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Everest National Insurance Co. v. Berkeley Place Restaurant Limited Partnership

Superior Court of Massachusetts, Suffolk

November 7, 2016

Everest National Insurance Company
Berkeley Place Restaurant Limited Partnership No. 135665

          Filed November 8, 2016


          Edward P. Leibensperger, Justice

         This action was commenced by Everest National Insurance Company as subrogee of three persons: Timothy J. Barletta (" Timothy"), Barletta Engineering Corporation (" Barletta Corp.") and Osprey Equipment Corporation (" Osprey"). The action is one for contribution under G.L.c. 231B, § 1(d). Everest, as insurer for all three persons, paid a settlement amount to a state trooper who was seriously injured in a car accident when he was struck from behind by a car driven by Timothy. Everest asserted in this case that defendant, Berkeley Place Restaurant Limited Partnership, d/b/a Grill 23 (" Grill 23"), is jointly liable to the state trooper as a result of negligently serving Timothy alcohol in the hours before the accident. Following a jury verdict in favor of Everest that determined that Grill 23 is liable as a joint tortfeasor and that the settlement reached by Everest with the state trooper and his wife was reasonable, the parties address two issues: (1) how many tortfeasors bear responsibility for a pro rata share of the settlement, and (2) what amount is Everest entitled to receive as contribution from Grill 23? Both questions involve application of the contribution statute. For the first question, the court must determine whether " if equity requires, the collective liability of some as a group shall constitute a single share." G.L.c. 231B, § 2(b). The second question is whether, under G.L.c. 231B, § 1, Everest may obtain contribution for more than a pro rata share of what it paid in settlement.


         On Saturday night, September 27, 2008, Timothy attended a private birthday party at the Grill 23 restaurant in Boston. The person being celebrated was Timothy's sister-in-law, Laura Barletta, and the person throwing the party was her husband, Timothy's brother, Vincent Barletta. Approximately 40 people attended the party and the guests were, generally, friends and family of Laura Barletta. The party was held in a function room, separate from the rest of the restaurant.

         There was evidence before the jury sufficient to show that at the party Timothy was served alcohol after it had been recognized by the Grill 23 manager on duty that Timothy was visibly intoxicated. Timothy left the party with his girlfriend, got into a motor vehicle, and drove west on the Mass. Pike. Several minutes later, Timothy, while operating under the influence of alcohol, smashed into the rear of a state police vehicle parked on the edge of the Pike to assist a stopped car. State Trooper Christopher Martin was inside the state police vehicle. As a result of the collision, Trooper Martin suffered serious personal injuries. Subsequently, Timothy pleaded guilty to the criminal charge of operating under the influence of alcohol.

         On September 18, 2009, Trooper Martin and his wife commenced a lawsuit against Timothy, Barletta Corp. and Osprey. The lawsuit alleged the negligence of Timothy as the driver. The lawsuit also alleged that the vehicle Timothy was driving at the time of the accident was " owned, controlled and maintained by" Barletta Corp. " and/or" Osprey. Therefore, " as owner(s) of the vehicle, [the companies] were responsible for the negligent operation, ownership, control and maintenance of the motor vehicle." Complaint, ¶ s 12 and 15.[1]

         On May 3, 2010, the lawsuit commenced by Trooper Martin and his wife was settled. In connection with the settlement, a Settlement Agreement and Release (the " Release") was executed. Exhibit 3. Pursuant to the Release, Everest and Travelers Insurance Company, as liability insurers of all three of Timothy, Barletta Corp. and Osprey, agreed to pay a total of $3, 750, 000, present value, to the Martins as part of a structured settlement to be paid over twenty years. In return, the Martins released Timothy, Barletta Corp. and Osprey from any and all claims arising out of the accident.[2]

         The evidence at the trial of this case established that at the time of the accident, Timothy was employed by Barletta Corp. Barletta Corp. was a family business. The president of Barletta Corp. was Vincent Barletta.

         Osprey was a wholly-owned subsidiary of Barletta Corp. Osprey owned the vehicles and equipment used by Barletta Corp. Certain employees of Barletta Corp., including Timothy, were provided with cars owned by Osprey. Pursuant to company policy, employees provided with company cars were allowed to utilize the cars for personal use as well as for company business. There was no restriction on the use of a company car. Vincent Barletta had no direct involvement in supervising the use of company cars. On the night of the accident, Timothy was driving a car owned by Osprey and provided to him by his employer.

         Vincent Barletta testified that, at the birthday party, he had very little contact with Timothy. He did not see Timothy show any signs of intoxication. To the extent he did observe Timothy, nothing in his behavior stood out. The testimony from several witnesses confirmed that Timothy was seated at a table for six to eight people, away from the head table where Vincent Barletta was seated with his wife. Vincent Barletta had no memory of observing Timothy consume alcohol. I find Vincent Barletta's testimony to be credible.

         Before the settlement, counsel for Trooper Martin wrote two demand letters to the insurers. In the first letter (Exhibit 28), counsel stated that " I understand from our conversations that liability in this matter is admitted (at least for purposes of mediation)." The letter focused upon the damages suffered by Trooper Martin and requested $7, 500, 000 to settle. The second letter (Exhibit 29), stated more specifically that " [t]he evidence of clear liability against [Timothy] Barletta is undisputed." The rest of the letter focused on damages and the additional claim that the insurers were acting in violation of G.L.c. 93A and c. 176D by not yet agreeing to settle. A demand for settlement of $11, 000, 000 was asserted. Neither letter asserted a theory of liability against Barletta Corp. or Osprey, other than that Timothy was allegedly a " principal" of those companies.

         At trial, Everest called as a witness Robert A. DeLello. Mr. DeLello was counsel on the Complaint filed for the Martins to commence the lawsuit against Timothy, Barletta Corp. and Osprey. He continued as counsel to the Martins in connection with the negotiation of the settlement. As a result of the determination that the question of pro rata shares of tortfeasors is an issue to be decided based upon principles of equity (see G.L.c. 231B, § 2(b)), Mr. DeLello gave the following testimony to the court, outside of the hearing of the jury.

         Mr. DeLello testified that the theory of the Martins' case against Barletta Corp. and Osprey was to hold the companies liable under G.L.c. 231, § 85A; that is, as the owner of the vehicle Timothy was driving on the night of the accident. Mr. DeLello testified that the police report listed both companies as the owner of the vehicle. While he acknowledged that if the litigation had not settled he would have taken discovery regarding possible other theories of liability of the companies such as negligent entrustment or negligent maintenance, his ...

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