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ASHBROOK v. KOWALICK

September 27, 1971

Glindon ASHBROOK, Plaintiff,
v.
Carl D. KOWALICK, Defendant, and Volkswagen Insurance Company, Garnishee


Fullam, District Judge.


The opinion of the court was delivered by: FULLAM

FULLAM, District Judge.

 Plaintiff was a passenger in an automobile which left the road and struck a bridge abutment. The defendant's answer admitted negligence on the part of the driver; the only defense pleaded was assumption of risk on the part of the plaintiff.

 Plaintiff moved for summary judgment on the issue of liability. This was at first denied, because the record was incomplete; but later granted. Thereafter, the case proceeded to trial of damages.

 At the first trial, the jury returned a verdict in favor of the plaintiff in the sum of $55,000. I granted a new trial on the ground that this verdict was inadequate. However, at the second trial, the jury returned a verdict in the sum of $60,714, which became the final judgment when no post-trial motions were filed by either side.

 The defendant's liability insurance policy was limited to $10,000. In the present garnishment phase of the litigation, plaintiff is seeking to recover the balance of the judgment from the insurance company, on the theory that the company was guilty of bad faith in failing to settle the action within the policy limits when it had an opportunity to do so.

 The trial of the garnishment was quite brief. The evidence consisted almost entirely of documents from the insurance company's file. Both sides had previously filed motions for summary judgment in the garnishment phase of the matter, claiming there were no factual disputes; however, I ruled at that time that the existence or non-existence of bad faith was an inference of fact, to be drawn by the jury, 332 F. Supp. 77.

 The jury returned a verdict in favor of the plaintiff and against the garnishee insurance company. After the verdict was returned, I suggested to counsel that, in view of the lengthy procedural history of this litigation, the delays which had already occurred, and counsel's thorough familiarity with all aspects of the case, any post-trial motions should be filed within one week and promptly disposed of, without awaiting a reporter's transcript of the trial. Neither side voiced any objection to this procedure. Nevertheless, defense counsel has now filed a motion for an extension of time in which to set forth additional reasons for granting a new trial. The motion claims that counsel wishes to review the transcript of the charge in order to assert possible errors therein.

 The charge was relatively brief. The factual and legal issues discussed were not complicated. What few objections counsel expressed at the time were either removed by a supplemental charge or were clearly without merit. The motion for a new trial already filed by the defendant challenges the Court's charge, and the rulings on defendant's points for charge, in several respects. I am satisfied that all significant issues have thus been raised, and that no useful purpose would be served by the further delay now sought. Accordingly, I shall proceed to dispose of the motions for a new trial and for judgment n.o.v.

 Pennsylvania law relating to an insurer's duty in handling claims against its assured is set forth as follows in Cowden v. Aetna Casualty & Surety Co., 389 Pa. 459, 134 A. 2d 223 (1957):

 
"[An] insurer against public liability for personal injury may be liable for the entire amount of a judgment secured by a third party against the insured, regardless of any limitation in the policy, if the insurer's handling of the claim, including a failure to accept a proffered settlement, was done in such a manner as to evidence bad faith on the part of the insurer in the discharge of its contractual duty [to defend the action against the insured]."

 Id. at 468, 134 A. 2d at 227.

 
"[The] fairest method of balancing the interests [of insurer and insured] is for the insurer to treat the claim as if it were alone liable for the entire amount."

 Id. at 470-471, 134 A. 2d at 228. See also Bell v. Commercial Ins. Co., 280 F.2d 514, ...


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