HOLDINGS: [1]-An insured’s complaint alleged facts sufficient to state a tort claim for the insurer’s breach of the duty of good faith and fair dealing under common law and for failure to attempt to effectuate a prompt and fair settlement under the California Insurance Code; [2]-The complaint adequately alleged that the insurer’s breach of its duty of good faith and its failure to attempt to effectuate a prompt and fair settlement directly and proximately caused the insured to suffer damages, including incurring unnecessary costs and fees of arbitration; [3]-It was not the insured’s conduct, but the insurer’s that precluded any possible settlement and made arbitration inevitable; [4]-Accordingly, the trial court erred in sustaining the insurer’s demurrer and dismissing the complaint with prejudice.
California Business Lawyer & Corporate Lawyer, Inc. understands CACI 420
Outcome
The judgment was reversed, and the matter was remanded with directions.