Gianfillippo v. Northland Cas. Co., 71032

• Decision Date: 05 October 1993
• Docket Number: No. 71032,71032
• Citation: 1993 OK 125,861 P.2d 308
• Parties: Gina M. GIANFILLIPPO, Appellant, v. NORTHLAND CASUALTY COMPANY, a Minnesota Corporation; Northland Insurance Company, a Minnesota Corporation, and Northfield Insurance Company, a Delaware Corporation, Appellees.
• Court: Oklahoma Supreme Court

Page 308

861 P.2d 308

1993 OK 125

Gina M. GIANFILLIPPO, Appellant, v. NORTHLAND CASUALTY COMPANY, a Minnesota Corporation Northland Insurance Company, a Minnesota Corporation, and Northfield Insurance Company, a Delaware Corporation, Appellees.

No. 71032.

Supreme Court of Oklahoma.

Oct. 5, 1993.

Certiorari to the Court of Appeals, Division No. 4.

Passenger covered under driver's liability policy brought action which included claims against insurer alleging 1) violation of Unfair Claim Settlement Practices Act, 2) breach of insurer's duty of good faith and fair dealing, and 3) fraud. Trial court dismissed passenger's claims against insurer. Court of Appeals upheld dismissal as to passenger's claim under Act but also reversed holding that passenger had standing to bring bad faith action and that fraud had been pled with requisite particularity.

CERTIORARI PREVIOUSLY GRANTED; COURT OF APPEALS OPINION VACATED; TRIAL COURT AFFIRMED.

James M. Levine, Oklahoma City, for appellant.

McKinney, Stringer & Webster, P.C. by Jim T. Priest, Oklahoma City, for appellees.

HODGES, Chief Justice.

This case presents three issues: 1) Does the Unfair Claim Settlement Practices Act provide a private right of action? 2) Does an insurer's duty to act in good faith and deal fairly with its insured extend to an insured's passenger who asserts a claim under the insured's liability policy? 3) Were fraud claims against the insurer pled with the requisite particularity? These questions are answered in the negative.

Gina Gianfillippo was a passenger injured in a car owned by D & W Sales and driven by Jeffrey Walker. The liability policy covering the car was issued to "AL WALKER DBA D & W SALES CO." Al Walker is Jeffrey's father.

The Walker car drove into the back of another car driven by Woody. Gianfillippo sued Walker and Woody alleging negligent driving. She later added claims against Walker's insurer for violation of the Unfair Claim Settlement Practices Act, Okla.Stat. tit. 36, §§ 1221-1228 (1991), for bad faith, and for fraud. The trial court dismissed her claims against the insurer. The Court of Appeals upheld the dismissal as to her claim to a private right of action under the Act. However, it also reversed holding that she did have standing to bring a bad faith action and that she had pled fraud with particularity. At the request of both Gianfillippo and the insurer, this Court granted certiorari review.

I.

The first issue was resolved by this Court's recent pronouncement in Walker v. Chouteau Lime Co., 849 P.2d 1085 (Okla.1993). Walker held that the Unfair Claim Settlement Practices Act provides no private right of action. That holding applies to this case. No private right of action was available to Gianfillippo. The trial court and the Court of Appeals were correct in so holding.

II.

The second issue is whether a passenger who is covered under the driver's motor vehicle liability policy may bring a bad faith action against the insurer. A similar issue was recently addressed in the context of uninsured motorist coverage in Townsend v. State Farm Mutual Automobile Insurance Co., 860 P.2d 236 (Okla.1993).

Townsend held that a "class 2 insured" passenger covered by an uninsured motorist policy could bring a bad faith action. Id., at 238. That holding was based on the statutory relationship between the injured passenger and the insurer resulting from the uninsured motorist statute. Id. See Okla.Stat. tit. 36, § 3636 (1991). Gianfillippo was covered under a liability policy because she occupied an insured vehicle. She did not enjoy the statutory relationship that Townsend enjoyed.

Gianfillippo sought compensation for injuries she alleged were caused by Walker's negligence. She did not seek uninsured motorist benefits as none were available under the policy. Thus, her standing to bring a bad faith claim would have to come from the contract of insurance.

The insurer urges that there is no contractual relationship and that Gianfillippo is merely a third-party claimant citing Allstate Insurance Co. v. Amick, 680 P.2d 362 (Okla.1984). In Amick, passengers injured in one car brought a bad faith action against the insurer of the driver of the other car involved in the collision. This Court held that the passengers were strangers to the contract of insurance between the driver of the other car and that driver's insurer. Amick explained that an insurer's "duty of dealing fairly and in good faith with the insured arises from the contractual relationship. In the absence of a contractual or statutory relationship, there is no duty which can be breached." Id., at 364.

Gianfillippo's relationship to the insurer in this matter is very much like that of the passengers in Amick. The only difference is that Gianfillippo was a passenger in the same car with the driver whose insurer was being sued. Nevertheless, she argues that she is a third-party beneficiary of the insurance contract between Walker and his insurer. However, she fails to explain why she is entitled to third-party beneficiary status when the passengers in Amick were not.

Third-party beneficiary status was found in Roach v. Atlas Insurance Co., 769 P.2d 158 (Okla.1989). There, the named beneficiary in a life insurance policy was allowed to pursue a bad faith claim against the insured. But Walker's insurance policy was not made for the express benefit of Gianfillippo. The policy was intended for the protection of the insured. It benefitted Gianfillippo only incidentally. Gianfillippo was...