DEFENDANT INSURER’S MOTION FOR SUMMARY JUDGMENT DISMISSING THE “BAD FAITH” COMPLAINT–ALLEGING A BAD FAITH FAILURE TO SETTLE PLAINTIFF’S PERSONAL INJURY ACTION STEMMING FROM A TRAFFIC ACCIDENT–SHOULD HAVE BEEN GRANTED (SECOND DEPT).

The Second Department, reversing Supreme Court, determined defendant insurer demonstrated it did not act in bad faith when it refused to settle a personal injury action. Plaintiff VanNostrand sued Froelich in an action stemming from a traffic accident and recovered a $300,000 verdict. Froelich’s insurer, defendant New York Central Mutual Fire Insurance Company, had refused to settle. Froelich assigned his rights in the policy to VanNostrand and they sued the insurer alleging a bad faith failure to settle. The Second Department held the insurer’s motion for summary judgment should have been granted:

” … [A] bad-faith plaintiff must establish that the defendant insurer engaged in a pattern of behavior evincing a conscious or knowing indifference to the probability that an insured would be held personally accountable for a large judgment if a settlement offer within the policy limits were not accepted” … . …

… [T]he evidence submitted by the defendant in support of its motion for summary judgment established … the defendant had a rational basis for concluding that a jury in the underlying action could find that the plaintiff did not sustain a serious injury within the meaning of Insurance Law § 5102(d) as a result of the subject accident, which would preclude her from recovery in the underlying action (see Insurance Law § 5104[a]). Specifically, the defendant monitored the plaintiff’s claim in the underlying action and, among other things, retained expert physicians to examine the plaintiff and review the MRI films of her spine. One of the defendant’s experts concluded, inter alia, that the alleged disc herniation at L5-S1 did not involve any root impingement. As far as the alleged disc herniation at C3-C4 was concerned, the defendant’s expert found no herniation and, at most, a bulge. Moreover, it was undisputed that the plaintiff returned to work within one month of the accident and did not seek recovery for lost wages. It was further undisputed that as of November 2001, two years after the accident, and at the time of trial in April 2013, the plaintiff was not taking any medication or undergoing any further treatment. In opposition, the plaintiff failed to raise a triable issue of fact. VanNostrand v New York Cent. Mut. Fire Ins. Co., 2020 NY Slip Op 05550, Second Dept 10-7-20