Appellant assignees sought review of the judgment of the Superior Court of Los Angeles County (California) in favor of respondent insurance carrier in appellants’ action alleging bad faith breach of an insurance contract.

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Overview

Appellant assignees were heirs of a deceased passenger of an airplane. Appellants filed a wrongful death action against the estate of the insured, deceased pilot, alleging that the pilot’s negligence was the cause the death of the passenger. The administratrix of the estate settled the wrongful death action and in satisfaction assigned all causes of action against respondent insurance carrier to appellants. Appellants filed an action against respondent, alleging bad faith breach of an insurance contract. The jury found in favor of appellants, but the trial court entered judgment in favor of respondent. The court affirmed the judgment of the trial court, finding that appellants’ assigned cause of action was invalid because the liability of respondent to the insured had not been determined in a manner approved by the case law or contemplated by the insurance contract. The court found that a judgment against the insured was a condition precedent to the insured’s cause of action against respondent and that the nature of the assignment agreement between appellants and the insured did not comply with the insurance policy provisions.

Outcome

The court affirmed the judgment of the trial court in favor of respondent insurer in appellant assignees’ action alleging bad faith breach of an insurance contract. The court found that appellants’ cause of action, which was assigned by the estate of the insured, was invalid because the liability of respondent to the insured had not been determined in a manner approved by law or contemplated by the insurance contract.