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Keywords

lawsuitdamagesattorneyappealtrialverdictmotiongood faithbad faith

tortdamagesnegligenceappealverdictmotioncompliancecompensatory damagesgood faithbad faith

Related Cases

Farmers Ins. Exchange v. Shirley, 958 P.2d 1040

Facts

Barbara Shirley was involved in an automobile accident on October 9, 1989, while insured by Farmers Insurance Exchange. Following the accident, she incurred medical expenses exceeding the $5,000 coverage limit. Despite submitting medical bills to Farmers, payments were delayed, leading the Shirleys to rely on their attorney for assistance. The emotional strain from the delayed payments and threats from creditors contributed to their distress, prompting them to file a lawsuit against Farmers for breach of the duty of good faith and fair dealing.

Barbara Shirley was involved in an automobile accident on October 9, 1989. At the time of the accident, the Shirleys were insured under an automobile insurance policy issued by Farmers.

Issue

Did the Shirleys prove substantial economic damages necessary to support their claim for emotional distress damages in their bad faith lawsuit against Farmers Insurance Exchange?

Did the District Court commit error when it submitted the case to the jury on the basis of instructions, which transformed the intentional tort of bad faith into a mere negligence action?

Rule

To recover damages for emotional distress in a bad faith insurance claim, the insured must demonstrate substantial other damages, such as economic loss, in addition to emotional distress.

We hold the scope of available compensatory damages for a breach of the duty of good faith and fair dealing includes damages for harm to pecuniary interests and emotional distress.

Analysis

The court found that the Shirleys failed to provide sufficient evidence of substantial economic damages beyond emotional distress. The jury was not properly instructed on the requirement to prove these economic damages, leading to a potential miscalculation in their award. The court emphasized that the jury's determination of damages could not be based on speculation and that the instructions given did not align with the legal standards established in prior cases.

The record discloses the following colloquy between counsel and Barbara Shirley: Q. Have you had any problems in terms of getting credit which you attribute to your failure to pay the medical bills on time? A. Have I applied for credit? Q. At any time and been denied? A. Yes.

Conclusion

The Supreme Court reversed the jury's verdict and remanded the case for a new trial, requiring the jury to be properly instructed on the need to separate economic damages from emotional distress damages.

We reverse the Judgment on Jury Verdict entered in this case because of the failure of the record to demonstrate compliance with the rule in Shrader.

Who won?

Farmers Insurance Exchange prevailed in the appeal as the Supreme Court reversed the jury's verdict against them, citing insufficient evidence of economic damages.

Farmers has appealed from the Judgment on Jury Verdict entered on March 7, 1994.

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