Goheagan v. American Vehicle Insurance Co.
2012 Fla. App. LEXIS 20897
Fla. Dist. Ct. App.2012Background
- Goheagan, as Personal Representative of the Estate of Molly Swaby, appeals a final summary judgment in AVIC's favor on a bad-faith claim arising from a February 24, 2007 motor vehicle collision.
- Perkins, AVIC’s insured, was intoxicated (.19 BAC) and speeding when he rear-ended Swaby, who sustained catastrophic injuries and died May 12, 2007.
- Swaby’s wrongful death judgment against Perkins totaled $2,792,893.65 plus $28,070 cost; policy limits were $10,000 per person/$20,000 per accident.
- AVIC initially tendered to settle within policy limits; Goheagan—later identified as Swaby’s mother—retained an attorney and controverted the tender approach, especially since communications were restricted by law and adjuster ethics.
- The trial court granted summary judgment, ruling no bad faith due to Swaby being in a coma and lack of a guardian to receive an offer; the appellate court reversed, finding material fact issues remained.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether there are material facts showing bad faith by AVIC | Goheagan contends AVIC failed to act with due care and timely tender policy limits. | AVIC argues it acted fairly and within legal/ethical constraints while attempting to locate Goheagan’s attorney. | Disputed facts remain; summary judgment inappropriate. |
| Did AVIC have a duty to initiate settlement given clear liability and potential excess exposure | Insurer should have proactively tendered within policy limits to avoid excess judgment. | No obligation to tender where an attorney represents the claimant and where tender could be improper under rule. | Issue for jury; not appropriate for law-only resolution. |
| Whether Goheagan’s retention of an attorney impeded settlement offers | Attorney representation impeded offers; insurer could tender to the claimant’s attorney. | Attorney representation does not automatically bar offers; insurer could have written offers if permissible. | Questions of law/credibility; not determinative on summary judgment; remand appropriate. |
| Whether Florida Admin. Code Rule 69B-220.201 barred settlement dealings with a represented third party | Rule barred direct negotiations with a third-party claimant known to be represented. | Rule prohibits negotiations or direct settlement with represented claimants, potentially preventing even tender. | Could be controlling; unresolved whether tender to Swaby via Goheagan violated the rule; factual question for trial. |
| Is the standard for deciding insurer bad-faith claims appropriately de novo at summary judgment or a fact-intensive review | Lower court favored de novo review; must treat credibility and record facts for jury. | Where undisputed facts show no bad faith, summary judgment is appropriate. | Disputes about conduct and credibility preclude trial-free resolution; remand. |
Key Cases Cited
- Boston Old Colony Ins. Co. v. Gutierrez, 386 So.2d 783 (Fla. 1980) (insurer must act with care; diligence; settlement when prudent)
- Berges v. Infinity Insurance Co., 896 So.2d 665 (Fla. 2004) (reaffirms good-faith duty in claims handling)
- Powell v. Prudential Prop. & Cas. Ins. Co., 584 So.2d 12 (Fla. 3d DCA 1991) (delay in settlement may show bad faith under totality of circumstances)
- Laforet v. State Farm Mut. Auto. Ins. Co., 658 So.2d 55 (Fla. 1995) (totality of circumstances standard in bad-faith claims)
- Gutierrez, 386 So.2d 783 (Fla. 1980) (guardian or representative may negotiate settlement; duties extend to insured)
- Clauss v. Fortune Ins. Co., 523 So.2d 1177 (Fla. 5th DCA 1988) (insurer's duty to negotiate in good faith for settlement)
- RLI Ins. Co. v. Scottsdale Ins. Co., 691 So.2d 1095 (Fla. 4th DCA 1997) (no bad faith where insurer did not miss opportunity to settle)
- Caldwell v. Allstate Ins. Co., 453 So.2d 1187 (Fla. 1st DCA 1984) (insurer not guilty of harsher bad-faith conduct when settlement sought but verification desired)
- DeLaune v. Liberty Mut. Ins. Co., 314 So.2d 601 (Fla. 4th DCA 1975) (negligence alone insufficient to prove bad faith)