Opinion ID: 1689243
Heading Depth: 1
Heading Rank: 4

Heading: The Law on Inconsistent Verdicts

Text: This Court has written: Where a jury verdict is the result of confusion or is inconsistent in law, the trial court should grant a new trial; a new trial is necessary because, once the jury is dismissed, any attempt to reconcile the inconsistencies in a verdict must be based on mere speculation about the jury's intent. City of Bessemer v. Foreman, 678 So.2d 759, 760 (Ala.1996). See also Clark v. Black, 630 So.2d 1012 (Ala.1993); Humana Med. Corp. v. Traffanstedt, 597 So.2d 667 (Ala.1992). Accordingly, if the jury rendered an inconsistent verdict in this case, then we must affirm the Court of Civil Appeals' order directing a new trial rather than attempt to strike some portion of the inconsistent verdict. In order to establish a breach-of-contract claim, a plaintiff must show (1) the existence of a valid contract binding the parties in the action, (2) his own performance under the contract, (3) the defendant's nonperformance, and (4) damages. Southern Med. Health Sys., Inc. v. Vaughn, 669 So.2d 98, 99 (Ala.1995) (citations omitted). The elements of a cause of action for a bad-faith refusal to pay an insurance claim were set out in National Security Fire & Casualty Co. v. Bowen, 417 So.2d 179 (Ala.1982): [T]he plaintiff in a `bad faith refusal' case has the burden of proving: (a) an insurance contract between the parties and a breach thereof by the defendant; (b) an intentional refusal to pay the insured's claim; (c) the absence of any reasonably legitimate or arguable reason for that refusal (the absence of a debatable reason); (d) the insurer's actual knowledge of the absence of any legitimate or arguable reason; (e) if the intentional failure to determine the existence of a lawful basis is relied upon, the plaintiff must prove the insurer's intentional failure to determine whether there is a legitimate or arguable reason to refuse to pay the claim. In short, plaintiff must go beyond a mere showing of nonpayment and prove a bad faith nonpayment, a nonpayment without any reasonable ground for dispute. Or, stated differently, the plaintiff must show that the insurance company had no legal or factual defense to the insurance claim. Id. at 183 (first emphasis added). See also Chavers v. National Sec. Fire & Cas. Co., 405 So.2d 1 (Ala.1981). Thus, a breach of the insurance contract is an element of a bad-faith-refusal-to-pay claim. After reviewing the record before us, we see no situation presented in this case in which Alfa could have in bad faith refused to pay the Poarches' insurance claim without breaching the policy of insurance it had issued the Poarches. Because a breach of the insurance contract is an element of a bad-faith-refusal-to-pay claim, the jury, in order to find in favor of Poarch on the bad-faith claim, must have found that Alfa breached its contract of insurance with Poarch. See Bowen, supra ; see also State Farm Fire & Cas. Co. v. Slade, 747 So.2d 293, 319 (Ala.1999) (Thus, the jury, in finding State Farm guilty of bad faith, must have found that State Farm had breached the insurance contract.... Thus, the jury inconsistently resolved the same issue in two separate counts, thereby making its verdict inconsistent.). The verdict in favor of Poarch on the bad-faith claim is inconsistent with the verdict in favor of Alfa on the breach-of-contract claim. [I]t is clear that the appropriate remedy for the rendition of an inconsistent verdict is not a [postverdict JML]; rather, the appropriate remedy is a new trial. Slade, supra, 747 So.2d at 319, quoting Luker v. City of Brantley, 520 So.2d 517, 521 (Ala.1987). Accordingly, this Court agrees with the Court of Civil Appeals that the jury's verdict is inconsistent and that the judgment must be reversed and this cause remanded for a new trial. The Court of Civil Appeals properly held that both the breach-of-contract claim and the bad-faith claim should be retried. We reject Alfa's argument that Poarch presented insufficient evidence to create a jury question on his claim of bad faith. We note that the question whether Poarch presented sufficient evidence on his claim that Alfa intentionally refused to replace the damaged walls in accordance with the terms of the homeowner's policy is a close one. However, this Court need not resolve that question, because the evidence created a jury question on Poarch's claim that Alfa intentionally refused to honor the Poarches' claim for additional living expenses. It is undisputed that the Poarches' insurance policy provided coverage for additional living expenses; the Poarches made a claim under this coverage at the time Alfa approved their claim for replacement of the walls. Alfa knew that the estimated time for those repairs was a minimum of four weeks and that the repairs to be made at the Poarches' house (the removal of walls and plasterboard in numerous rooms), and all related inconveniences would cause a major disruption to their family life. [2] Poarch presented evidence indicating that Alfa denied the Poarches' claim for additional living expenses, and the record provides no indication of any reason for this denial. The record contains sufficient evidence to present a jury question as to whether Alfa denied this claim in bad faith. It is well established that this Court will uphold a ruling of the trial court if the ruling is proper for any reason, even one that was not presented to, or considered by, the trial court. Deaton, Inc. v. Monroe, 762 So.2d 840 (Ala.2000). Finally, we reject Alfa's far-reaching interpretation of Sexton v. Liberty National Life Ins. Co., 405 So.2d 18 (Ala.1981), cited by Alfa as authority for the proposition that where an insurance company pays a portion of a plaintiff's claim, its failure to pay another part will not support a bad-faith-failure-to-pay action. The Sexton Court merely concluded that, considering the partial payment in the context of [that] case, 405 So.2d at 22, there was no basis for a claim alleging bad faith. [3] Id. at 22. Thus, the holding of Sexton was limited to the facts of that case and it does not per se preclude a jury's consideration of an insured's bad-faith claim simply because the insurer has paid a portion of the insured's claim. Under the facts of this case, we hold that Alfa's partial payment of the Poarches' insurance claim does not preclude the jury from considering Poarch's bad-faith claim. Finally, we take this opportunity to recommend that Instruction 20.37, Alabama Pattern Jury Instructions: Civil (2d ed.1993), the pattern jury instruction for a bad-faith claim, be amended to avoid the recurring confusion now leading to inconsistent jury verdicts on breach-of-contract and bad-faith claims. We believe the confusion could easily be eliminated by adding the following sentence to Instruction 20.37: In order to find for the plaintiff on his/her bad-faith count, you must have found for the plaintiff on his/her breach-of-contract count. No prejudice could result from the court's giving such an instruction, because the jury currently must find for the plaintiff on the contract claim in order to find for the plaintiff on a bad-faith claim. This sentence, if added to the instruction, will simply provide clear and concise directions to the jury so as to avoid an inconsistency due to oversight or to confusion among the jurors. There is no reason to avoid directly apprising jurors, in words they can understand, of the interrelationship under Alabama law of a breach-of-contract claim and a bad-faith claim.