Free Jury Instructions - District Court of Colorado - Colorado

Case 1:04-cv-01143-JLK

Document 73

Filed 02/09/2006

Page 1 of 50

SECTION 1.0 GENERAL INSTRUCTIONS

1

Case 1:04-cv-01143-JLK

Document 73

Filed 02/09/2006

Page 2 of 50

INSTRUCTION NO. 1.1 Description of the Case

I will now give you a brief summary of the claims and defenses in this case. The party who brings the lawsuit is called the plaintiff. The plaintiff in this action is Dolly Lau. For convenience, in this case we will call her Ms. Lau. The party against whom the lawsuit is brought is called the defendant. In this action the defendant is Allstate Insurance Company, which, for convenience, will be referred to as " Allstate." This is a case for a breach of contract and bad-faith breach of contract. Ms. Lau purchased an automobile insurance policy from Allstate that included personal injury protection, which is commonly called " PIP"coverage, and uninsured/underinsured motorist coverage, and the parties agree that at all times pertinent to her claims the policy was in full force and effect. Ms. Lau was injured in an automobile collision involving her vehicle and a vehicle driven by an individual named Clarence R. Johnson on September 28, 2001. Lau claims Johnson was traveling eastbound on Brookdale Avenue in Salida when he disregarded the stop sign on Highway 24 and struck her vehicle, which was stopped, facing northbound in the turn lane of Highway 24. Johnson is not on trial in this case and it is agreed by Ms. Lau and Allstate that Johnson was the sole cause of the collision.
2

Case 1:04-cv-01143-JLK

Document 73

Filed 02/09/2006

Page 3 of 50

With Allstate' permission, Lau settled her claim against Johnson' s s insurance carrier for $25,000, the maximum amount of coverage under his policy. Because Lau claims her damages were greater than $25,000, she made a demand to her insurer, Allstate, for the difference pursuant to the underinsured policy limits of their insurance contract. She also made demand for certain medical costs under her PIP provision, because those costs are not covered under the underinsured motorist part of her policy until they total $50,000 or more. Allstate' refusal to pay under either or both policy provisions forms the s basis for Lau' claim that Allstate breached its insurance contract with her. Lau s also asserts a claim for bad faith breach of insurance contract against Allstate based on allegations that Allstate acted unreasonably in refusing to pay under circumstances in which it knew it was acting unreasonably. Allstate denies it breached its contract with Ms. Lau. Allstate further denies that its adjusting of Ms. Lau' personal injury protection benefits and s underinsured motorist claims were in bad faith. Allstate claims it has already paid all amounts owed to Ms. Lau under the terms of Ms. Lau' insurance policy. s Finally, the parties to this lawsuit have agreed to certain facts. You must treat these agreed upon, or stipulated facts, as being proved. The facts on which both sides have agreed are as follows:

3

Case 1:04-cv-01143-JLK

Document 73

Filed 02/09/2006

Page 4 of 50

1.

At all times pertinent to the claims in this action there existed a valid

and enforceable policy of insurance issued by Allstate. 2. benefits. 3. On September 28, 2001, Ms. Lau was driving her car on North This insurance policy included PIP and underinsured motorist

Highway 24 at the intersection of Brookdale Avenue in Buena Vista, Colorado. 4. Also on September 28, 2001, Clarence Johnson was driving his

vehicle near the intersection of North Highway 24 and Brookdale Avenue in Buena Vista, Colorado. 5. Mr. Johnson drove his vehicle onto Highway 24 without stopping as

required by law. Ms. Lau' vehicle was stopped on Highway 24 in the turn lane s and Mr. Johnson' vehicle struck Ms. Lau' vehicle. s s 6. 7. The sole cause of the collision was the negligence of Mr. Johnson. On August 14, 2003, Ms. Lau settled her claim with Mr. Johnson for

his liability insurance policy limits of $25,000 with the consent of her insurer, Allstate.

4

Case 1:04-cv-01143-JLK

Document 73

Filed 02/09/2006

Page 5 of 50

JURY INSTRUCTION NO. 1.2 All Persons Equal Before the Law All persons are equal before the law. A corporation is considered by the law to be a person. Corporations are entitled to the same fair and conscientious consideration by you as any physical person. Corporations can act only through their officers and employees. Any act or omission of an officer or employee while acting within the scope of his or her employment or authority is the act or omission of the corporation. I tell you that all parties are equal before the law to remind you that you must base any decision in this case on the law and facts, not outside factors such as race, national origin, citizenship, or corporate status.

5

Case 1:04-cv-01143-JLK

Document 73

Filed 02/09/2006

Page 6 of 50

JURY INSTRUCTION NO. 1.3 Knowledge of a Corporation Knowledge of, or notice to, a corporation' director, officer, or employee s received while he or she is acting within the scope of his or her authority, is the knowledge of, or notice to the corporation.

6

Case 1:04-cv-01143-JLK

Document 73

Filed 02/09/2006

Page 7 of 50

JURY INSTRUCTION NO. 1.4 Evidence ­ General It will be your duty to decide from the evidence what the facts are. You and you alone, are the judges of the facts. You will hear the evidence, decide what the facts are, and then apply those facts to the law I give you. That is how you will reach your verdict. In doing so, you must follow the law whether you agree with it or not. At no time during the trial will I suggest what I think your verdict should be nor do I want you to guess or speculate about my views of what verdict you should render. You will decide what the facts are from the evidence which the parties will present to you during the trial. That evidence will consist of the sworn testimony of witnesses on both direct and cross-examination, regardless of who called the witness; documents and other things received into evidence as exhibits; and any facts on which the lawyers agree or which I may instruct you to accept as true. The following things are not evidence and you must not consider them as evidence in deciding the facts of this case: 1. Statements and arguments by lawyers are not evidence. The lawyers are not witnesses. What they say in their opening statements, closing arguments, and at other times is intended to help you interpret the
7

Case 1:04-cv-01143-JLK

Document 73

Filed 02/09/2006

Page 8 of 50

evidence, but it is not evidence. If the facts as you remember them differ from the way the lawyers have stated them, your memory of the facts controls. 2. Questions and objections by the lawyers are not evidence. Lawyers have a duty to their clients to object when they believe a question is improper under the rules of evidence. You should not be influenced by the objection or by my ruling on it. 3. Testimony that has been excluded or stricken, or that you have been instructed to disregard, is not evidence and must not be considered. In addition, I may allow some testimony or exhibits only for a limited purpose, and you must consider such only for that limited purpose. 4. Anything you may see or hear when the Court is not in session is not evidence, even if what you see or hear is done or said by one of the parties or by one of the witnesses. You are to decide the case solely on the evidence received in this courtroom during the trial. You are to consider only the evidence in the case. But in your consideration of the evidence, you are not limited solely to what you see and hear as the witnesses testify. You are permitted to draw, from facts that you find have been proved, such reasonable inferences as seem justified in the light of your experience. Inferences are conclusions your reason and common sense lead you to draw from the facts established by the evidence in the case.
8

Case 1:04-cv-01143-JLK

Document 73

Filed 02/09/2006

Page 9 of 50

JURY INSTRUCTION NO. 1.5 Direct and Circumstantial Evidence can either be direct or circumstantial. Direct evidence is testimony by a witness about what that witness personally saw or heard or did. Circumstantial evidence is indirect evidence; that is, it is proof of one or more facts from which one can find that another fact exists or is true. You should consider both kinds of evidence in deciding this case. It is for you to decide how much weight to give any evidence, direct or circumstantial. The rules of evidence control the facts you may consider. When one lawyer asks a question or offers an exhibit and an opposing lawyer thinks that it is not permitted by the rules of evidence, the opposing lawyer may object. If I overrule the objection, the question may be answered or the exhibit received. Whenever I sustain an object to a question, you must ignore the question and must not guess what the answer might have been. Sometimes I may order that evidence be stricken from the records and that you disregard or ignore such evidence. That means that when you are deciding the case, you must not consider the evidence that I told you to disregard.

9

Case 1:04-cv-01143-JLK

Document 73

Filed 02/09/2006

Page 10 of 50

JURY INSTRUCTION NO. 1.6 Fact of Lawsuit Not Evidence of Wrongdoing The fact that a plaintiff files a lawsuit is not evidence that the other party did anything wrong. The fact that a plaintiff complains that she has been damaged is not evidence that she has been damaged or that the other party violated the law. Similarly, the fact that a defendant denies that plaintiff has been damaged or that the law does not provide relief for her is not evidence that plaintiff has not been damaged or that the defendant did not violate the law. Both the complaint and the denial are merely the formal way in which the case is brought to court for you to decide. The traditional expression, " where there' smoke there' fire"is not s s always true and it cannot have any part in your reaching a decision in this case.

10

Case 1:04-cv-01143-JLK

Document 73

Filed 02/09/2006

Page 11 of 50

JURY INSTRUCTION NO. 1.7 Credibility In deciding the facts of this case, you will have to decide which witnesses to believe and which witnesses not to believe. You may believe everything a witness says, only part of it, or none of it. In considering the testimony of any witness, you may consider: 1. The witness' opportunity and ability to see or hear or know the things

to which the witness testified; 2. 3. 4. The quality of the witness' memory; The witness' manner while taking the oath and while testifying; Whether the witness had an interest in the outcome of the case or any motive, bias or prejudice; 5. Whether the witness' testimony is contradicted by anything the

witness said or did at another time, by the testimony of other witnesses, or by other evidence; 6. How reasonable the witness' testimony was in light of all the

evidence; and, 7. Any other facts that bear on believability.

If you believe a witness has willfully lied regarding any material fact, you have the right to disregard all or any part of that witness' testimony.
11

Case 1:04-cv-01143-JLK

Document 73

Filed 02/09/2006

Page 12 of 50

In addition, the weight of the evidence as to a fact does not necessarily depend on the number of witnesses who testify to that fact. The testimony of a single witness that produces in your minds belief in the likelihood of truth is sufficient for the proof of any fact, and would justify a verdict in accordance with such testimony, even though a number of witnesses may have testified to the contrary, if, after consideration of all the evidence in the case, you hold greater belief in the accuracy and reliability of the one witness.

12

Case 1:04-cv-01143-JLK

Document 73

Filed 02/09/2006

Page 13 of 50

JURY INSTRUCTION NO. 1.8 Burden of Proof This is a civil case. Therefore, Ms. Lau has the burden of proving her claims by what is called a preponderance of the evidence. That means that no matter who produces the evidence, when you consider each of Ms. Lau' claims s in light of all the facts, you believe that claim is more likely true than not true. To put it differently, if you were to put all the evidence in favor of Ms. Lau and all the evidence in favor of Allstate on opposite sides of the scales, Ms. Lau would have to make the scale tip to her side. If Ms. Lau fails to meet this burden on any claim, your verdict on that claim must be for Allstate. In defense to one or more of Ms. Lau' claims, Allstate asserted affirmative s defenses, which will be described to you more fully later. An affirmative defense is more than a denial of the claim. You should treat Allstate' affirmative defense s in the same way you treat Ms. Lau' claims. That is, Allstate, as the asserting s party, has the burden of proving that the affirmative defense is more likely true than not true. In evaluating whether Ms. Lau and Allstate have met their respective burdens on their claims and defenses, you should know that the law does not require parties to call as witnesses all persons who may have been present at any time or place involved in the case, or who may appear to have some
13

Case 1:04-cv-01143-JLK

Document 73

Filed 02/09/2006

Page 14 of 50

knowledge of the matter in issue at this trial. Nor does the law require parties to produce as exhibits all paper or other things mentioned in the evidence in the case.

14

Case 1:04-cv-01143-JLK

Document 73

Filed 02/09/2006

Page 15 of 50

JURY INSTRUCTION NO. 1.9 Conduct of Jurors Your conduct as jurors is of the utmost importance. First, do not discuss the merits of this case with one another until the end when you go to the jury room to decide on your verdict. Second, do not talk with anyone else about this case or about anyone who has anything to do with it until the trial has ended and you have been discharged as jurors. " Anyone else"includes members of your family and your friends. You may tell them that you are a juror in a case and that I have ordered you not to tell them anything else about it until the case is over. I make this order to prevent other people from influencing you. Third, do not let anyone talk to you about the case or about anyone who has anything to do with it. If someone tries to talk to you, please report it to me immediately. Fourth, do not read any news stories or articles or listen to any radio or television reports about the case or about anyone who has anything to do with it. Fifth, do not do any research, such as consulting dictionaries or other reference materials, and do not make any investigation about the case on your own. Sixth, do not make up your mind about what the verdict should be until
15

Case 1:04-cv-01143-JLK

Document 73

Filed 02/09/2006

Page 16 of 50

after you have gone to the jury room to decide the case and you and your fellow jurors have discussed the instructions of law and the evidence. Keep an open mind until then. Seventh, each of you will have one or more notebooks containing the names of the witnesses and copies of exhibits. You are free to take notes in order to enhance your memory or assist you in recollecting during your deliberations. I caution you, however, not to become a slave to your notes. It is most important that you observe the witnesses and listen to their testimony. Your note taking should merely assist you.

16

Case 1:04-cv-01143-JLK

Document 73

Filed 02/09/2006

Page 17 of 50

JURY INSTRUCTION NO. 1.10 Order of Trial This case will proceed as follows: First, the lawyers for each side will make opening statements. What is said in opening statements is not evidence, but an outline of the evidence each side intends to present to help you understand what each party expects the evidence to show. A party is not required to make an opening statement. After the opening statements, the plaintiff, Dolly Lau, will present evidence in support of her claims and the lawyer for Allstate, the defendant, may crossexamine the witnesses. At the conclusion of Ms. Lau' case, the defendant, s Allstate, may introduce evidence and Ms. Lau' lawyer may cross-examine the s witnesses. Allstate is not required to introduce any evidence or to call any witnesses. If Allstate introduces evidence, Ms. Lau may then introduce rebuttal evidence. After the evidence is presented, the parties' lawyers each will make closing arguments in support of their client' case summarizing the evidence and s explaining how the law set forth in these instructions when applied to those facts requires a finding in their client' favor. For this reason, what is said in closing s arguments is not evidence.

17

Case 1:04-cv-01143-JLK

Document 73

Filed 02/09/2006

Page 18 of 50

SECTION 2.0

INSTRUCTIONS FOR USE DURING TRIAL

18

Case 1:04-cv-01143-JLK

Document 73

Filed 02/09/2006

Page 19 of 50

JURY INSTRUCTION NO. 2.1 Consideration of Deposition Testimony A deposition is testimony taken under oath before the trial and preserved in writing or on videotape. Deposition testimony can be read into evidence or shown by videotape. You are to give the same consideration to deposition testimony as to live testimony presented here in the courtroom. That is, you are to judge the credibility of the witness and determine the weight to be given to the testimony to the best of your ability under the circumstances, as if the witness had been before you on the witness stand when he or she made the statement under oath.

19

Case 1:04-cv-01143-JLK

Document 73

Filed 02/09/2006

Page 20 of 50

JURY INSTRUCTION NO. 2.2 Experts You will hear opinion evidence from people described as experts. People who by knowledge, skill, experience, training or education, have become expert in some field may state their opinions on matters in that field and may also state the reasons for their opinions. Expert opinion testimony should be judged just like any other testimony. You may accept it or reject it and give it as much weight as you think it deserves, considering the witness' education and experience, the reasons given for the opinions, and all of the other factors that you consider when determining the credibility of the other witnesses. Experts generally rely upon some assumptions in developing their opinions. These assumptions are likewise subject to your evaluation and should be considered along with the rest of the evidence. In resolving the conflict in the testimony of expert witnesses, you should weigh the opinion of one expert against that of another. In doing this, you should consider the qualifications and believability of each witness, the reasons for each opinion and the matter upon which it is based.

20

Case 1:04-cv-01143-JLK

Document 73

Filed 02/09/2006

Page 21 of 50

[page intentionally left blank]

21

Case 1:04-cv-01143-JLK

Document 73

Filed 02/09/2006

Page 22 of 50

SECTION 3.0 SUBSTANTIVE INSTRUCTIONS

22

Case 1:04-cv-01143-JLK

Document 73

Filed 02/09/2006

Page 23 of 50

JURY INSTRUCTION NO. 3.1 Admitted Liability Allstate has admitted that Clarence Johnson was negligent in causing the collision that occurred on September 28, 2001, and would therefore be legally liable for any injuries and damages Lau suffered as a result of that collision. The only issues for you to decide in this insurance action are the nature and extent of Ms. Lau' injuries, if any, and the amount of any damages Ms. Lau suffered, so s that her personal injury protection and underinsured motorist coverage issues with her insurer Allstate can be determined. The fact that Allstate has admitted it was Johnson who was negligent in causing the collision must not influence how you decide these remaining issues.

23

Case 1:04-cv-01143-JLK

Document 73

Filed 02/09/2006

Page 24 of 50

JURY INSTRUCTION NO. 3.2 Nature of Plaintiff' Claims s Dolly Lau asserts two claims in this case: (1) a claim for breach of contract and (2) a claim for bad faith breach of contract. In the breach of contract claim, Ms. Lau contends that Allstate breached the terms of its insurance contract by (a) not paying underinsured motorist benefits beyond the amount that Ms. Lau received from Charles Johnson' s insurance company; and (b) by failing to pay medical expenses submitted under the PIP provisions of her policy. Ms. Lau contends that she has incurred damages in excess of Mr. Johnson' insurance limits as a result of the s September 28, 2001, automobile collision. Allstate denies it breached its contract to pay underinsured motorist benefits to Ms. Lau because Ms. Lau was fully compensated for her damages by the amounts that she received from Clarence Johnson' insurance company. Allstate denies it breached its contract to pay s Lau' medical expenses under the PIP provisions of her policy. s Lau' bad faith breach of contract claim is premised on the fact that, under s Colorado law, contracts for insurance between insurers and their insureds include in addition to the duty to provide payment under the terms and conditions of the policy a separate duty of good faith and fair dealing. The duty of good faith and fair dealing is breached if an insurance company knowingly delays or denies payment to its insured without a reasonable basis for its delay or denial. Ms. Lau contends Allstate failed to pay PIP benefits within the time specified by Colorado statutes after receiving proof that the benefits were reasonable, necessary and related to the automobile accident. Ms. Lau further contends that Allstate' actions were unreasonable and were done in a willful and s wanton manner and in reckless disregard of Ms. Lau' rights under her insurance s contract with Allstate. Allstate denies its adjusting of Ms. Lau' insurance claims was done in bad s faith. Allstate contends Ms. Lau has been fully compensated for the damages she sustained in the September 28 collision by payment from Mr. Johnson' s insurance company. It is your job to determine whether Ms. Lau has proven either or both of her claims by a preponderance of the evidence.

24

Case 1:04-cv-01143-JLK

Document 73

Filed 02/09/2006

Page 25 of 50

JURY INSTRUCTION 3.3 UIM Breach and Damages ­ Breach of Underinsured Motorist Contract Plaintiff, Dolly Lau, has the burden of proving, by a preponderance of the evidence, the nature and extent of her damages caused by the negligence of Clarence Johnson. You must determine the total dollar amount of plaintiff' s damages, if any, that were caused by the negligence of Clarence Johnson. You will be asked to enter that amount of damages on the Verdict Form you will sign after concluding your deliberations at the end of this case. In determining the total dollar amount of Lau' damages, if any, you shall s consider the following: 1. Any noneconomic losses or injuries which plaintiff has had to the

present time and which plaintiff will probably have in the future, including: physical and mental pain and suffering, inconvenience, emotional stress, and impairment of the quality of life. In considering damages in this category, you shall not include actual damages for physical impairment, because these damages, if any, are included in a separate category (3) below. 2. Any economic losses or injuries which plaintiff has had to the present

time and which plaintiff will probably have in the future, including reasonable and necessary medical, hospital, rehabilitation, and other expenses. In considering damages in this category, you shall not include actual damages for physical impairment, as these damages, if any, are included in category 3 below.
25

Case 1:04-cv-01143-JLK

Document 73

Filed 02/09/2006

Page 26 of 50

3.

Any physical impairment. In considering damages in this category,

you shall not include damages again for losses or injuries already determined under either numbered paragraph 1 or 2 above. In determining the amount of plaintiff'damages, if any, for the economic losses described in category 2, above, you must exclude: (A) the amount of any medical expenses Ms. Lau has incurred or will incur during the first five years after the accident, i.e., between September 28, 2001 and September 28, 2006, up to $50,000; and (B) the amount of any rehabilitation expenses which Ms. Lau has incurred or will incur during the first ten years after the accident, i.e. between September 28, 2001 and September 28, 2011, including but not limited to, palliative care. If you find Ms. Lau has incurred or will incur more than $50,000 in medical expenses, you will be asked to note that in the relevant place on the Verdict Form. The court has instructed you to exclude these amounts because, according to the Colorado Auto Accident Reparations Act, the plaintiff has received or is entitled to receive these amounts from other sources.

26

Case 1:04-cv-01143-JLK

Document 73

Filed 02/09/2006

Page 27 of 50

JURY INSTRUCTION NO. 3.4 Elements of Failure to Pay PIP Benefits ­ Breach of Personal Injury Protection Contract For Ms. Lau to recover from Allstate on her breach of contract claim based on failure to pay PIP benefits, you must find that all of the following have been proved to be more likely true than not true: 1. Reasonable and necessary medical and/or rehabilitation expenses

were incurred by Ms. Lau as the result of the automobile collision of September 28, 2001; and 2. Allstate did not pay Ms. Lau' such medical and/or rehabilitation s

expenses within 30 to 45 days after receiving reasonable proof of the fact and amount of those expenses. If you find that either of these statements has not been proved, then your verdict must be for Allstate. If you find that both of these statements have been proved, then your verdict on Ms. Lau' breach of contract claim for violation of her s policy' PIP provisions must be for Ms. Lau. s

27

Case 1:04-cv-01143-JLK

Document 73

Filed 02/09/2006

Page 28 of 50

JURY INSTRUCTION 3.5 Elements of Claim - Bad Faith Breach of Insurance Contract For the plaintiff, Dolly Lau, to recover from the defendant, Allstate Insurance Company, on her claim of bad faith breach of insurance contract, you must find all the following have been proved by a preponderance of the evidence: 1. The plaintiff had damages arising from the Clarence Johnson' s

negligent operation of a motor vehicle on September 28, 2001; 2. The defendant acted unreasonably in denying or delaying payment

of the plaintiff' claims; s 3. The defendant knew that its conduct or position was unreasonable or

the defendant recklessly disregarded the fact that its conduct or position was unreasonable; and 4. The defendant' unreasonable conduct or position was a cause of s

the plaintiff' damages. s If you find that any one or more of these four statements has not been proved, then your verdict must be for the defendant. On the other hand, if you find that all of these four statements have been proved, then your verdict must be for the plaintiff.

28

Case 1:04-cv-01143-JLK

Document 73

Filed 02/09/2006

Page 29 of 50

JURY INSTRUCTION NO. 3.6 Unreasonable Conduct or Position ­ Defined - Bad Faith Breach of Insurance Contract

" Unreasonable conduct"means the failure to do an act that a reasonably careful insurance company would do, or the doing of an act that a reasonably careful insurance company would not do, under the same or similar circumstances, to protect the persons insured from damages. " Unreasonable position"means a position taken by an insurance company with respect to a claim being made on one of its policies that a reasonably careful insurance company would not take under the same or similar circumstances.

29

Case 1:04-cv-01143-JLK

Document 73

Filed 02/09/2006

Page 30 of 50

JURY INSTRUCTION NO. 3.7 Unreasonable Conduct or Position ­ Statutory Violation - Bad Faith Breach of Insurance Contract

The statutes of Colorado prohibit an insurance company from willfully: 1. Failing to adopt and implement reasonable standards for the prompt

investigation of claims arising under insurance policies; 2. Refusing to pay claims without conducting a reasonable investigation

based upon all available information; 3. Not attempting in good faith to effectuate prompt, fair, and equitable

settlements of claims in which liability has become reasonably clear; 4. Failing to acknowledge and act reasonably promptly upon

communications with respect to claims arising under insurance policies; 5. Failing promptly to provide a reasonable explanation of the basis in

the insurance policy in relation to the facts or applicable law for denial of a claim or for the offer of a compromise settlement; 6. Failing timely to pay reasonable, necessary and accident related

medical bills within 30 to 45 days after receiving reasonable proof of the fact and amount of those expenses. You may consider any such conduct in determining whether the defendant acted unreasonably in denying or delaying payment if you find that:
30

Case 1:04-cv-01143-JLK

Document 73

Filed 02/09/2006

Page 31 of 50

1. conduct; 2.

The defendant Allstate Insurance Company willfully engaged in such

Such conduct caused or contributed to the defendant' denial or s

delay of payment of the plaintiff' insurance claim; and s 3. Such conduct caused or contributed to any of the plaintiff' claimed s

damages. (See elements of liability in Instruction 3.5.)

31

Case 1:04-cv-01143-JLK

Document 73

Filed 02/09/2006

Page 32 of 50

JURY INSTRUCTION NO. 3.8 Reckless Disregard ­ Defined- Bad Faith Breach of Insurance Contract An insurance company recklessly disregards the unreasonableness of its conduct or position when it acts or takes a position with knowledge of facts that indicate that its conduct or position lacks a reasonable basis or when it is deliberately indifferent to information concerning the claim.

32

Case 1:04-cv-01143-JLK

Document 73

Filed 02/09/2006

Page 33 of 50

JURY INSTRUCTION NO. 3.9 Duty of Good Faith and Fair Dealing - Bad Faith Breach of Insurance Contract An insurance company owes to those it insures the duty of good faith and fair dealing. The duty of an insurer to deal fairly and in good faith towards its insurer includes the following: 1. The duty to investigate and fully and fairly ascertain the facts

and law concerning a claim and to do so adequately and with due diligence; 2. The duty to keep its insured fully informed with respect to the

investigation being conducted concerning an insured' claim. s 3. insured; and 4. The duty not to deny or withhold unreasonably benefits due The duty not to favor its own interests over those of the

under the insurance policy. An insurer' duty of good faith and fair dealing is not limited to its s decision to accept or deny coverage for a claim or to pay or not to pay a claim. Rather, the duty relates to the entire relationship and all dealings between the insurance company and the insured, and claims for bad faith may encompass all of the dealings between the parties. The duty of good faith is a broad and wideranging one which extends to everything pertaining to the provision of insurance
33

Case 1:04-cv-01143-JLK

Document 73

Filed 02/09/2006

Page 34 of 50

services to the public. It requires both parties to act in such a manner that both will attain their reasonable expectations under the contract.

34

Case 1:04-cv-01143-JLK

Document 73

Filed 02/09/2006

Page 35 of 50

INSTRUCTION NO. 3.10

Evidence in Support of Claim- Bad Faith Breach of Insurance Contract An insurance company does not have the right to insist that a claim be proven through certain types of evidence. You are not to consider whether Allstate received every item it requested from Ms. Lau or whether it appeared that it had the exact type of information it prefers when deciding a claim. Rather, you should consider whether the evidence in support of the claim, in whatever form and however acquired, was sufficient to support the claim such that it would be unreasonable for the insurance company to refuse to pay the claim.

35

Case 1:04-cv-01143-JLK

Document 73

Filed 02/09/2006

Page 36 of 50

INSTRUCTION NO. 3.11

Measure of Damages You must determine damages in accordance with these instructions. That I will instruct you on the measure of damages does not mean I am instructing you as to which party is entitled to your verdict, or that I am instructing you to award or not award damages. Whether or not damages are to be awarded, and the amount of such damages, are for your consideration alone. If you decide to award damages, you should fix the amount using calm discretion and sound reason, not sympathy, prejudice, or speculation. Difficulty or uncertainty in determining the precise amount of damages does not prevent you from deciding an amount. You should use your best judgment based on the evidence.

36

Case 1:04-cv-01143-JLK

Document 73

Filed 02/09/2006

Page 37 of 50

JURY INSTRUCTION NO. 3.12 Damages Bad Faith Breach of Insurance Contract Ms. Lau has the burden of proving the nature and extent of her damages. If you find in Ms. Lau' favor, you must determine the total dollar amount of her s damages, if any, that were caused by Allstate' bad faith breach of contract, if s any. Remember that the standard of proof that Ms. Lau must meet is that what she claims is more likely true than not true. In determining such damages, you shall consider the following: 1. Any noneconomic losses or injuries Ms. Lau has had to the present

time or that she will probably have in the future, including: physical and mental pain and suffering, inconvenience, emotional stress, and impairment of the quality of life. 2. Any economic losses or injuries Ms. Lau has had to the present time

or that she will probably have in the future.

37

Case 1:04-cv-01143-JLK

Document 73

Filed 02/09/2006

Page 38 of 50

JURY INSTRUCTION NO. 3.13 Punitive Damages (all claims) In addition to compensation for actual damages, Ms. Lau also seeks an award of punitive (also called " exemplary" damages based on her claims of ) breach of contract (breach of UIM and PIP policy provisions) and bad faith breach of contract. If you find in favor of Ms. Lau and award actual damages on her claims for breach of contract or bad faith breach of contract, then you shall consider whether exemplary damages should be assessed against Allstate. The standard for awarding punitive or exemplary damages is " beyond a reasonable doubt." Thus, if you find " beyond a reasonable doubt"that the injury complained of was attended by circumstances of malice or willful and wanton conduct, then in addition to actual damages, you may also assess a reasonable sum as exemplary damages, not to exceed the amount awarded as actual damages. " Reasonable doubt"means an uncertainty of mind in which your judgment is not at rest and you can explain this uncertainty based on a fair and thoughtful consideration of all of the evidence, or lack of evidence, in the case. "Attended by circumstances of malice or willful and wanton conduct" means an act or omission purposefully committed by a person who must have realized that the conduct could cause damages to others, and was done
38

Case 1:04-cv-01143-JLK

Document 73

Filed 02/09/2006

Page 39 of 50

heedlessly and recklessly, either without regard to the consequences, or without regard to the rights of others, particularly the plaintiff.

39

Case 1:04-cv-01143-JLK

Document 73

Filed 02/09/2006

Page 40 of 50

SECTION 4.0 FINAL INSTRUCTIONS

40

Case 1:04-cv-01143-JLK

Document 73

Filed 02/09/2006

Page 41 of 50

INSTRUCTION NO. 4.1 Facts from the Evidence It is your duty to find the facts from all the evidence in the case. To those facts, you must apply and follow the laws contained in these instructions whether you agree with them or not. Your decision is called a verdict and is reached by applying those laws to the facts as you find them. You must not be influenced by any personal likes or dislikes, opinions, prejudices or sympathy. You have taken an oath promising to do just so. You must follow all of these instructions and not single out some and ignore others; they are all equally important. You must not read into these instructions or into anything I may say or do any suggestions as to what verdict you should return. Your verdict is a matter entirely for you to decide.

41

Case 1:04-cv-01143-JLK

Document 73

Filed 02/09/2006

Page 42 of 50

INSTRUCTION NO. 4.2 Presiding Juror When you go to the jury room to begin your deliberations, you must elect one of you to serve as your Presiding Juror. He or she will preside over your deliberations and speak for you here in court. You will then discuss the case with your fellow jurors to reach agreement if you can do so. Your verdict must be unanimous. Each of you must decide the case for yourself, but you should do so only after you have considered all the evidence, discussed it with your fellow jurors, and listened to the views of your fellow jurors. I offer some suggestions on how you might do this in the next jury instruction, entitled " Jury - The Deliberations Process." Do not be afraid to change your opinion if the discussion persuades you that you should. But do not come to a decision simply because other jurors think it is right. It is important that you attempt to reach a unanimous verdict, but, of course, only if each of you can do so after having made your own conscientious decision. Do not change an honest belief about the weight of the evidence simply to reach a verdict.

42

Case 1:04-cv-01143-JLK

Document 73

Filed 02/09/2006

Page 43 of 50

INSTRUCTION NO. 4.3 Behavior of Jurors Once you have elected your Presiding Juror as directed by the previous instruction, you are free to proceed as you agree is appropriate. Therefore, I am not directing you how to proceed, but I offer the following suggestions that other juries have found helpful so that you can proceed in an orderly fashion, allowing full participation by each juror, and arrive at a verdict that is satisfactory to each of you. First, it is the responsibility of the Presiding Juror to encourage good communication and participation by all jurors and to maintain fairness and order. Your Presiding Juror should be willing and able to facilitate productive discussions even when disagreements and controversy arise. Second, the Presiding Juror should let each of you speak and be heard before expressing his or her own views. Third, the Presiding Juror should never attempt to promote nor permit anyone else to promote his or her personal opinions by coercion or intimidation or bullying of others. Fourth, the Presiding Juror should make certain that the deliberations are not rushed to reach a conclusion.

43

Case 1:04-cv-01143-JLK

Document 73

Filed 02/09/2006

Page 44 of 50

If the Presiding Juror you select does not meet these standards, he or she should voluntarily step down or be replaced by a majority vote. After you select a Presiding Juror you should consider electing a secretary who will tally the votes, help keep track of who has or hasn' spoken on the t various issues, make certain that all of you are present whenever deliberations are under way and otherwise assist the Presiding Juror. Some juries are tempted to start by holding a preliminary vote on the case to " where we stand." It is most advisable, however, that no vote be taken see before a full discussion is had on the issue to be voted on, otherwise you might lock yourself into a certain view before considering alternative and possibly more reasonable interpretations of the evidence. Experience has also shown that such early votes frequently lead to disruptive, unnecessarily lengthy, inefficient debate and ineffective decision-making. Instead, I suggest the Presiding Juror begin your deliberations by directing the discussion to establishing informal ground rules for how you will proceed. These rules should assure that you will focus upon, analyze and evaluate the evidence fairly and efficiently and that the viewpoint of each of you is heard and considered before any decisions are made. No one should be ignored. You may agree to discuss the case in the order of the questions presented in the special verdict form or in chronological order or according to the testimony of each

44

Case 1:04-cv-01143-JLK

Document 73

Filed 02/09/2006

Page 45 of 50

witness. Whatever order you select, however, it is advisable to be consistent and not jump from one topic to another. To move the process of deliberations along in the event you reach a controversial issue, it is wise to pass it temporarily and move on to the less controversial ones and then come back to it. You should then continue through each issue in the order you have agreed upon unless a majority of you agrees to change the order. It is very helpful, but certainly not required of you, that all votes be taken by secret ballot. This will help you focus on the issues and not be overly influenced by personalities. Each of you should also consider any disagreement you have with another juror or jurors as an opportunity for improving the quality of your decision and therefore should treat each other with respect. Any differences in your views should be discussed calmly and, if a break is needed for that purpose, it should be taken. Each of you should listen attentively and openly to one another before making any judgment. This is sometimes called " active listening"and it means that you should not listen with only one ear while thinking about a response. Only after you have heard and understood what the other person is saying should you think about a response. Obviously, this means that, unlike TV talk shows, you should try very hard not to interrupt. If one of your number is going on and on, it

45

Case 1:04-cv-01143-JLK

Document 73

Filed 02/09/2006

Page 46 of 50

is the Presiding Juror who should suggest that the point has been made and it is time to hear from someone else. You each have a right to your individual opinion, but you should be open to persuasion. When you focus your attention and best listening skills, others will feel respected and, even while they may disagree, they will respect you. It helps if you are open to the possibility that you might be wrong or at least that you might change your mind about some issues after listening to other views. Misunderstanding can undermine your efforts. Seek clarification if you do not understand or if you think others are not talking about the same thing. From time to time the Presiding Juror should set out the items on which you agree and those on which you have not yet reached agreement. In spite of all your efforts, it is indeed possible that serious disagreements may arise. In that event, recognize and accept that " getting stuck"is often part of the decision-making process. It is easy to fall into the trap of believing that there is something wrong with someone who is not ready to move toward what may be an emerging decision. Such a belief is not helpful. It can lead to focusing on personalities rather than the issues. It is best to be patient with one another. At such times slower is usually faster. There is a tendency to set deadlines and seek to force decisions. Providing a break or more time and space, however, often helps to shorten the overall process.

46

Case 1:04-cv-01143-JLK

Document 73

Filed 02/09/2006

Page 47 of 50

You may wish from time to time to express your mutual respect and repeat your resolve to work through any differences. With such a commitment and mutual respect, you will most likely render a verdict that leaves each of you satisfied that you have indeed rendered justice.

47

Case 1:04-cv-01143-JLK

Document 73

Filed 02/09/2006

Page 48 of 50

INSTRUCTION NO. 4.4 Communication with the Judge If it becomes necessary during your deliberations to communicate with me, you may send a folded note through the court security officer, signed by one of you. Do not disclose the content of your note to the court security officer. No member of the jury should hereafter attempt to communicate with me except by signed writing; and I will communicate with any member of the jury on anything concerning the case only in writing, or orally here in open court. You are not to tell anyone ­ including me ­ how the jury stands, numerically or otherwise, until you have reached a unanimous verdict and I have discharged you. If you send a note to me containing a question or request for further direction, please bear in mind that responses take considerable time and effort. Before giving an answer or direction, I must first notify the attorneys and bring them back to the court. I must confer with them, listen to arguments, research the legal authorities, if necessary, and reduce the answer or direction to writing. There may be some questions that, under the law, I am not permitted to answer. If it is improper for me to answer the question, I will tell you that. Please do not speculate about what the answer to your question might be or why I am not able to answer a particular question.

48

Case 1:04-cv-01143-JLK

Document 73

Filed 02/09/2006

Page 49 of 50

In some instances jurors request that certain testimony be read to them. This cannot be done as it is inappropriate for the court to single out testimony. In those circumstances you must rely upon your own recollection.

49

Case 1:04-cv-01143-JLK

Document 73

Filed 02/09/2006

Page 50 of 50

INSTRUCTION NO. 4.5 Jury Verdict Forms You each have copies of a document called a Jury Verdict Form. You should answer the questions in the Jury Verdict Form as directed. You must reach unanimous agreement on the answers to each of the questions you are directed in the form to answer. Upon arriving at an agreement, your Presiding Juror will insert each answer on the Jury Verdict Form. After all of the questions have been answered as directed by the Jury Verdict Form, your Presiding Juror will date the Jury Verdict Form, sign it, and then ask all of the other jurors to sign it. After you have filled out the Jury Verdict Form in this manner, your Presiding Juror should advise the court security officer stationed outside the jury room that you have reached a verdict.

50