Oklahoma Insurance Lawyer & Attorney : Stauffer & Nathan Law Firm

The Oklahoma Legislature has proposed a new bill which would limit the amount and types of damages uninsured motorists could recover for accidents which are not their fault.  In an apparent attempt to discourage Oklahoma citizens from driving without insurance, the Legislature wants to limit the recoverable damages to medical costs, property damage and lost income.  In other words, if you are in an accident that it not your fault, and you don't have insurance, the bill would prevent you from getting money for pain and suffering:

HB3380 limits damages to uninsured motorists:

"Except as provided in subsection B of this section, in any civil action to recover damages arising out of an accident involving the operation of a motor vehicle or for any claim against the motor vehicle liability insurance coverage of another party, the maximum amount that a plaintiff or claimant may receive, if the plaintiff or claimant is not in compliance with the Compulsory Insurance Law, shall be limited to the amount of medical costs, property damage, and lost income and shall not include any award for pain and suffering."

The bill makes exceptions for those who are passengers (if they are not owners of the uninsured vehicle); those injured by drunk drivers or drivers who are committing felonies; and wrongful death claims.

Since Oklahoma is not a "no fault" state, it is unclear how such a law will encourage its poor citizens to buy insurance.  Furthermore, Oklahoma law does not permit a someone who commits a wrong against another to benefit from his victim's insurance.  If the bill passes, it is likely to meet a constitutional challenge. 

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Roesler v. TIG; 251 Fed.Appx. 489, (10th Cir. Okla. 2007)


Roesler was a nurse anesthetist.  He purchased liability insurance from TIG in May 2002. In August 2002, Roesler was sued for his involvement in the June 1998 cesarian section birth of a severely brain-damaged infant. Roesler notified TIG, and TIG rescinded Roesler’s policy because he failed to include information about the incident on his application.  Roesler sued for bad faith and breach of contract.  A jury awarded him  $60,072 for breach of contract,  $2.31 million in compensatory damages for TIG's bad faith, and $2.3 million in punitive damages.  The Tenth Circuit found that the introduction of certain post - litigation conduct was improper, but it also found that the trial court properly denied TIG’s motion for directed verdict.  The Tenth Circuit reversed, the judgment, however, because of improper jury instructions.  The trial judge had instructed the jury (over TIG’s objection) that if the jury found that TIG’s coverage position was wrong, they would have to find that TIG acted in bad faith.  (Jody R. Nathan made this argument to the trial court).  The appellate court agreed.  The case was remanded for a new trial. 
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Vining v. Enterprise Financial Group
48 F.3d 1206, 49 Fed. R. Evid. Serv. 1026 (10th Cir. Okla. 1998)

Claimant under a credit life insurance policy sued the insurer for breach of contract and bad faith after the insurer refused to pay benefits upon the insured's death. After a jury found for the claimant and awarded her $800,000 in compensatory and punitive damages, the trial court denied the insurer's motions for judgment as a matter of law and for a remittitur, and the insurer appealed. The award was affirmed on appeal.  The insurer’s systematic practice of cancelling policies without determining whether it had good cause to do so was bad faith; since the insurer admitted that the insured did not intentionally misrepresent his health history, it had no recission defense;  the evidence supported the damages award; a report prepared by the Oklahoma Insurance Commissioner concerning the insurer's business practices was admissible; an expert witness was properly allowed to testify; and the insurer’s training manual and the testimony of other claimants was admissible to show bad faith.
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A judgment in excess of $650,000 was affirmed by the Tenth Circuit against Hartford Insurance Company because it did not know the provisions of its own policy, and it changed the reason it denied the claim once suit was filed.

Haberman v. Hartford, 443 F.3d 1257 (10th Cir. Okla. 2006)

In this case, Haberman was the sole shareholder of a corporation.  She and an employee were driving  on a pleasure trip when the employee lost control of the vehicle.  The employee was killed and Haberman was injured.  After Haberman collected both the liability and UM limits on the employee’s car (the one involved in the accident), she sought UM coverage under her Hartford policy.  The Hartford policy was issued to her corporation and the employee’s car was not a scheduled vehicle.  The Hartford policy, however, had an endorsement on the auto policy which specifically named Haberman as an insured for auto liability purposes.  Hartford denied the claim.  The policy limited UM coverage to specific vehicles and the employee’s car was not a listed vehicle.

On summary judgment motions, the court ruled that the endorsement made Haberman an insured for all purposes under the policy.  Even if the policy was ambiguous, the court would have to find for coverage.  It therefore entered summary judgment on behalf of Haberman finding coverage.  At trial, Haberman was granted judgment as a matter of law on her contract claim and Hartford’s quest to remove punitive damages from the jury was denied.  The jury found for Haberman and awarded her $548,000 on the contract claim, $5,000 for actual damages on the bad faith claim and a further $100,000 for punitive damages on the bad faith claim.

The appellate court affirmed both the contract and bad faith findings.  Even if there was a legitimate dispute as to coverage, the bad faith claim was appropriately decided by the jury because the reason Hartford gave when it denied the claim (that Haberman was not in a covered vehicle) was different from the reason it gave when it was in court (that Haberman was not an insured).  Furthermore, because there was evidence that Hartford ignored its own policy language and well settled Oklahoma law, and because it delayed payment of her med pay claim, there was sufficient evidence to take the question to the jury.

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Burton (who was convicted of first degree manslaughter) shot and killed Savage in an apparent road rage incident.  Plaintiff sued Burton for the wrongful death of her husband, claiming that Burton violently and negligently shot Savage.  The court entered a judgment against Burton for $1.2 million dollars.  The judgment stated there had been a trial with witnesses and evidence presented.  Savage then garnished State Farm, Burton's insurer.  State Farm tried to get the judgment vacated.  Instead, the trial court modified it -- instead of a trial, the modified judgment stated it was based on "stipulations." 

The appellate court found that the judgment should have been vacated in its entirety.  There was no evidence that there was a trial.  The judge did not remember one.  Plaintiff was not at the "accident" and could not testify as to the facts of the accident.  Neither Burton nor his attorney were present.  Therefore the judgment, which should be based on what actually happens in court, rather than on what might happen, was improper.  It was also improper to try to prop it up by claiming it was a judgment based on stipulations.  There is nothing in the record that shows that Burton or his attorney agreed to any of the facts the court found. 

SAVAGE v. BURTON; 2008 OK CIV APP 20 Continue Reading...

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This case is the first one to interpret Oklahoma's amended declaratory judgment statute.  Previously, Oklahoma did not permit insurers to use the declaratory judgment statute to determine rights and liabilities under an insurance policy.  Since 2004, however, the statute specifically permits such determinations.  The court agreed that the plain language of the statute permitted such a determination. 

In addition, the court specifically found that the intentional act of hitting someone with your car is not covered, even if the insured did not intend to cause injury.  This is not so obvious as you might think in Oklahoma, since there are cases that distinguish between intentional acts and intentional injuries.

EQUITY INSURANCE CO. v. GARRETT; 2008 OK CIV APP 23

In this case, summary judgment in favor of Equity was affirmed.  Garrett, the insured, admitted to intentionally bumping Hull with her car.  She claimed she was trying to stop a fight between Hull and her husband and did not intend to cause Hull injury.  Equity filed a declaratory judgment seeking a declaration of no coverage and no duty to defend Garrett in Hull’s action against her.  The court found that under Oklahoma’s declaratory judgment statute, as amended, the trial court could properly declare whether there was coverage under the policy.  The Court of Civil Appeals also affirmed that there was no coverage for the intentional act of Garrett. 

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