Court says insurer can't void medical malpractice insurance policy

side note: Here is an interesting case. A doctor lied to his insurer by not disclosing previous claims; then disappears after damaging the plaintiff in this case — never to be heard from again — and is unavailable to participate in his own defense. A sad case all around. Here’s hoping this never happens to anyone again!

St. Louis Tribune

After years of legal wrangling, a 12-year-old Eureka boy who suffered brain damage at birth is a step closer to getting money to help compensate for his injuries.

The Utah Supreme Court on Tuesday ruled an insurance company cannot invalidate the medical malpractice policy of the obstetrician who made a failed attempt to deliver the boy with forceps. Under that decision, The Doctors’ Company (TDC), an insurance company based in Napa, Calif., remains responsible for an almost $1.3 million jury verdict in favor of Athan Montgomery.

With interest, the total could top $2 million.

The insurer has argued for years that it should be excused from defending the doctor or paying any judgment on his behalf. TDC did not have immediate comment on the decision.

David Biggs, an attorney who represents Athan and his family, said: “We are pleased beyond measure that finally, this young child, now a young man, might be compensated for the medical malpractice that took place so many years ago.”

Heidi J. Judd, who gave birth in May 1997 at Tooele Valley Regional Medical Center, alleges her son has permanent brain damage because Dr. Gregory Drezga pulled too hard with forceps. Even before Judd filed a lawsuit in 1998, Drezga disappeared and his whereabouts remain unknown.

TDC sought a declaration that Drezga’s policy was invalid because the doctor failed to report three previous malpractice claims against him and did not cooperate in his defense. A 3rd District judge rejected the request.

At a December 2002 trial, attorneys James McConkie and Bradley Parker argued that Athan suffers from cognitive disability and slight paralysis on his left side because of the forceps injury and a subsequent Caesarean section.

A jury awarded the boy $1.25 million for pain and suffering and $1,022,735.30 in special damages for past and future medical expenses. The award was reduced by $1 million because of a state-mandated cap of $250,000 on non-economic damages.

The jury found no negligence on the part of Tooele Valley Regional Medical Center.

After the trial, Judd realized that her son might not be able to get any money if TDC voided the insurance and asked that an attorney be appointed to represent the absent Drezga. A judge agreed and also ordered TDC to pay the attorneys’ fees.

The Supreme Court ruled 3-2 in 2004 that the damages cap was constitutional. Then, in 2005, it upheld the appointment of a lawyer to argue on Drezga’s behalf against voiding his insurance.

In Tuesday’s ruling, the justices noted that TDC took action to cancel Drezga’s policy in 2000 and ruled that the cancelation affected only future cases. The court, under the “extraordinary circumstances” in the case, also upheld the order that the company pay the fees for the doctor’s attorney.

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