2006

31 Fla. L. Weekly S882a

Insurance — Performance bond — Bad faith refusal to settle claim under performance bond — Obligee of a surety contract qualifies as an “insured” and is therefore entitled to sue its surety for bad faith refusal to settle claims pursuant to section 624.155(1)(b)(1), Florida Statutes (1999) — Language of section 624,155(1)(b)(1), Florida Statutes (1999), eliminates the requirement of proof of a general business practice when a plaintiff pursues a section 626.9541 claim through the right of action provided by section 624.155(1)(b)(1) — Arbitration panel’s findings that a surety’s principal has breached its duty to the obligee and that the surety is obligated to the extent that its principal is bound satisfies the condition precedent to a section 624.155 bad faith refusal to settle claim — Arbitration panel’s finding that a surety’s principal has breached its duty to the obligee and that the surety is obligated to the extent that its principal is bound does not bar a later claim against a surety for bad faith refusal to settle under section 624.155 under doctrine of res judicata — Arbitration panel’s denial of defendant’s affirmative defense in breach of contract claim collaterally estops same defendant from raising those affirmative defenses in subsequent section 624.155 bad faith refusal to settle when the essential elements of collateral estoppel are present

31 Fla. L. Weekly D2818a

Insurance — Uninsured motorist — Bad faith — Failure to disclose and pay benefits — Trial court departed from essential requirements of law in allowing insured’s statutory bad faith claim to proceed without prior determination of liability and extent of damages allegedly owed on insurance contract — However, insurer failed to show that it would suffer irreparable harm that cannot be adequately remedied on appeal

31 Fla. L. Weekly D1551a

Insurance — Personal injury protection — Bad faith — Unfair settlement practices — Punitive damages — Insured alleging that insurer, as a general business practice and in wanton and willful disregard for rights of its insureds, fails to pay 80% of reasonable and necessary medical expenses and continually reimburses its insureds in amounts on less favorable terms than those required by statute and its policy of insurance, and further alleging that this conduct constituted unfair settlement practice in violation of section 626.9541(1)(i)(2) — Error to dismiss claim for punitive damages because insured failed to allege additional compensatory damages other than those which had already been paid as result of settlement of underlying PIP lawsuit — Insurer’s settlement of its obligation to insured was equivalent of verdict in favor of insured and therefore insured’s actions for benefits have been resolved in his favor — Insurer’s failure to pay benefits to insured under his policy within 60 days of receiving notice under section 624.155 entitled insured to make his claim for bad faith — Allegation that insurer’s acts occurred with such frequency as to indicate general business practice and that these acts were willful, wanton, malicious and in reckless disregard of rights of its insureds was sufficient to state cause of action for punitive damages

31 Fla. L. Weekly D2835a

Insurance — Homeowners — Bad faith — Failure to settle — Unfair claims practices — Action against insurer who refused to pay full amount of policy following hurricane-related loss on ground that loss was caused by both wind damage, which was covered under policy, and flood damage, which was not covered — Trial court departed from essential requirements of law in forcing insurer to defend against statutory claims before issue of coverage was fully resolved — Although insurer’s attorney conceded at hearing that insurer had some liability under policy, this did not settle question of how much coverage was due — Even if insurer’s admission of limited liability under Valued Policy Law meant that it was liable for full policy limits as to dwelling itself, extent of loss or damage under remaining coverage provisions, including other structures coverage, ordinance and law coverage, personal property coverage, and loss of use coverage, remains unsettled — Insurer will suffer irreparable harm if forced to defend against both breach of contract and bad faith claims simultaneously — Trial court has authority to abate statutory claims, rather than to dismiss them, if it appears that abatement would be in interest of judicial economy

31 Fla. L. Weekly D2467a

Insurance — Bad faith — Failure to settle — No abuse of discretion in denying motion for new trial based upon newly discovered evidence when, after trial, insurance company expert acknowledged errors in his testimony, or based upon cumulative errors — Expert’s admission that, contrary to his testimony at trial, his law firm did not use a release worded similarly to the one used by insurer in instant case, which released all persons from liability, was not material to issue of bad faith, but would be evidence to impeach expert’s opinion — Moreover, expert maintained that the fact that the questioned language had been removed from his firm’s release years earlier did not change expert’s opinion that the release was appropriate, nor did he waiver in his opinion that insurer did not commit bad faith — Evidence regarding law firm’s use of different form was not the type of evidence that would probably change result in case because insurer had already established that the attorney for claimant had crossed out over-inclusive language in another release submitted to him by the insurer on behalf of a different insured — Cumulative error — No merit to insured’s contention that certain errors, when considered cumulatively, improperly attempted to shift focus to claimant’s motives and conduct of claimant’s attorney in refusing to settle, although correct focus should have been on motive of insurer in fulfilling its duty to insured — Conduct of claimant and her attorney would be relevant to question of whether there was any realistic possibility of settlement — None of the incidents individually were reversible, as they were either not error or were cured with instruction — Incidents included statement by insurer’s attorney in opening statement that claimant’s attorney stood to earn $500,000 from case, suggesting he would be a biased witness with a financial interest in the outcome; cross-examination of claimant’s attorney as to why attorney did not send request for insurance information to insurer and whether attorney had told claimant not to communicate with insurer; and response by insurer’s expert to a jury-initiated question as to why, in expert’s opinion, claimant’s attorney didn’t make insurer aware of attorney’s appointment as claimant’s legal representative, a question to which insured did not object, even though he had reviewed it prior to expert’s being allowed to answer

31 Fla. L. Weekly D1090a

Insurance — Uninsured motorist — Discovery — Work product — Claim file — When a litigant files claims for both coverage and bad faith in same action, claim file is not discoverable until issue of coverage has been resolved — Because insured was pursuing a claim for coverage under policy and seeking to void release she previously signed, the circuit court departed from the essential requirements of law by ordering insurer to produce its claim file for inspection by insured’s counsel — Requiring disclosure of claim file during litigation of coverage issues would result in irreparable harm that cannot be adequately addressed on plenary appeal

31 Fla. L. Weekly D3124a

Insurance — Disability income — Bad faith — Insured’s action against insurer, brought after insurer stopped monthly payments from disability income policy — Discovery — Attorney-client privilege — Error to compel discovery of documents protected by attorney-client privilege — Question certified: Does the Florida Supreme Court’s holding in Allstate Indemnity Co. v. Ruiz, relating to discovery of work product in first-party bad faith actions brought pursuant to section 624.155, Florida Statutes, also apply to attorney-client privileged communications in the same circumstances?

31 Fla. L. Weekly D160b
917 So. 2d 1008

Insurance — Bad faith — Discovery

31 Fla. L. Weekly D850a

Insurance — Automobile liability — Subrogation — Insurer was not entitled to recover amount of bodily injury damages paid to injured party in subrogation action against defendant where insurer did not prove that it paid all of injured party’s damages or that it obtained a release of defendant from the injured party

31 Fla. L. Weekly D963a

Insurance — Automobile liability — Intervention — Where party who was injured in automobile accident with insured accepted insurer’s policy limit in settlement and released insured and insurer, and later filed negligence action against insured and obtained judgment against insured based on insured’s failure to respond to requests for admissions, court did not abuse discretion in denying insurer’s postjudgment motion to intervene in the negligence action to assert the settlement and release as a defense — Insurer did not have a direct and immediate interest in the action that would justify intervention — Insurer’s concern that it may later be subject to a suit for bad faith refusal to defend and will have to pay judgment against insured is a contingent interest which did not justify intervention — Although bad faith action could be initiated by injured party on behalf of insured, judgment in negligence action will not automatically result in such an action being filed, and insurer will have a forum in which it can raise its objections if it is in fact sued for bad faith