MICHAEL O'SHIELDS, APPELLANT,
v.
UNITED AUTOMOBILE INSURANCE CO., APPELLEE
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O'Shields appeals summary judgment in favor of his insurance company after his car was stolen. The court reverses, finding that even though United Auto eventually paid the claim, the insurer violated its duty of good faith and fair dealing by failing to promptly disclose settlement terms and stonewalling the insured's discovery requests.
Payment of the claim does not vitiate the insurer's failure to deal fairly and in good faith with its insured. The insurer owes a duty of good faith and fair dealing under the insurance contract, including the right to be informed of settlements and to verify the adequacy of payments made on the insured's behalf.
[1] An insurance company owes a duty of good faith and fair dealing to its insured under the terms of the insurance policy.
[2] An insured has a right to be informed by their insurer regarding settlements made with lienholders.
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Join FLexlaw to unlock all legal intelligence“An insurance company owes a duty of good faith and fair dealing to its insured under the tenns of the insurance policy.”
Establishes the foundational duty owed by insurers to their insureds
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Join FLexlaw to unlock all legal intelligenceO'Shields' automobile was stolen on January 12, 1999. United Auto denied coverage based on alleged failure to cooperate after a three-hour statement. …
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RAMIREZ, J.
We grant appellee United Automobile Insurance Company’s motion for rehearing only as to the issue of entitlement to attorney’s fees raised in this Court’s opinion of May 2, 2001, which is now vacated and substituted by the following opinion. We also deny the motion for certification.
Michael O’Shields, plaintiff below, appeals the entry of final summary judgment in favor of his insurance company, United Auto.
We reverse the entry of summary judgment. O’Shields’ automobile was stolen on January 12, 1999, and he filed a claim with United Auto. After taking a three-hour statement from its insured, United Auto took the position that O’Shields had failed to cooperate and denied coverage.
On August 23,1999, without notifying its insured, United Auto agreed to settle O’Shields’ claim and sent payment to the lienholder, but did not advise O’Shields as to the amount or terms of the settlement. O’Shields filed suit for breach of contract against United Auto on August 24, 1999.
On September 8, 1999, in a letter to United Auto, O’Shields requested information regarding the settlement and any releases obtained on O’Shields’ behalf. United Auto responded by filing a motion to dismiss for improper venue.
It is not necessary to describe all the pleadings filed by United Auto to establish the stonewalling tactics of the insurer. On November 22, 1999, O’Shields moved to compel the production of the documents concerning the settlement and releases. It was not until March 29, 2000, when, in response to the trial court’s order compelling production, United Auto sent O’Shields a copy of the check it had sent to the lienholder as payment for the loss of the automobile. United Auto then moved for summary judgment and, as payment had been made, the trial court granted the motion.
An insurance company owes a duty of good faith and fair dealing to its insured under the tenns of the insurance policy. See North American Van Lines, Inc. v. Lexington Ins. Co., 678 So. 2d 1325, 1330-31 (Fla. 4th DCA 1996).
According to the terms of the insurance contract, O’Shields, as the insured, had a right to the settlement documents, and a right to be informed regarding the settlement with the lienholder. O’Shields also had the right to verify that the amount United Auto had paid the lienholder was adequate. Instead of providing O’Shields with the requested documentation and promptly ending the litigation, United Auto did not cooperate with O’Shields and failed to provide him with the requested documentation. This made continuation of the lawsuit necessary, and payment for the loss did not vitiate United Auto’s failure to deal fairly and in good faith with its insured.
For these reasons, we therefore reverse.
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QBE Ins. Corp. v. Chalfonte Condo. Apt. Ass'n, Inc., 94 So. 3d 541 (Fla. 2012)…, only whether a contractual term was breached and whether the parties’ reasonable contractual expectations have been thwarted”). Chalfonte also relies on the Third District Court of Appeal’s decision in O’Shields v. United Automobile Insurance Co., 790 So. 2d 570 (Fla. 3d DCA 2001), which is cited by the Eleventh Circuit in the instant case as “implicitly recognizing] that a good faith and fair dealing claim can be distinct from a statutory bad faith claim in a first-party action on an insurance contract.” C…
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O'Shields v. United Auto. Ins. Co., 812 So. 2d 448 (Fla. 3d DCA 2002)…PER CURIAM. In light of this Court’s decision in the underlying action, O’Shields v. United Auto. Ins. Co., 790 So. 2d 570 (Fla. 3d DCA 2001), and United Automobile Insurance Company’s proper confession of error, we vacate the trial court’s final order of entitlement to attorney’s fees under section 768.79 (1997), and the final judgment on United Automobile Insurance Co…
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Chalfonte Condo. Apt. Ass'n, Inc. v. QBE Ins. Corp., 561 F.3d 1267 (11th Cir. 2009)…n, at least one Florida appellate court has implicitly recognized that a good faith and fair dealing claim can be distinct from a statutory bad faith claim in a first-party action on an insurance contract. See O’Shields v. United Auto. Ins. Co., 790 So. 2d 570, 571 (Fla.Dist.Ct.App.2001) (“An insurance company owes a duty of good faith and fair dealing to its insured under the terms of the insurance policy.”). The plaintiff in O’Shields, however, did not sue his insurer for failure to investigate and ass…
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Join FLexlaw to unlock all legal intelligenceAuthorities Cited
- N. Am. van Lines, Inc. v. Lexington Ins. Co., 678 So. 2d 1325 (Fla. 4th DCA 1996)