PA Supreme Court Upholds Assignment of Rights in Excess Bad Faith Claims



Tort Talkers may recall previous posts on the case of Allstate Ins. Co. v. Wolfe, in which the Pennsylvania Supreme Court accepted an issue to review on certification of a matter from the U.S. Third Circuit Court of Appeals who was seeking guidance on the question of the validity of assignment of bad faith claims by third party tortfeasors hit with excess verdicts to injured party plaintiffs seeking to recover on the amounts due over and above the tortfeasor's liability insurance policy limits.

As anticipated by many watching out for the Pennsylvania Supreme Court's decision in the case of Allstate Ins. Co. v. Wolfe, No. 39 MAP 2014 (Pa. Dec. 15, 2014)(Op. by Saylor, J.)(Castille, C.J, Dissenting Without Opinion), the Court ruled that a third party defendant tortfeasor hit with an excess verdict in a trial on personal injuries arising out of a motor vehicle accident may assign to the plaintiff his potential rights to sue his own automobile liability insurance carrier for a bad faith refusal to settle the case prior to trial.

The Supreme Court "conclude[d] that the entitlement to assert damages under Section 8371 may be assigned by an insured to an injured plaintiff and judgment creditor such as Wolfe.  Having answered the certified question, we return the matter to the Third Circuit."


Anyone wishing to review a copy of the Supreme Court's decision may click this LINK.

I send thanks to Attorney Tom Wilkinson, Jr. of the Philadelphia office of Cozen & O'Connor and Attorney Scott Cooper of the Harrisburg office of Schmidt Kramer for bringing this decision to my attention.