Court Opinion

ID: 9879509
Source: CourtListenerOpinion
Date Created: 2023-09-27 18:21:58.097902+00
Date Added: 2024-06-11T07:47:55.699869
License: Public Domain

Gurich, V.C.J.,
specially concurring:
¶ 1 I concur with the majority but write separately to emphasize the appalling conduct that led to the filing of this action. On June 26, 2008, Appellant Tracy Meeks suffered an on-the-job injury with Southside Recycling, who was insured by the Defendant Guarantee Insurance Company. By order of April 15, 2010, Mr. Meeks was awarded temporary total disability benefits, payable at the rate of $ 299.00 per week for a period of 156 weeks. On more than twenty-six (26) occasions, Guarantee Insurance refused to pay the benefits. Counsel for Mr. Meeks was forced to make multiple trips to the court to seek additional orders for payment. Some orders included a 15% penalty and interest. This pattern continued for several years.
¶ 2 On June 26, 2014, the Workers’ Compensation Court of Existing Claims1 issued the final order on arrearages, finding that Guarantee Insurance had failed to pay benefits in the amount of $ 8,940.10 without justifiable reason. The claim was eventually settled. For a period of over four years, Guarantee Insurance habitually ignored valid court orders to pay benefits. The facts of this case are outrageous, and this is exactly the reason why a claimant must have a common law remedy of bad faith. In spite of flagrant violations of multiple court orders *287over a period spanning from 2010 to 2014, Guarantee Insurance was merely held in contempt and assessed penalties and interest over and over again. The dissent would not allow workers’ compensation insurance providers to be sued for bad faith because the Workers’ Compensation Court has the power to sanction contempt for failure to pay the award. But the court’s statutory power to sanction clearly did nothing to deter the wrongful conduct in this case, and the dissent’s citation to § 73 of the Administrative Workers’ Compensation Act, which went into effect February 1, 2014, cannot apply to this ease because the date of injury was June 25, 2008.2 Guarantee Insurance’s continued conduct evidenced intentional, malicious, and bad faith refusal to pay multiple awards, and neither the payment of the ar-rearages and penalty nor the settlement stands as a bar to an action for bad faith.
¶ 3 Prior to 2002,3 there was little doubt that a claimant who was wrongfully denied benefits after a final award by the Workers’ Compensation Court could pursue a bad faith ease against the insurer in a court of general jurisdiction.4 Both Goodwin v. Old Republic Insurance Co., 1992 OK 34, 828 P.2d 431 and Anderson v. U.S. Fidelity and Guarantee Co., 1997 OK 124, 948 P.2d 1216, made clear that intentional acts are statutorily excluded from the Workers’ Compensation Act. “If an employee is injured by an insurer’s bad faith-intentional failure to pay benefits under an award, the employee has a common law action in tort under the Christian doctrine.”5 An insurer’s failure to pay a valid final award of benefits to -a claimant in a workers’ compensation proceeding is simply not a compen-sable injury contemplated in the workers’ compensation scheme. A bad faith claim against a workers’ compensation insurer is separate and apart from the employer/employee relationship and does not arise in the course and scope of employment.6 In YWCA of Okla. City v. Melson, 1997 OK 81, 944 P.2d 304, this Court allowed discovery to go forward in a district court action against a workers’ compensation self-insurance group for the bad faith failure to pay an award.7
¶4 In 2006, in Sizemore v. Continental Casualty Co., 2006 OK 36, 142 P.3d 47, the Court unequivocally stated that an action for bad faith is available for failure to pay a valid workers’ compensation award. The Court fully discussed the inconsistencies in previous cases and concluded that neither the exclusive remedy provision of the Workers’ Compensation Act nor the certification procedure found in 85 O.S. § 42 preempted a bad faith claim against a workers’ compensation insurer. The certification process was further clarified in Summers v. Zurich American Insurance Co., 2009 OK 33, 213 P.3d 565. The Court made it abundantly clear that it would be nonsensical to interpret Section 42 to require a party to seek permission from the Workers’ Compensation Court to bring a common law action for bad faith. In the case before us, for example, the order of the Workers’ Compensation Court merely confirmed the facts that were well known to the *288parties: that Guarantee Insurance intentionally and without just cause refused to make required payments to the detriment of Mi-. Meeks. Although Guarantee Insurance paid the arrearages and penalty as a purge amount to avoid being held in contempt of court and may use such payment in its defense of the bad faith claim, the payment cannot prevent Mr. Meeks from bringing his bad faith claim in the district court.
¶ 5 “[T]he essence of the intentional tort of bad faith with regard to the insurance industry is the insurer’s unreasonable, bad-faith conduct, including the unjustified withholding of payment due under a policy....” McCorkle v. Great Atlantic Ins. Co., 1981 OK 128, ¶ 21,637 P.2d 583, 587. In a bad faith, breach of insurance contract case, the delay refers to an insurer’s duty to act in a diligent manner in relation to investigation, negotiation, defense, and settlement of claims being made against the insured.8 In a, bad faith claim against a workers’ compensation insurer, a claimant must prove an unjustifiable delay in payment of an award. The consequences of the delay form the basis of the actual damages.9 This Court was correct in 1992 in Goodwin when it first recognized a common law tort action for an insurance earner’s bad faith in refusing to pay a workers’ compensation award. In Sizemore in 2006, this Court reaffirmed the law by correctly overruling decisions to the contrary in Kuykendall and Deanda. Today’s decision fits squarely within the Goodwin and Sizemore line of cases. When a workers’ compensation insurer refuses to pay benefits awarded and ordered by the Workers’ Compensation Court, such refusal “invites, encourages and gives viability to a bad faith claim by the injured and unpaid worker.” Sizemore, 2006 OK 36, 142 P.3d 47 (Taylor, J., concurring ¶ 1).

. The Workers' Compensation Court is now the Workers’ Compensation Court of Existing Claims. See 85A O.S. Supp. 2013 § 400.

. "The general rule is that the law in effect at the time of an employee’s injury controls in workers' compensation matters.” King Mfg. v. Meadows, 2005 OK 78, ¶ 11, 127 P.3d 583, 589.

. In Kuykendall v, Gulfstream Aerospace Technologies., 2002 OK 96, 66 P.3d 374 and DeAnda v. AIU Insurance, 2004 OK 54, 98 P.3d 1080, the Court signaled a dramatic change from long standing law on the availability of a bad faith action arising from failure to pay a workers' compensation award. The Court reasoned that 85 O.S. 42 was sufficient to prevent employers and insurance carriers from failing to pay their legal obligations. The facts in this case illustrate the fallacy of that logic.

. Relying on case law from the Supreme Court, in October of 2000, the case of Susan Huntington v. Reliance National Indemnity Co., CJ-98-7765, (Okla. Cnty. Dist. Ct.), was tried to verdict. Plaintiff alleged a bad faith refusal of the workers’ compensation insurance carrier to pay an award of medical benefits. The jury returned a verdict of $ 200,000 actual and $ 500,000 punitive damages. The defendant insurance company did not appeal.

. Goodwin, 1992 OK 34, ¶ 14, 828 P.2d at 435.

. Id., ¶ 12, 828 P.2d at 435.

. In Whitson v. Oklahoma Farmers Union Mutual Insurance Co., 1995 OK 4, 889 P.2d 285 and Anderson, 1997 OK 124, 948 P.2d 1216, the Supreme Court clarified that a bad faith claim cannot arise until after there is a valid award. See also Cooper v. Nat'l Union Fire Ins. Co., 1996 OK CIV APP 52, 921 P.2d 1297.

. Badillo v. Mid Century Ins. Co., 2005 OK 48, ¶ 36, 121 P.3d 1080, 1096.

. “Unwarranted delay precipitates the precise economic hardship the insured sought to avoid by purchase of die policy.” Christian v. Am. Home Assurance Co., 1977 OK 141, ¶ 21, 577 P.2d 899, 903.