MARTIN v. GRAY
2016 OK 114
| Okla. | 2016Background
- Kourtni Martin (insured) was seriously injured in an Oklahoma City automobile collision on May 31, 2013; she had uninsured motorist (UM) coverage through Goodville Mutual (insurer).
- The policy was purchased by her parents while they lived in Kansas; Martin was a listed driver and her parents notified the Kansas agent she would garage the vehicle in Oklahoma.
- Martin filed suit against the tortfeasor (Gray) and sought UM benefits from Goodville; claim handling was conducted out of Pennsylvania after being reported to the Kansas agent.
- Martin amended to add breach of contract and an insurer-bad-faith tort claim alleging inadequate, delayed, and biased investigation and training failures.
- The trial court applied Kansas law and dismissed the bad-faith claim (concluding Kansas doesn’t recognize the claim); the order was certified for interlocutory review.
- The Oklahoma Supreme Court held Kansas law did not automatically govern the bad-faith tort and reversed the trial court; the case was remanded for dismissal based on the parties’ settlement.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether an insurer bad-faith claim is independent of contract for conflicts analysis | Martin: bad-faith is a tort distinct from contract under Oklahoma law and thus requires tort choice-of-law analysis | Goodville: bad-faith arises from the insurance contract, so contract choice-of-law (Kansas) controls | Held: Bad-faith is an independent tort under Oklahoma precedent; tort choice-of-law applies |
| Which choice-of-law rule governs an insurer bad-faith claim | Martin: apply the "most significant relationship" test for torts | Goodville: apply contract-place-of-performance or Oklahoma UM statute-based rules pointing to Kansas law | Held: Apply the most significant relationship test (tort test), not automatic application of Kansas law |
| Whether the trial court properly applied Kansas law to dismiss the bad-faith claim | Martin: dismissal improper without applying tort choice-of-law factors | Goodville: Kansas law applies and precludes bad-faith claim | Held: Trial court erred in applying Kansas law without performing the most significant relationship analysis |
| Whether the appellate court should remand for choice-of-law analysis despite settlement | Martin: remand for application of tort contacts | Joint parties: settled and moved to dismiss with prejudice | Held: Court recognized public interest, reversed trial court, but remanded for dismissal consistent with the parties’ settlement rather than further proceedings on choice-of-law |
Key Cases Cited
- Christian v. Am. Home Assur. Co., 577 P.2d 899 (Okla. 1977) (establishes insurer-bad-faith as an independent tort based on implied duty of good faith)
- McCorkle v. Great Atl. Ins. Co., 637 P.2d 583 (Okla. 1981) (reaffirms Christian; bad-faith is an intentional tort applicable to all insurers)
- Panama Processes, S.A. v. Cities Serv. Co., 796 P.2d 276 (Okla. 1990) (applied contract choice-of-law to fiduciary/contract-based duties; distinguished here)
- Brickner v. Gooden, 525 P.2d 632 (Okla. 1974) (adopts the "most significant relationship" multistate tort choice-of-law test)