In perhaps its most significant insurance coverage decision since Young v. Allstate, 119 Haw. 403, 198 P.3d 666 (2008), the Hawaii Supreme Court ruled that an insured need not prove economic or physical loss caused by the insurer's bad faith in order to recover emotional distress damages. See Miller v. Hartford Life Ins. Co.
Bad Faith
Florida Court Prevents Simultaneous Trial of Breach of Contract And Bad Faith Issues
By Tred R. Eyerly on
Landmark American Insurance Company successfully moved to dismiss four of the insured's six counts. Landmark Am Ins. Co. v. Studio Imports, Ltd., Inc., Nos. 4D10-5001 and 4D10-5073 (Fla. Dist. Ct. App. Nov. 16, 2011). The trial court did not dismiss the breach of contract claim and the bad faith claim. Because both claims…
Bad Faith Seminar a Success
By Tred R. Eyerly on
Thanks to all who attended yesterday’s seminar on Insurance Bad Faith Claims in Waikiki, hosted by Sterling Education Services. We had an astute, engaged audience, which made the event a success.
Attached is the Bad Faith Power Point for my topics, Development of the Tort of Bad Faith and Elements of a…
Insurer May Be In Bad Faith Despite Trial Court’s Holding of No Coverage for Construction Defects
By Tred R. Eyerly on
After the trial court determined the insurers had no coverage obligations for alleged construction defects, a ruling that was subsequently reversed, it was still possible to demonstrate the insurers acted in bad faith. See Lennar Corp. v. Transamerica Ins. Co., 2011 Ariz. App. LEXIS 123 (Ariz. Ct. App. July 5, 2011).
Lennar oversaw…
Employer’s Bad Faith Claim against State Compensation Board Survives Demurrer
By Tred R. Eyerly on
The insured employer adequately pled its claims against the California State Compensation Insurance Fund (SCIF), allowing it to survive a demurrer. Edward Carey Constr. Co. v. State Compensation Insurance Fund, 2011 Cal. App. LEXIS 457 (Cal. Ct. App. March 25, 2011, certified for publication April 20, 2011).
Edward Carey Construction Co. (CCC) had…
Policyholder Fails to Build Adequate Record to Support Bad Faith Claim
By Tred R. Eyerly on
The importance of careful preparation and documentation was the take away lesson in a Texas bad faith case, C.K. Lee v. Catlin Specialty Ins. Co., 2011 U.S. Dist. LEXIS 19145 (S.D. Tex. Feb. 28, 2011).
C.K. Lee owned a commercial shopping center in Houston. Catlin issued a commercial property policy to Lee. …
Insured Must Reimburse for Uncovered, Settled Claims
By Tred R. Eyerly on
If the insurer notifies the insured it intends to settle a claim, but will then seek reimbursement if the claim is not covered, can the insured avoid having to reimburse the insurer? The California Court of Appeal answered no in Am. Modern Home Ins. Co. v. Fahmian, 2011 Cal. App. LEXIS 420 (Cal.
Bad Faith Suit Pursued After Settlement Dismissed
By Tred R. Eyerly on
Can an insured settle a disputed claim with its first party insurer and then sue the insurer for allegedly fraudulently inducing a settlement of the claim for less than it is worth? The California Supreme Court answered no in Village Northridge Homeowners Assoc. v. State Farm Fire and Cas. Co., 2010 Cal. LEXIS…
Insurer’s Reliance on Mistake to Deny Coverage May be Bad Faith
By Tred R. Eyerly on
Is an insurer exposed to bad faith if it relies upon its own mistake to withhold payment under the policy? The court answered yes in Lundy Enterprises, LLC v. Wausau Underwriters Ins. Co., No. 06-3509, 2009 U.S. Dist. LEXIS 121295 (E.D. La. Dec. 30, 2009).
Wausau provided commercial property coverage for the insured's…
Additional Insureds Not Entitled to Notice of Policy’s Cancellation
By Tred R. Eyerly on
Defendants were sued in an underlying state court action. See Riverport Ins. Co. v. Oakland Cmty. Housing, Inc., No. C 08-3883, 2009 U.S. Dist. LEXIS 104472 (N.D. Cal. Nov. 6, 2009). Defendants were additional insureds under a policy issued by Riverport. In its coverage action for declaratory judgment, Riverport secured an order awarding summary judgment that determined there…