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Bad Faith Blog

We cover current issues, highlights and best practices exclusively on claims of bad faith and extra contractual damages.

Bad Faith Blog
July 1, 2021

New Missouri Law Amending § 537.065 Enacted

On June 29, 2021, Governor Parson signed into law Missouri HB 345, which amends R.S.Mo. § 537.065 (permitting contracts to limit recovery to specified assets or insurance policies) and R.S.Mo. § 435.415 (Missouri’s Uniform Arbitration Act). This legislation is an effort to reform insurance “bad faith” litigation in Missouri, supplement legislation passed in 2017, and address recent tactics to avoid the statutory protections granted to insurers in 2017.

Bad Faith Blog
February 18, 2021

Stacy v. The Bar Plan Ins. Co.: Summary Judgment for the Insurer

The Missouri Court of Appeals, Eastern District, found the word “related” in a professional liability insurance policy’s limits of liability provision is unambiguous and a reasonable attorney would understand multiple acts of negligence in the course of representing clients in their personal injury claims arising from a single motor vehicle accident are “a series of related acts or omissions.” Accordingly, the Court of Appeals held demands by the attorney’s former clients constitute a single claim under the policy. Further, because limits of liability are not waivable and do not preclude defenses to coverage as a matter of law, the insurer was not estopped from asserting the policy’s limits of liability when it informed the attorney it considered the malpractice claims to be a single claim under the policy. And because of the attorney’s execution of an agreement pursuant to R.S.Mo. § 537.065 with his former clients was without the insurer’s consent, the attorney violated the policy’s cooperation clause and prevented the insurer from controlling the litigation, such that the insurer was not bound by the underlying judgment and was entitled to summary judgment in the resulting equitable garnishment action.