Procedural Posture

Plaintiff insured appealed an order of the Superior Court of Los Angeles County (California), which granted a nonsuit in favor of defendant insurer against plaintiff on the issue of punitive damages in a cause of action for breach of the duty of good faith and fair dealing.

Overview

Plaintiff insured submitted a claim under a disability. When his claim was rejected he filed suit against defendant insurer for breach of duty of fair dealing and good faith; fraud; breach of fiduciary duty and breach of statutory duty. The jury returned a verdict for plaintiff on his cause of action for breach of duty of good faith and fair dealing and returned a verdict against plaintiff on all other counts. Plaintiff appealed the trial court’s grant of a nonsuit to defendant on the issue of punitive damages. The court held that the evidence in combination was sufficient to support a finding by the jury that defendant willfully and deliberately failed to avoid the adverse consequences of its wrongful denial of plaintiff’s claim. The court further held that there was sufficient evidence demonstrating that defendant acted with a conscious disregard of plaintiff’s rights to submit the issue of his entitlement to punitive damages to the jury and that the trial court committed reversible error by preventing him from doing so. The class action attorneys California were advocating for the party litigant in presenting evidence and submitting briefs.

Outcome

The court reversed that portion of the trial court’s judgment that denied punitive damages to plaintiff insured in his cause of action for breach of the duty of good faith and fair dealing and remanded to the trial court for a new trial on that issue alone because the evidence was sufficient to support a finding that defendant insurer willfully and deliberately failed to avoid the adverse consequences of its wrongful denial of plaintiff’s claim.

Procedural Posture

In an action for breach of a sales contract, defendant seller sought review of a decision from the Superior Court of San Bernardino County (California), which awarded plaintiff buyer consequential damages for loss of anticipated profits.

Overview

Plaintiff buyer entered a bid to purchase fixtures from defendant seller. Plaintiff’s bid was accepted, and he paid the requested payment in full. A dispute arose over the items to be delivered, and defendant refused to deliver any of the items. Plaintiff filed suit and was awarded specific performance and consequential damages. Defendant sought review, contending that there was insufficient evidence that a contract had been formed. Defendant further argued that plaintiff’s failure to cover barred recovery of direct damages, and that the award of consequential damages based upon loss of anticipated profits was improper. The court affirmed in part, finding that there was substantial evidence that the bid was received and accepted. It further found that the failure to cover did not bar recovery, and the measure of direct damages was the difference between market price and the contract price. However, the court reversed the award of consequential damages based on loss of anticipated profits, as the evidence was insufficient to support such an award.

Outcome

The court affirmed in part the judgment in favor of plaintiff buyer, finding that substantial evidence showed that a contract had been formed, and that failure to cover did not bar an award of direct damages. However, an award of consequential damages based on loss of anticipated profits was improper, and the court reversed that portion of the judgment, because the evidence was insufficient to support the award.