Mario Badillo, Appellee/counter-Appellant v. Mid Century Insurance Company, a California Corporation; Farmers…

Summary

The court affirmed the $2.2 million judgment against the insurers for breach of the duty of good faith and fair dealing, holding that the evidence permitted the jury to find that the insurers unreasonably failed to investigate, communicate with the insured, and pursue a reasonable opportunity to settle a catastrophic third-party claim. It also affirmed the directed verdict denying punitive damages and the denial of attorney fees and prejudgment interest. Justice Taylor, concurring specially, emphasized the insurer's broader settlement and consultation duties, while Justices Winchester and Opala, dissenting, would have required proof of bad faith beyond unreasonable conduct and would have directed a verdict for the insurers.