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Bad Faith Blog

We cover current issues, highlights and best practices exclusively on claims of bad faith and extra contractual damages.

Bad Faith Blog
September 11, 2016

Delaware Bad Faith Claims Accrue When Excess Judgment Becomes Final and Unappealable

Summary: State Farm rejected an injured car driver’s $35,000 offer to settle against State Farm’s insured who admitted negligence. The trial resulted in a judgment for nearly $225,000, well above the $100,000 per person limit. The Delaware trial court dismissed the resulting bad faith claim on statute of limitations grounds, relying on an earlier unpublished superior court opinion. In a case of first impression, the Supreme Court of Delaware abrogated the unpublished decision and held that the bad faith action accrued when the excess judgment against the insured became final and unappealable.

Bad Faith Blog
April 8, 2015

Washington Insurer Gets to Depose Opposing Insurer’s Coverage Counsel

Summary: A Washington homeowners association filed suit against Derus Wakefield II, LLC for property damage at a condominium project. Derus tendered the suit to the association’s insurer, QBE, which denied the tender for defense at which point Everest agreed to defend under a reservation of rights. It then sued QBE arguing it had a duty to defend under Washington law. The matter was removed to federal court where the district court judge found the action was timely and further found that Everest could depose QBE’s coverage attorney in light of the bad faith claims.

Bad Faith Blog
November 21, 2014

Missouri Vexatious Refusal to Pay Award Stands in Face of Insurance Companies Contingent Attack

Summary: Stewart Title Guarantee Company provided title insurance to Randy Spalding for nearly 420 acres in Cass County, Missouri in the amount of $1.7 million. It also provided title insurance coverage to Paul Estes for a one acre tract in the middle of the 428 acres, which Spalding and others were trying to develop. Stewart Title’s investigation showed that Estes had the superior claim, but the value assigned by Stewart Title Guarantee Company was $10,000.00 whereas Paul Estes demanded payment of $387,000.00. After a jury trial, the circuit court entered judgment in favor of Spalding in the amount of $1,100,000.00 on the policy, vexatious penalties in the amount of $110,150.00, and attorney’s fees in the amount of $81,000.00. The court rejected Stewart Title’s appeal and affirmed the judgment.