Originally Posted by VolAgent
I clicked on document 26 and read the entire decision. You can do the same:
I'll first address the underlying lawsuit:
The 4+ million dollar award of July 2014 was apparently based on the severity of Monteil Hyland's injuries.
As far as I can tell the amount of the award has not been appealed so that amount is not going to change.
The federal lawsuit addresses whether Liberty Mutual should pay it due to breaching its duty to defend.
I agree with the court's ruling that Liberty Mutual pay the 4+ million. The reasoning is spot on.
Liberty Mutual's claims person made an incredibly dangerous mistake by denying a defense based on a more than sketchy question of whether Smith had permission to use the car.
Just look at the policy provisions quoted in the decision:
“Insured” as used in this Part means:
2. Any person using “your covered auto”.
a person is not covered under the policy when:
8. Using a vehicle without a reasonable belief that the “insured” is entitled to do so. . . .
The policy provisions don't require that a driver have "express permission" only that the driver has a "reasonable belief" that she was permitted to drive the car.
That Smith had the keys to the car makes it sheer folly to believe Risby's assertion of no permission over Smith's belief that she had permission.
Even if there was some suspicion that Smith wrongly obtained the keys, like taking them out of a drunk's pocket, the prudent thing for the claim rep to have done was at least provided a defense under a reservation of rights or just given the benefit of the doubt regarding permission and tendered the $25,000 limit.
That decision to deny a defense was just plain stupid.