Opinion ID: 1150821
Heading Depth: 1
Heading Rank: 2

Heading: Sufficiency of the Bad Faith Claim for Relief

Text: Falline charges that the defendants are guilty of a breach of the obligation of good faith and fair dealing by a negligent and intentional failure to pay benefits when due. Again, although Falline charges both defendants, it appears to me that the Gibbens Company, as administrator, is the actor, the refusor, who has actually done the deed that forms the predicate for this intentional tort action. Because one cannot be guilty of both a negligent and intentional failure to pay, I must assume for the purposes of this opinion that what we are dealing with here is a charge that Gibbens' conduct in refusing the Falline claim rendered it guilty of a breach of the obligation of good faith and fair dealing by... intentional failure [refusal] to pay benefits when due. (My emphasis.) As I see it, there are a number of difficulties associated with creating in this jurisdiction a new intentional tort called breach of the obligation [not covenant] of good faith and fair dealing, a tort that was, according to the averments of the amended complaint, committed by intentional failure to pay benefits when due. (My emphasis.) The new, breach-of-obligation tort proposed by Falline is, I take it, some relation to tortious breach of the implied covenant of good faith and fair dealing that is a part of every contract. I first wonder if there is a contract in this case from which the implied covenant can be derived. Neither defendant is in the insurance business; neither charges premiums; neither enters into an insurance-like contract with industrial claimants. I realize that other jurisdictions have recognized torts which arise out of an obligation of good faith; but, to me, presently at least, this obligation is of unknown and, in Nevada, unprecedented origin. I would like to know more about this new tort before I rule in favor of the creation of such a tort in Nevada. These matters should be dealt with at the trial level. Assuming that a breach of the obligation referred to by Falline can be turned into something analogous to the bad faith tort in insurance cases which was recognized in United States Fidelity v. Peterson, 91 Nev. 617, 540 P.2d 1070 (1975), I certainly doubt that a mere intentional failure to pay when due is alone sufficient to state a claim for an intentional tort. In Peterson, as I view it, the basis for these kinds of tort actions are insurance companies' refusing without proper cause to honor insurance claims after having knowledge that the claims are valid. It is not clear to me what Falline's allegation of intentional failure to pay benefits when due comprises, but it occurs to me that there might be a variety of non-tortious reasons why an insurance company might fail to pay a claim when due. If Falline had charged Gibbens with actual knowledge that Falline had a valid claim and that, despite such knowledge, Gibbens consciously decided to deprive Falline of the benefits to which it knew he was entitled, then we might be approaching the presence of ingredients out of which an intentional tort might be made. Even if an intentional tort had been legally pleaded, GNLV, of course, would not be responsible for the tort as pleaded because, as a principal, apparently GNLV did not participate actively in the wrongful administrative decisionmaking process engaged in by Gibbens, and which is claimed to constitute an intentional tort. As said, I think the trial judge acted properly in dismissing the negligence and bad faith tort claims because the amended complaint fails to state tort claims upon which relief can be granted. I would affirm the judgment of the trial court.