The Cougar and The Tiger, Part Three

Constant Readers,

It's as simple as borrowing a friend's car. You borrow it and cause an accident. The victim sues the owner of the car (your friend) and wins. Obviously, you should offer to pay whatever amount the judge rules that your friend owes the victim because you are the one who caused the wreck. In lawyerland, we call this agreement to pay for a legal judgment against someone else "indemnification." Think of it as a responsible "bail out."

Back in February, I wrote a two-part piece on the legal liability of the City for the Christmas Day tiger maulings at the San Francisco Zoo.

Predictably, the darling Dhaliwal brothers filed claims against the City on March 26. The complaint itself lists 17 causes of action for each brother, including negligence, emotional distress and failure to maintain property in a safe condition.

Today, the City Attorney responded to the claims with a pithy letter:

An investigation of your client's claim filed with the City and County of San Francisco has revealed no indication of liability on the part of the City and County. Accordingly, your claim is DENIED.

Then it gets interesting. The City Attorney's letter instructs Geragos to refer his clients' claims to the San Francisco Zoological Society (SFZS). Why? Because according to the Agreement between the City and the SFZS (Agreement), the SFZS is supposed to maintain "comprehensive general liability insurance" worth no less than $5 million for each incident leading to damages. (Sec. 17.1(a).) The agreement was signed in 1993, and Fog City Journal reports that the amount of insurance is now $15 million.

However, the insurance that the SFZS is supposed to maintain need only cover the City "to the extent of the losses" for which the SFZS has agreed to indemnify the City. (Sec. 17.2(a).)

So, to what extent does the SFZS have to indemnify (bail out) the City?

The Agreement says that the SFZS does NOT have to indemnify the City for losses resulting from "pre-existing conditions." (Sec. 21.2(a).) In our car-borrowing hypo, if the cause of a wreck were old tires that were already bald when you borrowed the car, obviously it would not be fair to make you pay the owner for resulting damages. Similarly, structural problems at the zoo that existed in 1993 when the City turned over management of the zoo to the SFZS are exempt from indemnification. In this case, the wall at issue was reportedly short well before 1993.

Also exempt from indemnification are "negligent or wrongful acts or omissions of any Civil Service Employees." (Sec. 21.2(b).)

And it gets worse.

The main indemnity provison of the Agreement (Sec. 21.1) states that the SFZS only has to indemnify the City for the damages for which the City is not responsible.

To recap: (a) the wall was reportedly a preexisting condition, (b) the SFZS does not have to indemnify the City for damages resulting from preexisting conditions, (c) the SFZS does not have to have insurance that covers damages relating to a preexisting condition (though it might), (d) the SFZS does not have to indemnify the City for negligence by City employees, and (e) the SFZS does not have to indemnify the City for damages caused by the City.

In other words, it appears as if the City will not be able to hide behind the Agreement when it comes to damages to the Dhaliwal brothers and Carlos Sousa. The SFZS will get their asses sued off, too (as will the owners of the Terrace Cafe) - I'm just saying that absent some recent arrangement between the SFZS and the City, they won't be alone.

--Melissa

BONUS: The reason that the Dhaliwal brothers had to file an initial claim (that was just denied) is because they are bringing suit under the CA Government Claims Act. Now that their claim has been denied by the City, the Dhaliwal brothers have 6 months from today to file a lawsuit in State Court. (Cal. Gov. Code sec. 945.6.)

Comments

[sfmike]

Thank you for once again explaining it all for us in comprehensible legal terms. I still don't understand why the city doesn't just come to an agreement rather than pay hundreds of thousands of dollars to scum like Sam Singer's P.R. outfit. The latter, by the way, have run a very sleazy media campaign against the brothers, which has become part of the lawsuit and will probably be the eventual reason that the taxpayers of San Francisco end up paying millions rather than thousands to the brothers everyone hates.

[brittney]

You are so fucking smart, Sweet Melissa. Good lord, I love this blog.

[sfwillie]

What sfmike said.

[Kimo Crossman]

Interesting summary, here's a shorter explanation: Deepest Pockets, SF Taxpayers

[lgh]

Melissa- I heart you brain!!!!!

[Mousqueton]

Hate to disagree but disagreement does spice up life.

In your example the person who borrowed the car does not have a "fiduciary duty". In contrast, the SFZS does have a fiduciary duty in regard to the zoo. This means, they are responsible for taking provisions, and/or asking the city to do it, in order to avoid both harm to people and animals.

If under contract I give you a loaded gun for you to administer and the gun goes off and hurts someone, responsibility does not fall on me for giving you a loaded gun but on you for not taking the necessary precautions to safeguard the gun and/or unload it to avoid any accidental firing of the gun.

Not that it matters because eventually, the Dhaliwal brothers will be "satanized" in the press and they will settle for a hefty sum.

As for who will pay; "Elemental my dear Watson; taxpayers will pay as always".