You can
search the entire site.
or go to the recent opinions, or the chronological or subject indices.
Linda W. Myers V. Sidney L. Robertson Sr. (3/10/95), 891 P 2d 199
<![CDATA[
Notice: This opinion is subject to formal correction
before publication in the Pacific Reporter. Readers
are requested to bring errors to the attention of the
Clerk of the Appellate Courts, 303 K Street, Anchorage,
Alaska 99501.
THE SUPREME COURT OF THE STATE OF ALASKA
LINDA W. MYERS, Representative)
for SIDNEY LEE ROBERTSON, JR.,) Supreme Court No. S-4661
deceased, Special Administra- )
trix for the Estate of ) Superior Court No.
SIDNEY LEE ROBERTSON, JR., ) 3AN-88-12271 Civil
deceased, and Special Guardian)
for STEPHEN M. ROBERTSON, )
a minor, )
)
Appellant, )
)
v. )
)
SIDNEY L. ROBERTSON, SR., )
TERRI A. ROBERTSON, and )
ALLSTATE INSURANCE COMPANY, )
)
Appellees. )
)
______________________________)
)
ALLSTATE INSURANCE COMPANY, ) Supreme Court No. S-4673
)
Cross-Appellant, )
)
v. )
)
LINDA W. MYERS, Representative)
for SIDNEY LEE ROBERTSON, JR.,)
deceased, Special Administra- )
trix for the Estate of )
SIDNEY LEE ROBERTSON, JR., )
deceased, and Special Guardian)
for STEPHEN M. ROBERTSON, )
a minor, )
and )
SIDNEY L. ROBERTSON, SR., ) O P I N I O N
and TERRI A. ROBERTSON, )
) [No. 4176 - March 10, 1995]
Cross-Appellees. )
______________________________)
Appeal from the Superior Court of the
State of Alaska, Third Judicial District,
Anchorage,
Dana Fabe, Judge.
Appearances: Olof K. Hell‚n, Hell‚n &
Accinelli, Anchorage for Appellant (S-4661)
and Cross-Appellee (S-4673) Linda W. Myers.
Theodore M. Pease, Jr. and Peter J. Maassen,
Burr, Pease & Kurtz, Anchorage, for Appellees
(S-4661) and Cross-Appellees (S-4673)
Robertson. Ronald L. Bliss and Maryanne
Boreen, Bliss Riordan, Anchorage, for
Appellee (S-4661) and Cross-Appellant (S-
4673) Allstate.
Before: Moore, Chief Justice,
Rabinowitz, Matthews and Compton, Justices,
and Bryner, Justice, pro tem.*
MOORE, Chief Justice.
COMPTON, Justice, with whom BRYNER,
Justice, pro tem, joins, dissenting.
I. Introduction
This intra-family lawsuit arises from the accidental
death of a thirteen year old boy, Sidney Robertson, Jr. The
minor's estate, along with the child's brother Stephen (the
"Estate"), sued the boys' parents, Sidney Robertson, Sr. and
Terri Robertson ("the Robertsons"), on a theory of negligence.
The parents' insurer, Allstate Insurance Co. ("Allstate"),
appointed counsel to defend the Robertsons. However, based on
Allstate's belief that the Robertsons' true interest was in
losing the lawsuit so that they could recover the insurance
proceeds paid to the Estate, Allstate later intervened in the
case as a party defendant. Allstate participated at trial
outside the jury's presence, and the jury was not informed of its
existence as the real party in interest. The jury found that,
although the Robertsons were negligent, their conduct was not the
legal cause of their son's death.
The Estate appeals, claiming that Allstate's interest
in the case should have been disclosed to the jury. Allstate
cross-appeals, arguing that the case should have been dismissed
for lack of adversity and on public policy grounds.
We conclude that several rulings of the trial court
were erroneous, but that the errors were harmless. Therefore, we
uphold the jury's verdict.
II. Facts and Proceedings
In June 1988, the Robertsons were living in a single
family residence in Anchorage with their two sons, Sidney, Jr.,
then age 13, and Stephen, then age 9. The Robertsons had plans
to attend a special event at an Anchorage museum for the evening
of June 23, 1988. They decided to leave the children at home for
the few hours they would be gone. To entertain the boys, the
Robertsons left them some VCR movies, including a skateboard
movie called "Thrasher."
Following their parents' departure, Sidney, Jr. and
Stephen watched "Thrasher." After the movie, Sidney, Jr. went to
the garage, where Terri Robertson had parked the family's 1981
Triumph TR-7. At the back of the garage, the Robertsons stored a
skateboarding ramp that they had given Sidney, Jr. for his
birthday one month earlier.
The parties dispute the following series of events.
Allstate argues that the TR-7 was securely parked, in gear, with
the emergency brake engaged and the garage door closed. Allstate
asserts that Sidney, Jr. opened the garage door, released the
car's parking brake and intentionally attempted to move the TR-7
so that he could skateboard in the garage. The Estate suggests
that the Robertsons had negligently left the garage door open,
left the TR-7 out of gear and failed to repair the car's
nonfunctioning emergency brake. As a result, when Sidney, Jr.
tried to skateboard around the car, he unintentionally caused it
to begin rolling.
In either event, it is clear that at some moment the TR-
7 began rolling backward down the Robertsons' steep incline
driveway. Sidney, Jr. ran behind the car, apparently trying to
stop it from rolling into the street. The TR-7 eventually backed
into another car parked across the street from the Robertson
home, pinning Sidney, Jr. between the two cars. Sidney, Jr.
later died as a result of his injuries. Stephen witnessed the
accident.
Several months after Sidney, Jr.'s death, the
Robertsons consulted with attorney Olof Hell‚n regarding the
extent of their insurance coverage for the accident. Hell‚n's
law firm reviewed the Robertsons' insurance policies and advised
the Robertsons to designate a close friend as representative of
Sidney, Jr.'s estate and as special guardian of Stephen. The
firm further advised the Robertsons to retain their own counsel,
since Sidney, Jr.'s estate and Stephen would bring a lawsuit
against them and that, in the event of a recovery by Sidney,
Jr.'s estate, the Robertsons ordinarily would receive the
proceeds as their son's heirs in intestacy.
Course of Proceedings
The Robertsons arranged for Linda Myers, a family
friend, to act as the representative of Sidney, Jr.'s estate and
as Stephen's special guardian for the purposes of this
litigation. The Robertsons waived any conflicts of interest, and
Olof Hell‚n undertook representation of the Estate. The Estate
filed this action against the Robertsons in December 1988,
alleging that the Robertsons were negligent in (1) possessing a
driveway with an unsafe incline, and (2) failing to properly
secure their Triumph TR-7 in their garage.
Due to its duty to defend the claim against the
Robertsons, Allstate appointed the law firm of Hughes, Thorsness,
Gantz, Powell & Brundin ("Hughes, Thorsness") to represent the
Robertsons. Hughes, Thorsness filed a motion to dismiss the
Estate's claims based on the public policy that negligent parties
should not benefit from their wrongful conduct. Hughes,
Thorsness argued that, because the Robertsons were the sole
beneficiaries of Sidney, Jr.'s estate, they would be monetarily
rewarded if they negligently caused their son's death.1 The
Estate opposed the motion; it then moved to disqualify the
Robertsons' counsel on the grounds that the motion to dismiss was
contrary to the Robertsons' interests in losing the case.
Before the court ruled on the Estate's motion to
disqualify, Hughes, Thorsness withdrew as defense counsel for
reasons unrelated to this case. The law firm of Guess & Rudd
substituted as defense counsel. However, Guess & Rudd
subsequently withdrew due to an "irreconcilable conflict of
interest"between it and the Robertsons.
Following Guess & Rudd's withdrawal, the Estate moved
for an order to protect the Robertsons by requiring that Guess &
Rudd's files be transferred to the Robertsons and not to
Allstate. Allstate then intervened in the case as a party
defendant, asserting that the Estate was advancing the real
interests of the Robertsons, who were not adverse to its claims.
Based on the conflicting interests between Allstate and the
Robertsons, the trial court ordered that Allstate appoint
independent counsel to represent the Robertsons. It further
ordered that independent counsel not report to Allstate. In
compliance with this order, Allstate retained Theodore Pease, Jr.
of Burr, Pease & Kurtz, with the Robertsons' consent and the
court's approval, to defend the Robertsons.
Allstate moved to dismiss the Estate's claims under
Alaska Civil Rule 12(b)(1), arguing that the lack of genuine
adversity between the Estate and the Robertsons deprived the
court of subject matter jurisdiction. Allstate alternatively
moved to dismiss under Civil Rule 12(b)(6), arguing that the
Estate's claims could not succeed due to the public policy
barring the Robertsons from benefitting from their negligent
conduct by obtaining the proceeds of Sidney, Jr.'s estate.2
The court denied Allstate's motion, and the case
proceeded to trial. With the court's approval, Allstate elected
not to participate at trial during the jury's presence. The
court also approved Allstate's motion to prevent any reference to
insurance during trial, except for limited questions during jury
selection.
During trial, the Robertsons testified in a manner
which sometimes suggested that they took responsibility for
negligently causing their son's death. For instance, Terri
Robertson testified that both she and her husband knew that the
TR-7's emergency brake had never worked, and that they were
negligent in failing to repair it. She also disputed that she
told the police on the night of the accident that she had closed
the garage door and left the TR-7 in gear before going out.
Sidney Robertson, Sr. testified that the TR-7's emergency brake
had never worked.
The Robertsons' counsel, Theodore Pease, then impeached
his clients' credibility with their prior statements, made either
to the police or in depositions, which suggested that the TR-7
could not have begun rolling unless Sidney, Jr. first opened the
garage door, took the car out of gear and released the parking
brake. By this impeachment, and through closing argument,
defense counsel suggested to the jury that the Robertsons'
emotional pain led them to take responsibility for their son's
death, even when such responsibility was inappropriate.
The Estate objected on the Robertsons' behalf, arguing
that Mr. Pease's impeachment was contrary to the Robertsons'
interests. The court overruled the objection, stating that, for
sufficient adversity to exist, defense counsel must present "a
classic defense in the sense that [the goal is] to make sure that
his clients are not found liable."
In argument over jury instructions, Allstate again
raised the adversity issue. On Mr. Pease's proposal, the court
instructed the jury that the Robertsons were the heirs to Sidney,
Jr.'s estate. Mr. Hell‚n again objected that it was improper for
defense counsel to propose such an instruction because the
instruction was contrary to the Robertsons' interests. The court
found that sufficient adversity existed because Mr. Pease was
properly representing the Robertsons as defendants, not as
plaintiffs. Similarly, the court held that Mr. Pease could argue
in closing that Sidney, Jr.'s own negligence had caused his
injuries and death, even if the Robertsons did not want this
argument to be made because they did not believe it was true.
The jury determined that the Robertsons were negligent
but that their negligence was not the legal cause of Sidney,
Jr.'s death. The court subsequently entered judgment in favor of
the Robertsons and Allstate.
III. Discussion
A.
We first address the issues raised by Allstate's cross-
appeal since they go to the court's jurisdiction. Allstate
asserts that the case should have been dismissed because there
was never any genuine adversity between the Estate and the
Robertsons.
1. Adversity and Subject Matter Jurisdiction3
Allstate contends that the trial court had no subject
matter jurisdiction over this case since the Robertsons and the
plaintiff had identical interests. Most notably, the Robertsons
would receive any recovery by Sidney, Jr.'s estate as his sole
beneficiaries in intestacy. See supra note 1. Moreover, because
the Robertsons prompted the plaintiff's initiation of this suit,
Allstate argues that Linda Myers is only a figurehead. According
to Allstate, the Robertsons are the real plaintiffs and are in
essence suing themselves.
In discussing the standing requirement, this court has
stated that an Alaska court has no subject matter jurisdiction
unless the lawsuit before it presents an actual controversy
involving a genuine relationship of adversity between the
parties. Trustees for Alaska v. State, Dept. of Natural
Resources, 736 P.2d 324, 329-30 & n.9 (Alaska 1987), cert.
denied, 486 U.S. 1032 (1988); Wagstaff v. Superior Court, 535
P.2d 1220, 1225 (Alaska 1975). Adversity insures that parties
will energetically pursue their opposing positions and present
facts necessary for the fair resolution of the case. Bowers
Office Prods., Inc. v. University of Alaska, 755 P.2d 1095, 1098
(Alaska 1988). Accordingly, adversity constitutes the basic
requirement for standing in Alaska. Trustees for Alaska, 736
P.2d at 327.
This court has also held that children have a right to
bring lawsuits against their parents for negligently inflicted
injuries. Hebel v. Hebel, 435 P.2d 8, 15 (Alaska 1967) (no
parental immunity bar to an unemancipated minor's negligence
action against a parent). Thus, there is no per se failure of
adversity simply because this lawsuit arises from an alleged
intra-family tort. In Hebel, this court specifically recognized
the potential for collusive intra-family litigation designed to
defraud insurance carriers but determined that this danger "does
not warrant denial of a remedy to the child." Id. at 12. It
further stated:
"Since the insurer is the real
defendant, it has been said that there is
danger of fraud and collusion between parent
and child. One may not, of course, deny the
hazard, but such a danger, being present in
all liability insurance cases, furnishes
reason not for denial of a cause of action,
but for added caution on the part of court
and jury in examining and assessing the
facts."
Id. (quoting with approval Badigian v. Badigian, 174 N.E.2d 718,
723 (N.Y. 1961) (Fuld, J., dissenting)) (emphasis added).
Similarly, in Aydlett v. Haynes, 511 P.2d 1311 (Alaska
1973), this court noted that intra-family tort litigation can
pose special problems due to the existence of insurance. In
Aydlett, a wife sued her husband to recover for injuries caused
by the husband's negligence. The court recognized that, in
ordinary personal injury litigation, an insurer and a defendant-
insured usually have a common interest in avoiding liability.
Id. at 1315 n.8. However, in intra-family litigation, the
interests of the insured may conflict with those of the insurer
since the insured may have a financial interest in seeing the
plaintiff prevail. For this reason, the court stated, "[W]here
the case involves an intra-family tort action, the trial judge
must take care to assure that the actual interests of all parties
are fairly represented." Id. In light of Hebel and
Aydlett, there is no merit to Allstate's contention that the
Estate's claims against the Robertsons were not actionable and
should be precluded as a matter of law.4 See also Drickerson v.
Drickerson, 604 P.2d 1082 (Alaska 1979) (husband's suit against
wife on behalf of injured child could lie). Rather, as these
cases indicate, the action may proceed. However, the trial court
must exercise added caution to insure that the potentially
conflicting interests of an insurer and its insured are fairly
represented. This is precisely what Judge Fabe did.
Consistent with the obligations imposed under Hebel and
Aydlett, the court required counsel for the Robertsons to further
the Robertsons' interests in this case as defendants, not as
plaintiffs. Although placed in a sometimes awkward position, Mr.
Pease conscientiously and effectively presented the Robertsons'
defense.5 Further protecting the interests of all parties, the
court appropriately required that the Robertsons' defense counsel
be independent from Allstate in the sense that Mr. Pease would
not report to Allstate. By these actions, the court struck a
balance between the Estate's right to sue and Allstate's right to
an adversarial defense. Because this case involved an
adversarial relationship, the trial was not a sham and was
properly allowed to proceed.6
While Allstate recognizes the general rule that intra-
family litigation is permissible, it claims that this case is
distinguishable from other Alaska intra-family tort cases because
the Robertsons stand to gain 100% of any recovery paid to Sidney,
Jr.'s estate. Allstate urges us to find that, in situations
where the defendants' pecuniary interests are identical to those
of the plaintiff, the defendants are in fact the "real
plaintiffs". Under this reasoning, the Robertsons are in essence
suing themselves, so there is no adversity and no subject matter
jurisdiction.
Allstate cites several cases from other jurisdictions
in support of this argument. These decisions adhere to the view
that the administrator of a decedent's estate is not the real
party in interest to the estate's wrongful death action; the real
party in interest is the beneficiary to whatever recovery is
obtained by the estate. Therefore, if the defendant is also the
sole beneficiary of the estate, he must be considered both
plaintiff and defendant, and no action will lie. See Dishon's
Administrator v. Dishon's Administrator, 219 S.W. 794, 795 (Ky.
1920) (no cause of action under Kentucky's wrongful death statute
when defendant is the sole beneficiary of plaintiff-estate
because the wrongdoer would be both defendant and real
plaintiff); Glucksman v. Strelecki, 245 A.2d 228, 231-32 (N.J.
Super. Ct. Law Div. 1968) (granting summary judgment against
plaintiff-estate because defendant, sole beneficiary of estate,
was real party in interest and effectively acted as both
plaintiff and defendant); Davenport v. Patrick, 44 S.E.2d 203,
205-06 (N.C. 1947) (administrator of estate had no wrongful death
cause of action against decedent's tortfeasor-husband who was
sole beneficiary of wife's estate); Carver v. Carver, 314 S.E.2d
739, 743 (N.C. 1984) (reiterating the Davenport rule in dicta).
These cases also rely on the public policy that no
person should profit from his or her own wrongdoing. This
principle provides that it would be incongruous to permit an
estate to recover damages, when the sole beneficiaries of that
award are the same people who negligently caused the injury in
the first place. See Carver, 314 S.E.2d at 745; Dishon's
Administrator, 219 S.W. at 795; Glucksman, 245 A.2d at 232.
However, a negligence action may proceed if there exist
beneficiaries to the estate other than any negligent
beneficiaries. See Carver, 314 S.E.2d at 744-45. In such
situations, the non-negligent beneficiaries may recover their
shares of any damages paid to the estate. Any negligent persons
who otherwise would be beneficiaries are precluded from obtaining
any part of the estate's recovery based on public policy
considerations. Id.
Whether the beneficiaries to an estate are in fact the
"true plaintiffs"in a wrongful death action by the estate is a
question of first impression in Alaska. We conclude that, where
any recovery by the estate would not be paid directly to
specified individuals, the beneficiaries to the estate should not
be considered the plaintiffs. Therefore, there is no
jurisdictional bar to an administrator's negligence action
against parties who might otherwise stand to benefit from their
wrongdoing.
In resolving this issue, we look to Alaska's wrongful
death statute, AS 09.55.580.7 It states that, in the event the
decedent left no spouse, children or other dependents, any
recovery for wrongful death will be paid to the decedent's
estate. The recovery does not go directly to any specified
beneficiaries. The proper beneficiaries of the estate can be
determined subsequent to the estate's recovery. For this reason,
the beneficiaries of an intestate estate are not the "true
plaintiffs"in an action by the estate. The plaintiff is the
administrator, on behalf of the estate, which is distinct from
its beneficiaries.8
Our conclusion is supported by precedent under Oregon
law.9 In Oviatt v. Camarra, 311 P.2d 746 (Or. 1957), the Oregon
Supreme Court interpreted Oregon's wrongful death statute and
determined that an estate is distinct from its beneficiaries when
any recovery would be paid to the estate, not to the
beneficiaries directly. We find this aspect of Oviatt
persuasive, and therefore adopt it as the rule in Alaska. See
also W. Keeton, Prosser and Keeton on the Law of Torts, 127 at
958 (5th ed. 1984) (under wrongful death acts where any damages
are recoverable on behalf of decedent's estate, the estate is
considered distinct from its beneficiaries).
In this case, there is no dispute that any wrongful
death recovery by the administrator would be paid to Sidney,
Jr.'s estate. The determination of eligible beneficiaries to
that award is a question arising subsequent to the jurisdictional
issue. We therefore address it as a matter of public policy
apart from the adversity question. Accordingly, we believe the
trial court properly asserted subject matter jurisdiction over
this litigation. The real question is whether, had the Estate
been successful on its claims, the Robertsons should forfeit
their right to inherit any part of Sidney, Jr.'s estate. We
address this question as a matter of public policy.
2. Public policy
Allstate contends that the Estate's claims should have
been dismissed based on the public policy preventing wrongdoers
from benefitting from their own negligence. Relying
substantially on Oviatt v. Camarra, 311 P.2d 746 (Or. 1957), the
trial court disagreed and concluded that there would be no public
policy bar in Alaska to the Robertsons' recovery of damages
awarded to Sidney, Jr.'s estate through intestate succession.
While we agree with Allstate as to its public policy
concerns, we do not agree that dismissal would be the appropriate
means of resolving those concerns. We therefore depart from
Oviatt in our analysis of this issue. The Oviatt court
determined that the administrator of a deceased child's estate
could bring a negligence action even though the administrator
herself was both an heir to the estate and contributorily
negligent in causing the child's death. 311 P.2d at 750-51. It
also held that there was no public policy bar to a negligent
party's recovery of wrongful death proceeds through intestate
succession. Id.
In our view, the better policy precludes a negligent
party from obtaining any part of a damage award, so that the
negligent party will not benefit from his or her wrongdoing.
This is true whether the negligent person would have benefitted
directly, as a specified beneficiary under the wrongful death
statute, or indirectly through intestate succession. In this
respect, our decision is consistent with several cases cited by
Allstate.10 See, e.g., Carver, 314 S.E.2d at 744-45; Davenport,
44 S.E.2d at 205; Glucksman, 245 A.2d at 232.
In implementing this policy, however, we do not follow
the example set forth in many of the cases cited by Allstate.
Many of those decisions reduce the damage award paid to the
estate by the pro rata share otherwise payable to the negligent
party. See, e.g., Carver, 314 S.E.2d at 744. In contrast to
these cases, we do not believe the award to Sidney, Jr.'s estate
should be reduced simply because certain beneficiaries are no
longer eligible to recover any proceeds. Rather, we believe that
any ineligible beneficiaries should be considered to have
renounced their right to recover. The proceeds of the estate
would then be distributed in a manner consistent with AS
13.11.295, regarding renunciation of intestate succession rights.
Thus, for purposes of distributing any proceeds awarded to
Sidney, Jr.'s estate, the Robertsons should be considered to have
predeceased their son, and the entire award may be distributed to
any other existing and eligible statutory heirs. See AS
13.11.295(c).11
In summary, we affirm the trial court's decision
regarding adversity and the court's subject matter jurisdiction
over this action. The Robertsons were not the plaintiffs in this
action, and the Estate's claims were properly permitted to go
forward. We reverse the court's ruling regarding the Robertsons'
eligibility as beneficiaries of any recovery by Sidney, Jr.'s
estate. However, since the jury's verdict was in favor of the
defendants, there is no need for further action on this issue.
B.
In its appeal, the Estate claims that the trial court
erred in allowing Allstate to participate at trial outside the
jury's presence and in prohibiting any reference to insurance
during trial. It contends that, once Allstate intervened, the
trial court was required to clarify the alignment of the parties
in the case so that the jury would not misunderstand the true
interests of all parties. The Estate further contends that the
Robertsons' counsel represented Allstate's interests at trial
instead of the Robertsons'. It argues that this fact tainted the
entire trial because counsel presented a case at odds with the
Robertsons' view of events and improperly suggested to the jury
that counsel's own clients could not be believed. The jury was
therefore unfairly prejudiced against the Robertsons, which
damaged the Estate's interest in having the jury fully consider
their trial testimony.
The Estate frames these arguments in constitutional
terms, claiming that the court's rulings violated its right to
due process under the Alaska Constitution. It also argues that
the rulings accorded insurance companies special status, thereby
depriving the Estate of equal protection under the law. We
disagree that the trial court's rulings violated any of the
Estate's constitutional rights. However, we agree with the
argument that, in intra-family negligence actions such as the
present case, the jury should be informed of an insurer's status
as the real party in interest in order to avoid confusion and
prejudice against either the plaintiffs or defendants. Despite
this conclusion, we believe that the failure to inform the jury
of Allstate's presence in this case was harmless error, and we
uphold the jury's verdict.
Disclosure of Allstate's interest
In Severson v. Estate of Severson, 627 P.2d 649 (Alaska
1981), this court held that direct actions against liability
insurers are not permitted in Alaska. The Estate does not argue
that Severson should be overruled. Instead, it contends that
once Allstate voluntarily intervened in the case, it was required
to disclose its presence to the jury. This argument relies in
part on Justice Dimond's concurring opinion in Drickerson v.
Drickerson, 604 P.2d 1082 (Alaska 1979). Drickerson involved an
intra-family lawsuit arising from an automobile accident in which
the defendant-mother's insurance company was the real party in
interest. In holding that good faith questioning of prospective
jurors regarding insurance connections was permissible, a
majority of this court chose not to address whether the presence
or absence of liability insurance should have been made known to
the jury. Id. at 1085.
In his concurring opinion, Justice Dimond argued that
the insurer's role as the real party in interest should have been
disclosed. He stated that, because jurors on the whole are aware
of the widespread existence of laws requiring automobile
liability insurance, they would assume that a child's lawsuit
against her mother involved insurance. He concluded:
In a suit against the mother brought by
a child, the insurance company is a real
party in interest. I submit that this fact
should be honestly faced and that the
presence or absence of liability insurance
should be divulged to the jury in cases such
as this one. It is time to remove from the
law the fiction that a child suing her mother
for vast sums of money really intends to
burden her mother with a resulting judgment,
and to collect on the judgment from whatever
assets the mother might have.
Id. at 1089.
Justice Dimond's point is well taken, and we now adopt
it as the rule in intra-family lawsuits such as the one at issue
here. That is, regardless of whether Allstate had intervened in
this action, we believe its interest should have been disclosed
to the jury. Without explaining the basic alignment of the
parties, and the Robertsons' role as purely nominal defendants,
there was a risk of confusing the jurors and unfairly prejudicing
them against the plaintiff. In reaching this result, we do not
overrule Severson or alter the basic proposition that the
existence of insurance is irrelevant to the issue of negligent or
wrongful conduct. See Alaska R. Evid. 411. We simply conclude
that, in cases such as this, the jury should be provided with
some context in order to fully and fairly evaluate the case and
the testimony before it. Here, the fact of insurance could have
been admitted consistent with Evidence Rule 411 because that
information would tend to show the potential bias or prejudice of
the Robertsons as witnesses.
Despite this conclusion of law, Allstate correctly
points out that, to prevail on appeal, the Estate bears the
burden of showing prejudicial error. Loof v. Sanders, 686 P.2d
1205, 1209 (Alaska 1984). To do so, the Estate must demonstrate
that the failure to disclose Allstate's interest had a
substantial influence on the outcome of the case. Id. To assess
the effect of this error, this court must put itself in the
position of the jury to determine whether the omission probably
affected the verdict. Id. (citing Love v. State, 457 P.2d 622,
631 n.15 (Alaska 1969)).
In our view, the Estate has not carried its burden of
showing prejudice. Although it raises a speculative possibility
of prejudice, the Estate has not convinced us that the failure to
disclose Allstate's interest probably affected the verdict. In
reviewing the record, we specifically recognize the trial court's
substantial efforts to preserve the integrity of the trial, and
we see no evidence of jury confusion or undue prejudice against
either the Estate or the Robertsons. The record indicates that,
over the course of the trial, the jury heard abundant evidence to
support the conclusion that Sidney, Jr. intentionally attempted
to move the car, and that the Robertsons were not the legal cause
of their son's injuries. The Estate's arguments do not convince
us that the evidence would have been interpreted substantially
differently if Allstate's presence had been disclosed. For this
reason, we conclude that the error was harmless, and the jury's
verdict should be affirmed.12
IV. Conclusion
In sum, we affirm the trial court's decision regarding
adversity and subject matter jurisdiction. However, we note
that, had the Estate recovered any damages in this case, the
Robertsons could not receive any benefit from that award through
intestate succession or otherwise, due to the public policy
preventing negligent parties from benefitting from their
negligent acts. We acknowledge the validity of the Estate's
argument regarding disclosure of an insurer's interest in intra-
family tort actions such as the present one. For this reason, we
believe that in this limited context the jury should be informed
of an insurer's interest in order to prevent any undue confusion
or prejudice against the parties. Despite this conclusion, we do
not believe that disclosure of Allstate's interest in this action
would have affected the jury's verdict. Therefore, the failure
to inform the jury of Allstate's presence was harmless error.
The verdict is AFFIRMED.
COMPTON, Justice, with whom BRYNER, Justice, pro tem,
joins, dissenting in part.
I. Introduction
In Drickerson v. Drickerson, 604 P.2d 1082 (Alaska
1979), Justice Dimond advocated that:
In a suit against a mother brought by a
child, the insurance company is the real
party in interest. I submit that this fact
should be honestly faced and that the
presence or absence of liability insurance
should be divulged to the jury in cases such
as this one. It is time to remove from the
law the fiction that a child suing her mother
for vast sums of money really intends to
burden her mother with a resulting judgment,
and to collect on the judgment from whatever
assets the mother might have.
Id. at 1089 (Dimond, J., concurring). Fifteen years later this
court adopts Justice Dimond's view as the law of this
jurisdiction. I agree with the court that when the presence of
liability insurance creates irreconcilable conflicts of interest
between the insurer and insured, the fact of liability insurance
coverage should be disclosed to the jury. However, Justice
Dimond's view, considered in conjunction with intervening
decisions of this court, mandates a broader holding. In the case
before us, it also requires a different result. The trial court
defined the Robertsons' interests for them and dictated their
attorney's strategy. As a result, the Robertsons were denied
representation by an attorney independent in fact, and also were
prevented from expressing untainted views in the adjudication of
their own interests. Had the Robertsons been represented by the
CHI counsel,13 to which they were entitled, the jury's verdict
probably would have been different. Hence, substantial error
exists. Furthermore, substantial error also exists simply
because of the failure by the trial court even to disclose the
conflicting interests to the jury.
II. The Trial Court Denied the Robertsons Counsel Who Was
Independent in Fact, Which Resulted in Their Interests Going
Unrepresented.
In CHI of Alaska, Inc. v. Employer's Reinsurance Corp.,
844 P.2d 1113 (Alaska 1993), this court held that when there is
an irreconcilable conflict between the insured and the insurer,
"the insured should have the unilateral right to select . . .
counsel." Id. at 1121. The court noted that this view is in
accord with that of most states. Id. at 1117. In making this
observation, the court cited cases from a number of jurisdictions
and the remarks of commentators. "`The prevailing view is that
the presence of a [conflict] issue enables the insured to reject
appointed counsel, select his own lawyer and control the defense
at the expense of the insurer.'" Id. at 1117 n.8 (quoting Ronald
E. Mallen, A New Definition of Insurance Defense Council, Ins.
Couns. J., Jan. 1986, at 108, 113) (emphasis added). "`[T]he
attorney who represents the insured owes him an undeviating
allegiance whether compensated by the insurer or the insured . .
. .'" Id. at 1116 (quoting Farmers Ins. Co. of Ariz. v.
Vagnozzi, 675 P.2d 703, 708 (Ariz. 1983)) (emphasis added). The
rationale compelling the result in CHI was the recognition that
the interests of the insurer may not be coextensive with those of
the insured. Therefore, the insured is entitled to an attorney
who is independent of the insurer's interests in fact. Inherent
in the notion of CHI counsel is the premise that the attorney
owes undeviating allegiance to the client. Yet in this case the
court reneges on its promise in CHI. The Robertsons were
deprived of an attorney with undeviating allegiance to their
cause, and the independent-in-fact representation that CHI
counsel is to provide. The necessity of undeviating allegiance
is a special concern in this case, which is a paradigm of
conflicting interests that inevitably undermine independent
counsel's undeviating allegiance.
This court has noted previously the legitimate problem
often present in intra-family tort litigation: the interests of
the insured tort-feasor and the insurer may be in conflict.
Aydlett v. Haynes, 511 P.2d 1311, 1315 n.8 (Alaska 1973).
Accordingly, we have stated that in such a case "the trial judge
must take care to assure that the actual interests of all parties
are fairly represented." Id. at 1315 n.8. This case demands
this special precaution. The "fiction"that troubled Justice
Dimond in Drickerson was that one family member was suing another
with the intent of collecting a judgment from that relative. In
reality it is the insurer that will pay the judgment, and the
family unit or a member of the family unit that will collect it.
Therefore, in a case of intra-family litigation, there are
typically three sets of conflicting interests: (1) those of the
injured person, here the Estate, that wants to establish
liability in order to obtain a judgment, (2) those of the
insurer, who wants to escape the imposition of some or all of
this liability, and (3) those of the insured family member.
The insured family member may have purchased the
insurance policy for a variety of reasons, just as insurance is
marketed on a variety of bases. One reason, and basis, may have
been to ensure that the family will be able to compensate
adequately a victim of a family member's tortious conduct. This
motivation may be particularly strong where the insured has a
close personal relationship with the victim. Therefore, as in
the case of the Robertsons, it may be in the interest of the
insured family member to be found liable.14
Despite the Robertsons' desire to pursue such a goal,
the trial court prevented the Robertsons' independent counsel
from so doing. Instead, the trial court directed Allstate to
retain independent counsel for the Robertsons. The trial court
then ordered independent counsel to present "a classic
[insurance] defense"designed to avoid Allstate's liability.
This goal was in keeping with the interests of Allstate, but not
necessarily those of the Robertsons.15 While the trial judge
recognized the unusual alignment of parties often present in
intra-family tort litigation, she distinguished between the
Robertsons' independent counsel representing his clients as
plaintiffs versus defendants. The judge stated that the
Robertsons were not their independent counsel's "clients as
plaintiffs. They're his clients as defendants. . . . [I]f that
defense were not being provided [by the Robertsons' independent
counsel] there could be concern with regard to adversity to the
extent that his clients wanted this lawsuit to proceed."16
(Emphasis added.) These conflicting interests were so strong
that throughout the entire case the Robertsons retained personal
counsel to advise them in dealings with independent counsel, who
was representing them in the proceedings. Otherwise stated, the
Robertsons were compelled to retain an attorney to advise them on
how to deal with the attorney who ostensibly was advocating their
interests!
In its motion to intervene in the proceedings, Allstate
itself implicitly recognized this conflict, acknowledging that
"this suit [by the Estate] is advancing the real interests of the
Robertsons." (Emphasis added.) However, in the same motion
Allstate also argued that "[t]he lawyer representing the
Robertsons as defendants clearly cannot represent the Robertsons'
interests as plaintiffs."17 The trial court, in ordering
independent counsel for the Robertsons and directing him to
conduct "a classic [insurance] defense,"did so
because of the . . . inherent potential for conflict
given . . . the participation of the Robertson[s] in
their defense, that . . . counsel who reported directly
to Allstate could be in a position of on one hand
representing the Robertson[s] and on the other hand
establishing some kind of policy defense based on non-
cooperation.
It further did so in order to ensure that Allstate did not have
access to information that it could later use against the
Robertsons. But these are only two facets of the potential harm
this court attempted to guard against in CHI. We also recognized
that the insured's attorney "should have full access to the
client so that the defense may be effectively conducted." CHI,
844 P.2d at 1119. The CHI court concluded that the ability of
the insured's attorney to control the litigation, independently
of the insurer's desires, was critical. See id. 1117-18.
In the instant case, the trial court could have pursued
an alternate approach that would have acknowledged the obvious
adversity, and ensured that all interests were represented
without the conflict. Under such a scheme, three attorneys would
independently advocate the interests of the plaintiff, the
insurer and the insured.18 Based on this court's decision in CHI,
it would have been permissible for the Robertsons, through CHI
counsel, to pursue their own interests. They were required only
to comply with their contractual obligation to cooperate with
their insurer, and not breach any implied covenant of good faith
and fair dealing.
In this case, however, the trial court directed the
Robertsons' independent counsel to present a case that advocated
the interests of Allstate. This approach resulted in substantial
error. As this court repeatedly notes, in the course of
following these instructions the Robertsons' independent counsel
was forced to intentionally impeach his own clients' testimony,
testimony that indicated that they took responsibility for
negligently causing their son's death. This impeachment was
intended to destroy the Robertsons' credibility with the jury.
In a case where the testimony of the Robertsons was critical, the
effect of this taint cannot be underestimated. Because of the
trial court's instructions, the Robertsons were denied CHI's
mandate of an attorney independent-in-fact and its inherent
promise: the undeviating allegiance of one's own attorney and
the ability to control the defense. In spite of this court's
previous admonition that care must be taken "to assure that the
actual interests of all the parties are fairly represented,"the
Robertsons' perspective was not heard. Had the Robertsons'
testimony not been impeached by their attorney, it is not
difficult to see that the jury's verdict probably would have been
different. Therefore, substantial error exists. See Loof v.
Sanders, 686 P.2d 1205, 1209 (Alaska 1984) (In order to assess if
an error is substantial, "`the members of this court must
necessarily put themselves . . . in the position of the jury to
determine whether, as reasonable men, the error committed
probably affected their verdict.'"(quoting Love v. State, 457
P.2d 622, 631 n.15 (Alaska 1969)).
This court's opinion also has troublesome implications
beyond the instant case. The failure to hold that CHI counsel
should have been retained to pursue the Robertsons' interests
permits a continuation of the "fiction"that Justice Dimond
warned against in Drickerson. See Drickerson, 604 P.2d at 1088-
89 (Dimond, J., concurring). If separate counsel is not
available to represent each set of conflicting interests, our
warning to "take care to assure that the actual interests of all
parties are fairly represented,"Aydlett v. Haynes, 511 P.2d
1311, 1315 n.8 (Alaska 1973) (emphasis added), will have gone
unheeded.19 Yet despite these two separate, significant concerns
regarding the Robertsons' lack of CHI counsel, the court is
content to dismiss these problems summarily in a footnote.20 Op.
at 23 n.12.
III. Failure to Disclose to the Jury the Insurer's
Interests Also Constitutes Substantial Error.
A basis for finding substantial error, however, goes
beyond the representation issue since Allstate's interests and
role in the litigation were not divulged to the jury. Allstate's
covert participation undermines the foundation for the acceptance
of intra-family tort liability in this state. This court first
recognized this cause of action in Hebel v. Hebel, 435 P.2d 8
(Alaska 1967). In Hebel the court addressed the argument that
family harmony would be destroyed by permitting one family member
to bring an action against another for damages. The court, as
did Justice Dimond in Drickerson, 604 P.2d at 1089 (Dimond, J.,
concurring), concluded that because most families carry insurance
that will pay the damage award, the concern over the degradation
of the familial relationship was not a determinative complication
that barred the cause of action. Hebel, 435 P.2d at 12
("[A]lthough the existence of liability insurance does not create
liability its presence is of considerable significance . . . .").
As this court notes, Op. at 10, the Hebel court observed,
"Since the insurer is the real
defendant, it has been said that there is a
danger of fraud and collusion between the
parent and child. One may not, of course,
deny the hazard, but such a danger, being
present in all liability insurance cases,
furnishes the reason not for denial of a
cause of action, but for added caution on the
part of court and jury in examining and
assessing the facts."
Id. (quoting Badigian v. Badigian, 174 N.E.2d 718, 723 (N.Y.
1961) (Fuld, J., dissenting)) (emphasis added). The jury in this
case, in spite of this need for "added caution,"was left to
speculate on the existence or non-existence of liability
insurance. As a result, it may have been concerned that the
Robertsons did not carry liability insurance and that a damage
award could potentially disrupt the family unit. See Drickerson,
604 P.2d at 1085. Furthermore, it seems indisputable that the
jury did not know of, much less understand, the active role of a
second attorney who also was representing Allstate: he was
concealed from view. Instead, the jury was left with the image
of an attorney who impeached the credibility of his own clients.
If the jury had been informed of the conflicting interests at
stake, their verdict probably would have been different. This
too provides a basis for finding substantial error.
IV. Conclusion
The court concludes that the Estate has not proved
prejudice by the trial court's failure to disclose Allstate's
interest. It "recognize[s] the trial court's substantial efforts
to preserve the integrity of the trial,"and suggests that the
"record indicates that, over the course of the trial, the jury
heard abundant evidence to support the conclusion that Sidney,
Jr. intentionally attempted to move the car." Op. at 22-23. The
court is not convinced that "the evidence would have been
interpreted substantially differently if Allstate's presence had
been disclosed."21 Op. at 23. What the court declines to do is
engage in any debate regarding the issue of the "abundant
evidence"presented by independent counsel in accordance with the
trial court's instructions. This "abundant evidence"entailed
impeaching the credibility of the Robertsons, offering an
instruction which did not advance their interests, and generally
presenting "a classic [insurance] defense"case. This court
claims that the Estate has no standing to "assert the Robertsons'
rights"regarding Allstate's shell game, which left Allstate with
one attorney at bar and another behind the door, and yet it cites
not one jot or tittle of authority for the proposition. In this
particular way the trial court erred in its order regarding
independent counsel, its instructions to independent counsel, and
its definition of the Robertsons' interests. Were this court to
undertake such debate, I suggest it could not reach the same
result.
I would remand the case to superior court for re-trial
with (1) the Robertsons represented by an attorney of their
choice, subject to the CHI qualification, whose undeviating
allegiance would be to the Robertsons and pursuit of their
interests, (2) the existence of liability insurance disclosed to
the jury and (3) the open participation of Allstate's attorney.
_______________________________
* Sitting by assignment made pursuant to article IV,
section 16 of the Alaska Constitution.
1 Because Sidney, Jr. had no dependents, any
recovery for wrongful death would be paid to his estate. AS
09.55.580(a); In re Estate of Pushruk, 562 P.2d 329, 332 (Alaska
1977). That amount would then flow back to the Robertsons as
Sidney, Jr.'s heirs in intestacy under AS 13.11.015(2).
2 This motion pertained only to the claims by
Sidney, Jr.'s estate. There is no dispute that Stephen
Robertson's claims for emotional trauma and loss of consortium
were properly before the court.
3 Adversity is a basic requirement of standing,
which is subject to de novo review. See Bowers Office Prods.,
Inc. v. University of Alaska, 755 P.2d 1095, 1096-98 (Alaska
1988) (whether there is a genuine adversity so as to meet the
standing requirement, is reviewed de novo as part of the doctrine
of judicial restraint).
4 Moreover, it is well-settled in this state that,
as the Robertsons' liability insurer, Allstate was not a proper
party defendant at trial. Severson v. Estate of Severson, 627
P.2d 649, 651 (Alaska 1981) (direct actions against an alleged
tortfeasor's liability insurer are not permitted in Alaska).
5 Allstate argues that defense counsel's adversarial
posture could not cure the lack of adversity in this case because
counsel had no control over the manner in which the Robertsons
would color the facts. However, even assuming that the
Robertsons tried to give testimony which would favor the Estate,
the result in this case belies Allstate's claim. Defense counsel
effectively handled the Robertsons' defense and procured a jury
verdict in favor of the Robertsons and Allstate.
6 Given the trial court's actions to preserve the
integrity of the proceedings in this case, sufficient adversity
existed to allow the case to proceed even without Allstate's
intervention. Therefore, Allstate's intervention did not cure a
lack of adversity or create sufficient adversity for the case to
proceed. Allstate's ultimate decision to intervene, to further
insure adequate representation of its interests, is simply one
more circumstance indicating that adverse interests were fairly
litigated in this case. But cf. 13 Charles A. Wright, Arthur R.
Miller & Edward H. Cooper, Federal Practice & Procedure 3530 at
319 (2d ed. 1984) ("a case conceived in cooperation may be saved
by intervention of a genuine adversary").
7 At the time of Sidney, Jr.'s accident, AS
09.55.580 stated in relevant part:
(a) When the death of a person is
caused by the wrongful act or omission of
another, the personal representatives of the
former may maintain an action therefore
against the latter, if the former might have
maintained an action, had the person lived,
against the latter for an injury done by the
same act or omission. . . . The amount
recovered, if any, shall be exclusively for
the benefit of the decedent's spouse and
children when the decedent is survived by a
spouse or children, or other dependents.
When the decedent is survived by no spouse or
children or other dependents, the amount
recovered shall be administered as other
personal property of the decedent but shall
be limited to pecuniary loss.
8 Under this rule, there also would be no jurisdictional
bar to an administrator's survival action, which would be brought
on behalf of the decedent, since any damages will be paid to the
estate to be distributed according to law. See AS 09.55.570.
However, if the defendants in this action were the
decedent's spouse, children or other dependents, a slightly
different analysis is warranted. Because AS 09.55.580 directs
that any recovery in wrongful death would be maintained
exclusively for those specified individuals, they could be
considered the "real plaintiffs"in an action by the estate. See
Ditty v. Farley, 347 P.2d 47, 52 (Or. 1959). However, as
discussed infra, our public policy would preclude any negligent
parties from recovery. Therefore, in such situations, there may
be no per se failure of subject matter jurisdiction. The
designated beneficiaries under the wrongful death act would be
prevented from benefitting from any recovery, and the award would
be distributed according to the intestacy scheme or other
applicable probate law.
9 Alaska's original wrongful death statute adopted a
modified version of Oregon's wrongful death act. The two
statutes are compared in Kulawik v. ERA Jet Alaska, 820 P.2d 627,
631 n.8 (Alaska 1991).
10 It is also consistent with the policy view declared by
the Alaska Legislature. The state legislature has provided that
persons who feloniously kill another may not benefit from their
actions either by obtaining any proceeds of a wrongful death
recovery, AS 09.55.580(f), or by inheriting through intestate
succession. AS 13.11.305. Our decision today extends the policy
expressed by these provisions in a manner that is compatible with
the legislature's stated intentions.
11 We recognize that this rule may result in a windfall
for the other eligible heirs. This possibility has also arisen
in other circumstances and is not inconsistent with the language
of our wrongful death statute. See Kulawik v. ERA Jet Alaska,
820 P.2d 627, 637-38 & n.21 (Alaska 1991).
12 The Estate also asserts that there was reversible error
arising from the Robertsons' counsel's presentation of a case to
the jury that sometimes questioned the Robertsons' trial
testimony and views on liability. The Estate further claims that
the trial court erred in denying its motion for a mistrial after
the Robertsons advised the court that they disagreed with their
attorney's theory of the case. We decline to address these
claims since the Estate has not explained how it has any standing
to assert the Robertsons' alleged rights with respect to their
relationship with Mr. Pease.
13 In order to differentiate clearly between the
different types of legal representation implicated in this case,
the following terms will be used.
CHI counsel. An attorney who is selected by the
insured and who controls the defense litigation when
there is an irreconcilable conflict of interest between
the insured and the insurer. This attorney is
"independent in fact." This type of representation was
both recognized and required by this court in CHI of
Alaska, Inc. v. Employer's Reinsurance Corp., 844 P.2d
1113 (Alaska 1993).
Independent counsel. The attorney who was selected
and paid for by the insurer, Allstate, to represent the
insureds, the Robertsons. This attorney did not report
to Allstate. At trial this attorney, in accordance
with the instructions of the trial court, presented "a
classic [insurance] defense"that was designed to avoid
liability.
Personal counsel. An attorney who was retained and
paid for by the Robertsons to advise them during the
proceedings; he had no active role in the litigation.
14 As we indicated in our opinion in Hebel v. Hebel,
435 P.2d 8 (Alaska 1967), in a lawsuit among family members there
is a danger of fraud and collusion of which the jury must be
aware. Id. at 12. In the instant case, this danger is present.
Ultimately, it could be the insureds that stand to gain
monetarily from the Estate's collection of any award. Therefore,
I also concur in the court's conclusion that negligent tort-
feasors should be prevented from sharing in any award that
results from their conduct.
15 It should be noted that the proceedings leading to
the trial court's instructions to independent counsel occurred
before our decision in CHI of Alaska, Inc. v. Employer's
Reinsurance Corp., 844 P.2d 1113 (Alaska 1993). Hence the trial
judge and the Robertsons' independent counsel were acting without
the guidance of that opinion. Therefore, although the trial
court's instructions were in apparent accordance with the law as
it existed at that time, later case law demands a different
approach to the difficulties encountered and a different result.
16 Despite the conflicts of interest in this case and
the trial court's recognition of the unusual alignment of
parties, the approach utilized fails to consider the
correspondingly unique interests that are frequently pursued in
insurance litigation. For example, when insureds threaten an
insurer with a bad faith refusal to settle a plaintiff's claim,
it may be in the best interests of the insureds to confess
judgment, assign the bad faith claim to the plaintiff, and permit
the plaintiff to bring the bad faith claim against the insurer.
In such a situation, the insureds require CHI counsel to advise
and represent them. Clearly such representation would involve
decisions that are not compatible with the interests of the
insurer. Nevertheless, the proceedings would involve the
adversity necessary for the trial court to have jurisdiction.
17 The court makes a statement which, in context, is
startling. In the section of the opinion entitled Disclosure of
Allstate's Interest, the court remarks on Justice Dimond's
concurrence in Drickerson:
Justice Dimond's point is well taken,
and we now adopt it as the rule in intra-
family lawsuits such as the one at issue
here. That is, regardless of whether
Allstate had intervened in this action, we
believe its interest should have been
disclosed to the jury. Without explaining
the basic alignment of the parties, and the
Robertsons' role as purely nominal
defendants, there was a risk of confusing the
jurors and unfairly prejudicing them against
the plaintiff.
Op. at 21-22 (emphasis added).
If the Robertsons were purely nominal defendants, a
characterization with which I agree, then Allstate was the real
defendant. Thus Allstate's argument about adversity, or lack of
adversity, borders on frivolous. Worse, the trial court's
attempt to protect the Robertsons' interest by ordering Allstate
to appoint independent counsel for them lacks any substance.
Independent counsel's very competent representation of the
nominal defendants was in fact representation of the real
defendant, Allstate, which was engaged in a shell game to keep
its identity hidden from the jury.
18 See infra note 7 and accompanying text.
19 The open, honest and independent advocacy on
behalf of each set of conflicting interests would result in more
informed jury deliberations. The critical evidence is more
likely to be identified when attorneys, representing separable
interests, individually advocate these positions.
The situation before the court also leads me to
reiterate the position that I expressed in dissent in CHI of
Alaska, Inc. v. Employer's Reinsurance Corp., 844 P.2d 1113, 1129-
31 (Alaska 1993) (Compton, J., dissenting). The scheme that I
advocated there, with individual counsel for the plaintiff, the
insured and the insurer, permits each set of conflicting
interests to be advocated. CHI's approved method does not permit
the insurer to have its interests separately advanced by its own
counsel; hence, the concerns of the insurer may go unrepresented.
20 The court's rationale for its summary rejection of
this argument is the Estate's alleged failure to substantiate a
basis for standing to assert these claims; the court reasons that
if any harm has been suffered, it is the Robertsons' and not the
Estate's. Op. at 23 n.12. Yet the court recognizes the
existence of the adversity necessary to permit the Estate to
bring a claim against the Robertsons. Op. at 11. At the same
time, the court also cites, Op. at 9-10, Trustees for Alaska v.
State, Department of Natural Resources, 736 P.2d 324 (Alaska
1987) cert. denied, 486 U.S. 1032 (1988), for the proposition
that adversity is "[t]he basic requirement for standing in
Alaska." Id. at 327. Trustees also provides that for a
plaintiff to have standing, the degree of injury "need not be
great; `"`[t]he basic idea . . . is that an identifiable trifle
is enough for standing to fight out a question of principle; the
trifle is the basis for standing and the principle supplies the
motivation.'"'" Id. at 327 (quoting Wagstaff v. Superior Court,
Family Court Div., 535 P.2d 1220, 1225 n.7 (Alaska 1975)).
The Estate has demonstrated more than the mere "trifle"
that is sufficient to confer standing. As the court agrees, the
Estate has suffered a harm of sufficient proportion to bring suit
against the Robertsons. The Robertsons' lack of CHI counsel
prejudiced the Estate's case, because the jury witnessed the
Robertsons' own attorney impeach his clients' testimony, thereby
devaluing evidence that was crucial to the Estate's case.
Furthermore, at the direction of the trial court, the Robertsons'
attorney presented the case in a manner that emphasized the
interests of Allstate, not those of the Robertsons. The jury's
apparent confusion surely obstructed them in their fact-finding
role; this also prejudiced the Estate's case. Therefore, the
prejudice to the Estate seems sufficient to confer standing to
raise the issue of Robertsons' lack of CHI counsel.
The unique context of intra-family tort litigation also
presents another basis for finding that the Estate had standing
to pursue this issue of appeal. The Robertsons believed
themselves legally responsible for their son's death, which
belief, if accepted by the jury, would have resulted in a
judgment that would have been paid by Allstate. The trial court
prevented them from advocating that position, by instructing
independent counsel to present "a classic [insurance] defense."
The Robertsons have never received the CHI counsel their insurer
is obligated to provide. As a result, the Estate now appeals
based upon prejudice to its case. This situation was caused by
the trial court, which defined the Robertsons' interests for
them. Since the Robertsons "prevailed"based on the trial
court's perception of their interests, they are unable to appeal
the decision. Who would raise the issue on their behalf? Surely
not the attorney who was ordered to present "a classic
[insurance] defense." If the Estate cannot raise the issue, the
Robertsons' interests in having CHI counsel will have gone
entirely unrepresented throughout the proceedings.
21 Allstate apparently felt differently. Not
surprisingly, in its motion to intervene as a party defendant,
Allstate, immediately after "respectfully request[ing] that it be
permitted to intervene as a party defendant,"explicitly refused
to "concede that it must necessarily be present at the trial of
this case or that the jury must necessarily be told about the
presence of insurance."
]]>
