Saturday, April 14, 2012

Mario Massillamany Explains Why Sending A Qualified Settlement Offer Is Even More Critical Now

By Mario Massillamany

All truck accident attorneys in Indiana are aware of the use of Qualified Settlement Offers ("QSOs") for trying to settle personal injury cases, or if not, to qualify their client for prejudgment interest if the case is not settled prior to a successful jury verdict. However, these QSOs have sometimes been difficult to draft if your client's medical damages continue to rise, even after litigation has commenced. This, of course, can be common if the accident victim continues to treat, such as when conservative treatment is not deemed sufficient and major surgery is later required.

This is what happened in the recent case of Kosarko v. Padula, 2011 Ind. App. LEXIS 1978 (Dec. 30, 2011) (You can find a PDF of this case here) In that case the plaintiff, Margaret Kosarko, was involved in an automobile accident, and later filed suit against the defendant.

On March 18, 2008, the plaintiff tendered a QSO to the defendant, offering to settle the case for $100,000, payable within 60 days. At around that time the plaintiff's medical bills were around $31,000, and defendant chose not to settle the claim. Thereafter, the plaintiff underwent a surgery related to the accident which dramatically increased her medical expenses to over $72,000. This increase in medical expenses occurred approximately a year after the QSO was sent. Then, a year after that, in March 2010, the case was tried to a jury where the plaintiff won the case and was awarded a verdict of $210,000.

Thereafter, plaintiff's counsel moved for prejudgment interest, demanding over $79,000, based on the QSO. The trial court denied the motion, holding that plaintiff's "damages, as determined by the jury in this case, were not ascertainable within a time frame that justifies granting plaintiff's motion for prejudgment interest." The Indiana Court of Appeals, in a 2-1 decision, reversed the trial court and awarded Kosarko all the prejudgment interest demanded.

The court held that even though the plaintiff's medical bills increased as the case progressed, the defendant "had ample opportunity to evaluate the known dollar cost of the dispute and consider settlement." The court of appeals felt it was important that in the case no one disputed the amount of the medical bills, and there was no indication that they were unnecessary, fraudulent or unrelated to the automobile accident.

Therefore, Indiana automobile and truck accident attorneys should take note of this case and seriously consider sending a QSO whether or not their client is still treating for their injuries. Further, defense counsel should reevaluate all previous QSO offers, even after expiration, if plaintiff's damages amounts increase dramatically after the QSO is sent out. This evaluation should consider, among other things, whether their client can also risk potential exposure of the prejudgment interest part of damages after a trial in such circumstances.

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