Bad Faith Blog

Summary: In a traditional garnishment case against the liability insurer, the Missouri Supreme Court held recovery against the insurer was limited to the policy limits. The court held absent a finding of bad faith by the insurer, no extra-contractual damages were awardable.

Summary: Green Earth, the operator of a Colorado Springs retail medical marijuana business and growing facility submitted a claim to its insurer for a wildfire-caused smoke and ash damage and a separate break in and theft. Atain denied the claims on multiple grounds which caused Green Earth to sue Atain for breach of contract and statutory claims for bad faith and unreasonable delays in payment. The District Court was confronted with numerous motions addressing what was and was not covered under the policy issued to Green Earth and whether Green Earth’s bad faith and delayed payment claims were sustainable. After reviewing the coverage issues at length, the Court granted summary judgment to Atain on Green Earth’s bad faith and unreasonable delay in payment claims regarding the theft, but questions of fact regarding parts of the wildfire claim and Green Earth’s related statutory claims for bad faith and unreasonable delay in payment precluded summary judgment.