Newport, State to Pay $3.1 Million in Bike Crash Case : Settlement: An insurance salesman who suffered severe brain damage after the 1990 accident had claimed the city failed to maintain nature reserve trail.

The city and state have agreed to pay $3.1 million to an insurance salesman who suffered severe brain damage after he crashed his bicycle in a nature reserve, officials confirmed Tuesday.

James P. Murphy was not wearing a helmet when he hit a large puddle on a bike trail two years ago, but he claimed nonetheless that the city was liable for his injuries because it failed to properly maintain the path through the Upper Newport Bay Ecological Reserve.

Court documents show that the four-foot-wide puddle Murphy hit, and others like it, had plagued the path for years and that city officials knew about the puddle but did not adjust the drainage system to fix the problem.

Although details of the settlement, which will be paid out monthly over Murphy’s lifetime, have not been finalized, City Council members and the plaintiff’s attorney said the total of $3.1 million had been accepted by both sides, making it perhaps the largest personal injury award in Newport Beach history. The state will pay less than 10% of the settlement, officials said.

“We’ve been through a lot, obviously. Money just can’t replace anything that we’ve been through,” Murphy, 47, said Tuesday, beginning to cry involuntarily because of his head injury.

“I don’t think there’s any victory,” he said. “What I’ve lost--you’re talking about giving away part of your brain . . . what I’ve lost and most of all what it represents to the rest of the family, it completely changed our lives. It’s been hard. It’s just too bad it happened for both sides.”

Murphy, a 14-year resident of Newport Beach who was a varsity linebacker at the University of Southern California in the 1960s, was earning $250,000 a year as an insurance salesman and financial planner for Pacific Mutual at the time of the accident. After three brain surgeries and more than four months in the hospital, Murphy has regained the ability to walk and talk, but remains brain damaged. He is heavily medicated and under regular physician’s supervision.

Murphy, who has a son and daughter ages 20 and 24, now works about 10 hours a week and collects some income from insurance accounts he sold during more than two decades at Pacific Mutual. But he struggles with exaggerated emotions and learning new concepts.

“It’s been a nightmare, but we shall go on,” said his wife, Cheryl Murphy. “We worked so hard for 25 years to have a decent life and then to have it all go down the drain just because he went out for a leisurely bike ride on a Sunday afternoon . . . at least now he’ll have something that will keep him living the way he was living.

“No one really realizes that money doesn’t take away pain,” she said Tuesday at their home in the Harbor View neighborhood. “I would much rather have him back the way he was and have us living our normal life.”

The settlement, approved by the City Council on Monday night in a closed session just after it voted to ban skateboarders along its oceanfront sidewalk, is the latest in a string of hefty personal injury lawsuits the city has lost in the last decade.

City Atty. Robert Burnham said the extent of Murphy’s injuries was the prime motivation to settle the case, and that the settlement does not signal a change in the city’s conservative policy on personal injury settlements.

Santa Monica attorney Browne Greene, who represented the Murphys, agreed that this was an unusual case and said it was unlikely the settlement will set a precedent for municipal liability of bicycle accidents on public roads.

“These are very difficult cases to win,” he said. “Here you have a case of an obvious defect, one that had been there for months, and people had asked them to fix it. It’s real simple.”

Court documents show that the city had received complaints about persistent puddles on the trail for as many as eight years, and that city employees recommended drainage improvements but they were not done before the accident. Since the accident--and another minor bicycle accident that occurred the same week--the road has been repaved, drains have been fixed, and signs have been posted warning of the dangers of riding quickly down hills.

Murphy, who had ridden a bicycle as an adult only about a dozen times, ventured onto Backbay Drive for the first time Sept. 2, 1990. Murphy sped down a hill and then lost control when his bike hit the puddle, which had algae and moss growing in it.

In the lawsuit, Murphy contends that the state, which owns the ecological reserve, and the city, which owns Backbay Drive, were negligent in maintaining the road or providing adequate signs to warn of dangerous terrain. Both parties filed documents saying Murphy himself was negligent for riding without a helmet and going too fast down a hill.

Attorneys for the state of California contended that the city was entirely responsible for maintaining the road, but city officials testified in pretrial depositions that the state Department of Fish and Game restricted their ability to maintain the road in order to protect the wetlands in the adjacent reserve.

Strict guidelines passed in the spring of 1990 “prevented the city from performing maintenance activities adjacent to the roadway, including maintenance of drainage facilities,” Public Works Director David Niederhaus said in a sworn statement.

Newport Beach Lawsuits

Here is a partial list of successful personal-injury suits filed against Newport Beach in recent years: John Taylor: Awarded $6 million in 1986 for injuries suffered when he dived head-first into shallow water near the Balboa Pier. The city appealed the case and Taylor agreed to an undisclosed out-of-court settlement with the city’s insurer. Sundaga Bryant: Awarded $1.5 million in 1990 after he was shot by Newport Beach police who mistook the boom-box radio he was carrying for a sawed-off shotgun. Ricky Patrick Miller: Awarded $300,000 by a jury after he was accidentally shot in the back during a scuffle with police in 1990. Brian Riley: Awarded $175,000 after he was shot by Newport Beach police in 1988. Donald Steele: Awarded $164,000 after he tripped over a tree root in a city-owned park in 1983. Rhea Dunlop: Awarded $100,000 in 1981 after a bicycle accident on Jamboree Road. Source: Los Angeles Times library Researched by JANICE L. JONES / Los Angeles Times