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Bad Faith Claim Against Insurer Barred When Insurer Paid Judgment Against Insured
Description Customer sued business for personal injury and business owner's insurance company for bad faith for not attempting to settle her claim. District court decision to dismiss case against insurance company because it paid the judgment won in the action against insured upheld by Florida high court.
Topic Insurance
Key Words Bad Faith
C A S E   S U M M A R Y
Facts Zebrowski was injured at a business owned by Haisfield and insured by State Farm. She sued Haisfield and included a claim that State Farm violated Florida law by not attempting to settle her third-party liability claim in good faith. The trial court stayed prosecution of that claim pending resolution of the personal injury action. Zebrowski won a judgment for her injury, which was covered by Haisfield's State Farm insurance. She then pursued her claim against State Farm, which obtained "summary judgment on the premise that a claimant injured by an insured tortfeasor did not have a bad faith claim under [Florida law] when the judgment against the tortfeasor did not exceed the insurer's liability limits." The appeals court reversed, holding that Zebrowski was entitled to pursue her bad-faith claim against State Farm, which appealed.
Decision Reversed. Florida law "authorizes a third party to file a bad-faith claim directly against the liability insurer without an assignment by the insured upon obtaining a judgment in excess of the policy limits." To uphold Zebrowski's position "would place a liability insurance company in the dilemma of having a good-faith obligation to a third-party claimant as well as to its insured when the best interest of one would not necessarily be in the best interest of the other." Judgment of district court reinstated.
Citation State Farm Fire & Casualty Co. v. Zebrowski, Slip Copy (1997 WL 730719, Sup. Ct., Fla.)
or
706 So.2d 275 (Sup. Ct., Fla., 1998)

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