Premises Liability Lawsuit Seeking Damages In Excess of a Previous Settlement*



Case Summary:

This is a review of a premises liability lawsuit. The plaintiff in this case was an employee of a building management company who was injured when the scaffold he was working on collapsed. The plaintiff contended it was the responsibility of the company to ensure the scaffold was in proper working order, and he filed suit against the company seeking damages.

The case was further complicated when the two parties reached a settlement out of court. The plaintiff was later told the settlement agreement would award him substantially less than he believed he would receive when he signed the settlement release.

Believing he was deceived, the plaintiff returned to court and asked the judge to award him the full amount of the settlement.

Statement of Facts...

John Beal was employed by Ocean Apartments to paint the exterior of Ocean's apartment buildings. While he was painting on a scaffold, a cable snapped, plunging the scaffold and Beal 30 feet to the ground. Beal suffered serious injuries to his neck and back.

Beal later claimed Ocean knew the scaffolding cables were damaged and refused to repair them. Beal stated Ocean had invited Beal onto Ocean's premises as an employee and that Beal was provided the scaffold by Ocean. Beal claims Ocean never informed him the cables holding the scaffold were damaged and in need of repair or replacement.

A premises liability lawsuit ensued and both sides prepared for trial. On the eve of trial, Beal and Ocean came to an agreement to settle the case. The settlement consisted of a lump sum payment from Ocean's insurance company, the Indemnity Corporation, of one million dollars to the defendant Beal.

While drawing up the settlement agreement, Beal was informed by Ocean and Indemnity he was being paid one million dollars, the maximum amount of Ocean's insurance policy, but because Ocean had no funds left to pay its defense attorneys, the attorneys' fees would have to be taken out of the lump sum settlement amount.

Beal was told the amount of Ocean's attorneys' fees, $150,000, were to be deducted from the settlement of one million, leaving Beal a net lump sum settlement amount of $850,000.

The Judge in the case had dismissed the jury explaining to them the case had been settled and the lawsuit was to be dismissed. The Judge thanked them, telling the jury their services were appreciated but no longer needed for this trial.

Beal and Ocean signed the settlement agreement. Before submitting the Settlement Order to the Judge for her signature, Beal balked, stating he was told his settlement amount was supposed to be one million dollars and not $850,000. Ocean and Ocean's insurance company disagreed, stating Beal had agreed to the settlement and, in fact, had signed it.

Beal filed 2 separate Motions for Judgment: One was against Ocean, and the second against Ocean's insurance company, Indemnity.

Motions for Judgment...

Beal's Motions were filed individually and collectively for one million dollars. In his Motion, Beal stated he was deceived by Ocean and Indemnity into believing he would receive a lump sum settlement of one million dollars, not $850,000.

In response to Beal's Motion for Judgment, Ocean and Indemnity filed their respective Motions to Dismiss, asking the Judge to dismiss both Beal's Motion for Judgment and his premises liability lawsuit, claiming the case had already been settled.

Outcome...

After hearing the arguments of counsel for Beal and those of Ocean and Indemnity, the court ruled against Beal.

In her order the Judge said the main case before her would be finalized and dismissed, and the final Court Order would state the case was dismissed and the Settlement Agreement awarding Beal $850,000 was sustained.

The Judge went further stating:

"Accordingly, Plaintiff John Beal's cause of action against Defendants' Ocean Apartments, Inc. and the Indemnity Insurance Company cannot be sustained and the Motions by each of the defendants to dismiss Plaintiff's premises liability lawsuit was hereby granted."

In her Court Order, the Judge left a door open for Beal by stating although the main case was dismissed, Beal could file a separate lawsuit against Ocean and Indemnity for $150,000. In the separate lawsuit, Beal could allege he was deceived by Ocean and Indemnity,

Subsequently, Beal did file a separate premises liability lawsuit against Ocean and Indemnity seeking damages in the amount of $150,000. Beal also sued for an additional $100,000 for court costs and punitive damages

The new case was set for trial. Although Indemnity had already tendered to Beal a check in the amount of $850,000, Beal refused to deposit or cash the check. In fact, Beal attached the check to his new lawsuits against Ocean and Indemnity as Plaintiff's Exhibit Number 1.

Important Points...

  • Premises can be businesses, residences, adjoining properties, and other parcels of land and the buildings which are set upon them. When the premise's owner invites a person or persons onto their premises, the owners have a legal duty to protect them. The people who are invited onto the premises, like Beal in this case, are called "Invitees."

    Premises owners have a legal duty to insure their Invitees can be free of danger. If the premises owners neglect their legal duty to keep their premises safe, and as a result an Invitee is injured, the premise owner will in all likelihood be responsible for the injuries and related expenses suffered by the Invitee.

  • When entering into a written agreement, whether for a substantial amount of money or not, it is vital all sides be absolutely sure they have a clear understanding of their duties and obligations.

    In this premises liability lawsuit example, it would have been prudent for all parties to have signed the agreement, and after signing it they should have entered the agreement into the court's record. This is accomplished by having all parties state in open court and under oath what the Settlement Agreement is said to be. That way there will be little, if any opportunity for a party to say they did not understand the agreement.


*This case example is for educational purposes only. It is based on actual events although names have been changed to protect those involved. Any resemblance to real persons or entities is purely coincidental.

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