FEBRUARY 2008 BAD FAITH CASES INSURER GETS SUMMARY JUDGMENT ON BAD FAITH CLAIM WHERE ALLEGEDLY FORGED SIGNATURE ON UIM REJECTION FORM IN DISPUTE (Middle District)

 

In Blaylock v. Allstate Insurance Company, the United Stated District Court for the Middle District of Pennsylvania was confronted with cross motions for summary judgment stemming from Blaylock’s Complaint alleging bad faith claims handling.  Blaylock was injured in an automobile accident with an uninsured driver.  Blaylock submitted a claim to its insurer, Allstate, for uninsured motorist benefits.  Allstate denied the claim, citing to a form, allegedly executed by Blaylock, refusing coverage for uninsured motorist benefits (the “Rejection Form”).  Blaylock disputed the signature on the Rejection Form; asserted that it had been forged; and continued to request uninsured benefits.  The case was arbitrated and  Blaylock won a split decision awarding coverage.  Subsequently, Blaylock filed a Complaint for bad faith claims handling.
Blaylock filed a motion for summary judgment alleging that Allstate had acted in bad faith because it had arbitrated the uninsured motorist coverage issue with no reasonable basis for so doing.  In addition, Blaylock argued that she had presented evidence, including a sworn statement, that the signature on the UM Form was not hers and an opinion from a handwriting expert stating that the signature was not authentic.
Allstate filed a motion for summary judgment asserting that it had a reasonable basis for denying Blaylock’s uninsured motorist claim.  Allstate argued that its decision was reasonable because it had the Rejection Form signed by Blaylock and it produced an expert report asserting that the authenticity of the signature could not be verified one way or the other.
The Court opined that the question was not whether the signature on the Rejection Form was authentic, but whether Allstate had acted in bad faith in denying the claim.  The Court found that, under Pennsylvania law, to prevail on a bad faith claim Blaylock had to show that Allstate “did not have a reasonable basis for denying benefits under the policy” and that it “knew or recklessly disregarded its lack of a reasonable basis in denying the claim.”  See Greene v. United Services Auto Ass’n, summarized in December 2007 archives on this blog.  After reviewing all the evidence, the Court denied Blaylock’s motion for summary judgment and granted summary judgment in favor of Allstate.  Significantly, the Court found, inter alia, that: (1) Blaylock’s claim had presented credibility questions; (2) Blaylock had a high burden of proof demonstrating that her signature was forged and;  (3) Allstate’s handwriting expert had negated some of Blaylock’s evidence.  As such, the Court dismissed Blaylock’s bad faith claim.
Blaylock v. Allstate Insurance Co., United States District Court for the Middle District of PA, No. 1:CV-06-1456, 2008 U.S. Dist. LEXIS 1098 (M.D. Pa. Jan. 7, 2008) (Caldwell, J.)
J.T.L.