News & Insights

Recent Posts

WSHB's Constance Endelicato To Speak at ASHRM 2019 Annual Conference

Supreme Court Allows Suit Over Website Accessibility

Strategies for Defending Legionella and Mold Claims

Residential Revolution

Time Limit Demand Issues Arrive in North Carolina

WSHB Welcomes New Partner Julie A. Weerth to the Firm's New York Office

Temp Agency Absolved of Liability in Hotly Contested Action

Alternative Fee Agreements and Construction Issues: Oil and Water or Perfect Pairing!?

WSHB's Graham Miller Helps Demystify Construction Claims in the Pacific Northwest

WSHB Partner Janice Michaels Named to The Best Lawyers in America© 2020 List

One Bad Apple: Navigating through Sexual Battery and other Intentional Torts

Leading Construction Litigator Cynthia Tari Joins WSHB's Dallas Office

WSHB’s Philadelphia Partner Secures Summary Judgment in Catastrophic Premises Liability Matter

WSHB Welcomes New Partner Andrew Kessler

New Bill In New York Proposed for Signature by Governor Andrew Cuomo is Set To Make Employers "SWEAT"

Renowned Litigator Jason Williams Joins WSHB's Nevada Office

Litigator Richard Young Joins WSHB's Nevada Office

Published Appellate Opinion Upholding Summary Judgment in Favor of Commercial Tenant Against $3.5M Subrogation Suit

17 WSHB Lawyers Honored as 2019's Rising Stars

Arizona Supreme Court Allows Court of Appeals Decision Expanding Defendants' Ability to Enforce Settlements to Stand

WSHB’s Jason Klein Breaks Down the Good, the Sad and the Funny Sides of Claims

Litigating Sexual Battery and Other Intentional Torts: Navigating the One Bad Apple in Medical Negligence

WSHB Partner Michelle Arbitrio to Moderate Panel on Insurance and Risk Management in the Age of Mass Shootings

Girl on Fire: The Price of Pursuing the Truth in the #MeToo World

Pragmatic Issues on Settlement Versus Trial for Legal Malpractice Cases

WSHB Partner Jade Tran Named to Lawyers of Color's "Nation's Best" List

A Withering Assault

The Natural Progression of Natural Disasters

Nevada’s Governor Signs Chapter 40 Reform Bill

WA Condo Law Changes Hope to Curtail Frivolous Defect Lawsuits and Stimulate Production

WSHB Co-Founder Stephen Henning Steps Into the Spotlight at this Year's West Coast Casualty Seminar

Professional Liability Expert Weighs In On Protecting Your Practice From Opioid Doc Arrest Fallout

Penalties, Punitives, and Granny Cams: The Escalating Lure of Elder Abuse Litigation

Are Structured Settlements Still Relevant

Game Changing Trends Affecting Construction

He's Not My Guy: The Joint-Employer Doctrine

WSHB Case Update: DOL Proposes Increase to Minimum Salary Threshold

WSHB and DWF Announce Exclusive Association

WSHB Partner Nancy Quinn Koba Elected Supreme Court Justice for the Ninth District

Time Limit Demand Issues Arrive in North Carolina

September 23, 2019

For years, the prohibition on assignment of bad faith claims has largely kept the time limited demand game out of North Carolina. A recent appellate decision, however, may change the playing field…

The case, Haarhuis v. Cheek, 820 S.E.2d 844 (N.C. App. 2018), involved an unfortunate motor vehicle accident where an intoxicated tortfeasor hit a pedestrian on the side of the road who subsequently died as a result of her injuries. Prior to filing suit, Plaintiff’s counsel served a time-limited demand on tortfeasor’s auto carrier in which Plaintiff agreed to release his claims against the tortfeasor in exchange for payment of the liability limits of $50,000 if payment was made within ten days. Plaintiff did not receive any response to the time-limited demand from the carrier or defense counsel within the ten-day window, and filed suit shortly thereafter.

The case proceeded to trial, and the jury entered a verdict against tortfeasor for $4.25 million in compensatory damages and $45,000 in punitive damages. Post-judgment collection efforts confirmed the tortfeasor was uncollectable.

Subsequently, Plaintiff moved for appointment of a receiver on the basis that tortfeasor possessed property in the form of unliquidated legal claims against her insurance carrier and assigned defense counsel for their actions in causing tortfeasor to be encumbered with a judgment of nearly $4.3 million (i.e., claims for bad faith against the carrier and malpractice against defense counsel). Plaintiff contended that tortfeasor was unwilling to pursue these claims, so a receiver should be appointed to pursue them on her behalf, primarily for the benefit of tortfeasor’s judgment creditor, Plaintiff.

The trial court denied the motion, and the Court of Appeals unanimously reversed, based on a language of the receiver statute, and allowed the receiver to be appointed to pursue the bad faith claim against the liability insurer (and the malpractice claim against defense counsel). The case was subsequently appealed to the North Carolina Supreme Court who in May of this year declined to allow review.

The practical effect of this decision is to give a potential end run around the prohibition on assignment of bad faith claims in North Carolina. The well-settled rule in North Carolina is that there is no third-party bad faith except in extremely limited circumstances; however, this recent development creates a window for a third-party claimant to use a bad faith claim against a liability carrier. Where these time-limited demands have not been common before in North Carolina, carriers and defense counsel are already seeing an uptick in time-limited demands as a result of the Haarhuis decision.

The experienced team of insurance attorneys at Wood Smith Henning & Berman, LLP can assist in navigating time-limited demands in North Carolina based on this new development. For more information, please contact William Silverman at (919) 987-2206 or at wsilverman@wshblaw.com.

PRINT

Privacy Policy      |      Site Map

© 2019 Wood Smith Henning & Berman LLP

Subscribe to our mailing list

* indicates required