391 P.3d 120
Okla. Civ. App.2015Background
- Tolman’s wife held a $100,000 life policy with Reassure; Tolman was the named beneficiary.
- Tolman deposited a Reassure check in Bank of the Lakes on Feb 27, 2009; Bank suspected fraud due to Bank One being defunct and unable to verify.
- Bank notified Tolman and Reassure; Reassure's agent did not follow up with Tolman or investigate adequately.
- Bank filed police report the same day Tolman deposited the check; Tolman faced a criminal complaint later that month alleging a forged instrument, later dismissed.
- The claim was paid within 30 days; Tolman sued Reassure, Bank, and J.P. Morgan Chase; jury awarded Tolman $450,000 in actual damages apportioned 50% to Reassure and Bank, with Chase not liable; prejudgment interest was included.
- Reassure moved for JNOV; trial court denied; Reassure appeals asserting no negligence claim and urging directed verdict on other claims.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Oklahoma recognizes a negligence claim by an insured against an insurer | Tolman asserts duty of care exists; insurer promised investigation and breached duty. | Reassure contends no such tort exists; only contract and bad-faith duties apply. | No such negligence claim; dismissed for error to submit. |
| Whether the negligence claim submission affected other claims | Tolman argues breach of implied covenant and bad faith claims remain viable if negligence exists. | Reassure asserts no direct causal link via negligence and directed verdict proper. | Directed verdict on contract/bad-faith claims affirmed; negligence claim reversed and remanded for consideration only. |
| Whether trial court erred by submitting negligence claim to jury | Tolman premised on insurer’s duty to investigate and timely pay; supports jury trial. | Without a recognized negligence cause, submission was error. | Submission improper; reversed in part and remanded. |
Key Cases Cited
- Christian v. American Home Assurance Co., 577 P.2d 899 (Okla. 1977) (breach of implied duty; first-party bad faith and contract distinct)
- Trinity Baptist Church v. Brotherhood Mut. Insurance Services, L.L.C., 341 P.3d 75 (Okla. 2014) (insurer duties; implied covenant and good faith)
- Badillo v. Mid Century Insurance Co., 121 P.3d 1080 (Okla. 2005) (standard for bad faith beyond simple negligence)
- Brown v. Patel, 157 P.3d 117 (Okla. 2007) (insurer duties to timely pay; standard for culpability)
- Timmons v. Royal Globe Ins. Co., 653 P.2d 907 (Okla. 1982) (trust and breach-based duties; contract/implied duties)
- Lewis v. Farmers Ins. Co., Inc., 681 P.2d 67 (Okla. 1983) (distinction between contract claim and bad faith claim)
- Fry Land & Cattle Co. v. Colorado Interstate Gas Co., 805 P.2d 695 (Okla. 1990) (cited in context of contract/bad faith discussion)