What do you do when it’s your word against a dead man’s? This is a real problem faced by subrogation attorneys everywhere as lengthy litigation processes leave time for plaintiffs and defendants alike to shuffle off this mortal coil. But what if you needed that person’s testimony as evidence in your subrogation case? Or what about a witness that had been ready to testify against them? Is it still possible to litigate the claim?
Rathbone Group attorneys Rebecca Wright and Steve Alsip discussed just this problem in a recent podcast episode of On Subrogation: Dead Man’s Rule. Here, we’ll cover the major points and case studies that offer insurance and subrogation professionals a path forward when it seems the key characters in your subrogation claim have passed on.
When a Deceased Defendant is Haunting Your Subrogation Case
The Dead Man’s Act, originally passed in Illinois, is meant to prevent any party from testifying about conversations or events involving a deceased or legally disabled party if said testimony would be damaging to the deceased’s case. Once someone is dead, anyone can say anything about them – they are not there to defend themselves. Also called the Dead Man’s Rule, it serves to prevent self-serving or malicious claims to take advantage of an estate.
By disallowing testimony about something the deceased did or said, courts ward off the specter of perjury. However, like all matters in subrogation, the way this rule is interpreted and applied varies widely by state. For instance, if a defendant dies in the course of auto insurance subrogation in Texas, the rule extends only to what they said. It’s basically hearsay for the dead.
Speaking of speaking for the dead, check out our blog and YouTube episode of On Subrogation: When a Tortfeasor Dies During Subrogation Pursuit for another discussion of macabre matters in subrogation.
Subrogation Laws by State: Virginia, Shumate v. Mitchell 2018
An auto subrogation case in Virginia recently dealt with how to interpret the Dead Man’s Statute. Shumate, the Plaintiff, sued William Earl Thompson after he rear-ended her. The dispute was not about liability but about the speed at which Shumate was hit. Thompson died before the subrogation matter was litigated. His son, who was not in the car at the time of the accident, said he spoke to his father right after and he had said he hit Shumate at about 5 – 7 mph.
Meanwhile, Shumate claimed she was hit at 20 – 40 mph. Bowman, who was in the car with Thompson at the time, described it as 5 – 6 mph. Because Thompson’s estate admitted liability, the case was limited to damages. Obviously, a jury would award much more in damages for a 40 mph rear end accident than a 5 mph one. Both Bowman and Thompson, via his son, described the low end of the spectrum, and the fact that all parties were in stop-and-go traffic at the time also supported their recollection.
Shumate filed a motion to prevent Thompson’s son from testifying because he was not at the scene, so his testimony was hearsay not cured by the Dead Man’s Statute. The court overruled the motion. The jury returned a unanimous verdict for Shumate but awarded $0 in damages. Shumate immediately appealed and it reached Virginia’s Supreme Court, who upheld the rulings of the lower courts.
Why did Virginia allow testimony by an interested party even though the defendant was dead? Because there has to be a balance between preventing perjury and protecting the estate while also minimizing evidence lost by excluding all such testimony. So Virginia’s application of the Dead Man’s Rule has an exception that no judgment may be rendered for testifying survivor unless a party testifying on behalf of the deceased corroborates their claims.
What is interesting about Virginia’s interpretation of this rule is that the exception is basically a blanket exclusion of hearsay rules of evidence. The courts prevent interested parties from testifying against the deceased to prevent opportunistic perjury but accept testimony from parties speaking in support of the deceased, as if there is no danger of someone committing perjury on behalf of an estate. As a result, Virginia subrogation in these claims are much simpler if your insured is the deceased’s estate.
A Different Approach: Illinois, State Farm v. Plough 2017
Another case in Illinois took a slightly different approach, this time directly in the context of auto insurance subrogation. In 2013, Rodriguez was hit head on my Plough, who had run a red light. Rodriguez testified that Plough’s vehicle drove through the intersection at high speed, swerved to avoid another vehicle, crossed into opposing lanes, and collided with her SUV.
A responding police officer reported that Plough admitted the light had turned red as he approached, he attempted to stop, lost control, and hit Rodriguez. State Farm paid out her claim and promptly pursued Plough for the damages by filing a subrogation lawsuit. The jury in the case awarded State Farm the full amount.
Here’s where the “dead” man comes in – Plough had been institutionalized several months after the accident for mental health reasons and was declared legally incompetent. A representative was appointed to speak on his behalf. Therefore, the Dead Man’s Rule should apply. Plough’s estate appealed the verdict, arguing that, under the statute, Rodriguez’s testimony should have been excluded.
Plough argued she was an interested party whose testimony advantaged her case while disadvantaging the estate of the “deceased”. The court struck down Plough’s appeal, citing that Rodriguez’s testimony did not benefit her, but State Farm, so the Dead Man’s Rule did not apply to her testimony. They further stated that regardless of the admission of her testimony, the events were corroborated by other evidence such that it would not have affected the jury’s decision on the subrogation award.
Illinois Digs in on Protections for the Deceased: Excluding Events
Illinois’s applications of the Dead Man’s Act are broader than most other states, making Illinois subrogation of these claims difficult if your insured isn’t the dead one. Rerack v. Lally 1992 was an auto insurance lawsuit filed by O’Leary against Rerack, who had rear ended O’Leary’s car. O’Leary died of unrelated causes before his deposition could be taken.
Rerack was Polish and spoke no English. As a result, the police officer who processed the scene of the accident, who neither spoke nor understood Polish, never took Rerack’s testimony, only speaking to the now-deceased defendant. Under the Dead Man’s Act, O’Leary’s estate argued that there was no issue of material fact and no uninterested witnesses to testify; they asked for a summary judgment, which the court granted.
Expectedly, Rerack appealed, arguing the application of the Dead Man’s Rule to a summary judgment was inappropriate and that there was an issue of fact: whether or not the deceased’s actions were negligent. He argued the rule only applies to testimony about statements and events, so he should have been able to testify about other facts unrelated to the deceased, for instance, that his brake lights were clearly on.
The court agreed that while the Dead Man’s Act applies to statements made by the deceased and any events that happened in the presence of the deceased, the Plaintiff should still have been able to testify about facts of the case that do not directly involve the Defendant. They reversed the summary judgment.
Don’t Just Give Up the Ghost in Your Subrogation Case
While exceptions to exceptions to rules of evidence like these can make finding the right subrogation strategy difficult, it is important to remember that most jurisdictions do not have a Dead Man’s Rule. So that is question number one if you have a party die during subrogation pursuit. As a subrogation attorney, understanding the nuances of your jurisdiction is crucial to every claim.
If you find you are in a jurisdiction with a Dead Man’s Rule, determine exactly how it is applied and the case law behind it. Then, evaluate the merits of your case if testimony would be excluded under the act. If your subrogation claim is strong enough, you will be able to maximize recovery, dead man or no.
For more podcasts on subrogation topics, strategy, and law, visit our podcast library. You can find more educational subrogation articles on our blog and video episodes of On Subrogation at our YouTube channel. Have a question or topic we’ve not yet covered? Reach out at podcast@rathbonegroup.com to see it featured in a future episode!