Public Comments for: SB1108 - General district courts; jurisdictional limits.
Last Name: Moyers Organization: Virginia Association of Defense Attorneys Locality: Roanoke

VADA further opposes SB1108 to the extent it eliminates the option in Va. Code § 16.1-107 that allows an insured defendant, in lieu of posting an appeal bond, to provide a letter from the defendant’s insurer setting forth an irrevocable certification that the defendant has coverage sufficient to satisfy the amount of the judgment. This provision, which passed with overwhelming bipartisan support, has been law in this Commonwealth since 2011, the same year the General Assembly raised the jurisdictional limit in GDC from $15,000 to its present $25,000. Strict compliance with this provision is required. Members of the plaintiff’s bar confirm that there has been no history of abuse of this provision. The purpose of the appeal bond is to make sure there is a source of funds with which to satisfy the judgment. An insurer promising irrevocably and in writing to provide coverage to a defendant in an amount sufficient to satisfy the judgment accomplishes that end. There is no reason to eliminate it. Particularly given the increase in litigation in GDC once the jurisdictional limit increases, eliminating the “irrevocable confirmation” option serves no other purpose than to make it more difficult for defendants who have insurance to appeal, without enhancing the rights of plaintiffs to collect on their judgment should they prevail in circuit court. With circuit court being the only opportunity for defendants to take advantage of procedural safeguards such as written discovery, depositions, and their constitutional right to a trial by jury, and with no ability on the part of defendants to remove an action from GDC to circuit court, we should make it easier for litigants to appeal to circuit court, not harder. Such is particularly true for defendants who, under SB1108 in its current form, face the risk of an excess exposure in GDC, thus making access to circuit court and its attendant safeguards all the more critical. Regarding a defendant’s right to trial by jury, the Supreme Court of Virginia has made clear that requiring a litigant to appeal in order to exercise that right is permissible only so long as the appeal can be accomplished via “a reasonable, simple procedure.” Brooks v. Potomac, 149 Va. 427, 141 S.E. 249 (1928). The “irrevocable confirmation” option is such a procedure, and is one which has served Virginians and the court system well for the past ten years. Any attempt to eliminate that option should be rejected. As to any argument that the “irrevocable confirmation” option should be eliminated so that the Code treats all litigants equally, Code § 16.1-107 already waives the bond requirement as to a select group of litigants. For example, no bond is required of a plaintiff in a civil case, unless the defendant has asserted a counterclaim. Also, with limited exceptions, §16.1-107 waives the bond requirement in its entirety for persons who are indigent. SB1108 limits the increase in GDC jurisdiction to actions “for injury to person, regardless of theory, and any action for wrongful death … .” These actions are the very types of actions covered by automobile liability insurance. At bottom, elimination of the “irrevocable confirmation” option in § 16.1-107 appears to be nothing more than a solution in search of a problem. In so doing, it creates more problems than it solves. For these reasons, and those stated in our other comments, we would ask the Committee not to report SB1108.

Last Name: Moyers Organization: Virginia Association of Defense Attorneys Locality: Roanoke

VADA is not opposed in concept to an increase in the jurisdictional limit in GDC. Our concern with SB1108 rests on the fact that it raises the GDC jurisdictional limit to $50,000, while SB1182, as presently under consideration in the House Labor and Committee, raises Virginia’s minimum insurance limits to only $30/60/25. Of additional concern to our members is the timing of the increase in GDC jurisdiction relative to the effective date for the effective date of the liability coverage increase in SB1182. Since GDC’s inception in 1973, the jurisdictional limit for civil cases in GDC always has been equal to or less than Virginia’s minimum limits for automobile liability coverage. Litigants have been able to order their affairs in reliance upon the fact that civil claims in GDC are never going to exceed their available insurance limits, thereby protecting them from the risk of personal or excess exposure. Without any increase in GDC jurisdiction commensurate with an increase in Virginia’s minimum coverage limits, and further marrying an increase in GDC jurisdiction to the same timetable as an increase in Virginia’s minimum coverage, there will be a class of Virginians—primarily those of limited means—who, for the first time ever, face a risk of liability out of their own pocket that previously did not exist. Compounding the harm SB1108 creates, litigants in general district court lack access to important safeguards such as depositions, written discovery, and the ability to exercise their constitutional right to a trial by a jury of their peers to help protect and defend them against this risk. With a flood of new cases to GDC once the jurisdictional limit increases, this harm to defendants is magnified even further. Further, rather than increasing the GDC jurisdictional limit across the board, SB1108, in its current form (lines 52-53), restricts this increase to actions “for injury to person, regardless of theory, and any action for wrongful death … .” These cases are ones that typically arise as the result of motor vehicle accidents. They likewise are ones that typically are covered by insurance. For this reason, too, any increase in the GDC jurisdiction for these cases should be tied to a like increase in Virginia’s minimum coverage limits. Such increase in jurisdiction, too, should be wed to the same timeframe as the increase in coverage. Lastly, subjecting a defendant to a risk of excess exposure in GDC implicates an insurer’s ability under Virginia Code § 38.2-2206(K) to tender its insured’s available coverage and, contingent upon the insured’s cooperating with the plaintiff’s UIM carrier, protect the insured from the risk of a subrogation claim. In its present form, Virginia Code § 8.01-66.1 sets forth the parameters of an insured’s duty to cooperate with the UIM carrier. They include things like answering discovery and attending depositions, neither of which are part of an action in GDC. Without revision to § 8.01-66.1, there will be uncertainty among insurers, plaintiffs, and defendants as to what their respective rights and obligations are under these two statutes. For these reasons, and those stated in our other comments, we would ask the Committee not to report SB1108.

Last Name: Cales Organization: Virginia Association of Defense Attorneys Locality: Chesapeake

SB 1108 Comment submitted by James A. Cales III In light of and in addition to the previous comments, VADA is not opposed in concept to an increase in the jurisdictional limit in GDC. Our concern with this bill rests on the elimination of the option in Va. Code § 16.1-107 allowing an insured defendant, in lieu of posting an appeal bond, to provide a letter from the defendant’s insurer setting forth an irrevocable certification that the defendant has coverage sufficient to satisfy the amount of the judgment. A. Elimination of “irrevocable confirmation” provision in Va. Code § 16.1-107 1. Disparate treatment a. For insured defendants, it is generally their insurer, not the defendants personally, who is responsible for the judgment and for noting and perfecting the appeal. b. Unlike with a single litigant, getting an appeal bond generated and posted by an insurance carrier—and the layers of management, review, etc., that goes along with it—is much more arduous. c. Virginia Code §16.1-107 makes clear that “no appeal bond shall be required of a plaintiff in a civil case” unless the defendant has asserted a counterclaim. Hence, the statute already treats plaintiffs and defendants differently, rendering it easier for plaintiffs to note and perfect an appeal. Eliminating the “irrevocable confirmation” option for defendants enhances this disparity. d. With limited exceptions, §16.1-107 further waives the bond requirement in its entirety for persons who are indigent. 2. In addition, absent an appeal, opening the gates to more cases in GDC is going to deprive a defendant—who, unlike a plaintiff, doesn’t have a choice of forum—of his or her right to trial by jury. Addressing whether a party’s right to a jury trial is unconstitutionally infringed when he or she must appeal in order to exercise that right, the Supreme Court of Virginia, in Brooks v. Potomac, 149 Va. 427, 141 S.E. 249 (1928), held "[t]he fact that the party is not able to obtain [a trial by jury] in the inferior court is not a deprivation of the right of trial by jury, if provision is made whereby it can be secured upon an appeal by a reasonable, simple procedure" (emphasis added). Such a procedure, which has served Virginians and the court system well for the past ten years, is the “irrevocable confirmation” option of Va. Code § 16.1-107. a. Given that the General Assembly passed the “irrevocable confirmation” bill the same year it raised the GDC limit from $15k to $25k, it appears clear that the General Assembly, with increased access to general district court, thought it a good idea to simplify the process for appeal. b. Here, we are aware of no compelling reason why this option should be eliminated. What we would urge would be: restore and leave in place the “irrevocable confirmation” option in Va. Code § 16.1-107. Alternatively, we would ask the Committee to refer SB1108 for consideration relative to the propriety of instituting at least some form of limited discovery that would help assuage for defendants the impact of proceeding forward in GDC without these safeguards in place.

Last Name: Cales Organization: Virginia Association of Defense Attorneys Locality: Chesapeake

SB 1108 Comment submitted by James A Cales III In addition to and in light of the other comments, the VADA is not opposed in concept to an increase in the jurisdictional limit in GDC. Our concern with this bill rests on the elimination of the option in Va. Code § 16.1-107 allowing an insured defendant, in lieu of posting an appeal bond, to provide a letter from the defendant’s insurer setting forth an irrevocable certification that the defendant has coverage sufficient to satisfy the amount of the judgment. A. Elimination of “irrevocable confirmation” provision in Va. Code § 16.1-107 1. Disparate treatment a. For insured defendants, it is generally their insurer, not the defendants personally, who is responsible for the judgment and for noting and perfecting the appeal. b. Unlike with a single litigant, getting an appeal bond generated and posted by an insurance carrier—and the layers of management, review, etc., that goes along with it—is much more arduous. c. Virginia Code §16.1-107 makes clear that “no appeal bond shall be required of a plaintiff in a civil case” unless the defendant has asserted a counterclaim. Hence, the statute already treats plaintiffs and defendants differently, rendering it easier for plaintiffs to note and perfect an appeal. Eliminating the “irrevocable confirmation” option for defendants enhances this disparity. d. With limited exceptions, §16.1-107 further waives the bond requirement in its entirety for persons who are indigent. 2. In addition, absent an appeal, opening the gates to more cases in GDC is going to deprive a defendant—who, unlike a plaintiff, doesn’t have a choice of forum—of his or her right to trial by jury. Addressing whether a party’s right to a jury trial is unconstitutionally infringed when he or she must appeal in order to exercise that right, the Supreme Court of Virginia, in Brooks v. Potomac, 149 Va. 427, 141 S.E. 249 (1928), held "[t]he fact that the party is not able to obtain [a trial by jury] in the inferior court is not a deprivation of the right of trial by jury, if provision is made whereby it can be secured upon an appeal by a reasonable, simple procedure" (emphasis added). Such a procedure, which has served Virginians and the court system well for the past ten years, is the “irrevocable confirmation” option of Va. Code § 16.1-107. a. Given that the General Assembly passed the “irrevocable confirmation” bill the same year it raised the GDC limit from $15k to $25k, it appears clear that the General Assembly, with increased access to general district court, thought it a good idea to simplify the process for appeal. b. Here, we are aware of no compelling reason why this option should be eliminated. What we would urge would be: restore and leave in place the “irrevocable confirmation” option in Va. Code § 16.1-107. Alternatively, we would ask the Committee to refer SB1108 for consideration relative to the propriety of instituting at least some form of limited discovery that would help assuage for defendants the impact of proceeding forward in GDC without these safeguards in place

Last Name: Moyers Organization: Virginia Association of Defense Attorneys Locality: Roanoke

VADA is not opposed in concept to an increase in the jurisdictional limit in GDC. In addition to the other comments we have expressed, our concern with this bill rests on the elimination of the option in Va. Code § 16.1-107 allowing an insured defendant, in lieu of posting an appeal bond, to provide a letter from the defendant’s insurer setting forth an irrevocable certification that the defendant has coverage sufficient to satisfy the amount of the judgment. A. Elimination of “irrevocable confirmation” provision in Va. Code § 16.1-107 1. Allows “a defendant with indemnity coverage through a policy of liability insurance sufficient to satisfy the judgment” rendered in GDC to, in lieu of posting an appeal bond, provide from the defendant’s insurer “a written irrevocable confirmation of coverage in the amount of the judgment.” If defendant's insurer does not provide this confirmation, then the defendant must post a bond. (lines 118-122) 2. This provision has been on the books since 2011 (HB1845), the same year the General Assembly raised the jurisdictional limit in GDC from $15k to its present $25k. a. Introduced by then-Delegate Clifford Athey, now Judge Athey of the Virginia Court of Appeals. b. It passed the House of Delegates 99-0; the Senate, 29-11. 3. No history of abuse of this provision. 4. Strict compliance with the statute has been required. See Damtew v. Jeng, 101 Va. Cir. 89 (Fairfax County 2019) (addressing what constitutes an “irrevocable confirmation of coverage” pursuant to Virginia Code §16.1-107). 5. Purpose of the appeal bond is to make sure there is a source of funds with which to satisfy the judgment. See, e.g., Tauber v. Commonwealth ex rel. Kilgore, 263 Va. 520, 545, 562 S.E.2d 118 (2002) (purpose of appeal bond "is to secure payment of the full judgment amount ... to which a prevailing party is entitled in the event that an appellant does not succeed on appeal"); Greer v. Dillard, 213 Va. 477, 193 S.E.2d 668 (1973) (appeal bonds are "designed to protect the judgment rights of successful litigants"); Mahoney v. Mahoney, 34 Va. App. 63, 67, 537 S.E.2d 626 (2000) ("An appeal bond provides assurances that any judgment that may be rendered on appeal, if perfected, will be satisfied.") a. An insurer promising in writing to provide coverage to a defendant in an amount sufficient to satisfy the judgment accomplishes that end. b. No reason to eliminate it. 6. Particularly given the likelihood that more cases are going to end up in GDC once the jurisdictional limits increase, eliminating the “irrevocable confirmation” option seems to serve no other purpose than to make it more difficult for insured defendants to appeal, without enhancing the rights of plaintiffs to collect on their judgment should they prevail in circuit court. What we would urge, in addition to that set forth in our other written comments, would be: restore and leave in place the “irrevocable confirmation” option in Va. Code § 16.1-107. Alternatively, we would ask the Committee to refer SB1108 for consideration relative to the propriety of instituting at least some form of limited discovery that would help assuage for defendants the impact of proceeding forward in GDC without this safeguard in place.

Last Name: Love, Tate Organization: VADA Locality: Staunton, VA

SB1108 VADA is not opposed in concept to an increase in the jurisdictional limit in GDC. Our concern with this bill rests on the timing of when the increase in limit would go into effect relative to the proposed increase in the minimum automobile liability coverage limits in SB1182.. A. Timing of GDC jurisdictional increase 1. The interplay between this bill and Virginia Code § 38.2-2206 is problematic. a. Presently, liability insurers have the ability to tender an insured’s available coverage and essentially punt the defense of the case to the UIM carrier. b. UIM carrier loses its right of subrogation so long as the insured cooperates with the UIM carrier in the manner provided by statute (Va. Code § 8.01-66.1) (1) To attend his deposition or trial if subpoenaed to appear at least 21 days in advance of either event; (2) To assist in responding to written discovery; (3) To meet with defense counsel for a reasonable period of time after reasonable notice, by phone or in person, within 21 days of being served with any lawsuit and again prior to his deposition and trial; or (4) To notify counsel for the underinsured motorist benefits insurer of any change in address. c. By speaking to the insured’s cooperating in attending depositions or responding to discovery, Va. Code § 38.2-2206 and Va. Code § 8.01-66.1 expressly contemplate actions in circuit court where such discovery exists. d. For defendants facing a potential $50,000.00 exposure in GDC who have only $25/50 limits, there is a risk that their insurer will tender the insured’s available coverage, requiring a UIM insurer to step in and essentially take over the defense. The cooperation required of the insured is effectively diluted at that point, as there are no depositions or written discovery permitted in GDC. e. If the increase in the GDC jurisdictional limit was tied to the increase in mandatory minimum coverage, this problem would not exist. 2. In its original form, SB1108 increased the GDC jurisdictional limit for all cases subject to GDC jurisdiction. In its current form (lines 52-53), the bill restricts this increase to actions “for injury to person, regardless of theory, and any action for wrongful death … .” These cases are the ones that typically are covered by insurance. They also are the cases that typically arise as the result of motor vehicle accidents. This being the case, any increase in the jurisdictional limit for GDC should be tied to an increase in the limits for automobile liability coverage. a. It leaves personal property claims subject to the existing $25k limit (lines 46-47). What we would urge would be tie the increase in the GDC jurisdictional limit to the same timeframe as the increase in minimum insurance coverage limits.. Alternatively, we would ask the Committee to refer SB1108 for consideration relative to the propriety of instituting at least some form of limited discovery that would help assuage for defendants the impact of proceeding forward in GDC without these safeguards in place.

Last Name: O'Grady Organization: Virginia Association of Defense Attorneys Locality: Chesterfield

SB1108 VADA is not opposed in concept to an increase in the jurisdictional limit in GDC. Our concern with this bill rests on the timing of when the increase in limit would go into effect relative to the proposed increase in the minimum automobile liability coverage limits in SB1182. A. Timing of GDC jurisdictional increase 1. Ever since GDC was created in 1973, the jurisdictional limit for civil cases in GDC has always been less than or equal to minimum limits for automobile liability coverage. a. liability limits have been $25/50 since 1974 b. GDC jurisdiction since 1974: (1) $10k (1974-1997) (2) $15k (1997-2011) (3) $25k (2011-present) 2. Litigants have been able to order their affairs in reliance upon the fact that civil claims in GDC are never going to exceed the insurance coverage they bought and paid for. 3. In its present form, SB1108 increases the GDC limit to $50k immediately upon the bill’s passing the General Assembly and being signed by the Governor. If this bill becomes law, there is a high likelihood, if not an absolute certainty, that plaintiffs with a civil claim pending in GDC will seek leave to amend the amount of their claim to the new jurisdictional maximum of $50k. a. Fairness concern for defendants with existing $25/50/20 policies who suddenly face the risk of personal exposure. (1) Disproportionately affects those of lesser means who are unable to afford more than a minimum limits policy b. This concern is enhanced by virtue of the fact that a defendant, unlike in circuit court, has essentially no ability to take discovery as to the issues presented in the case. c. While there is pending a separate bill (SB1182) to increase the minimum coverage limits to $50/100/40, it doesn’t take effect until January 1, 2022, and then only as to policies issued on or after that date. (1) Thus, this negative effect of the bill will persist for an entire class of litigants whose policies were issued and remain in effect at the lesser minimum limits. What we would urge would be tie the increase in the GDC jurisdictional limit to the same timeframe as the increase in minimum insurance coverage limits.. Alternatively, we would ask the Committee to refer SB1108 for consideration relative to the propriety of instituting at least some form of limited discovery that would help assuage for defendants the impact of proceeding forward in GDC without these safeguards in place.

End of Comments