Request For Attorney Fees Rejected Relative to Declaratory Judgment Action

In the case of Atain v. Ins. Co. v. Kaz Tire, Inc., No. CV-21-3651 (E.D. Pa. Nov. 16, 2021 Kearney, J.), the court denied an insured’s request for attorney’s fees under the Declaratory Judgment Act in federal court after the insured obtained summary judgment in its favor in a declaratory judgment action regarding coverage under a policy.

The court noted that, under the Declaratory Judgment Act, an insured was compelled to bring a declaratory judgment action to establish the carrier’s duty to defend an action brought by a third party may recover attorney’s fees incurred in the declaratory judgment action if the carrier has refused to defend the action in bad faith.

The court, based upon the record before it, did not find that the carrier’s initial denial of coverage was in bad faith or was otherwise frivolous. As such, the request for the payment of fees and costs in this action in which it appeared to the court that the carrier had properly sought declaratory relief, was denied.

Anyone wishing to review a copy of this decision may click this LINK.

I send thanks to Attorney Lee Applebaum of the Philadelphia office of Fineman, Krekstein & Harris for bringing this case to my attention. Attorney Applebaum is the writer of the excellent Pennsylvania and New Jersey Insurance Bad Faith Case Law blog which can viewed HERE.

Source of image:  photo by Karolina Grabowska from www.pexels.com.