Opinion ID: 2514388
Heading Depth: 1
Heading Rank: 5

Heading: Presumption of Harm and Remedy

Text: ¶ 22 The second certified question asks whether, given the existence of a cause of action, the insured is entitled to a presumption of harm and coverage by estoppel, or instead must prove actual harm and damages. As noted above, in answering the certified questions in this case we must presume that St. Paul's rejection of the insured's claim and tender of defense was proper. The certified facts and questions, as well as the briefing from the parties, focus on St. Paul's lack of action immediately following the insured's tender of the underlying action to St. Paul in February 2005. Hence, the facts of this case do not present a situation substantially different from that in Coventry, where the focus of the bad faith claim was on acts that arose immediately following the claim tender. Coventry, 136 Wash.2d at 274, 961 P.2d 933. As in Coventry, a reservation of rights or failure to defend in any capacity is not at issue. Therefore, no rebuttable presumption of harm can arise here, and the measure of damages offered in Coventry should apply here also. The remedy of coverage by estoppel is not recognized in this context. Compare Coventry, 136 Wash.2d at 283-86, 961 P.2d 933 (declining to apply coverage by estoppel) with Kirk, 134 Wash.2d at 563-65, 951 P.2d 1124 (applying coverage by estoppel). As in Coventry, RMS must prove actual harm, and its damages are limited to the amounts it has incurred as a result of the bad faith ... as well as general tort damages. Coventry, 136 Wash.2d at 285, 961 P.2d 933.