In Revi, LLC v. Chicago Title Ins. Co., ___ S.E.2d ___, 2015 WL 5448640, *1 (Va. September 17, 2015), the Supreme Court of Virginia determined that "Code § 38.2-209(A) requires a trial judge, rather than a jury, to determine whether an insurer committed a bad faith breach of an insurance contract warranting an award of attorney's fees to the insured."
The narrow application of this ruling limits bad-faith-breach attorney's fees awards to the discretion of trial judges rather than juries in Virginia, of course. However, the application that this holding will receive may be wider than the borders of Virginia. The holding may have persuasive effect in jurisdictions in which judges are perhaps less receptive to insurance companies when determining bad faith, whether the bad faith determination is made pursuant to a statute or pursuant to common law or equity.
This is the language which the Supreme Court of Virginia construed, with emphasis supplied by the Court in the quotation below:
Code § 38.2–209(A) states:
[I]n any civil case in which an insured individual sues his insurer to determine what coverage, if any, exists under his present policy ... or the extent to which his insurer is liable for compensating a covered loss, the individual insured shall be entitled to recover from the insurer costs and such reasonable attorney fees as the court may award. However, these costs and attorney's fees shall not be awarded unless the court determines that the insurer, not acting in good faith, has either denied coverage or failed or refused to make payment to the insured under the policy.
*3 (Emphasis added.)
Revi, LLC v. Chicago Title Ins. Co., ___ S.E.2d ___, 2015 WL 5448640, *3 (Va. September 17, 2015). [As noted, emphasis by the Supreme Court of Virginia.]
Many States and Commonwealths have similar statutes, and some have common law rules similar to the thrust and purpose of the Virginia statute. The Revi case may reach far beyond the borders of Virginia before long.
Please Read The Disclaimer. ©2015 by Dennis J. Wall, author of Litigation and Prevention of Insurer Bad Faith (3d ed. Thomson Reuters West in 2 Volumes, with 2015 Supplements), which present many Sections on Attorney's Fees issues in Bad Faith cases, featuring in particular Sections 13:12, 13:13, and 13:14 in Volume 2. All rights reserved.
Comments