Court Opinion

ID: 9539565
Source: CourtListenerOpinion
Date Created: 2023-08-07 16:06:05.889278+00
Date Added: 2024-06-11T14:58:57.881282
License: Public Domain

MARTONE, Justice,
concurring in the judgment.
The issue here is not “whether breach of an express covenant in an insurance policy is a necessary prerequisite to a bad faith tort claim.” Ante, at 506. Nor do I agree that the answer to that question is always “no.” Thus I disagree with the court’s absolutist resolution of the issue.
Whether breach of contract is a prerequisite to a bad faith tort claim depends upon the similarity between the essential ingredients of each claim. Where the claims are essentially the same, the answer to the question should be a resounding “yes.” For example, where there is a claim for breach of contract for failure to pay benefits on the policy, and the bad faith tort claim is based on an allegation that the failure to pay was without a reasonable basis under Noble v. National Life Ins. Co., 128 Ariz. 188, 190, 624 P.2d 866, 868 (1981), then proof of the contract claim is a prerequisite to the bad faith tort claim. By definition, if the defendant has not breached its contract with the plaintiff, then it had a reasonable basis to deny the claim.
At the other extreme, where the claim of bad faith has nothing at all to do with the contract claim, as in Rawlings v. Apodaca, 151 Ariz. 149, 726 P.2d 565 (1986), then proof of the contract claim is irrelevant to proof of the bad faith tort claim. In Rawlings, the contract claim was for fire insurance under the policy. 151 Ariz. at 152, 726 P.2d at 568. The bad faith tort claim was for failing to disclose to the insured favorable information which would have helped the insured in a separate dispute with its neighbor. Id. These were wholly different claims and thus Farmers’ payment of the contract claim was irrelevant to the assertion of the bad faith tort claim. In that context, the contract claim was not an essential ingredient of the tort claim.
The case before us is somewhere between these two extremes. The basis of plaintiff’s bad faith tort claim is an allegation that the defendant has engaged in a plan and practice of always resisting bills for chiropractic treatment without regard to whether any individual claim is valid. Plaintiff’s breach of contract claim seeks recovery for the defendant’s failure to pay plaintiff’s specific chiropractic bill. Unlike the claims in Rawlings, these claims are not entirely separate. However, unlike the first illustration posited above, they are not entirely identical either. On the pleadings in this case, the jury could find that while plaintiff’s chiropractic bill which was the subject matter of its contract claim was not reasonable or was not necessary, they could also find that the defendant breached its duty of good faith and fair dealing to the plaintiff because the denial of the claim was not based upon a careful evaluation of plaintiff’s claim, but was part of a plan and practice to resist all such claims and the defendant should not profit from the mere fortuity that this particular claim was unreasonable. Thus in this case, the breach of contract claim was not a prerequisite to the bad faith tort claim.
I therefore suggest the following analytical framework to explain today’s decision. Whether breach of contract is a prerequisite to a bad faith tort claim depends upon whether the contract claim is an essential element of the tort claim. If it is, then breach of contract is a prerequisite to the bad faith tort claim. If not, then breach of contract is not a prerequisite to the bad faith tort claim. Because the contract claim in the case before us is not an essential ingredient of the bad faith tort claim, I concur in today’s judgment, but not in the *511universally applicable rule which the court adopts to reach it.