Posted In: Insurance Recovery
By Sallie Conley Lux on August 9, 2018
The controversy over the recently adopted Restatement of Law, Liability Insurance (RLLI) continues. On July 30, 2018, Ohio Governor John Kasich signed a law that unequivocally affirms that, in Ohio, state insurance statutes and state common law continue to be preeminent in insurance disputes governed by Ohio law.
Senate Bill 239 was primarily sponsored by Senator Matt Dolan and passed unanimously. While the bill contained a number of non-insurance related provisions, it specifically addressed the RLLI. The bill as approved and signed adopts Ohio Rev. Code section 3901.82 which states: “The ‘Restatement of the Law, Liability Insurance’ that was approved at the 2018 annual meeting of the American law institute (sic) does not constitute the public policy of this state and is an inappropriate subject of notice.” Reportedly, the ALI has confirmed that Ohio is the first state ever to address legislatively a Restatement of Law in its entirety.
The Restatements of Law are adopted by the American Law Institute, “the leading independent organization in the United States producing scholarly work to clarify, modernize, and improve the law.” The Restatements are extremely persuasive and influential in both state and federal courts throughout the country, routinely cited in briefs advocating various legal concepts and principles, and cited and relied upon in an untold number of judicial decisions announcing controlling legal principles in various states.
Some jurists and practitioners caution that some of the influential Restatements in certain circumstances have moved beyond clear statements of what the law is to statements of what the law should be, in the view of the ALI:
I write separately to note that modern Restatements . . . are of questionable value, and must be used with caution. The object of the original Restatements was “to present an orderly statement of the general common law.” Restatement of Conflict of Laws, Introduction, p. viii (1934). Over time, Restatements’ authors have abandoned the mission of describing the law, and have chosen instead to set forth their aspirations for what the law ought to be…Restatement sections such as that should be given not weight whatsoever as to the current state of the law, and no more weight regarding what the law ought to be than the recommendations of any respected lawyer or scholar.
Kansas v. Nebraska, 135 S. Ct. 1042, 1054 (Scalia, J., concurring and dissenting).
The recent adoption of the RLLI in May, 2018 was the culmination of many drafts over a number of years. As it evolved, the project was the object of intense interest and scrutiny by insurance scholars and practitioners representing both insurers and policyholders. Throughout its evolution, many aspects of the project were highly debated, and many proposed Sections of proposed statements of law were contested in comments submitted by interested parties.
Because of the comprehensive nature of the RLLI, which addresses a wide range of insurance topics, there remain many differences of opinion on whether particular statements of law reflect clear and accurate restatements of the law or statements of what the law should be. And, not unsurprisingly, advocates of a certain perspective may view certain sections of RLLI to be accurate reflections of the law, while other sections are not.
Insurance law is a matter of state law. It is governed by state statutes and common law, and may vary from state to state. As cases are litigated, and the resultant common law in each state is established and evolves, majority and minority views among the states concerning various insurance principles inevitably develop.
Presumably, Ohio legislators were concerned both (1) that the RLLI as adopted reflects, at least in part, aspirational statements of what the law should be, as proposed by the ALI, rather than statements of established black letter law; and (2) that specific provisions and sections of the RLLI do not accurately reflect Ohio law on particular topics.
Accordingly, the legislature took the unprecedented step of adopting Ohio Rev. Code section 3901.82, which protects the integrity of established Ohio law in insurance disputes. While the RLLI may be referenced and cited as persuasive authority in advocating for a certain position or change in the law, this recent legislation makes it crystal clear that, despite the recently adopted RLLI, the established and developing insurance common law of Ohio and Ohio insurance statutes continue to govern the Courts in Ohio and control Ohio insurance disputes.
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