Opinion ID: 307785
Heading Depth: 1
Heading Rank: 4

Heading: sufficiency of the evidence

Text: 13 While the New York rule is unquestionably that the insurer must act in good faith, in the unending variety of fact patterns which continue to plague courts in these cases, there is no pat formula which can be routinely applied to determine its presence. 7 We can do little more than repeat what Judge Judd charged the jury in substance in this case. The insurance company must give at least equal consideration to the insured's interests as to its own when making settlement decisions. 8 14 We believe that there was sufficient evidence before the jury to find that the insurance company did not proceed in good faith in attempting to negotiate a settlement of this claim within policy limits. There was little question of liability in this case from the beginning. It was uncontroverted that the insured had driven over a divider and collided with a car coming in the opposite direction. He was charged with reckless driving and driving while intoxicated and he pleaded guilty to reckless driving. Although he has consistently denied being drunk, there was evidence that he had failed a drunkometer test at the police precinct. Just as negligence was clear so was the magnitude of the injuries suffered by the plaintiff. She was a 30 year old woman who as a result of the accident was permanently blinded in one eye, faced the possible loss of vision in the other eye and received severe facial scarring. She spent forty days in a hospital. There was no attempt to controvert the seriousness and permanency of her injuries and the insurer was fully apprised of the gravity of the harm she suffered. The policy coverage was $10,000 and the high probability of a verdict far in excess of the policy limit cannot be seriously questioned. 15 The only possible defense of the insurer was that Miss Peterson was guilty of contributory negligence in accepting a ride with a driver she had reason to believe was intoxicated. 9 Such a defense, while it may totally exculpate the defendant and the insurer, obviously may have the opposite effect. The carrier's emphasis on the culpability of the insured, may so inflame the jury that a swollen verdict may ensue. In such a case Professor Keeton suggests that the circumstances may create such a conflict of interest that this defense should not be permissible. R. Keeton, Insurance Law Sec. 7.7(c), at 501 (1971). This question was not raised by the parties below and was not brought to the attention of the jury. However, there was evidence from an expert witness for the insurer that a jury may well disregard evidence of contributory negligence where there are severe injuries because of their sympathy or compassion for the plaintiff. 16 Realistically the prospect of success of the defense in this case was highly dubious. Although Miss Peterson's hospital record indicated A.O.B. (alcohol on breath) she denied that she had been drinking or that she knew Washington had been. There was conflicting evidence as to how long she had been with him before accepting the ride. There was no evidence that Washington was obviously drunk or that his actions were such as to alert Miss Peterson to his condition. 10 See Burnell v. La Fountain, 6 A.D.2d 586, 180 N.Y.S.2d 52 (3d Dep't 1958). This does emphasize of course the question of the thoroughness of the insurer's investigation as well as the particular urgency to advise Washington of his right to independent counsel. As with most aspects of this case, these were disputed questions of fact, which were left to the jury. 17 When this case was placed on the state trial calendar for September, 1968, there was testimony that the company advised Miss Peterson's attorney that this was a no pay case and that he would offer $1000 to settle. There was no evidence of any negotiation before trial. After the selection of a jury, the insurer offered $5000. There was testimony that counsel for plaintiff was willing to take $10,000 and evidence by defendant that the offer was really $20,000-there was a co-defendant, the owner of the car which had collided with Washington's-and that the offer was conditioned on receiving $10,000 from each. This was denied by counsel for the plaintiff who testified that he was willing to accept $10,000 but that the offer was never made. This was disputed by the insurer which claimed that $10,000 was offered before the trial ended. The jury returned an $80,000 verdict, the insurer paid $10,000 and did not appeal the verdict. 18 From a review of the record as a whole and viewing the proof in the light most favorable to the plaintiff, we are satisfied that the case was properly submitted to the jury under appropriate instructions 11 and that the jury was justified in finding that the insurer did not discharge its responsibility to consider the interests of Washington, the insured, at least equally with those of the company. In fact the conclusion is almost inescapable that the insurer was essentially concerned with its own fortunes and not at all with the plight of the insured.