Bad faith is the unreasonable failure of an insurance company to honor the terms of an insurance policy and deal with a policyholder in good faith. Insurance companies who are found to have acted in bad faith can be liable for punitive damages in addition to contract damages. Some states have bad faith statutes called "Unfair Insurance Claims Practices Acts."
Religious Rights Lawsuit Spawns Follow-up Suit for ACE Unit
June 24th, 2014 - After Maui County, Hawaii, was sued in federal court for allegedly violating the first amendment rights of a preacher handing out religious tracts, the government body turned to ACE American Insurance Co. seeking defense and indemnity.
Now, Maui County has sued the ACE unit over its reported refusal to defend it in that lawsuit.
The County of Maui was sued early this year by Stratford and Doreen Goodhue in an action brought by the American Civil Liberties Union. In a Feb. 6, press release from the ACLU, it said the lawsuit was sparked after officers of the Maui Police Department ordered the Goodhues to leave a sidewalk outside the Maui County Fair, where they were peaceably handing out religious pamphlets.
The ACLU said that police order was unconstitutional. Goodhue told a local television station that the police based their decision on their opinion that since the fair had a permit, it had control of the sidewalk and street in front of the venue.
In their underlying suit, the Goodhues seek declaratory and injunctive relief against the county. They also asked for damages to redress past violation of the plaintiffs’ first amendment rights, and further damages for the humiliation, inconvenience and embarrassment they allegedly sustained when ordered off the sidewalk by the police.
On April 14, the County of Maui sued ACE in state court seeking its own declaratory judgment that the insurer defend and indemnify its client, and provide liability coverage. There was no indication as to why ACE has allegedly refused to defend or indemnify the county.
In addition to a declaration for defense of the County of Maui, the government body also has asked for compensatory, consequential and special damages from the insurer.
New Federal Lawsuit Charges Maui County with 1st Amendment Violations - American Civil Liberties Union - https://www.aclu.org/news/new-federal-lawsuit-charges-maui-county-1st-amendment-violations?redirect=free-speech/new-federal-lawsuit-charges-maui-county-1st-amendment-violations
Like us on facebook!