THURSDAY, OCTOBER 9, 1997

Style: State Farm Fire & Casualty v. Zebrowski, No. 88,338

Facts: Zebrowski was injured on another person's property and sued the propertyowner for negligence. The suit was successful in obtaining a judgment against theproperty owner. The property owner had liability insurance with State Farm. Theamount of the judgment was within the coverage limit in the insurance policy so StateFarm paid the judgment. Zebrowski then sued State Farm under section624.155(1)(b)1., Florida Statutes (1993) for not attempting in good faith to settle theclaim when it should have done so. The trial court granted summary judgment for theinsurance company. On appeal, the district court of appeal reversed, holding that a thirdparty (i.e., not a party to the insurance contract) may bring an action against an insurerfor bad-faith failure to settle if it can plead and prove damages. State Farm seeksreview, arguing that the insurer's duty of good faith under the statute is to protect theinterests of its insured and not third parties.
Issue: Whether the statute creates a right of action of a third party to recover against aninsurer for bad-faith failure to settle.