Court Grants Summary Judgment In Favor of Insurer and Its Adjuster on Alleged Unfair Claim Settlement Practices and Defamation07/01/2015
A Kansas insured sued United Fire & Casualty Company in Johnson County, Kansas for “bad faith” and alleged violations of the Kansas Unfair Claim Settlement Practices Act after fire damaged an insured building. The insured claimed that additional amounts were owed for thousands of dollars of building code upgrades and that the insured had engaged in unfair settlement practices in attempting to negotiate a settlement of the claim. The insured also sued United Fire’s adjuster personally for various torts, including defamation of character. The insured alleged that the adjuster had spoken with a city building code official and alleged that construction was proceeding without a permit and that the insured “should be arrested.” The insured also alleged that the United Fire adjuster had interfered with the insured’s relationship with its banker. At his deposition, the building code official testified he recalled no allegation by United Fire’s adjuster that the insured was performing work without a permit and recalled no comment by the adjuster that the insured should be arrested. The bank produced documents and provided testimony that the bank never had any contact from anyone with United Fire. United Fire and its adjuster moved for summary judgment in its favor on the grounds that Kansas does not recognize the tort of bad faith and that there is no private right of action under the Kansas Unfair Claim Settlement Practices Act, K.S.A. § 40-2404(9). United Fire also moved for summary judgment on its favor on the claims of negligent misrepresentation, tortious interference with business, and defamation. The court granted summary judgment in defendants’ favor on all counts. Suzanne Bruss and John Schultz handled the litigation for United Fire and its adjuster.