Bad Faith Claim Based Upon Sackett Dispute Rejected

In a recent decision out of the Western District Federal Court of Pennsylvania in the case of Trustgard  Ins. Co. v. Campbell, No. 16-CV-1013 (W.D. Pa. Nov. 28, 2016 Schwab, J.), the court rejected a claim of bad faith in the case where the insureds had prevailed upon  previous legal argument as to whether they were entitled to stacking under the policy.  

The insureds were asserting that the court should find that the carrier acted in bad faith on the basis of the insureds’ prevailing on their legal argument with respect to coverage.  

The court found that the bad faith claim failed because the carrier’s position, while unsuccessful on the coverage issue, was reasonable under the circumstances presented.

The court noted that “[t]he crux of the Parties’ disagreement - - whether the [vehicle] was added to the [insureds’] policy by endorsement or by the “newly acquired vehicle” clause of the policy - - was resolved in the [insureds’] favor by this Court, but the authority for both Parties’ positions was reasonably supported by the cases they respectively cited.”  

Accordingly, the court granted summary judgment to the carrier on the bad faith claim presented by the Plaintiff.  

To view this case online, please click this LINK.

 

I send thanks to Attorney Lee Applebaum of the Philadelphia law firm of Fineman, Krekstein & Harris for bringing this case to my attention through his excellent Pennsylvania and New Jersey Insurance Bad Faith Case Law Blog.