FEBRUARY 2009 BAD FAITH CASES
SUMMARY JUDGMENT GRANTED WHERE INSURER’S SETTLEMENT POSITION REASONABLE EVEN THOUGH ARBITRATION AWARD EXCEEDED OFFER (Philadelphia Federal)
In Laferriere v. Zurich American Insurance Company, a bad faith claim arose after a motor vehicle accident. The plaintiff was struck from behind while she was riding in her employer’s vehicle that had uninsured motorist coverage with the insurer. The plaintiff’s claim was eventually submitted to arbitration. The plaintiff submitted memoranda outlining her alleged injuries and arguments, and demanded $450,000 in settlement. Subsequently, the plaintiff demanded $375,000. The insurer offered $125,000. The arbitration went forward and the arbitrators made an award which substantially exceeded the amounts which had previously been offered by insurer.
The plaintiff filed a bad faith complaint against the insurer. The insurer filed a motion for summary judgment. The court found that there was a legitimate dispute as to the amount of plaintiff’s damages. There was a valid, reasonable basis for the position taken by the defendant, as well as the position taken by the plaintiff. The court did not believe that a reasonable jury could properly conclude that the defendant has been shown to have acted in bad faith in any respect. Therefore the court granted the insurer’s motion for summary judgment.
Date of Decision: November 25, 2008