Bad Faith Blog

Injured logger, as an assignee of claims by a timber lessee and land owner, brought an action against his employer’s liability insurer to recover a consent judgment for the $1M policy limits. After the trial court entered summary judgment in favor of the logger, the employer’s insurer appealed. The Supreme Court of Appeals of West Virginia found the consent judgment was not binding on the insurer because it was not a party to the underlying suit and the settlement and assignment were void for fraud and collusion.

Summary: Kent Roose was severely injured in an auto crash in 2007. The liability carrier for the negligent driver and the driver’s estate paid sums to settle the case Roose filed, but his extensive medical expenses were insufficient to pay his more than $300,000 in medical expenses. His group health plan had an exclusion providing that medical benefits would not be paid when any other liability insurance was available to pay medical costs which the Supreme Court of Montana ruled violated Montana’s “made whole law.” Roose pursued declaratory and injunctive relief on a class action basis, but individually “requested a trial seeking actual and punitive damages for bad faith.” The trial court certified the declaratory judgment and injunctive relief claims and separately granted him a jury trial on the bad faith issues. These rulings were affirmed on appeal.