In Perkins v. General Insurance Co. of America, Download Perkins v. General Ins. Co. of Am. (D.S.C. Case No. 4.10cv439, Order Filed October 6, 2010) PUBLIC ACCESS, also published as 2010 WL 3941459 *1 (D.S.C. October 6, 2010)(Westlaw subscription required to access Westlaw), there was never a question about the Policy language. Mr. Gregory Perkins bought "a contract for insurance coverage on [his] motorcycle, which included comprehensive coverage for larceny". Under South Carolina Insurance Law, the Policy language was clear and unambiguous: It provided Coverage for larceny of the motorcycle. Id. at *3.
General Insurance Company of America disputed instead that "larceny" did not include a breach of trust under South Carolina case law. The Federal Court examined South Carolina statutory law and case law interpreting and applying South Carolina Statutes for about a Century and a half. At the end of its historical forensic analysis, the Court concluded that South Carolina law has included "breach of trust" as a "larceny" for about 150 years.
The only question in the case then, according to the Federal Court, is whether there was a breach of trust at all on the facts. Clearly, there was a question of fact whether in this particular Case there was Insurance Coverage. Therefore, the issues of Contract Liability and Bad Faith could not be determined until that question was first determined in this particular case:
The Policy at issue clearly provides Comprehensive coverage for any loss of the motorcycle due to “theft or larceny.” Under South Carolina law, breach of trust is a larceny. In fact, Perkins' entrustment of the motorcycle to Johnson, who in turn allegedly formulated an intent to convert the property to his own and fraudulently appropriated it, is the exact scenario the prevention of which was the goal behind expanding the crime of larceny through passage of the breach of trust statute.
See McCann, 166 S.E.2d at 412 (The “object of [passing the breach of trust statute] was simply to enlarge the field of larceny, removing what before might have been a defense for those who received property in trust and afterwards fraudulently appropriated it.” (quoting
State v. Shirer, 20 S.C. 392 (1884))). Viewing the evidence in the light most favorable to Perkins, there is at least a genuine issue of material fact as to whether General has breached the insurance contract and acted in bad faith in denying Perkins' claim for benefits as a result of the loss of the motorcycle due to larceny. For the foregoing reasons, this Court
DENIES the Defendant's Motion for Summary Judgment [Docket 20].
Id. at *5. The question of whether a First-Party Insurer can defend a Bad Faith Claim on the ground that the Contract Claim or Coverage for it was Fairly or Reasonably Debatable, is addressed in Section 11.17 of Dennis J. Wall, Litigation and Prevention of Insurer Bad Faith (Shepard's/McGraw-Hill Second Edition; West Publishing Company 2010 Supplement).
Please Read The Disclaimer. AUTHOR'S NOTE: The Online Docket of the Perkins Case on Pacer reflects that General Insurance is represented by Elmore & Wall of Charleston, South Carolina, which has no relation to the Author.
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