TRINITY BAPTIST CHURCH v. BROTHERHOOD MUTUAL INSURANCE SERVICES, LLC
341 P.3d 75
| Okla. | 2014Background
- Trinity Baptist Church insured its property with Brotherhood Mutual; after a December 2009 storm it filed a claim for sanctuary damage.
- Brotherhood retained Sooner Claims Services (an independent adjuster) under a Limited Assignment to inspect and report; Sooner submitted reports to Brotherhood, not to Trinity, and had limited authority over coverage decisions.
- Trinity sued Brotherhood and Sooner alleging breach of contract, bad faith, and gross negligence for Sooner’s handling of the claim; Trinity later settled with Brotherhood.
- Sooner moved for summary judgment arguing it owed no duty of good faith or negligence-based duty to Trinity; the trial court granted summary judgment for Sooner (dismissing Trinity’s claims against Sooner).
- On appeal, the Oklahoma Supreme Court considered whether an independent adjuster can (1) be subject to the insurer’s implied covenant of good faith and fair dealing and (2) owe an independent tort duty of care to the insured.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether an independent adjuster may be bound by the insurance contract's implied covenant of good faith and fair dealing | Sooner acted beyond a normal adjuster role and thus formed a "special relationship" with Trinity sufficient to impose the covenant | Sooner was a stranger to the policy and did not act like an insurer; no special relationship existed | No — Sooner was not subject to the implied covenant; no special relationship shown |
| Whether an independent adjuster owes a tort duty (negligence) to the insured for claim adjustment | An adjuster can foreseeably harm the insured and therefore owes a duty to investigate and adjust fairly | Imposing a tort duty would conflict with adjuster’s contractual duties to insurer and create duplicative liability; insurer already has non‑delegable duties | No — Sooner owed no independent legal duty in tort to Trinity |
| Whether summary judgment dismissal was proper based on damages or duty | Trinity argued errors in summary judgment denial of gross negligence claim | Sooner argued no duty exists so damages issue is moot; also moved to preclude emotional damages for a corporation | Court affirmed summary judgment for Sooner, holding absence of duty disposes of tort claims; did not reach corporate emotional damages issue |
| Whether prior authorities (minority decisions) require a different outcome | Trinity relied on Brown (OK Civ. App.) and some out‑of‑state minority rulings recognizing adjuster duties | Sooner relied on majority authority and policy considerations against imposing such duties | Court adopted majority approach and policy reasons; declined to follow Brown as controlling |
Key Cases Cited
- Timmons v. Royal Globe Ins. Co., 653 P.2d 907 (Okla. 1982) (general rule: implied covenant of good faith applies to insurer, not strangers to contract)
- Christian v. Am. Home Assur. Co., 577 P.2d 899 (Okla. 1977) (foundation for insurer’s implied duty of good faith and fair dealing)
- Wolf v. Prudential Ins. Co. of Am., 50 F.3d 793 (10th Cir. 1995) (analysis recognizing special‑relationship exception where administrator acts like an insurer)
- Wathor v. Mutual Assurance Admins., Inc., 87 P.3d 559 (Okla. 2004) (applies Wolf; special relationship requires power, motive, opportunity to act unscrupulously)
- Badillo v. Mid Century Ins. Co., 121 P.3d 1080 (Okla. 2005) (third‑party may be subject to good faith duty where it acted indistinguishably from insurer)
- Brown v. State Farm Fire & Cas. Co., 58 P.3d 217 (Okla. Civ. App. 2002) (Court of Civil Appeals adopting minority view that adjusters may owe insureds a duty to investigate fairly)