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Wednesday, March 2, 2011

Nationwide Mutual Insurance Company v. Cory M. Briggs, Case no. 2010-0114
5th District Court of Appeals (Stark County)

State of Ohio v. Mor Mbodji, Case no. 2010-0819
1st District Court of Appeals (Hamilton County)

Joseph Starkey v. Builders FirstSource Ohio Valley, LLC, and Administrator, Ohio Bureau of Workers' Compensation, Case no. 2010-0924
1st District Court of Appeals (Hamilton County)

State of Ohio ex rel. Jamey D. Baker v. Coast to Coast Manpower LLC and Industrial Commission of Ohio, Case no. 2010-0211
10th District Court of Appeals (Franklin County)

Ohio Bureau of Workers' Compensation v. Jeffrey McKinley et al., Case no. 2010-0720
7th District Court of Appeals (Columbiana County)


Does Insured Person's Illegal Discharge of Fireworks Support Finding of 'Inferred Intent' to Cause Injury?

Where Policy Excludes Coverage for Harm Caused by 'Criminal Acts'

Nationwide Mutual Insurance Company v. Cory M. Briggs, Case no. 2010-0114
5th District Court of Appeals (Stark County)

ISSUE:  When a liability insurance policy excludes coverage for property damage caused by an insured person’s act or omission that is “criminal in nature,” is the insurance company entitled to summary judgment denying coverage for damages caused by a policyholder’s illegal discharge of fireworks based on a finding that intent to cause harm can be inferred because the insured’s conduct was  “substantially certain” to cause personal injury or property damage?

BACKGROUND: On July 3, 2007, Corey Briggs of Massillon and a friend took a number of bottle rockets and other fireworks Briggs had purchased to a field near his parents’ home and prepared to discharge them.  The first bottle rocket Briggs launched traveled about 20 feet into the air, then made a 90 degree turn and flew into the garage of a neighboring house. Briggs gathered up the rest of the fireworks and returned them to his parents’ home, then noticed that flames were visible from the garage into which the bottle rocket had flown. After asking bystanders to call the fire department, Briggs tried unsuccessfully to put the fire out himself with a garden hose. Before firemen could put out the fire, it had spread to two other houses and caused damages totaling approximately $175,000. 

As a result of the incident, Briggs was charged with violating two Massillon city ordinances that prohibit possession and discharge of fireworks. He entered no contest pleas and was found guilty on both charges.

The neighbors whose homes were damaged sought recovery from Briggs, who was covered as an insured person under a Nationwide homeowner’s policy issued to his parents. Briggs and his parents filed a claim seeking legal defense and indemnification for liability under the Nationwide policy. Nationwide filed suit in the Stark County Court of Common Pleas seeking a declaratory judgment that Briggs was not entitled to defense or indemnification under its policy based on a clause excluding coverage for bodily injury or property damage “caused by or resulting from an act or omission which is criminal in nature and is committed by an insured.”  Briggs filed a counterclaim seeking a declaratory judgment that he was entitled to coverage under the policy. Nationwide moved for summary judgment.

The trial court denied Nationwide’s summary judgment motion and ruled that Briggs was entitled to coverage under the policy. In its opinion, the trial court held that the Nationwide policy language broadly excluding coverage for “criminal acts,” without a requirement that the policyholder intended to cause injury or that his conduct was so inherently dangerous that it was  “substantially certain” to cause injury, was overbroad and unenforceable under Ohio law.  Nationwide appealed. On review, the 5th District Court of Appeals affirmed the judgment of the trial court.

Nationwide sought Supreme Court review of the 5th District’s ruling. In April 2010 the Court declined to hear the appeal.  In response to a motion for reconsideration, however, the Court reversed its earlier ruling and agreed to review the case.

Attorneys for Nationwide argue that the lower courts erred by failing to find that Briggs’ conduct in discharging illegal fireworks was “substantially certain” to cause injury or property damage, and therefore his intent to cause harm should have been inferred as a matter of law.  They argue that state and local laws prohibiting possession and discharge of fireworks are based on the high risk that such conduct will cause fires and/or injure bystanders, and that Briggs knew or reasonably should have known that his conduct was against the law and very likely to cause harm.

Attorneys for Briggs urge the Court to affirm the 5th District’s ruling that Nationwide’s exclusion for damage arising from “criminal acts,” without a specific requirement of intent or substantial certainty of injury, is so broad that it would allow an insurer to unjustly deny coverage for damages caused by merely negligent conduct such as drivers who commit minor traffic infractions or teenagers who cause property damage during hours covered by a curfew ordinance. They point to a line of prior court decisions holding that an insured person’s conduct only gives rise to an inference of intent to injure when the conduct necessarily results in bodily injury or property damage to another (e.g. in cases involving deliberate acts of murder, physical assault or sexual molestation).

With regard to the question of “substantial certainty,” they argue that under the standard set by earlier court decisions, Briggs act of firing a single bottle rocket into the air in an open field was not an action so likely to cause injury that intent to cause harm may be inferred as a matter of law.

Contacts
Kirk E. Roman, 330.253.8877, for Nationwide Mutual Insurance Company.

Stephen A. Ginella Jr., 330.492.3636, for Corey Briggs.

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Must Clerk of Courts Submit Private Citizen's Affidavit Alleging Crime To Prosecutor or Judge for Review?

Before Accepting Complaint Against Alleged Offender

State of Ohio v. Mor Mbodji, Case no. 2010-0819
1st District Court of Appeals (Hamilton County)

ISSUE:  When a private citizen presents to a clerk of courts an affidavit setting forth the details of a crime he or she allegedly witnessed and a sworn complaint identifying the offender and identifying the crime by its essential facts and statutory designation, may the clerk immediately issue a valid arrest warrant based on the affidavit and complaint without first forwarding them for review by a person designated under R.C. 2935.09 as a “reviewing official?”

BACKGROUND:   Mor Mbodji was arrested and charged with a misdemeanor count of domestic violence based on an affidavit and complaint filed with the Hamilton County Clerk of Courts by his wife, Katrina McCall.  Mbodji was tried and convicted of domestic violence, and sentenced to eight months of community control.

Mbodji appealed his conviction to the 1st District Court of Appeals. Among the assignments of error raised by Mbodji, he argued that the trial court did not have subject mater jurisdiction to hear the charge brought against him because the complaint under which he was charged had not been reviewed by a judge, magistrate or prosecuting attorney as required by R.C. 2935.09.  The court of appeals rejected that argument, citing the Supreme Court of Ohio’s 2006 holding in Boylen v. Harmon that R.C. 2935.09 must be read in combination with 2935.10, and the latter statute allowed a clerk of courts to issue a warrant based on a complaint filed by a private citizen without prior review  by a judge or prosecutor. 

Mbodji sought and was granted Supreme Court review of the 1st District’s ruling on the “reviewing official” requirement.

Attorneys for Mbodji point out that this Court’s January 2006 decision in Boylen analyzed a previous version of  R.C. 2935.09 that was amended by the General Assembly a few months later to explicitly add the current language requiring that an affidavit charging a criminal offense that is submitted to a clerk of courts by a private citizen “shall be forwarded” to a prosecutor, judge or magistrate “for the purpose of review to determine if a complaint should be filed by the prosecuting attorney …”

In light of that change in the law, they urge the Court to revisit its decision in Boylen and instead  follow a 2009 decision, State v. Sharp, in which the 5th District Court of Appeals held that the current version of R.C. 2935.09 makes it mandatory for clerks of court to forward citizen-filed complaints to a reviewing official before filing charges or issuing a warrant,  and that failure to obtain such review renders a complaint defective and deprives a trial court of subject matter jurisdiction to prosecute a defendant based on the invalid complaint.

Attorneys for the Hamilton County prosecutor’s office argue that the procedural requirements of R.C. 2935.09 do not affect the validity of a criminal complaint, which they say is governed by Rule 3 of the state’s Rules of Criminal Procedure. Under Crim.R.3, they assert, the criminal complaint sworn to by McCall and filed with the clerk of courts in this case was valid because it included the three required elements: it set forth the facts constituting the offense charged, stated the numerical designation of the applicable statute or ordinance, and was sworn before a police officer authorized by law to administer oaths.

Contacts
Robert Hastings Jr., 513.946.3712, for Mor Mbodji.

Scott M. Heenan, 513.946.3227, for the state and Hamilton County prosecutor's office.

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May Court Hearing Workers' Comp Appeal Consider Both Direct Causation and Aggravation of Condition?

When Aggravation Was Not Asserted at Administrative Hearing

Joseph Starkey v. Builders FirstSource Ohio Valley, LLC, and Administrator, Ohio Bureau of Workers' Compensation, Case no. 2010-0924
1st District Court of Appeals (Hamilton County)

ISSUES: If a workers’ compensation claimant does not assert during administrative proceedings the alternative theories that a medical condition for which benefits are sought was either directly caused by a workplace accident or was a pre-existing condition aggravated by a work accident, and his claim is administratively denied, has the claimant forfeited the right to later raise an aggravation theory of causation during an R.C. 4123.512 appeal proceeding, and/or his right to file a new claim asserting the same condition based on an aggravation theory of causation?

BACKGROUND:  Joseph Starkey suffered injuries to his left hip while working as a service technician for Builders Firstsource Ohio Valley (Builders). He received various types of medical treatment that did not resolve his injuries, and ultimately underwent hip replacement surgery. Starkey applied for and was awarded workers’ compensation benefits to cover his medical costs and lost wages based on several different medical conditions arising from the accident.  He later applied for benefits based on the additional condition of “degenerative osteoarthritis of the left hip.”

The Bureau of Workers’ Compensation (BWC) conducted an administrative hearing at which a hearing officer granted an award of benefits  for the additional condition. Builders exercised its right to challenge the award for the arthritis condition through an appeal hearing in the Hamilton County Court of Common Pleas.  During the court proceeding medical experts for Starkey and Builders both testified that in their opinion Starkey had arthritis in his hip prior to the workplace accident, but that the accident substantially aggravated the condition.

Builders moved for a directed verdict in its favor on the basis that the BWC administrative order granted additional benefits based on a finding that Starkey’s accident had directly caused degenerative osteoarthritis, while the appeal testimony established that the accident had aggravated pre-existing arthritis, a claim had not been asserted at the administrative hearing and therefore was not covered by the BWC order granting additional benefits. The court granted Builders’ motion and ordered that Starkey’s benefits for the arthritis claim be discontinued.  Starkey appealed that ruling.  On review, the 1st District Court of Appeals reversed the trial court and reinstated Starkey’s benefit. Builders then sought and was granted Supreme Court review of the 1st District’s decision.  

Attorneys for Builders argue that the 1st District erred by holding that Starkey was free to raise a new and different condition (aggravation of preexisting arthritis) in an appeal hearing when that condition was not addressed during his BWC administrative proceedings. They cite this Court’s 2005 decision in Ward v. Kroger and a line of appellate decisions since then that they say have limited the scope of an R.C. 4123.512 appeal to the medical conditions that were addressed in the administrative order from which the appeal is taken.

Attorneys for Starkey respond that the medical condition asserted by Starkey in the trial court appeal was the same condition for which Starkey sought and was granted benefits in his BWC administrative hearing: “degenerative osteoarthritis of the left hip.” They point out that the definition of a compensable injury in state workers’ compensation statutes specifically includes aggravation of a preexisting condition, and argue that the trial court mistakenly held that Starkey’s raising of a new or alternative theory of causation (aggravation of an existing condition rather than direct causation of that condition) during appeal proceedings was the same as of changing the identity of the medical condition for which benefits were sought.  They also point to language in the BWC training manual that directs administrative hearing officers to consider different alternative theories of causation (e.g., direct causation, aggravation of an existing condition, repetitive damage ...) in determining whether a claimant’s medical condition is work-related.

BWC Administrator Marsha Ryan, who is also a party in the case, has entered a brief urging the Court to affirm the 1st District’s analysis and rule that a claimant is not precluded from advancing alternative theories of causation on appeal so long as there is no change in the identity of the medical condition for which benefits were administratively approved.

Contacts
Howard D. Cade III, 513.683.2252, for Builders Firstsource Ohio Valley LLC.

MK. Christopher Kneflin, 513.961.6644, for Joseph Starkey.

Benjamin C. Mizer, 614.466.8980, for BWC Administrator Marsha Ryan.

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Does Worker Suffer 'Total Loss' of Vision When Injury Requires Removal of Natural Eye Lens?

When Artificial Lens Implant Restores Some Vision

State of Ohio ex rel. Jamey D. Baker v. Coast to Coast Manpower LLC and Industrial Commission of Ohio, Case no. 2010-0211
10th District Court of Appeals (Franklin County)

ISSUE: When a workplace accident causes injuries to a worker’s eye that ultimately require surgical removal of the natural lens, is the worker entitled to compensation for the “total loss of vision” in that eye despite the fact that the implantation of an artificial lens subsequently restores vision in the damaged eye?

BACKGROUND:  Jamey Baker suffered a workplace accident in which a metal cable he was cutting snapped and a metallic fragment of the cable lodged in the cornea of his right eye.  Following surgery to remove the fragment, Baker developed a traumatic cataract that required surgery to remove the natural lens of the injured eye and implant an artificial lens.

Baker filed a state workers’ compensation claim for the total loss of vision in his right eye.  A Bureau of Workers’ Compensation (BWC) district hearing officer found that the initial change in Baker’s vision after the injury was 8 percent, and that under the Supreme Court of Ohio’s 1987 holding in State ex rel. Kroger Co. v. Stover,any change in vision resulting from a subsequent surgery may not be considered in setting his workers’ compensation benefit. Baker appealed. A staff hearing officer vacated the district officer’s decision and awarded Baker benefits for 100 percent loss of vision in the damaged eye. The employer appealed that ruling to the full Industrial Commission, which overruled the staff hearing officer, vacated the award for total loss of vision and reinstated the partial disability award. 

Baker then filed suit in the 10th District Court of Appeals seeking a writ of mandamus finding that  the Industrial Commission abused its discretion and misapplied the los-of-vision statute, R.C. 4123.57(B), in denying his claim for complete loss of vision based on the surgical removal of his natural lens as the result of a workplace injury. While both Baker’s employer and the Industrial Commission initially opposed Baker’s complaint, the commission subsequently acknowledged that it had not applied the proper standard in reviewing his loss of vision claim, and joined Baker’s request for a writ.   The 10th District denied the requested writ.  Baker and the Industrial Commission sought and were granted Supreme Court review of the court of appeals’ decision.

Attorneys for Baker and the Industrial Commission ask the Court to clarify that its Kroger decision did not preclude consideration of a further loss of vision caused by post-injury surgery necessary to correct a claimant’s underlying injury, but instead held that corneal transplants are corrective rather than restorative of a claimant’s sight, and that the percentage of loss of sight on which a workers’ compensation award should be based is the percentage of vision loss suffered prior to the implantation surgery.  Because Baker’s injury required the surgical removal of his natural lens in the damaged eye, they contend, he suffered a 100 percent loss of natural, uncorrected vision in that eye, and is therefore eligible for a full loss-of-vision award regardless of the amount of vision he was able to recover through the implant.

Attorneys for Baker’s employer, Coast to Coast Manpower LLC, ask the Court to affirm the 10th District’s denial of the requested writ.  They argue that R.C. 4123.57(B) does not provide workers’ compensation benefits for the “loss of a natural lens,” but rather for the “loss of vision in an eye.”

In this case, they argue, Baker’s vision prior to his accident was 20/30 and his post-accident vision prior to the surgery in which his natural lens was removed and an artificial lens was implanted was 20/50, which the district hearing officer correctly calculated to be an eight percent loss.  Thus, they assert, under the rule set forth in Kroger, the eight percent loss of vision suffered by Baker prior to receiving his implants not only does not qualify him for a “total” loss of vision award, it does not even meet the minimum 25 percent loss of vision standard to qualify for an award of partial benefits.

Contacts
Theodore A. Bowman, 419.843.2001, for Jamey Baker.

Colleen Erdman, 614.466.6696, for the Industrial Commission of Ohio.

Mickey L. Proxmire, 614.228.1311, for Coast to Coast Manpower LLC.

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Is BWC Subrogation Action to Recover Lawsuit Proceeds Subject to Two-Year or Six-Year Limitations Period?

When Benefits Claimant Receives Additional Settlement From Third Party

Ohio Bureau of Workers' Compensation v. Jeffrey McKinley et al., Case no. 2010-0720
7th District Court of Appeals (Columbiana County)

ISSUE: R.C. 4123.93 and 4123.931 give the Bureau of Workers’ Compensation (BWC) a right to subrogation (reimbursement) of benefits the bureau has paid to an injured worker if the worker later recovers damages from a third party through a lawsuit based on the same injury.  In this case, the Court is asked to determine whether the statute of limitations (time limit) within which BWC must file a subrogation suit under R.C. 4123.931(G) is the two-year limitations period within which the injured worker is required to file his tort claim against the third party, or instead is the six-year limitations period applicable to “a liability created by a statute.”

BACKGROUND: Jeffrey McKinley was injured in July 2003 while working for his employer, Safway Services Inc., at a trash incinerator facility in East Liverpool owned by Heritage-WTI. McKinley applied for and was granted state workers’ compensation benefits including compensation for medical bills, lost wages and other expenses. 

McKinley subsequently filed a personal injury lawsuit against Heritage, alleging that the company’s failure to maintain its plant in a safe condition had been a proximate cause of his injuries.  McKinley notified BWC that he had filed the personal injury.  On Nov. 1, 2004, McKinley notified BWC that he and Heritage were negotiating a settlement of his claims against the company. BWC did not apply to intervene in the lawsuit or settlement negotiations, or institute an independent action on its own behalf against Heritage. McKinley and Heritage entered into a settlement agreement for an undisclosed amount, and McKinley notified BWC of the settlement.

BWC filed a lien against the settlement proceeds, asserting its right to be subrogated (repaid from the proceeds of the lawsuit settlement) for $885,000 in benefits that the bureau had either already provided to McKinley or anticipated that it would provide him in the future pursuant to his ongoing disability. In April 2005, McKinley responded to the bureau’s demand for payment by filing suit in the Washington County Court of Common Pleas. In his complaint, McKinley sought a declaratory judgment that R.C. 4123.93 and 4123.931 were unconstitutional. If the laws were upheld as constitutional, the complaint asked the court for a declaration of what amount  BWC was entitled to recover from the settlement proceeds. The trial court found the statutes unconstitutional, and so did not reach the issue of the recoverable amount. 

BWC appealed.  On review, the 4th District Court of Appeals reversed the trial court and held that the statutes were constitutional.  McKinley sought Supreme Court review of the case. The Supreme Court accepted jurisdiction, but held McKinley’s case pending its decision in Groch v. GMC, another case that raised the same constitutional challenges to the BWC subrogation statutes.  In February 2008, the Supreme Court released its decision in Groch, which upheld the reimbursement statutes as constitutional.  In keeping with its ruling in Groch, the Court then affirmed the 4th District’s decision in McKinley’s case.  The 4th District remanded McKinley’s case to the trial court for a determination of what amount the state was entitled to recover from the Settlement proceeds.  In April 2008, before that issue was determined, McKinley dismissed his complaint.

In November 2008, BWC filed suit against both McKinley and Heritage in the Columbiana County Court of Common Pleas under R.C. 4123.931(G), which authorizes the bureau to recover the full amount of its subrogation interest jointly and severally from a claimant and a third party from whom that claimant has recovered through a judgment or settlement: 1) if the BWC was not given advance notice and a chance to intervene in the pending judgment or settlement or 2) if the judgment or settlement excluded any amount paid by BWC to or on behalf of the claimant.

Heritage moved to dismiss the bureau’s complaint against it on the basis that BWC had not filed its subrogation action within the two-year statute of limitations that was applicable to McKinley’s claims against Heritage. The trial court agreed with Heritage’s argument and dismissed the BWC action as not timely filed.  BWC appealed.  On review, the 7th District Court of Appeals reversed, holding that the right of subrogation asserted by BWC in this case was an “independent right of recovery” created by enactment of R.C. 4123.931. Based on that analysis, the 7th District held that BWC’s subrogation claim against Heritage was subject to a different, six-year statute of limitations applicable to “a liability created by a statute.” Heritage sought and was granted Supreme Court review of the 7th District’s ruling.

Attorneys for Heritage argue that the right of recovery conferred on BWC by R.C. 4123.931(G) is not a new cause of action or independent right of recovery created by statute but merely an extension of the long-recognized common law right of subrogation. They urge the Court to reverse the 7th District and reinstate the trial court’s holding that, because BWC’s rights in the case are derivative of McKinley’s rights, BWC’s right to subrogation from the settlement is subject to all the same limits and requirements as McKinley’s underlying claim against Heritage, including the two-year statute of limitations for filing personal injury lawsuits. 

They point out that McKinley notified BWC that he was negotiating a settlement with Heritage in November 2004, eight months before the two-year limitations period expired, giving the bureau an opportunity either to intervene in the settlement negotiations or to assert its statutory subrogation rights against McKinley and Heritage under R.C. 4123.193(G) after the settlement was entered. They point to multiple court decisions holding that subrogation claims must be asserted within the same limitations period applicable to a plaintiff’s claim against a third party, and argue that nothing in R.C. 4123.931 allowed BWC to “sit on” its subrogation rights for an additional four years before filing suit to reopen a long-settled personal injury case.

Attorneys for BWC point out that, prior to the enactment of the current version of R.C. 4123.193, the preceding version only gave the state a right to restitution if the claimant recovered damages from the tortfeasor through a judgment – as opposed to a settlement.  By enacting new language that authorized the bureau to assert joint and several subrogation claims against both the claimant and a third party if they settled without BWC’s participation, they say, the legislature created a new statutory right of recovery that is different from traditional  subrogation, and lawsuits brought under that independent right of recovery are subject to the six-year limitations period applicable to a “liability created by statute.”

Contacts
Patrick Kasson, 614.228.1311, for Heritage WTI Inc.

T. Jeffrey Beausay, 614.224.8166, for Jeffrey McKinley.

Benjamin C. Mizer, 614.455.8980, for Ohio Bureau of Workers' Compensation.

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These informal previews are prepared by the Supreme Court's Office of Public Information to provide the news media and other interested persons with a brief overview of the legal issues and arguments advanced by the parties in upcoming cases scheduled for oral argument. The previews are not part of the case record, and are not considered by the Court during its deliberations.

Parties interested in receiving additional information are encouraged to review the case file available in the Supreme Court Clerk's Office (614.387.9530), or to contact counsel of record.