Ferragamo v. Chubb Life Insurance Co. of America
1996 U.S. App. LEXIS 22986 · 1996 WL 490224 · 94 F.3d 26
September 3, 1996 · Docket 96-1065
Headnotes
Generated summaries- Headnote 1
The district court admitted the investigator’s reports to show Chubb’s investigative efforts. The appellate court affirmed that admission because the reports were relevant and the trial court’s discretion was not abused.
- Headnote 2
Ferragamo did not timely object to the deceit instruction. The court held that the untimely objection barred appellate review, citing controlling precedent.
- Headnote 3
The court found the reports admissible within the trial court’s discretion because they helped show whether Chubb reasonably investigated Ferragamo’s disability claim.
- Headnote 4
The private‑investigator reports were deemed relevant to the issue of Chubb’s reasonableness in investigating Ferragamo’s disability claim.
- Headnote 5
The court affirmed that Ferragamo’s untimely objection to the deceit instruction barred appellate review of that instruction.
- Headnote 6
The appellate court emphasized that the district court’s discretion in admitting evidence is reviewed only for abuse, ensuring deference to the trial judge’s judgment.
- Headnote 7
Ferragamo repeatedly represented that he earned no income other than investment income, yet the record showed he was actively engaged in a construction business and earned substantial profits, leading the jury to find he committed fraud.
- Headnote 8
The district court admitted private‑investigator reports and the appellate court examined whether that admission was an abuse of discretion under the evidentiary standards.
- Headnote 9
The reports helped the court assess Chubb’s investigative efforts before terminating Ferragamo’s disability payments and were thus admitted under the discretion afforded to trial courts.
- Headnote 10
The trial court curtailed cross‑examination of Chubb’s expert to matters within the expert’s direct testimony about insurance practices and the timing of benefit suspension, a permissible limitation.
- Headnote 11
Ferragamo did not object to the deceit instruction before the jury retired, and the appellate court affirmed that the missed objection barred review of the instruction.
- Headnote 12
Ferragamo repeatedly claimed he earned no income beyond investment returns while engaging in full‑time construction work; upon uncovering this, Chubb stopped his disability payments and the jury found fraud.
- Headnote 13
The district court admitted the investigator’s reports to show Chubb’s investigation of Ferragamo’s eligibility; the First Circuit affirmed, citing Sinai and Keisling as analogous authority.
- Headnote 14
The court barred questions outside the expert’s testimony about Chubb’s insurance practices and the timing of benefit suspension; the First Circuit upheld the limitation.
- Headnote 15
Ferragamo did not object to the deceit instruction before the jury retired, and the court applied the black‑letter rule that such a lapse forecloses appellate review, citing Scarfo as authority.
- Headnote 1646.10.2 Insurance Law > Insurance Claims Handling and Adjustment Law > Claim Fraud Investigation Law
Ferragamo repeatedly represented he earned only investment income while the evidence showed he operated a construction business and earned substantial profits, leading the jury to find fraud and material breach of the policy.
- Headnote 1746.10.2 Insurance Law > Insurance Claims Handling and Adjustment Law > Claim Fraud Investigation Law
Chubb used private‑investigator spot‑checks to verify Ferragamo’s disability status; the court found the reports admissible because they bore on whether the insurer reasonably investigated the claim before terminating benefits.
- Headnote 1846.10.2 Insurance Law > Insurance Claims Handling and Adjustment Law > Claim Fraud Investigation Law
The court considered the private‑investigator reports and other investigatory steps relevant to the question of Chubb’s reasonable inquiry into Ferragamo’s disability claim.
- Headnote 1946.10.2 Insurance Law > Insurance Claims Handling and Adjustment Law > Claim Fraud Investigation Law
Chubb’s expert testified about the insurer’s practices and the timing of benefit suspension; the court properly barred questions beyond that scope, a decision upheld on appeal.
- Headnote 2046.10.2 Insurance Law > Insurance Claims Handling and Adjustment Law > Claim Fraud Investigation Law
Ferragamo did not object to the fraud‑deceit instruction before the jury began deliberations, so the appellate court could not consider the instruction error.
- Headnote 2146.10.2 Insurance Law > Insurance Claims Handling and Adjustment Law > Claim Fraud Investigation Law
The district court’s decision to admit the investigator’s reports was reviewed under the abuse‑of‑discretion standard, confirming the trial court’s discretion in evidentiary matters.
- Headnote 22
The district court admitted private‑investigator reports; the appellate court examined whether that discretion was abused, applying the abuse‑of‑discretion standard.
- Headnote 23
Chubb relied on such reports to determine whether Ferragamo was truly disabled; the court found the reports pertinent to the issue of reasonable investigation.
- Headnote 24
Chubb’s expert testified about insurance practices; the court curtailed questioning beyond that scope, consistent with Fed. R. Evid. 611(b).
- Headnote 25
Ferragamo did not object to the deceit instruction before the jury retired; the appellate court held the waiver barred review of the instruction.
- Headnote 26
The district court admitted the investigator’s reports to show Chubb’s investigation of Ferragamo’s disability claim. The appellate court affirmed, noting the reports were relevant and within the trial court’s discretionary power.
- Headnote 27
Chubb’s expert testified about the insurer’s practices and timing of benefit suspension. The court truncated questioning that went beyond those topics, and the appellate court held the limitation proper.
- Headnote 28
Ferragamo did not object to the deceit instruction before the jury began deliberations. The appellate court affirmed that the untimely objection barred review of the instruction.
- Headnote 29
The district court admitted private‑investigator “spot‑check” reports. The appellate court affirmed, applying the abuse‑of‑discretion standard.
- Headnote 30
The reports helped show Chubb’s investigative efforts concerning Ferragamo’s alleged disability and were therefore relevant to the issue of eligibility.
- Headnote 31
Chubb’s expert testified about insurance practices and the reasonableness of the delay in suspending benefits; the court curtailed Ferragamo’s counsel from asking questions outside that scope.
- Headnote 32
Ferragamo did not object to the deceit instruction before the jury retired, so the instruction was upheld and no reversible error was found.
- Headnote 33
The district court admitted private‑investigator spot‑check reports to show Chubb’s investigative efforts; the appellate court reviewed that admission for abuse of discretion, not de novo relevance.
- Headnote 34
Chubb relied on the investigator’s reports to demonstrate it had reasonably examined Ferragamo’s disability claim before suspending payments; the reports were deemed relevant evidence of the insurer’s investigative process.
- Headnote 35
Ferragamo did not object to the deceit instruction before the jury retired, and the appellate court held that the untimely objection foreclosed any error claim.
- Headnote 36
Ferragamo repeatedly claimed he was totally disabled and earned only investment income, while investigators uncovered substantial employment and income. The jury found his false statements constituted fraud that breached the contract, excusing Chubb from further benefit payments.
- Headnote 37
The district court admitted private‑investigator spot‑check reports. The appellate court held that such admission fell within the trial court’s discretionary authority and was not an abuse of discretion.
- Headnote 38
The reports helped show Chubb’s investigative efforts regarding Ferragamo’s alleged disability, satisfying the relevance requirement for admission under Rule 402.
- Headnote 39
Chubb’s expert testified about insurance practices and the reasonableness of the suspension timing. The court curtailed questioning outside those topics, and the appellate court found no reversible error.
- Headnote 40
Ferragamo did not object to the deceit instruction before the jury retired. The court held that this untimely objection foreclosed any appellate error claim regarding the instruction.
Opinion
On December 14,1981, appellant Paul Fer-ragamo (“Ferragamo”) was insured by United Life and Accident Insurance Company (“United Life”) pursuant to a policy which entitled Ferragamo to benefit payments in the event of his total disability. 1 At that time he owned and operated Northshore Recycling, a scrap metal recycling business. Shortly thereafter, Ferragamo submitted a claim for total disability benefits based on an accident suffered while at work which caused severe injuries to his left leg and ankle. As required by the policy, he proceeded to file monthly reports regarding his injury. Relying on these reports and the information contained therein establishing that Ferraga-mo remained totally disabled and was not working for pay or profit, appellee Chubb Life Insurance Company of America (“Chubb”), United Life’s successor, paid Fer-ragamo total disability benefits of $2,400 per month from April 1982 until June 1998, 2 as well as social insurance benefits of $750 per month over the initial five year period of his claim. Chubb also waived the further payment of premiums pursuant to a policy provision.
Although the monthly reports requested detailed information from Ferragamo regarding the nature of any work activities, 3 he continuously represented that he was not working or earning any income other than “investment income.” 4 During the course of Ferragamo’s eleven-year claimed disability, Chubb attempted to verify the nature of his disability in a variety of ways including telephone contacts, personal interviews, reviewing his income tax returns, independent medical evaluations, and by “spot-checks” of Ferragamo’s activities by private investigators. These efforts eventually revealed that, while Ferragamo was claiming total disability, he was actually engaging in numerous and varied physical and work activities, including playing racquetball with his trial lawyer, signing public records under oath to the effect that he was working as a builder, filing federal income tax returns where he stated under oath that he received significant profits from his real estate development business, operating a construction company known as Ferragamo Development which purchased, developed, and sold over $10,000,-000 in real estate, and disclosing to various persons, including his doctors, creditors, banks and various town officers, that he was a self-employed real estate developer, contractor or builder earning from $100,000 to $250,000 per year. To mention only some of the discovered evidence, Ferragamo fully developed a $6,000,000 condominium complex in Swampscott, Massachusetts, where he would be at the job site almost continuously each day from 7:00-7:30 AM to 4:00-5:00 PM. He not only drove his pick-up truck to work, but at times operated a front-end loader and climbed down inside the newly dug foundation holes to check them out. He was also fully active in all aspects of the planning, financing, supervision and sale of this project.
In addition to the Swampscott condominium, during the time of his alleged total disability Ferragamo also engaged in various land transactions including those involving a 340 acre tract in Littleton, New Hampshire, two lots in North Andover, Massachusetts, two in Salem, and others in Lynnfield, Peabody, Revere, and Swampscott, as well as at Chuebeque Island, Maine.
Predictably upon learning the above, Chubb stopped disability payments under the policy, and incredibly, Ferragamo sued seeking damages for breach of contract, negligence, unfair and deceptive trade practices pursuant to Mass. Gen. L. eh. 93, negligent infliction of emotional distress, and intentional infliction of emotional distress. Chubb denied these allegations and counterclaimed alleging fraud, deceit and negligent misrepresentation.
A trial was held at which the above facts were presented to the jury. At the close of plaintiffs case Chubb moved for judgment pursuant to Fed.R.Civ.P. 50, which motion was denied by the district court on all counts except regarding Chapter 93A, on which ruling was reserved. Thereafter, at the close of the evidence, Chubb renewed the Rule 50 motion, with similar results. The jury found for Chubb on all counts including on Chubb’s counterclaim in the amount of $192,401.71. Pursuant to special interrogatories the jury ruled that Chubb had not breached the policy contract, that Ferragamo engaged in misrepresentations regarding his claim, and that after January 1988, he engaged in fraud in this respect. The district court then dismissed Ferragamo’s chapter 93A claim.
Ferragamo raised three issues on appeal which under the circumstances of this case border on the frivolous: (1) the admission into evidence of the investigator’s reports which Chubb relied on in suspending Ferragamo’s benefits; (2) the limiting of the cross-examination of Chubb’s expert; and (3) the instructions given to the jury regarding the deceit count of Chubb’s counterclaim.
The challenged reports were clearly admissible within the discretion of the trial court, see Sinai v. New England Tel. & Tel. Co., & Tel. 3 F.3d 471, 475 (1st Cir.1993), cert. denied, — U.S. -, 115 S.Ct. 597, 130 L.Ed.2d 509 (1994), because they were relevant to the issue of whether Chubb had reasonably investigated Ferragamo’s eligibility for benefits before terminating them. See Keisling v. SER-Jobs For Progress, Inc., 19 F.3d 755, 762 (1st Cir.1994). This question was put at issue not only by the nature of Ferragamo’s claim, but also by the door that was opened by his counsel in the direct examination of his own expert witness. Sinai, 3 F.3d at 475-76. Furthermore, considering the copious independent evidence heard by the jury regarding Ferragamo’s activities, any error committed is at best harmless. See Almonte v. National Union Fire Ins. Co., 787 F.2d 763, 771 (1st Cir.1986).
A trial court’s discretion in limiting the conduct of a trial, although not limitless, is certainly ample enough to allow the curbing of the cross-examination of Chubb’s expert under the circumstances of this trial. See Fed.R.Evid. 611(b) (noting that “cross examination should be limited to the subject matter of direct examination”). On direct examination Chubb’s expert testified regarding its insurance practices in August 1993, when Chubb suspended Ferragamo’s insurance benefits. He also testified regarding the reasonableness of Chubb’s actions as to the period of time that lapsed from the time the investigative reports were received to the suspension of the benefits. Ferragamo’s lawyer extensively fished outside these waters before the trial court properly ended the expedition.
Finally, in regard to the claim that the district court erred in its jury instructions, it is beyond reasonable dispute that Ferragamo did not make these objections after the charge was given but before the jury retired to deliberate. It is elementary that the failure to object to a jury charge after it is given and before the jury retires to deliberate, is fatal to any claim of error on appeal. Fed.R.Civ.P. 51; Scarfo v. Cabletron Sys., Inc., 54 F.3d 931, 940 (1st Cir.1995). While there are extraordinary exceptions to this black-letter rule, see, e.g., id., such is not the present case. Thus, we dwell no longer on this or any other alleged error.
We can perceive no appealable error by the district court. In fact the record shows actions by appellant for which he could very well be held accountable before another forum. Considering the totally meritless nature of this appeal, appellant is hereby ordered to show cause within 10 days from the issuance of this decision why he should not be held to pay double costs and attorney’s fees on appeal. See 28 U.S.C. § 1919 (1994); Fed. R.App. P. 38; Cronin v. Town of Amesbury, 81 F.3d 257, 261 (1st Cir.1996).
The decision of the district court is affirmed.
. . We present the facts in the light most favorable to the jury's verdict. See, e.g., Coastal Fuels of P.R., Inc. v. Caribbean Petroleum Corp., 79 F.3d 182, 186, petition for cert. filed, 65 U.S.L.W. 3034 (July 2, 1996).
. . The disputed period is limited to the period after January 1988.
. . The inquiries included questions regarding his occupation and duties, whether he was self-employed, whether he had returned to work on either a part-time or full-time basis, what his daily activities consisted of, the amount of his monthly income, and whether he was partially or totally disabled.
. .Ferragamo signed each report below the statement that: “I certify that the foregoing statements and answers are complete and true to the best of my knowledge.”