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Do You Need to Give a Recorded Statement to Your Insurance Company?

I have long said it is an open question under Maryland law whether you are required to give a recorded statement to your own insurance company if you are making an uninsured motorist claim even if the insurance contract obligates you to do so.

The theory is that Maryland has a statutory scheme that preempts any contractual obligation imposed by the contract.  I didn’t make this up, I stole it from Janquitto’s book on Maryland insurance law.  (You should own if you are a lawyer handling auto tort cases in Maryland.)

I’m not sure whether this argument was advanced in Dolan v. Kemper, a new Maryland Court of Special Appeals case decided last week.  But if it was, the CSA shut the door on it.

Facts of Dolan

rearendPlaintiff was a passenger in his mother’s car—driven by his wife — when he was injured in an accident in Anne Arundel County.  He sought UIM benefits under his mother’s policy with Appellee, Kemper Independent Ins. Co. (“Kemper”). The Kemper policy had a provision that required claimants to “cooperate” with Kemper’s investigation and “submit to examination under oath and subscribe the same.”

As part of its investigation, Kemper requested that Dolan submit to an examination under oath (“EUO”). Counsel for Dolan agreed that Kemper was entitled to an EUO and potential dates were discussed. However, counsel for Dolan never scheduled the EUO before filing a complaint in Circuit Court. Once the suit was filed, Dolan’s counsel rejected Kemper’s EUO request and said that Dolan would be offered for deposition instead. At that point, Kemper formally rejected Dolan’s UIM claim based on his failure to submit to EUO.

After denying Dolan’s claim, Kemper brought an action for declaratory relief asking the Circuit Court to declare that Dolan’s EUO refusal was a material breach entitling Kemper to deny coverage. This is an extremely aggressive position to take (I think the defense lawyers were DeCaro, Doran, Siciliano, Gallagher & DeBlasis, LLP.)  But it worked.   The Circuit Court agreed with Kemper and ruled that: (a) EUO was a “condition precedent” to receiving UIM benefits under the policy; and (b) that Dolan’s refusal to submit to EUO was a material breach. Dolan appealed this decision to the Court of Special Appeals (“COSA”).

Court of Special Appeals Opinion in Dolan

On appeal, the focus was on the exact scope of an EUO in insurance claims. Dolan’s lawyers argued that he effectively satisfied the EUO requirement by submitting to a deposition in the civil case. Dolan suggested that a discovery deposition is the functional equivalent of an EUO in an insurance claim investigation. The COSA strongly rejected this argument and held that Dolan’s civil deposition did not satisfy the EUO requirement. Citing many cases in support, the COSA explained that an EUO and a pretrial deposition serve different functions. The EUO is aimed at information relevant to the acceptance or denial of the insurance claim, which differs from issues relevant to the litigation. The Court also noted that EUOs are not limited by the civil discovery rules that apply to deposition.

Take-Home Message from This Case

We always bark a lot on these UM statements.  But we never bite.  Because the juice is just not worth the squeeze of exactly this happening.

But assuming the Court of Appeals does not sweep in to remedy this, the lesson Maryland personal injury attorneys can take away from the decision is unambiguous:  make sure your client submits to the insurance carrier’s request for an examination under oath.

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