Appellate Win for Baker Sterchi in Case Alleging Bad Faith Failure to Settle

The Missouri Court of Appeals affirmed summary judgment for the insurer, ruling no bad faith where the carrier promptly offered policy limits. The claimant's subsequent demands for a 537.065 agreement were not sufficiently definite to constitute a “reasonable opportunity to settle.”

On December 3, 2024, the Missouri Court of Appeals, Western District affirmed the trial court’s order granting summary judgment in favor of insurance carrier and against insured who was suing for bad faith failure to settle.

The court found that the claimant’s demand for a settlement that included a 573.065 agreement was not sufficiently definite because claimant’s counsel never provided a proposed version of the agreement. As a result, and in view of the fact that the carrier had offered its policy limits on numerous occasions, the court found that the carrier did not act in bad faith. Instead, according to the court, claimant’s attorneys “simply refused [the carrier’s] attempts to pay its policy limits to release [the insured].”

The takeaway from this decision is that Missouri courts will not find an insurer liable for bad faith where there is a documented history of the carrier’s attempts to settle the case for the policy limits, and where plaintiff’s counsel conditions the settlement on terms that are not sufficiently clear to constitute a reasonable opportunity to settle.