Court Opinion

ID: 9779339
Source: CourtListenerOpinion
Date Created: 2023-08-29 21:47:34.195335+00
Date Added: 2024-06-11T07:33:25.492764
License: Public Domain

STEPHENSON, Justice,
dissenting.
I agree with the majority that we should not review the issue that the policy of insurance was in effect at the time of the accident. It is the holding that in the circumstances presented here the insurance company did not exercise “good faith” in refusing to settle that I part company with the majority. This opinion places an insurance company in an impossible position. There is not even a suggestion in the record that the insurance company received the premium allegedly sent to it. Why would the insurance company think otherwise than that the policy lapsed for nonpayment of premium? There is no question that the refusal to defend was made in good faith. I can understand how there would be a later determination that the insurance company was in error in refusing to defend and liable for the limits of the policy. It is the judicial trapeze act which converts a good faith error into a lack of good faith in settling which makes for an impossible situation. With this holding, an insurance company can never litigate a good faith refusal to defend a case. I am of the opinion the majority opinion is not sound, particularly in view of the fact that the determination that the insurance company had a duty to defend was not made until after judgment was entered on the trial of the tort action. This insurance company never had a chance to consider an *891offer of compromise. At the very least, there should be some legitimate reason in the record why Passmore did not settle. He had the same opportunity and had control of his case with retained counsel.
I would hold as clearly erroneous the finding of the trial court as to “bad faith” and affirm the Court of Appeals. Accordingly I dissent.