Brown v. State Farm Mutual Automobile Insurance

The issue upon this appeal is whether an insureds cause of action against his insurer for bad faith in failing to settle within the liability policy limits can be assigned to the insured’s judgment creditor. The trial court dismissed plaintiff’s suit upon the ground that plaintiff acquired no legal right to bring this action.

Brown, as Administrator, recovered a judgment against Sam Nale, Administrator of Rose Nale, in the amount of $40,000.00. Defendant had issued an automobile liability policy for Nale in the amount of $20,000.00. After extensive discovery, Brown offered to settle with…