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Keywords

lawsuitsettlementdamagesattorneynegligenceliabilitytrialmotionsummary judgmentmalpracticelegal malpracticemotion for summary judgmentmarine insurance
lawsuitsettlementdamagesattorneynegligenceliabilitytrialmotionsummary judgmentmalpracticelegal malpracticemotion for summary judgmentmarine insurance

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Mitchum v. Hudgens, 533 So.2d 194, 57 USLW 2374

Facts

Dr. Mitchum was sued for medical malpractice by the parents of a baby he delivered, who was born with birth defects. His liability insurer, St. Paul Fire and Marine Insurance Company, hired attorney A. Neil Hudgens to defend him. Before the trial, a settlement was reached for $500,000, which Dr. Mitchum claimed was made without his permission, leading him to file a lawsuit against Hudgens for malpractice, alleging damages to his professional reputation and business.

Dr. Mitchum was sued for medical malpractice by the parents of a baby he delivered, who was born with birth defects. His liability insurer, St. Paul Fire and Marine Insurance Company, hired attorney A. Neil Hudgens to defend him. Before the trial, a settlement was reached for $500,000, which Dr. Mitchum claimed was made without his permission, leading him to file a lawsuit against Hudgens for malpractice, alleging damages to his professional reputation and business.

Issue

Did attorney A. Neil Hudgens have the authority to settle the medical malpractice claim against Dr. Mitchum without his consent, and can he be held liable for legal malpractice for doing so?

Did attorney A. Neil Hudgens have the authority to settle the medical malpractice claim against Dr. Mitchum without his consent, and can he be held liable for legal malpractice for doing so?

Rule

An insurer has the exclusive right to settle claims against its insured within policy limits without requiring the insured's consent, and the attorney representing the insured does not owe a duty to the insured regarding settlement unless there is a conflict of interest.

An insurer has the exclusive right to settle claims against its insured within policy limits without requiring the insured's consent, and the attorney representing the insured does not owe a duty to the insured regarding settlement unless there is a conflict of interest.

Analysis

The court determined that the insurance policy granted St. Paul the exclusive right to settle claims without Dr. Mitchum's consent. Therefore, Hudgens, as the attorney hired by the insurer, was not legally obligated to obtain Dr. Mitchum's permission before settling the case. The court also noted that the attorney-client relationship does not negate the insurer's rights under the policy, and thus, Hudgens could not be held liable for failing to inform Dr. Mitchum of the settlement.

The court determined that the insurance policy granted St. Paul the exclusive right to settle claims without Dr. Mitchum's consent. Therefore, Hudgens, as the attorney hired by the insurer, was not legally obligated to obtain Dr. Mitchum's permission before settling the case.

Conclusion

The court affirmed the denial of Hudgens' motion for summary judgment regarding the claims of fraud and negligence against him, but reversed the denial of summary judgment on the claims related to the settlement without Dr. Mitchum's consent.

The court affirmed the denial of Hudgens' motion for summary judgment regarding the claims of fraud and negligence against him, but reversed the denial of summary judgment on the claims related to the settlement without Dr. Mitchum's consent.

Who won?

A. Neil Hudgens prevailed in the case because the court found that he acted within his authority as the attorney representing Dr. Mitchum's insurer and was not liable for legal malpractice.

A. Neil Hudgens prevailed in the case because the court found that he acted within his authority as the attorney representing Dr. Mitchum's insurer and was not liable for legal malpractice.

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