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93A Claim Against Insurer Includes Litigation Costs

The Massachusetts Appellate Court came down with a decision regarding 93A claims against insurance companies for unfair and deceptive settlement practices.

InMartinez Rivera, et al v. Commerce Insurance Company, et al, the Appellate Court found that the Plaintiff had the right to recoup the $27,000.00 in expenses incurred by his attorney in preparing the try the underlying tort case. In Martinez, the insurance company waited until the night before the trial to offer the policy limits to the Plainitff.

In the underlying case, the Superior Court judge decided that the Appellate Court's decision in Miller v. Risk Management Foundation, the plaintiff had no right to recoup any tort-related expenses as a matter of law.

Plaintiff appealed, and the Appellate Court disagreed with the interpretation of Miller. "We think Miller actually supports the inclusion of expenses as an element of actual damages under 93A." The court found that the insurance company could forsee these damages as a result of their failure to reasonably investigate the claim and settle in a timely manner, and therefore any reasonably tort-related litigation expenses incurred as a foreseeable result of the insurance company's 93A violations were compensable as actual damages. The case was remanded for recalculation of damages.

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