{"id":885773,"date":"2015-11-24T16:26:58","date_gmt":"2015-11-24T23:26:58","guid":{"rendered":"https:\/\/www.myconstructionexpert.com\/blog\/?p=885773"},"modified":"2015-11-24T16:26:58","modified_gmt":"2015-11-24T23:26:58","slug":"oregon-supreme-court-eases-the-path-to-hold-insurers-accountable-for-bad-faith-practices","status":"publish","type":"post","link":"https:\/\/www.myconstructionexpert.com\/blog\/oregon-supreme-court-eases-the-path-to-hold-insurers-accountable-for-bad-faith-practices\/","title":{"rendered":"Oregon Supreme Court Eases the Path to hold Insurers Accountable for Bad Faith Practices"},"content":{"rendered":"<p>Kyle Sturm | Ball Janik | November 20, 2015<\/p>\n<p>Yesterday, the Supreme Court of Oregon overruled <em>Stubblefield v. St. Paul Fire &amp; Marine<\/em> (1973) and paved the way for a more commonsense approach to negotiating stipulated judgments. Stipulated judgments have been a well-worn, though somewhat perilous, mechanism for insureds to resolve liability claims against them when their insurers defend in bad faith. In doing so, however, the parties to the stipulated judgment were tasked with navigating needlessly technical steps along the way. In\u00a0<em>Brownstone Homes Condo. Ass\u2019n. v. Capital Specialty Ins. Co.<\/em>, the court removed one of the insurers \u201cgotcha\u201d defenses to an otherwise valid stipulated judgment.<\/p>\n<p>Stipulated judgments are an effective weapon against abusive insurers in Oregon. They are employed effectively in cases where an insured is sued and the insurer defends that lawsuit in <a href=\"https:\/\/www.myconstructionexpert.com\/blog\/the-differences-between-insurance-disputes-and-bad-faith\/\" target=\"_blank\">bad faith<\/a>, including refusing to settle those claims against the insured, and thus exposing the insured to personal liability. Because a defending insurer is obligated to treat its interest <em>at least<\/em> equal to that of\u00a0 its insured, it is obligated to reasonably settle claims against its insureds. The problem often arises where the insurer refuses to negotiate in good faith, leaving the insured responsible for a large percentage of any proposed settlement or final judgment. Stipulated judgments allow the underlying plaintiff and the insured (the defendant in the lawsuit) to agree to an amount of liability, enter that judgment with the court, and agree that the plaintiff will not execute the judgment against the insured in return for an assignment of the insured\u2019s <a href=\"https:\/\/www.myconstructionexpert.com\/blog\/bad-faith-claim-for-inadequate-investigation-does-not-survive-summary-judgment\/\" target=\"_blank\">bad faith<\/a> claims against its insurer.<\/p>\n<p>In <em>Stubblefield<\/em>, the court declared that when a liability policy covers damages that an insured is \u201clegally obligated to pay\u201d (as most do), and the insured agrees to enter into a stipulated judgment against it in exchange for the plaintiff\u2019s covenant not to execute the judgment against the insured, that settlement eliminates the liability of <em>both<\/em> the insured and the insurer. Therefore, parties to a stipulated judgment had to be very careful about not completely eliminating the insured\u2019s liability\u2014the result of which is the use of unnecessarily complicated language preserving the plaintiff\u2019s right to come back later and execute the judgment against the insured under certain circumstances. Until yesterday, Oregon stood virtually alone on this issue.<\/p>\n<p>Following <em>Stubblefield<\/em>, the Oregon legislature passed ORS 31.825, a statute designed to allow an insured to assign claims against its insurer to a plaintiff and receive assurances that the plaintiff would execute the judgment only against the insurer. The statute, however, contains&#8230;<\/p>\n<p><a href=\"http:\/\/www.thepolicyholderreport.com\/2015\/11\/oregon-supreme-court-eases-the-path-to-hold-insurers-accountable-for-bad-faith-practices\/\" target=\"_blank\">To finish reading this article<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Kyle Sturm | Ball Janik | November 20, 2015 Yesterday, the Supreme Court of Oregon overruled Stubblefield v. St. Paul Fire &amp; Marine (1973) and paved the way for a more commonsense approach to negotiating stipulated judgments. Stipulated judgments have been a well-worn, though somewhat perilous, mechanism for insureds to resolve liability claims against them&hellip; <a class=\"more-link\" href=\"https:\/\/www.myconstructionexpert.com\/blog\/oregon-supreme-court-eases-the-path-to-hold-insurers-accountable-for-bad-faith-practices\/\">Continue reading <span class=\"screen-reader-text\">Oregon Supreme Court Eases the Path to hold Insurers Accountable for Bad Faith Practices<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","enabled":false},"version":2}},"categories":[140],"tags":[140,320,8941],"class_list":["post-885773","post","type-post","status-publish","format-standard","hentry","category-bad-faith","tag-bad-faith","tag-oregon","tag-ors-31-825","entry"],"jetpack_publicize_connections":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v25.0 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Oregon Supreme Court Eases the Path to hold Insurers Accountable for Bad Faith Practices - Advise &amp; 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