Court Reaffirms The Rule That A Plaintiff Cannot Sue a Tortfeasor's Liability Carrier For Bad Faith

In the case of Gitelman v. Wilkinson, No. 2:21-CV-1696 (W.D. Pa. March 24, 2022 Stickman, J.), the court confirmed that a Plaintiff has no standing to sue a tortfeasor Defendant’s carrier for bad faith.

In this matter, the Plaintiff had settled her personal injury case and the tortfeasor Defendant’s carrier issued a settlement check for over $100,000.00. The Plaintiff never deposited the check and took the position that she was defrauded and that she was entitled to more money from her own carrier and from the Defendant’s carrier.

The Plaintiff filed a bad faith claim against the tortfeasor Defendant’s carrier on the basis that that insurance company owed her a duty of good faith and fair dealing.

The court granted the Motion to Dismiss this claim and, citing the Pennsylvania Superior Court case of Strutz v. State Farm, 609 A.2d 569 (Pa. Super. 1992), confirmed that a tortfeasor’s carrier owes no duty of good faith in dealing to third party Plaintiffs.

Accordingly, the court found that the Plaintiff in this matter was found not to have any standing to sue the tortfeasor’s carrier for bad faith.

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

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

Federal Middle District Court of Pennsylvania Allows Bad Faith Claim To Proceed Where Carrier Allowed Same Claims Rep to Handle Both Third Party and UIM Claim

In the case of Vella v. State Farm Mutual Automobile Insurance Co., Civil Action No. 17-1900 (M.D. Pa. Apr. 23, 2018 Rambo, J.), the court granted in part and denied in part a Motion to Dismiss a Bad Faith claim arising out of the handling of a UIM claim.

According to the Opinion, the insured submitted a UIM claim to its insurer following a motor vehicle accident.

The tortfeasor in the accident happened to also be insured by the same carrier for liability purposes.

The carrier assigned the same claim representative to manage both the first-party UIM claim and the third-party negligence claim. The insured eventually sued for bad faith as to the handling of both claims.

The insurer moved to dismiss aspects of the bad faith claim on the basis that Pennsylvania law precludes a third-party claimant from bringing a cause of action for bad faith against a tortfeasor’s insurer.

The Court denied the motion in part and granted in part. More specifically, the Court found the insured sufficiently pleaded facts regarding the interplay between the claims handling of first-party UIM and third-party negligence claims to make out a plausible bad faith claim.

However, the Court dismissed those allegations in the Complaint pertaining to claims asserted by the insured for bad faith against the insurer solely on the basis of the carrier’s actions regarding the handling of the third-party claim.

Anyone wishing to review this decision in the Vella case may click this LINK.

I send thanks to Attorney Lee Appelbaum of the Philadelphia bad faith defense firm of Fineman, Krekstein & Harris, and writer of the excellent Pennsylvania and New Jersey Insurance Bad Faith Case Law Blog, for bringing this case to my attention.

 

Federal Court Reaffirms That Plaintiffs Have No Standing to Assert Direct Bad Faith Claim Against Tortfeasor's Carrier

In the case of Starrett v. Coe, No. 3:16-cv-02272 (M.D. Pa. June 20, 2017 Saporito, M.J.) (Report and Recommendation, affirmed by Judge A. Richard Caputo under an Opinion dated August 9, 2017), it was held that third party Plaintiffs do not have a contractual relationship with tortfeasor’s liability carriers and, therefore, such Plaintiffs have no standing to assert a bad faith claim against a tortfeasor’s insurer and/or its adjuster.

The district court judge agreed with Federal Magistrate Joseph Saporito's Opinion in this regard and, thereby, dismissed the bad faith failure to negotiate claim lawsuit filed by the Plaintiff.

Anyone wishing to review Federal District Magistrate Judge Saporito's Report and Recommendations may click this LINK.

To review Judge Caputo's Opinion adopting Judge Saporito's decision, please click HERE.

I send thanks to Attorney Lee Applebaum of the Philadelphia law firm of Fineman, Krekstein & Harris.  Attorney Applebaum is the creator and writer of the Pennsylvania and New Jersey Insurance Bad Faith Case Law Blog.