Exposure to Damages Beyond Policy Limits?
After a judicial ruling in which Georgia joined the majority of jurisdictions holding that "bad-faith-in-settlement" can result from a liability insurance carrier's failure to accept a time-limit settlement demand within the limited time of the demand, the Georgia Legislature acted. The Legislature amended the Georgia settlement-offer statute apparently to provide additional time to liability carriers to decide whether to accept settlement offers (or what the carriers themselves ordinarily call settlement demands), which again has counterparts in many States and other jurisdictions.
The interplay of "bad faith" ramifications and statutory interpretations came together in Grange Mut. Cas. Co. v. Woodard, 826 F.3d 1289 (11th Cir. 2016). With a wrinkle. That case did not present just questions of offer and acceptance. The claimants in that case added a condition that they receive payment within 10 days. Clearly the carrier in that case did not meet that condition within 10 days.
In that case, the Eleventh Circuit Court of Appeals certified the following questions to the Georgia Supreme Court, requesting the State Supreme Court's answers as to what Georgia State law will reply to them:
(1) UNDER GEORGIA LAW AND THE FACTS OF THIS CASE, DID THE PARTIES ENTER A BINDING SETTLEMENT AGREEMENT WHEN THE INSURER GRANGE ACCEPTED THE WOODARDS' OFFER IN WRITING?
(2) UNDER GEORGIA LAW, DOES O.C.G.A. § 9-11-67.1 PERMIT UNILATERAL CONTRACTS WHEREBY OFFERORS MAY DEMAND ACCEPTANCE IN THE FORM OF PERFORMANCE BEFORE THERE IS A BINDING, ENFORCEABLE SETTLEMENT CONTRACT?
(3) UNDER GEORGIA LAW AND THE FACTS OF THIS CASE, DID O.C.G.A. § 9-11-67.1 PERMIT THE WOODARDS TO DEMAND TIMELY PAYMENT AS A CONDITION OF ACCEPTING THEIR OFFER?
(4) UNDER GEORGIA LAW AND THE FACTS OF THIS CASE, IF THERE WAS A BINDING SETTLEMENT AGREEMENT, DID THE INSURER GRANGE BREACH THAT AGREEMENT AS TO PAYMENT, AND WHAT IS THE REMEDY UNDER GEORGIA LAW?
These important questions are self-explanatory, especially given their historical context.
The answers? Maybe not so much. The answers provided by the Georgia Supreme Court to these questions may guide more than judges, lawyers, and parties pursuing claims and defenses under Georgia law. The Supreme Court's answers may extend beyond Georgia to the nation.
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