On September 2, 2003, Cecil Fortner was injured when Alan Arnsdorff drove his pickup truck through a stop sign and slammed into Fortner’s truck. Arnsdorff was insured by Grange Mutual Casualty Company under a policy with a bodily injury liability limit of $50,000, and his plumbing business had an additional $1 million in liability coverage with Auto Owners Insurance Company. In early November 2003, Fortner’s attorney sent letters to the attorneys for Grange and Auto Owners, offering to settle all claims by accepting $50,000 from Grange and $750,000 from Auto Owners. The letters provided that if the offer was not accepted in writing within 15 days, then it would be irrevocably withdrawn. Auto Owners did not respond within the time period, but Grange responded that it would pay the $50,000 contingent upon Fortner signing a full release with indemnification language and dismissing his claim against Arnsdorff with prejudice. Fortner’s attorney deemed this a rejection of his settlement offer and ceased further negotiations with Grange. Fortner subsequently won a $7 million verdict against Arnsdorff, which was affirmed on appeal.1 Arnsdorff then assigned to Fortner the right to pursue any cause of action that Arnsdorff might have against Grange based on its purported bad faith or negligent failure to settle the case. Fortner brought such an action against Grange, and the case was tried before a jury, which returned a verdict in favor of Grange. The trial court entered judgment on the verdict and denied Fortner’s motion for a new trial. Fortner appeals.
Fortner contends that the trial court’s jury charge concerning an insurance company’s response to a settlement demand conditioned upon another insurance company’s response was erroneous. The court charged the jury:In responding to a settlement demand, which demand is conditional upon the response of another insurance company, an insurance company can offer its policy limits in response to the demand and then let the plaintiff negotiate with the remaining insurers. In that situation, the insurance company would have given equal consideration to its insured’s financial interest and fulfilled its duty to him. And you would return your verdict in favor of the defendant. Fortner argues that the charge was not adjusted to the facts of the case and that it was an incorrect statement of law because the law requires that an insurer act reasonably in responding to a settlement offer. Fortner’s arguments are without merit.
