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Badillo v. Mid Century Insurance Co.6/21/2005
In 1935, this Court rejected negligence as a basis for recovery when an insurer refused to settle a claim for damages covered by the insured's policy. Boling v. New Amsterdam Cas. Co., 1935 OK 587, 11, 12, 46 P.2d 916, 917-918. Although the bad faith tort was more than negligence, it developed into something less than a specific intent tort. Bad faith requires evidence of dishonest intentions, an advantage that is not conscientious, or an action taken that is unreasonable and unfounded. See, 25 O.S.2001, ยง 9. In contrast, the majority's standard for bad faith culpability by an insurer provides no concrete guidance for future litigants, but instead foists upon them a subjective standard open to a different interpretation by every person who examines it. Indeed, it already has, as evidenced in the numerous cases from other jurisdictions cited by the majority in today's pronouncement.
While I believe the majority's opinion, as well as the objections of appellants and Badillo's answer, all indicate confusion over what actions of an insurer comprise bad faith, there is no confusion as to one essential element thereof, and it clearly is not present in the instant matter. As I stated hereinabove, withholding payment is a necessary element of a claim for bad faith in refusing to pay a legitimate claim. Skinner v. John Deere Insurance Company, 2000 OK 18, 16, 998 P.2d 1219, 1223. In this action, it is undisputed that appellants not only tendered a check in the amount of the policy limits early on, but also that they again tendered that check, and the third party victim accepted it, prior to the filing of Badillo's bad faith claim. An essential element of appellee's bad faith claim is not met, and this is plainly evident in the undisputed facts of the instant case. I would continue to follow the teachings articulated by the Court in Christian and Skinner. This matter never should have gone to the jury, the reasonableness of appellants' conduct never should have arisen and this appeal never should have ensued. The majority's opinion further complicates the issues surrounding what acts will give rise to a bad faith claim, and what acts may be taken to avoid such a claim.
The irony and inherent injustice of this result, the distortion of our holding in Christian and its progeny, and the overruling, without mention, of Skinner, all compel me to respectfully dissent. I believe that the uncontested facts fail to support a breach of the duty of good faith and fair dealing under Christian and Skinner. Therefore, I would hold that the trial court should have granted the appellants' motion for a directed verdict.
OPALA, J., with whom WINCHESTER, V.C.J., joins, dissenting.
The court affirms the nisi prius imposition of liability upon Mid Century and Farmers Insurance (insurers) for a Christian bad-faith tort. I would reverse the trial court's judgment against these defendants/appellants. The plaintiff's judgment lacks support in competent evidence. The court's holding has cavalierly removed from the elements of a bad-faith tort the requirement that an insurer's conduct be shown to have been taken in bad faith. The court has also discarded (or disregarded) the legal distinction between the elements of unreasonableness and those of bad faith. The result produced here today foists liability for the insurer's mere failure to procure a settlement by means that would confer a benefit only upon a third party rather than upon its own insured. Because the record of the insurer's actions does not demonstrate bad faith towards the insured, I dissent from the court's judgment as well as from its pronouncement.
I. THE ADDUCED PROOF DOES NOT SUPPORT A CLAIM FOR BAD- FAITH REFUSA
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