 |
 |
to fill out a simple form to connect to DUI Lawyers in your area.
|
|
|
|
|
LOYAL AMERICAN LIFE INS. v. MATTIACE5/24/1996
the Catch 22 in your argument." (Emphasis added.) We believe the trial court's comment indicates that for the purpose of determining whether Sue Mattiace met the "directed verdict on the contract claim" standard, given the abundant evidence of inconsistency in the underwriting process, the court did not allow Loyal American's after-the-fact promises that it solely relied on the "Hudson" manual to evaluate "driver criticisms" to create its legitimate, debatable reason for denying the claim for policy benefits.
In Blackburn v. Fidelity & Deposit Co. of Maryland, 667 So.2d 661, 669 (Ala. 1995), we
stated that "an insurer's subjective belief that a portion of its insurance contract precludes coverage is not an absolute defense to a bad faith claim." We also stated that if an insurer's subjective interpretation of an insurance policy could create the fairly debatable reason needed to defend a bad faith claim, then insurers would be encouraged to write ambiguous insurance policies. Id.
Similarly, if an insurer is allowed to intentionally create an atmosphere in its underwriting department where no standards are binding on its underwriters and when a claim for policy benefits is received an underwriter can pull off a shelf underwriting standards that are stricter than those that were used when the policy was issued, then the insurer would be creating its own debatable reason for denying the claim. We cannot condone such action and let self-created uncertainty as to underwriting standards defeat a claim of bad faith where that uncertainty is the very basis of the allegation of bad faith. Thus, we hold that Loyal American cannot rely upon its chosen method of "subjective underwriting" to create its own legitimate reason for denying a claim, and we conclude that Sue Mattiace presented substantial evidence in support of each element of an action for bad faith. The trial court properly denied Loyal American's motions for a directed verdict on Sue Mattiace's bad faith claim.
V. J.N.O.V. Motions
For the same reasons discussed in section IV, we hold that the trial court properly denied Loyal American's motions for J.N.O.V.
VI. Constitutionality of Allowing Bad Faith Claims
Loyal American argues that allowing the bad faith cause of action violates its right to jury trial, as that right is guaranteed by the Alabama Constitution of 1901, Art. I, § 11. Citing Smith v. Schulte, 671 So.2d 1334 (Ala. 1995); Henderson v. Alabama Power Co., 627 So.2d 878 (Ala. 1993); Moore v. Mobile Infirmary Association, 592 So.2d 156 (Ala. 1991); and Gilbreath v. Wallace, 292 Ala. 267, 292 So.2d 651 (1974), Loyal American states that this Court's opinions regarding the jury trial right have held that the adoption of the Alabama Constitution of 1901 "froze" the right to a trial by jury as it existed at that time. It argues that because no bad faith cause of action existed as of 1901, the recognition of such a cause of action by this Court in 1981 was an unconstitutional tampering with the right to trial by jury as it was "frozen" in 1901. Thus, Loyal American contends that it is unconstitutional to allow actions based on the tort of bad faith.
Loyal American also contends that any action by this Court that alters the jury trial right, in violation of § 11 of the Alabama Constitution of 1901, also violates its rights under the equal protection guarantees of the Alabama and United States Constitutions. It argues that the recognition of the tort of bad faith is a violation of its equal protection rights because, it says, allowing plaintiffs a legal cause of action to recover damages for such a wrong favors plaintiffs and unfairly discriminates against t
Page 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 Alabama DUI Attorneys
DUI Lawyers
|
| |
to fill out a simple form to connect to DUI Lawyers in your area.
|
|