{"id":899227,"date":"2021-10-12T16:06:50","date_gmt":"2021-10-12T22:06:50","guid":{"rendered":"https:\/\/www.myconstructionexpert.com\/blog\/?p=899227"},"modified":"2021-10-12T16:06:56","modified_gmt":"2021-10-12T22:06:56","slug":"bad-faith-damages-insured-coverage","status":"publish","type":"post","link":"https:\/\/www.myconstructionexpert.com\/blog\/bad-faith-damages-insured-coverage\/","title":{"rendered":"Wyoming Supreme Court Allows Insured to Seek Bad Faith Damages"},"content":{"rendered":"\n

Lee-Ann Brown | Bradley Arant Boult Cummings<\/a><\/p>\n\n\n\n

In May of this year, the Supreme Court of Wyoming held that a subsidiary of Sinclair Oil could invoke statutory bad faith damages<\/a> after prevailing in a coverage dispute with its insurer, Infrassure. The court rejected the district court\u2019s analysis that accepted the insurer\u2019s narrow interpretation of Wyoming\u2019s insurance code. On certification from the 10th Circuit, the court found that a policy was \u201cdelivered\u201d in Wyoming\u2014and therefore, Wyoming insurance code applied\u2014because the policyholder and the covered risk were in Wyoming. Per the court\u2019s decision, proof of physical delivery beyond the stated headquarters\u2019 address, to a Wyoming address, was\u00a0not\u00a0<\/em>required.<\/p>\n\n\n\n

After a 2013 fire and explosion at its petroleum refinery in Sinclair, Wyoming, Sinclair sought business interruption insurance recovery from Infrassure and other insurers. Infrassure rejected a settlement among Sinclair and the market of quota share participants and instead sought to litigate the loss. Subsequently, a panel of appraisers affirmed that the loss value was higher than the settlement that Infrassure rejected, and Sinclair sought to recover its attorney\u2019s fees and enhanced interest at 10% under Wyoming Insurance Code. The policy insured a Wyoming company as additional insured and covered refining facilities located in Wyoming. Yet, Infrassure argued that Sinclair could not invoke Wyoming insurance code\u2019s bad faith remedies because the code excludes policies not \u201cissued for delivery\u201d or \u201cdelivered\u201d in Wyoming. The Wyoming federal district court agreed with Infrassure\u2019s contention that because there was no proof of physical delivery to the insured in Wyoming, Wyoming law did not apply. On appeal, the 10th Circuit accepted the suggestion from Sinclair\u2019s appellate counsel (Marc James Ayers, with Bradley\u2019s Appellate Practice Group), that the court certify the unsettled and novel question to Wyoming\u2019s highest court to determine the applicability of the statute.<\/p>\n\n\n\n

The Wyoming Supreme Court rejected the insurer\u2019s strict interpretation, finding that the purpose of Wyoming\u2019s insurance laws was to \u201cprotect public welfare and Wyoming residents\u2026\u201d and that achieving this purpose mandated a liberal interpretation of the law\u2019s application to Wyoming interests. The court adopted a rule articulated by the New York courts, holding that a policy is \u201cdelivered or issued for delivery\u201d in a state when it \u201ccovers both insureds and risks\u201d located in that state. Thus, because the Sinclair subsidiary and the insured refinery were in Wyoming, Sinclair was entitled to the protections mandated by the insurance law.<\/p>\n\n\n\n

Bad faith disputes arise in the context of construction as well. When negotiating first party insurance coverage\u2014such as builders risk policies\u2014insureds should pay close attention to the choice of law provisions in the policy to ensure the applicable jurisdiction recognizes first party bad faith claims.<\/p>\n","protected":false},"excerpt":{"rendered":"

Lee-Ann Brown | Bradley Arant Boult Cummings In May of this year, the Supreme Court of Wyoming held that a subsidiary of Sinclair Oil could invoke statutory bad faith damages after prevailing in a coverage dispute with its insurer, Infrassure. The court rejected the district court\u2019s analysis that accepted the insurer\u2019s narrow interpretation of Wyoming\u2019s… Continue reading Wyoming Supreme Court Allows Insured to Seek Bad Faith Damages<\/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":[10720],"tags":[9895,10769,10593,10938],"class_list":["post-899227","post","type-post","status-publish","format-standard","hentry","category-bad-faith-insurance-coverage","tag-advise-consult","tag-bad-faith-damages","tag-insurance-coverage-disputes","tag-wyoming","entry"],"jetpack_publicize_connections":[],"yoast_head":"\nWyoming Supreme Court Allows Insured to Seek Bad Faith Damages - 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