Pennsylvania Holds That Injured Party Has No Standing to Sue Defendant’s Insurance Company for Bad Faith

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Gitelman also made bad faith claims against Wilkinson’s insurer on the basis that his insurance company owed her a duty of good faith and fair dealing.

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She refused to sign the release required by the settlement agreement, so Wilkinson filed a Motion to Enforce the Settlement Agreement. On April 8, 2021, the Honorable Michael A. Delia Vecchia issued an Order granting Wilkinson’s request to enforce the terms of the settlement agreement.

Gitelman’s claims against Wilkinson were ordered released in exchange for a settlement of $150,000.00 pursuant to the terms and conditions of the written release, which was attached to Wilkinson’s Motion to Enforce the Settlement marked as Exhibit A. The terms and conditions of the Power of Attorney and Fee Agreement between Gitelman and George M. Kontos were also ordered to be enforced. The court confirmed that Dawne Wilkinson, by and through her insurance provider, shall pay Leslie R. Gitelman $100,422.47, and George M. Kontos $49,577.53.

As to the issue of bad faith raised by Gitelman, Western District Judge Stickman observed the case of Strutz v. State Farm, 609 A.2d 569 (Pa. Super. 1992) that an insurer does not owe a duty of good faith in dealing with third-party claimants, stating in pertinent part: “the duty to negotiate a settlement in good faith arises from the insurance policy and is owed to its insured, not to a third-party claimant. By asserting its policy right to handle all claims, the insurer assumes a fiduciary position toward the insured and becomes liable to act in good faith and with due care in representing the interests of the insured.” Strutz, 609 A.2d at 571.