VIEWPOINT | ISSUE IV | 2015

“

1715

It’s not often that a ruling by an Australian state court will cause a stir in U.S. legal circles.

But, a July 2015 ruling by the supreme court of New South Wales has renewed concerns that U.S. insurers may face claims for bodily injury identified as post-traumatic stress disorder (PTSD).

The ruling came in a case brought by a nurse who sued an air carrier for injuries and trauma she suffered during a charter flight that had to touch down at sea while she was helping to evacuate a patient.

The air carrier readily conceded to compensate the nurse for her physical injuries and the emotional distress that followed immediately upon those injuries. However, the air carrier resisted paying for her claims of PTSD.

In denying the PTSD claim, the air carrier argued that PTSD, as a mental condition removed in time from the trauma in question, fell outside the terms of the Montreal Convention of 1998, which governs international understandings of air carrier liability. (The Montreal Convention is the latest update of the better-known Warsaw Convention of 1929.)

The U.S. is a party to the Montreal Convention, so its provisions have the status of law in the U.S. Interpretations of the convention have been cited in U.S. court rulings unrelated to aviation.

The Montreal Convention, like the Warsaw Convention before it, draws a distinction between compensable injuries to the physical body and non-compensable injuries to a non-corporeal “mind.”

In the New South Wales case1, the judge ruled that “the PTSD which [the claimant] developed and continues to suffer is not merely the result of an injury to her mind. [The claimant’s] PTSD also involves an injury to her brain and other parts of her body involved in normal brain function.”

Continuing, the judge added that “the ongoing dysfunction of the plaintiff’s brain...is consistent with chemical changes in her brain and body and in her brain’s neurotransmitter pathways, which have prevented a return to normal brain function.”

ResearchThe ruling in Australia reflects a reaction in law, one

with potential international implications, to the progress of research in neuroscience as it identifies physical markers in the organic brain for conditions long regarded as diseases and disorders of the mind.

“Over the past three decades the growth of the biological PTSD literature has been explosive,” wrote Dr. Roger K. Pitman and a team of Harvard Medical

LIABILITY

© iStockphoto.com

Scars On the Brain Is post-traumatic stress disorder a form of bodily injury?

...the growth of biological PTSD literature has been explosive...

Harvard Medical School researchers

“

VIEWPOINT | ISSUE IV | 2015

School researchers in a 2012 article.2 “The impact of an environmental event, such as a psychological trauma, must be understood at organic, cellular and molecular levels.”

According to Pitman’s team, PTSD was regarded with skepticism in 1980 when it was first recognized as a diagnosable condition in the American Psychiatric Association’s Diagnostic and Statistical Manual of Mental Disorders, known as “DSM.”

Early on, the condition was conceptualized almost entirely in psychological terms, but the identification by researchers of “biomarkers” has provided an objective basis for diagnosing and treating the condition.

Neuroscientists have identified three organic conditions as particularly prominent among the physical manifestations of PTSD:■ A reduction in size of the hippocampus, a part of the

brain associated with conscious memories;■ Increased activity of the amygdala, a region of the

brain that affects emotional responses to sensory experiences; and

■ A reduction in volume of the prefrontal cortex, a part of the brain that affects cognitive functioning.

InjuryResearch into PTSD has been driven, in large part, by

widespread support for veterans of military combat, some of whom have reported experiencing the symptoms of PTSD. Those symptoms include recurrent and intrusive recollection of traumatic events and an increased sense of arousal and hypervigilance, to the point where the condition affects social and occupational functioning.

Jonathan Shay, a psychiatrist at a Veterans Affairs outpatient clinic in Massachusetts, bristles at the use of “disorder” to describe post-traumatic stress reactions, and makes a morally compelling case that PTSD is an injury with a biological basis, with or without an accompanying physical injury.

“We are dealing with an injury,” he wrote in 20113, “not an illness, malady, disease, sickness, or disorder.

“My insistence comes from an awareness that within military forces it is entirely honorable to be injured,” he added. “The primary psychological injury from war is the persistence into civilian life (or life in garrison) of the valid physiological, psychological, and social adaptions that promoted survival in the face of other human beings trying to kill you.” ►

tccs-inspro.com 800.388.7779

INTUITIVE WEB-BASED FULL-FEATURED

Insurance Processing SystemINS PRO

VIEWPOINT | ISSUE IV | 20151717

Shay concluded by saying: “I want to dispute the habitual mind-body distinction...This distinction is often useful, but at its root, incoherent...The body codes moral injury as physical attack and reacts with the same massive mobilization.”

If Shay’s position regarding PTSD as an injury prevails–and concern for veterans strongly influences how society regards PTSD–the law on what constitutes “bodily injury” could be profoundly affected.

The LawA transformation may already be underway in

criminal law, writes University of Minnesota law professor Francis X. Shen. In a 2013 article, he wrote that “policymakers and the public increasingly recognize the biological basis for, and the gravity of, ‘mental’ and ‘emotional’ disabilities.”4

As a result, he adds, “neuroscientific evidence is rapidly becoming more prevalent and prominent in criminal proceedings across the country.”

If PTSD and other mental conditions come to be commonly regarded as forms of bodily injury, Shen believes there will be a “tremendous expansion of criminal liability” because of the generally more severe charges and sentencing handed down for bodily as opposed to purely mental or emotional injury. He questions if jurors will be able to make the traditional distinction between physical and mental injury if they are presented evidence from neuroscience.

At the same time, objective evidence of mental impairment may help criminal defendants win acquittal or avoid the harshest sentences. Shen cites an example where a Florida jury gave an offender a life sentence rather than the death penalty on the basis of evidence produced by electroencephalography.

As for civil law, Shen finds that “neuroscientific understandings of mental injury” are having an effect

in efforts to remove the distinction between mind and body from considerations of tort recovery and liability insurance coverage.

Few courts have found that mental harm, on its own, constitutes bodily injury, he writes, but “most seem to agree that mental harm accompanied by physical manifestations can be sufficient to trigger insurance coverage.”

LiabilityTo illustrate the progression in legal thinking, the

Connecticut Supreme Court stated back in 2000 that “the majority rule nationally is that bodily injury does not include emotional distress unaccompanied by physical harm,” even though emotional distress often has physical manifestations.

Fourteen years later, another Connecticut court ruled that “claims for the physical manifestations of emotional distress, such as sleeplessness, may constitute a bodily injury under a policy.”

Thus, there are two scenarios today where a claimant has some chance of success in claiming that emotional distress falls under coverage for bodily injury:■ In situations where the emotional distress directly

accompanies or arises from bodily injuries as traditionally understood; and

■ In situations where emotional distress is manifested in objectively identifiable physical symptoms and directly connected to tortious acts of another.Recent cases concerning PTSD essentially seek to

add a third dimension to the consideration of mental injury as a form of bodily injury. Drawing on advances in neuroscience, some claimants argue that PTSD, in itself, is a form of physical injury to the organic brain compensable under liability coverage for bodily injury.

“Claims of PTSD impairment are increasing,” writes the Ohio State Bar Association in a posting on its website, adding that Ohio judges are generally skeptical

Claims of PTSD impairment are increasing.

Ohio State Bar Association

© iStockphoto.com

VIEWPOINT | ISSUE IV | 2015 1818VIEWPOINT | ISSUE IV | 2015

of PTSD claims, and look for direct evidence of the disorder and its connection to an occurrence.5

BystanderStandard liability insurance policies have long defined

bodily injury to be physical harm only, and have excluded mental or emotional injury not caused by a physical injury from that definition.

In recent years, the scope of these definitions have been tested by “bystander” claims from people who claim to suffer from PTSD after witnessing traumatic events in which they were not physically injured as traditionally understood.

Two well-known cases reached the Michigan Supreme Court, with different results.

In 2008, that court held that PTSD suffered by a train engineer who struck a school bus might be compensable as a bodily injury, and remanded the case back to the original trial court, which had originally ruled that PTSD did not constitute bodily injury.6

The engineer was not physically injured incident, but was traumatized to think that he might have injured or killed scores of students. (It turns out that the bus had no passengers. The bus driver was injured but survived, and the case was settled before the trial court could consider the cause and severity of the engineer’s PTSD.)

The Michigan Supreme Court took a different tack in a 2012 ruling, when it rejected a woman’s claim for bodily injury compensation for PTSD she experienced after

witnessing her son’s death in a motorcycle accident.7 That case was followed closely by the Michigan legal

community, with organizations representing trial lawyers, the defense bar, and business interests, including insurers, submitting amicus briefs.

In 2014, a divided Pennsylvania Supreme Court upheld, by operation of law, an appellate court ruling that three family members who saw their son and brother killed by a negligent motorist were entitled to compensation under bodily injury coverage for “negligent infliction of emotional distress.”

Significantly, the plaintiffs in the case did not plead specific physical manifestations, only generalized “physical complaints.”

DetectionAn Ohio case from the same year, 2014, illustrates

the complexities of establishing PTSD as a form of bodily injury.8

In the case, a woman sought damages for PTSD after watching her sister, a pedestrian, be killed by motorist; the claimant was not struck.

Her claim included testimony from a physician certified in psychiatry and internal medicine stating that she suffered from PTSD and psychiatric problems she had never had before the incident. His testimony detailed the physical damage that can result from PTSD. ►

In light of efforts to extend third-party bodily injury

coverage to mental and emotional injuries (see main

article), the most current AAIS liability forms include

provisions limiting the definition of bodily injury.

Policy forms in the AAIS Businessowners, Commercial

Umbrella, and Agricultural General Liability programs all

define bodily injury to mean “bodily harm, sickness, or

disease sustained by a person.”

By explicitly excluding bodily harm arising from mental

or emotional injury (not arising from a physical injury),

AAIS personal lines policy provisions are prepared for

rulings that mental or emotional injuries, including

PTSD, are biological in nature.

AAIS commercial liability forms state that:

“bodily injury does not include mental or emotional

injury, suffering, or distress that does not result from

a physical injury.”

In personal lines, AAIS Homeowners and Personal

Umbrella forms go a step farther to state that:

“bodily injury does not mean bodily harm (emphasis added), sickness, disease, or death that arises out of mental or emotional injury, suffering, or distress that

does not result from actual physical injury to a person.”

AAIS Forms Carefully Limit Definition of ‘Bodily Injury’

VIEWPOINT | ISSUE IV | 2015

© iStockphoto.com

1819

The appellate court found, however, that there was insufficient evidence to support the doctor’s assertions, as her claim of PTSD was not supported by objective medical evidence, such as imaging scans, which might have indicated how her specific brain was injured.

Even if such evidence had been presented, it is unlikely the court would have upheld the woman’s claim. In their ruling, the court’s majority stated that “we elect to decide here...whether ‘bodily injury’ defined as ‘bodily harm, sickness or disease, including death that results,’ includes a PTSD injury. We answer this question ‘no.’”

The majority concluded that “PTSD and physical symptoms stemming therefrom are not within the definition of ‘bodily injury’ as defined herein. Because the [claimant’s] claims all arose from [her] PTSD and her physical symptoms stemming therefrom, their claims are not covered under the [auto] policy.”

DistinctionsEven if PTSD were consistently found to be a bodily

injury, it is unclear how much such a trend would increase the severity of bodily injury claims.

There is a great deal of commonality among humans in purely physical functions. We walk, talk, breathe, digest, stand, and sit in largely the same way, although with different levels of ability. We can readily recognize the onset and effects of most physical disabilities, and identify what is needed to correct or compensate for it.

In contrast, our brains are very distinct from each other in their functioning as conscious “minds.”

In the absence of a clear physical event (e.g., a concussion), even modern neuroscience cannot definitively determine the cause and extent of a mental injury without knowing what the affected brain was like before the trauma.

Even if the cause and effect of a brain disorder is determined with precision, there remains a subjective element to the recovery. How much willpower can the victim muster to overcome the injury?

No theory of liability can answer that question. ■

1 Casey v Pel-Air Aviation, NSWSC 566 (15 May 2015)2 Roger K. Pitman, Ann M, Rasmussen, Karestan C. Koenen, Lisa

M. Shin, Scott P. Orr, Mark W. Gilbertson, Mohammed R. Milad, and Israel Liberzon, “Biological studies of post-traumatic stress disorder,” in Nature Reviews-Neuroscience, Vol. 13, November 2012, pp. 769-787

3 Jonathan Shay, “Casualties,” Daedalus, the Journal of the American Academy of Arts and Sciences, 2011, pp. 179-188

4 Francis X. Shen, “Mind, Body, and the Criminal Law,” Minnesota Law Review, 2013, pp. 2036-2173

5 Ohio State Bar Association, “Law Considers Post Traumatic Stress Disorder,” www.ohiobar.org; accessed on Dec. 4, 2015

6 Allen v. Bloomfield Hills School District, 775 N.W.2d 138 (Mich. 2009)

7 Boertmann v, Cincinnati Ins. Co., 804 N.W.2d 114 (Mich. 2011)8 Grange Ins. Co. v Sawmiller, 2014-Ohio-1482