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Estate collects $800K in UIM benefits after offer dispute

Liability in the underlying case was not contested, but the amount of available UIM coverage was the subject of a declaratory-judgment action.

Seventeen-year-old Lilli Manis was killed by a 19-year-old drunk driver, Justin Crouse, in the early-morning hours of July 12, 2008. Lilli had been expected to begin college in the fall at Earlham College in Richmond, Ind. Her surviving beneficiaries were her mother and father, Elizabeth and Paul Manis.

The vehicle in which Lilli had been a passenger had $50,000 in UIM coverage from State Farm, for which a proper selection/rejection form had been executed by the policyholder. As the primary UIM carrier, State Farm paid its $20,000 in available UIM coverage.

The real issue in the case had to do with the amount of available UIM coverage under the Manis family’s Allstate policy. Allstate claimed only $50,000 in UIM coverage.

In 1999, the Manis family had moved to Chapel Hill from Baltimore. In switching to a North Carolina policy, no Allstate agent had discussed or provided Lilli’s parents information about the UM/UIM option for $1 million in coverage. According to Allstate, a selection/rejection form had been included in the original packet mailed to Lilli’s parents when they received their new policy, but Allstate acknowledged that it did not possess an executed form.

The Manis family filed a declaratory judgment action against Allstate based upon Williams v. Nationwide and the failure to provide the UM/UIM option to the policyholders. The complaint added a second count for a wrongful-death action against Crouse.

After GMAC tendered its liability limits of $30,000, Lilli’s estate demanded arbitration. Prior to the arbitration, the matter was settled at mediation for an additional $800,000 from Allstate.

Crouse eventually pled guilty to second-degree murder based upon implied malice, with the evidence showing a number of people who had tried to stop him from driving in his grossly impaired condition.

Ingenix sought reimbursement of $16,500 for a self-funded ERISA plan. Based upon the estate’s argument that the plan’s language failed to meet the “particular fund” requirement to establish a proper, ERISA lien by agreement, the estate was able to compromise the reimbursement claim for $6,500.

The recovery in this case enabled the Manis family to establish The Lillian Broox Manis Foundation and the Lillian Broox Manis Memorial Scholarship. The Foundation is a 501c(3) charitable organization created to honor Lilli’s life and interests by supporting programs and causes close to Lilli’s heart, including the Chapel Hill High School Philharmonic Foundation, Duke Young Writer’s Camp, the Carolina Sailing Foundation and the Haiti earthquake relief effort. The memorial scholarship is an endowed scholarship at Earlham College and is used to help support students at Earlham to enable study for a semester or a year abroad, or for specific experiences in art or Asian studies.


 Mediation Report

Type of action: UIM coverage declaratory-judgment action; wrongful death

Injuries alleged: Multiple, fatal, blunt-force trauma

Case name: Paul Manis, Administrator of the Estate of Lillian Broox Manis v. Allstate Ins. Co. and Justin Crouse

Case number: 09 CVS 00170

Court: Orange County Superior Court

Mediator: Bonnie Weyher

Verdict or settlement: Mediation

Date: May 28, 2010

Amount: $860,000 – $800,000 in UIM coverage from Allstate, $20,000 in UIM coverage from State Farm, $30,000 in liability coverage from GMAC and $10,000 in medical payments coverage from Allstate (all collected)

Special damages: $20,000-plus (medical bills and funeral expenses) 

Plaintiff’s attorneys: Jerome P. Trehy Jr. and Donald R. Strickland, both of Twiggs, Beskind, Strickland & Rabenau (Raleigh)


Editor’s note: The information in Lawyers Weekly’s verdicts and settlements reports was submitted by the counsel for the prevailing party and represents the attorney’s characterization of the case.

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