Replies

“On allegations of molesting 13-year-old Jordy Chandler, which Jackson has always denied, He paid the boy’s parents 18 million to drop a civil case against him:”

NO, he did not....

From March 22, 2005 court motion filed (in the Arviso case) and titled, “Mr. Jackson’s Memorandum in Support of Objection to Subpoena to Larry Feldman for Settlement Documents”: (relevant section)

C. The 1993 Civil Settlement was Made by Mr. Jackson’s Insurance Company and was Not Within Mr. Jackson’s Control.

The plaintiff seeks to introduce evidence of the civil settlement of the 1993 lawsuit through the testimony of Larry Feldman, attorney for the current complaining family and attorney for the plaintiff in the 1993 matter. The settlement agreement was for global claims of negligence and the lawsuit was defended by Mr. Jackson’s insurance carrier. The insurance carrier negotiated and paid the settlement, over the protests of Mr. Jackson and his personal legal counsel.

It is general practice for an insurer to be entitled to control settlement negotiations and the insured is precluded from any interference. Shapero v. Allstate Ins. Co., 114 Cal. App.3d 433, 438 (1971); Ivy v. Pacific Automobile Ins. Co., 156 Cal. App.2d 652, 660 (1958)(the insured is precluded from interfering with settlement procedures). Under the majority of contracts for liability insurance, the absolute control of the defense of the matter is turned over to the insurance company and the insured is excluded from any interference in any negotiation for settlement or other legal proceedings (emphasis added). Merritt v. Reserve Ins. Co., 34 Cal. App.3d 858, 870 (1973). An insurance carrier has the right to settle claims covered by insurance when it decides settlement is expedient and the insured may not interfere with nor prevent such settlements. 44 Am. Jur. 2d, Insurance, sec. 1392, at 326-27 (rev. ed 2002)

In Brown v. Guarantee Ins. Co., 155 Cal. App. 2d 679, 685 (1957), the court stated:

“It is generally understood that these are rights and privileges which it is necessary for the insurer to have in order to justify or enable it to assume obligations which it does in the contract of insurance. So long as recovery does not exceed the limits of the insurance, the question of whether the claim be compromised or settled, or the matter in which it shall be defended, is a matter of no concern to the insured.”

The insurer’s right to control the defense of any action against the insured includes the right to negotiate settlement, and to otherwise conduct defense of the action. The consent of the insured is usually superfluous. “Liability policies usually specifically prohibit the insured from settling or negotiating for a settlement or interfering in any manner with the defense except upon request of the insurer unless the insurer is in breach of contract. By accepting a liability insurance policy, the insured is bound by these terms.” (Croskey, et. al, Cal. Practice Guide: Insurance Litigation 3, supra, section 12:207, p. 12B-2.) “For this reason, it is common practice for insurance counsel and an adjuster to handle the negotiation of insurance funded settlements with out the superfluous involvement of a fully protected insured.” Fiege v. Cooke, __ Cal. App. 4th __ (2004).

It is unfair for an insurance company’s settlement to be now held against Mr. Jackson or for the Settlement Agreement to be admitted as evidence of Mr. Jackson’s prior conduct or guilt. Mr. Jackson could not control nor interfere with his insurance carrier’s demand to settle the dispute. No admission against interest nor acknowledgment of criminality can be inferred regarding Mr. Jackson from the act of the insurance carrier in the settling the litigation.”

Chandler’s took the money and ran. They could have filed criminal charges against MJ and CHOSE NOT TO.