03 pm

“If we limited liability to degree of fault, wouldn’t juries just assign larger degrees of fault to the deeper pockets?”

Yes, they might. But then at least it would be the jury, and not merely a matter of law created of, by and for the trial lawyers. The jury at least does not have a direct personal interest in the case, and might actually get it right.

12 Tom Murin 10.25.07 at 9:13 pm

It seems that Washington has retained common law “joint and several” liability – nothing really strange or unusual about this. However, if they still have contributory negligence (1% fault on the plaintiff bars any recovery) – then no letting in the BAC is an issue since it could lead a jury to find the plaintiff partially at-fault.

13 Jason Barney 10.25.07 at 11:32 pm

Thank you all for the comments. A few thoughts:

Ubu, it’s never fair for an innocent person to receive less than full compensation for her injuries, but not at the expense of others in excess of their liability.

And that an insurance company may pay the judgment is not really relevant here. Insurance companies can’t print money, so whatever is paid comes from policyholders, yes–I’ll say it, like a “tort tax.”

Good comment, Nevins, on that, “You are proposing that payment should come from those with means, because they have the means, not because they have the guilt.” That’s my point better than I said it.

JB, (hey, those are my initials!) Juries often select those defendants they suspect as capable of paying judgments, especially in the cases of sympathetic plaintiffs. We hope and expect that juries follow the “jury instructions” given to them by the court and weigh the facts and follow the law. They don’t always get it right, but it’s a good system.

Tom, I could have been clearer on this point. Washington has pure comparative negligence. So, simply speaking, if you are 1% at fault you can recover 99% of your damages from an at-fault party, and if you are 99% at fault you can collect only 1%, and anywhere in-between.

But, under the joint & several statute, if and only if you are 0% at fault you can collect your entire damages from any defendant 1% or more at fault–whoever is most convenient for you.

And, retaining common law joint & several liability may be usual, but it’s certainly unjust for the reasons outlined above and elsewhere.

Your point on the BAC is still quite relevant. Although that evidence is disallowed to the jury, it is still admitted she drank that night which may provide some basis for 1% liability and defeat any basis for collecting her entire judgment from the defendant of her choice.

14 J.T. Wenting 10.26.07 at 12:44 am

“The jury at least does not have a direct personal interest in the case, and might actually get it right.”

Actually they do have a direct interest…
If they don’t find for the maximum amount of damages they set themselves up for receiving less damages next time they sue someone.

The entire jury system in liability cases is fundamentally broken, seriously skewed in favour of the claimant because it’s in the jury members interest to find for maximum liability against the most wealthy parties.

A fair system would ensure that noone influencing the finding has any interest in the outcome (directly or indirectly) except to see justice done to the letter of the law. That’s clearly not the case under the US legal system.

15 AZFlyer 10.26.07 at 8:04 pm

Ubu said : “The fact of the matter is that U-Haul (and the insurance company who is actually paying the money) will sue the co-defendant and probably receive a small amount of money.”

Some people make themselves feel better about these inequities by pointing out that the nameless “insurance company” will actually have to foot the bill. In this case, U-Haul is the “insurance company”. The are self insured.

16 TC 10.28.07 at 7:48 am

The people need to be informed so they can lobby these decisions!

Oh if they happen t find the attorney involved to be …. well not so upstanding… then he can pay the judgment.

See if those actually putting their name to the filings of some suits could be held personally accountable for such, I’d bet we would see less of them, valid or not, sad, but true.

17 Jerry 10.28.07 at 3:11 pm

Did U-Haul not undertand the WA law when it operated its business and rented the trailer? If they did, they implicitly built this into their cost of doing business and therefore the renter already paid for the insurance when they rented the trailer. It might seem something of a kludge, but from an economics POV the renter is the one that paid for the insurance and any insurance settlement.

18 Jason Barney 10.28.07 at 3:41 pm

Jerry, that’s an interesting point. I would still submit that it is incompatible with the basic tenant of the tort system–to hold actual wrongdoers accountable, not necessarily those with the fattest checkbooks.

19 jb 10.28.07 at 3:45 pm

Jerry,
So instead of the deep-pocketed insurance company/innocent trucking company, the people who are really paying out this judgment are the nation’s Uhaul customers? Now that’s really fair.

20 Jerry 10.28.07 at 11:33 pm

jb, that’s exactly what I mean. U-haul customers indirectly take out insurance that if something goes wrong, those wronged will be compensation. Like most people who are covered by insurance, very few will actually need the coverage.

That being said, I’m not sure that this is a good thing or the best way to handle the situation. But from an economic analysis, the renter is paying for the coverage.

21 jb 10.29.07 at 1:48 am

What I meant was this:

1) UHaul has built into its prices the cost of paying out for cases like this
2) UHaul’s prices are the same everywhere
3) Therefore, when I rent a UHaul in Illinois I’m paying more than I would otherwise because of lawsuits filed in Washington.

So this unjust settlement is costing me money, and I’m not even a defendant.

22 markm 10.29.07 at 1:30 pm

“Well, is it fair to allow an innocent person who has been hurt to not receive restitution because one of two wrongdoers is insolvent?”

Just as fair as it is that an innocent person may be struck by lightning and have no one at all to sue.

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