The worst $333 never spent and the continuation of the common fund doctrine.

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Information about The worst $333 never spent and the continuation of the common fund doctrine.

Phil Puccio

According to the Nebraska Supreme Court, the common fund doctrine is alive and well in Nebraska. In Hauptman, O’Brien vs. Auto Owners Ins. Co., 310 Neb. 147, – – NW2d – – (September 17, 2021) sued the law firm of an aggrieved plaintiff, Auto-Owners, the plaintiff’s motor insurer. The insurer refused to reduce its $ 1,000 medical payment entitlement under the common fund doctrine.

Standard procedure

It is common practice in Nebraska for the insurer to take a one-third reduction in the assigned amount as a “payment” to the plaintiff’s attorney who secured the judgment or settlement to satisfy the insurer’s interest in the assignment. Not so in Captain, O’Brien Case. Instead, Auto-Owners sent a letter stating that it intended to protect its own assignment interests and would not honor legal fees claims unless Auto-Owners “specifically request”[ed] your help. ”In accordance with this, car owners Hauptman, O’Brien’s application for a reduction of $ 333.33 denied after the plaintiff-insured reached an agreement with the culprit driver.

Hauptman, O’Brien sued car owners in the County Court for that amount. The district court rejected the car owners’ argument that a Nebraska, Neb. Rev. Stat. Section 44-3.128.01 anticipated the common fund doctrine. The statute did not contain any information on legal fees or the Common Fund doctrine. It has therefore only safeguarded the insurer’s interest in the assignment. It didn’t change Nebraska common law.

If initially unsuccessful, try, try again?

On appeal in the District Court, the District Court agreed that Section 44-3.128.01 was not prejudicial to common law and upheld the District Court’s summary judgment against Hauptman, O’Brien.

Car owners appealed again, this time to the Nebraska Court of Appeals. The court of appeal made it clear that this is not the “area” of legal pre-emption, but rather the law firm’s claim to reclaim a reasonable fee for its efforts to secure the assigned medical services from the insurer. In view of the silence of the statutes on this issue, there was no express precaution. There was also no field preemption, as nothing in the law indicated that the legislature intended to repeal the longstanding rule of common law. It was also confirmed.

Car owners unwaveringly moved to the Nebraska Supreme Court for another review, which the court cleared. Like the three previous courts, the Supreme Court upheld the District Court’s decision. It agreed that the clear provisions of the statute did not expressly override common law doctrine; nor did the language of the law suggest that the right of first refusal was the legislature’s intention.

Money not well spent

All in all, car owners’ money was not well spent. Except expenses much more than $ 333 to defend the county lawsuit and prosecute three appeals, Auto-Owners set a legal precedent that ran counter to its own financial interests.

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Original Source: https://www.ldmlaw.com/2021/09/the-worst-333-never-spent-and-the-continuation-of-the-common-fund-doctrine/
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