ERIKA MCDADE v. JUSTIN R. BENOIT & Others.

NOTICE: Summary decisions issued by the Appeals Court pursuant to M.A.C. Rule
23.0, as appearing in 97 Mass. App. Ct. 1017 (2020) (formerly known as rule 1:28,
as amended by 73 Mass. App. Ct. 1001 [2009]), are primarily directed to the parties
and, therefore, may not fully address the facts of the case or the panel's
decisional rationale. Moreover, such decisions are not circulated to the entire
court and, therefore, represent only the views of the panel that decided the case.
A summary decision pursuant to rule 23.0 or rule 1:28 issued after February 25,
2008, may be cited for its persuasive value but, because of the limitations noted
above, not as binding precedent. See Chace v. Curran, 71 Mass. App. Ct. 258, 260
n.4 (2008).

COMMONWEALTH OF MASSACHUSETTS

APPEALS COURT

22-P-1120

ERIKA MCDADE 1

vs.

JUSTIN R. BENOIT & others. 2

MEMORANDUM AND ORDER PURSUANT TO RULE 23.0

In this unfair settlement practices action, Erika McDade

claims that Safety Insurance Company (Safety) violated the

requirements of G. L. c. 93A and G. L. c. 176D by failing to

offer her a reasonable settlement following a car accident

between McDade and Safety's insured. After a bench trial on

these claims, a Superior Court judge found that Safety made

reasonable offers to McDade based on its assessment of her

injuries and comparative fault and thus did not engage in unfair

settlement practices. Judgment entered accordingly for Safety,

and McDade appeals. We affirm.

Background. In August 2013 Justin Benoit, a driver for

Brodie, Inc., made a left turn across McDade's lane of travel to

1 Formerly known as Erika McKenzie.
2 Brodie, Inc., and Safety Insurance Company.
turn into a parking lot. McDade struck the rear side of

Benoit's truck, sustaining damage to her car. An ambulance

transported McDade to the emergency room, and she was later

treated for neck and back pain. Brodie, Inc., was insured by

Safety.

Safety opened a claim on the accident and assigned

Christina Parsons, a veteran claims adjuster, to the accident

file. Parsons took a statement from McDade, who reported that

her neck and back issues from the accident required her to quit

her part-time nannying job and seek regular chiropractic care.

McDade further reported that she missed three days of work as a

nurse before returning full time.

Parsons also spoke to two eyewitnesses, Sonja Houle and

Charles Sidden. Houle, who was driving behind McDade and saw

Benoit's truck make the left turn, stated that McDade seemed a

"little late" in applying her brakes. Sidden, who was driving

behind the truck, stated that the truck was three-quarters of

the way into the parking lot when McDade hit it. Based in part

on these statements, Parsons determined that McDade had some

liability for the accident and informed her that Safety would

pay for eighty percent of the property damage.

Upon assigning eighty-percent liability to Benoit, Parsons

set an initial loss reserve amount of $7,929 for McDade's bodily

injury claim. The loss reserve was meant to represent the

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"worst-case scenario" for Safety. The initial loss reserve

amount was based on McDade's ambulance ride to the emergency

room, her negative x-rays, and her chiropractic care. By April

2014 Parsons increased the loss reserve to $15,000 after

McDade's insurer, Commerce Insurance Company (Commerce),

reported that McDade's medical bills exceeded $8,000. Later

that year, after Commerce made a subrogation demand, the matter

went to intercompany arbitration at which the arbitrator found

that Safety's position that its insured was eighty percent

liable was a "reasonable compromise" given the circumstances of

the accident.

In March 2015 Safety received a demand for $150,000 from

McDade. The demand included a medical report from Dr. George

Kasparyan, a nontreating orthopedic surgeon, who diagnosed

McDade with chronic pain syndrome and chronic cervical,

thoracic, and lumbar sprain. Based on the American Medical

Association (AMA) guidelines, Dr. Kasparyan opined that McDade

had a twenty-two percent "permanent partial impairment of the

whole person." The demand also included documented medical

expenses of $11,513.75 and stated that McDade had $535 in lost

earnings.

In response to the demand, Parsons increased the loss

reserve to $40,000, and Safety retained a medical expert to

review McDade's medical records. After McDade later reduced her

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demand to $130,000, Safety countered with an offer of $12,000,

justifying that amount based on its attribution of some fault to

McDade and its disagreement with the extent of her injuries.

Soon thereafter, Safety received a report from its medical

expert, who opined that the "records provided no objective

finding of an 'anatomic abnormality' causally related to the

accident." Safety then retained a second expert, Dr. Ryan

Friedberg, to obtain an opinion regarding Dr. Kasparyan's

conclusion that McDade had a permanent whole person impairment

of twenty-two percent.

Safety was waiting to hear from Dr. Friedberg when McDade

sent a c. 93A demand letter in September 2015. A few days

later, Safety received Dr. Friedberg's report in which he

concluded that McDade's diagnoses of cervical, thoracic, and

lumbar strain were causally related to the accident, but that it

would be unusual to classify for permanency based on those

injuries. Dr. Friedberg also opined that Dr. Kasparyan's

finding of a twenty-two percent whole person impairment was

"significantly exaggerated" and that that figure would more

likely be between two and eight percent.

Parsons conducted an updated valuation of McDade's claim

based on Dr. Friedberg's report. Parsons estimated the claim

range to be between $11,405 and $16,182 considering McDade's

comparative negligence, the soft tissue nature of her injuries,

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the lack of objective diagnostic testing, and the fact that she

missed only three days of work. The approved range was up to

$18,000. After crediting certain amounts based on Dr.

Friedberg's assessment of McDade's whole body impairment,

Parsons recommended increasing the offer to $15,000. William

Bradley, Parsons's supervisor, reviewed and approved the offer.

When the parties were unable to reach a settlement, McDade

filed suit in October 2015. Id. During discovery Dr. Friedberg

performed a medical examination of McDade, after which he

concluded that her medical treatment was reasonable through

March 2014, when she came to a "medical endpoint." Dr.

Friedberg again opined that Dr. Kasparyan's finding of a

permanent whole person impairment of twenty-two percent was

"significantly exaggerated" and not consistent with the AMA

guidelines. In addition, Dr. Friedberg explained in his

deposition that the permanency designation under the AMA

guidelines means that improvement is not expected over a one-

year timeframe, not that the impairment will necessarily persist

over a person's lifetime.

The underlying tort claim proceeded to a jury trial in

January 2018. The jury found that the defendants were negligent

and that McDade was not comparatively negligent and awarded her

damages of $225,000. The c. 93A claim against Safety then

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proceeded to the bench trial, after which an amended judgment

entered dismissing McDade's complaint against Safety.

Discussion. On appeal from a decision after a bench trial,

we accept the judge's findings of fact unless they are clearly

erroneous and review the judge's legal conclusions de novo. See

Cavadi v. DeYeso, 458 Mass. 615, 624 (2011). Whether particular

conduct is unfair or deceptive under G. L. c. 93A is a question

of fact, but whether that unfair or deceptive conduct rises to

the level of a c. 93A violation is a question of law. See H1

Lincoln, Inc. v. South Washington St., LLC, 489 Mass. 1, 13-14

(2022). The parties agree that, because the judge's decision

was based solely on documentary evidence, we may draw our own

conclusions from the record. See U.S. Bank Nat'l Ass'n v.

Schumacher, 467 Mass. 421, 427 (2014).

1. Failure to effectuate reasonable settlement. "General

Laws c. 93A and c. 176D operate in tandem 'to encourage the

settlement of insurance claims . . . and discourage insurers

from forcing claimants into unnecessary litigation to obtain

relief.'" Terry v. Hospitality Mut. Ins. Co., 101 Mass. App.

Ct. 597, 604 (2022), quoting Caira v. Zurich Am. Ins. Co., 91

Mass. App. Ct. 374, 381 (2017). The touchstone of c. 176D is

its requirement that an insurer "effectuate [a] prompt, fair,

and equitable settlement" when liability is "reasonably clear."

G. L. c. 176D, § 3 (9) (f). "[L]iability encompasses both fault

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and damages." Clegg v. Butler, 424 Mass. 413, 421 (1997). In

assessing the adequacy of a settlement offer, we must determine

"whether, in the circumstances, and in light of the

complainant's demands, the offer [was] reasonable," id., quoting

Calimlim v. Foreign Car Ctr., Inc., 392 Mass. 228, 234 (1984),

judged at the time it was made, see Silva v. Norfolk & Dedham

Mut. Fire Ins. Co., 91 Mass. App. Ct. 413, 417-418 (2017). Even

a serious undervaluation of a claim may not render an insurer

liable without evidence that the insurer acted "deliberately to

derail the settlement process." Parker v. D'Avolio, 40 Mass.

App. Ct. 394, 395 (1996).

At trial Safety did not contest that it had some liability

for the accident and was therefore obligated to tender a

reasonable settlement offer to McDade. The issue was whether

Safety's offer of $15,000 was a reasonable assessment of

McDade's damages. We agree with the judge that it was.

As set forth by the judge, there were multiple

circumstances supporting the reasonableness of Safety's offer.

At the time of the offer in September 2015, McDade's medical

bills were less than $12,000 and subject to an approximate

offset of $8,000 in personal injury protection benefits. Dr.

Friedberg provided an expert opinion that McDade's injuries,

which were soft-tissue in nature, were likely not permanent and

that she had only a small percentage of impairment. It was

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reasonable for Safety to rely on Dr. Friedberg's opinion,

especially given that most of McDade's medical expenses were for

chiropractic treatment, she had not sought treatment for over a

year since March 2014, and she returned to her rigorous job as a

nurse within days after the accident. Moreover, given the

eyewitness statements and the arbitrator's decision, Safety had

a basis to believe that McDade was partly at fault for the

accident. In light of all this information, we agree with the

judge that Safety had legitimate reasons to be skeptical of

McDade's characterization of the extent of her injuries and that

its offer was thus reasonable under c. 176D. See Silva, 91

Mass. App. Ct. at 418.

We are unpersuaded by McDade's argument that Safety's offer

was unreasonable because it failed to factor in her life

expectancy. This argument appears to be based on Bradley's

deposition testimony that he would typically consider life

expectancy when evaluating a permanent impairment claim. But

even assuming that this testimony established that a reasonable

insurer would have considered life expectancy in these

circumstances, Bradley further testified that he did in fact

consider McDade's life expectancy when approving Parsons's

offer. Although Parsons testified, somewhat ambiguously, that

she looked at McDade's life expectancy but did not "consider

that as part of [the] permanency value," Bradley explained that

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the settlement value of claims is determined according to an

"experience-based evaluation" under which the adjuster "can look

at permanency in terms of the life expectancy or . . . can also

take into account . . . other variables depending on the person

and the situation." Thus, even if Parsons did not "directly

factor" in McDade's life expectancy, Bradley still believed that

the "number that she came up with [was] reasonable" given all

the information known to him, which, as he expressly testified,

included life expectancy. McDade's argument therefore fails if

for no other reason than it is refuted by Bradley's testimony.

We are also unpersuaded by McDade's argument that the judge

erred by declining to credit her insurance expert. In his

deposition testimony, the expert opined that Safety's offer was

unreasonably low and that the settlement value of the case was

approximately $125,000. But as the judge explained, the expert

did not base his opinion on information in the record and failed

to review documents used by Safety to support its valuation of

McDade's claim. Furthermore, when asked, the expert was unable

to identify any industry standards or guidelines that he used to

form his opinion. Because the expert's opinion was conclusory

and not based on any identified reliable methodology, we discern

no error in the judge's decision not to credit his testimony.

See Palandjian v. Foster, 446 Mass. 100, 110 (2006).

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2. Failure to train. In passing, McDade suggests that

Safety independently violated c. 176D by failing to train its

adjusters on how to handle permanent impairment cases. But

McDade fails to explain why any inadequacy in training is

relevant if the offer itself was reasonable under c. 176D, as we

have determined it was. She cites no legal authority to support

her position, nor does she point to any credible evidence in the

record showing that Safety's training was not in line with

industry standards. As her conclusory assertions do not rise to

the level of appellate argument, we need not consider them. See

Halstrom v. Dube, 481 Mass. 480, 483 n.8 (2019).

3. Failure to investigate. Likewise, McDade has not

adequately developed her argument that Safety violated c. 176D

by failing to conduct a reasonable investigation, purportedly by

engaging in improper tactics with respect to Houle's eyewitness

statement. In any event the judge carefully explained

why Safety did not act improperly and why its investigation was

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otherwise reasonable. We agree with the judge's reasoning. 3

Amended judgment dated June
10, 2021, affirmed.

By the Court (Wolohojian,
Shin & Ditkoff, JJ. 4),

Clerk

Entered: November 6, 2023.

3 McDade's request for double or treble damages and attorney's
fees is denied.
4 The panelists are listed in order of seniority.

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