In American Capital Homes, Inc. v. Greenwich Insurance Co., Download American Capital Homes, Inc. v. Greenwich Insurance Co. (W.D. Wash. Case No. C09.622, Order Filed August 30, 2010) PUBLIC ACCESS also published as 2010 WL 3430495 (W.D. Wash. August 30, 2010)(Westlaw subscription required to access Westlaw), a Bad Faith Case, the Plaintiffs include several Washington Corporations and some individuals. They were issued a Policy which provided Coverage for "certain types of employment lawsuits" brought against them. They alleged that this included a certain Wrongful Termination Lawsuit, and they alleged in part that the Defendant Insurance Company "committed bad faith by assigning Brian Smith to handle both the defense and the coverage aspects of the [underlying or Wrongful Termination] litigation, [and] by commingling defense and coverage files". American Capital Homes, Inc. v. Greenwich Insurance Co., 2010 WL 3430495 at *3.
The Federal Judge disagreed. In what clearly appears to be a good lawyering effort for the Defendant in that Federal Case, the Court held in accord with the majority if not always practically desirable view that "commingling" Insurance Coverage and Bad Faith Claims Files and Claims Handling is not necessarily "Bad Faith," in and of itself:
Accordingly, Defendant did not act in bad faith when it assigned a single adjuster to defense and coverage functions. Plaintiffs' commingling claims are DISMISSED.
Id. at *6. See also Dennis J. Wall, "Litigation and Prevention of Insurer Bad Faith" § 3:2 "Timely Investigation and Evaluation" and § 3:95 "Avoiding Bad Faith Under Third-Party Claims: Summary as to Claims Made or Perhaps Reasonably Foreseeable" (Shepard's/McGraw-Hill Second Edition; West Publishing Co. 2010 Supplement).
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