Opinion ID: 1694656
Heading Depth: 2
Heading Rank: 3

Heading: Whether Competent Substantial Evidence Supports the Jury Finding of Bad Faith

Text: Finally, we address whether competent, substantial evidence supports the jury's verdict that Infinity acted in bad faith. In Florida, the question of whether an insurer has acted in bad faith in handling claims against the insured is determined under the totality of the circumstances standard. See State Farm Mut. Auto. Ins. Co. v. Laforet, 658 So.2d 55, 63 (Fla.1995). Each case is determined on its own facts and ordinarily [t]he question of failure to act in good faith with due regard for the interests of the insured is for the jury. Gutierrez, 386 So.2d at 785; see also Campbell, 306 So.2d at 530-31 ([R]easonable diligence and ordinary care [are] material in determining bad faith. Traditionally, reasonable diligence and ordinary care are considerations of fact  not of law.). Although the issue of bad faith is ordinarily a question for the jury, this Court and the district courts have, in certain circumstances, concluded as a matter of law that an insurance company could not be liable for bad faith. For example, as noted by Justice Cantero in his dissent, in State Farm Fire & Casualty Co. v. Zebrowski, 706 So.2d 275, 277 (Fla.1997), this Court concluded that the trial court's grant of summary judgment in favor of the insurer was proper because, under section 624.155, Florida Statutes (1995), the insurance carrier did not owe a duty to the third-party claimant in the absence of an excess judgment as a matter of law. However, Zebrowski is distinguishable because this case does not involve either the interpretation of section 624.155 or the absence of an excess judgment against the insured. It is undisputed that Infinity owed a duty to its insured, Berges, to act in good faith. Moreover, where material issues of fact which would support a jury finding of bad faith remain in dispute, summary judgment is improper. See, e.g., Robinson v. State Farm Fire & Casualty Co., 583 So.2d 1063, 1069 (Fla. 5th DCA 1991) (reversing grant of summary judgment on bad faith claim where jury could find that a reasonably prudent person faced with paying the entire judgment would have settled under disputed material facts). But see, e.g., Shuster v. S. Broward Hosp. Dist. Physicians' Prof'l Liab. Ins. Trust, 591 So.2d 174, 178 (Fla.1992) (concluding that insurer could not be liable for bad faith as a matter of law where the policy provided that the insurer could settle any claim as it deems expedient and the insurer settled within policy limits). As noted above, this case was properly submitted to the jury to resolve disputed issues of material fact. Therefore, our review is limited to whether the verdict is supported by legally sufficient evidence. See Gutierrez, 386 So.2d at 785 (concluding that although the question of bad faith is generally for the jury, the verdict must be supported by legally sufficient evidence). Infinity owed a duty to Berges to investigate the facts, give fair consideration to a settlement offer that [was] not unreasonable under the facts, and settle, if possible, where a reasonably prudent person, faced with the prospect of paying the total recovery, would do so. Id. In this case, Infinity's independent investigation of the facts completed within a month after the accident revealed that this was a case of clear, if not aggravated, liability. At this time and three days before Taylor delivered his demand for the policy limits, Infinity's investigator confirmed in writing to Infinity that the driver of its insured vehicle had, while intoxicated, crossed the center line and collided head-on with Taylor's wife's car. Not only was the driver of Infinity's insured vehicle determined to be one hundred percent at fault for the accident but as of that time, Infinity knew that Mrs. Taylor, a mother of two minor children, died as a result. Infinity also knew that one of Taylor's minor daughters sustained severe injuries, resulting in over $30,000 in medical bills to date. Thus, as of April 30, one month after the accident and several days before a demand was made, Infinity knew that this was a case of clear liability and substantial damages, and that a jury verdict could far exceed the insured's minimal policy limits of $20,000. The actions of Infinity in the period following the receipt of the claim were properly considered by the jury in determining whether Infinity was acting with due regard for its insured's interests. The competent, substantial evidence to support the jury's finding consists of what the investigation revealed and Infinity's conduct after being presented with a written offer to settle for the policy limits. As discussed more extensively above, the evidence construed in the light most favorable to Berges reveals that instead of doing everything reasonably possible to complete the settlement following the May 11 conversation, Fryer never contacted Taylor again or followed up with Korth to stress the urgency of the time limits. Fryer did not memorialize his understanding of the conversation with Taylor in a letter to him. When Korth communicated to Fryer that completing the settlement within the time demands was problematic, Fryer did not contact Taylor to request an extension, inform him that there was a problem with court approval, or otherwise investigate the possibility of placing the funds into interest-bearing accounts. Instead, the time limit in the May 2 written offer simply expired without any communication from Infinity to Taylor. Lastly, although Infinity knew on April 30 that this was a case of clear liability with substantial damages, Infinity did not advise its insured, Berges, of the probable outcome of litigation that might be instituted, of the possibility of an excess judgment, or of the settlement negotiations between Taylor and Infinity until after Taylor had filed suit. After the May 11 conversation between Taylor and Fryer, Infinity failed to contact Berges until June 20, more than a month later and well after the settlement deadlines had expired. When Infinity finally did contact Berges after Taylor had withdrawn his offer and filed suit, Infinity's description of the previous negotiations with Taylor was not accurate. In a letter that for the first time informed Berges about the possibility of an excess judgment and his right to retain independent counsel, Infinity told Berges in a postscript that we have offered to pay your policy limits of $20,000 for the above claim, but Mr. Taylor refused to settle for that amount. The postscript did not mention the settlement deadlines and other terms of Taylor's May 2 settlement offer. If Infinity had advised Berges at the time the demand letter was received, Berges might have been able to obtain his own attorney who, recognizing that time was of the essence and that this was an offer that Berges could not afford to let expire, could have expedited any necessary court proceedings. The totality of the circumstances regarding Infinity's failure to act in the best interests of its insured are similar to the circumstances in Hartford Accident & Indemnity Co. v. Mathis, 511 So.2d 601 (Fla. 4th DCA), review denied, 518 So.2d 1275 (Fla.1987), in which the Fourth District stated: [I]t was clear to the carrier, from its own intra-departmental report, from the day after the accident (a) this was a horrendous injury including brain damage to a minor, (b) it was either an absolute or nearly absolute liability case, and (c) the policy limits were $25,000. Six weeks post-accident the victim's attorney orally requested policy limits ... for a complete release of its insured. This information was not conveyed to the insured. No response was given for almost a month.... The victim's attorney then sent a written formal demand for the limits and extended only ten days within which the carrier could tender $25,000. Although this court has indicted its unhappiness with ten day demand letters, under these facts we find no error justifying reversal since there was sufficient evidence from which the jury could have found a breach of the carrier's duty of good faith.... In addition, there was evidence of the carrier's failure to communicate appropriately with its insured as well as a lack of candor and complete integrity in that which it did communicate, all of which could also justify the jury's finding of bad faith. Id. at 602 (citation omitted). We conclude that the Fourth District's analysis in Hartford is equally applicable to this case. The facts of this case recounted above support the conclusion that, in the words of the trial judge, Infinity entirely dropped the ball in its handling of this case. Under the totality of the circumstances standard employed in Florida, we conclude that based on these facts, there was competent, substantial evidence to support the jury verdict that Infinity breached its duty of good faith to Berges.