The Absence of Bad Faith Diminishes Potential Consequential Damages Award
Summary: Burgraff was injured when a Menard employee was loading Burgraff’s vehicle with materials purchased from Menard. Burgraff’s vehicle and trailer were insured by Millers First Insurance Company (Millers First). Menard was self-insured up to $500,000 and had an excess layer of $500,000 with CNA. During mediation Millers First agreed to settle Burgraff’s claim for $40,000. In exchange for the payment of $40,000, Millers First would be fully discharged as would “one-sixth of any liability that Menard, Inc. may have to [ ] Burgraff.” Millers First then stopped defending Menard. Menard did not settle so the tort case proceeded to trial. The circuit court, thereafter, ruled Millers First had no further defense obligation to Menard, the court of appeals reversed, and the Supreme Court of Wisconsin agreed Millers First had a duty to defend Menard through trial.