JUNE 2012 BAD FAITH CASES: COURT REFUSES TO ADOPT PARTIES’ CONTENTIONS DUE TO FACTUAL DISPUTE WITH RESPECT TO VALUE OF INSUREDS’ DAMAGES AND BAD FAITH CLAIMS (Middle District)

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In Boyer v. First Am. Title Ins. Co., the insureds filed a motion for summary judgment against their title insurance carrier from which the insureds had purchased a policy to cover a Tioga County property. The suit stemmed from a 2008 natural gas lease through which the insureds permitted the exploration and extraction of natural gas near their property. After being advised that they did not have title to the subsurface land because of a reservation made by the former owners in a 1964 deed, the insureds filed a claim with the carrier.

The insureds sought damages arising from the reservation of subsurface rights, which was not excepted from coverage in their title insurance policy. While the carrier did not disagree with the insureds’ claim, it disputed the value of the claim. As such, the insureds filed suit for damages under their policy and for the carrier’s allegedly bad faith delay in investigating the claim.

The court stated the facts at hand, but refused to engage in a thorough legal analysis, citing the “undeniable presence of factual issues precluding the entry of summary judgment.” However, the court did state that it viewed the case as solely one of assessing claim value, as opposed to claim liability. It scheduled a settlement conference with a magistrate and denied the insureds’ motion.

Date of Decision: May 31, 2012

Boyer v. First Am. Title Ins. Co., No. 4:11-CV-550, 2012 U.S. Dist. LEXIS 75351, U.S. District Court for the Middle District of Pennsylvania (M.D. Pa. May 31, 2012) (Conner, J.)

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