Messer v. Universal Underwriters Insurance Company 
Opinion by Judge Acree; Judges Lambert and Spalding concurred. 

The Court of Appeals affirmed the circuit court’s grant of summary judgment dismissing appellant’s bad faith claim brought pursuant to the Kentucky Unfair Claims Settlement Practices Act, KRS 304.12-230. The bad faith claim was abated while the parties litigated the underlying tort action, an auto accident involving appellant and the employee of appellee’s insured. The police report indicated that appellant caused the accident. Appellee’s insured said that its employee was driving its vehicle without permission, and non-permissive use was excluded from coverage under the policy of insurance. Consequently, appellee denied the claim because it had no contractual obligation under the policy and further disputed the claim because the insured’s employee’s liability was not beyond dispute. Appellee made nuisance value offers to appellant until a jury resolved the permission use fact question and appellant was found to have a contractual obligation to cover the accident. However, appellee continued to dispute the claim because liability was not beyond dispute and damages were in doubt. During the five months after the coverage question was resolved, the parties’ negotiations led to settlement of the underlying claim for the limits of the liability policy. When litigation of the bad faith claim resumed, appellee moved the circuit court for summary judgment, which was granted. The Court of Appeals affirmed because there was no obligation to pay the claim until the coverage issue was resolved, the insured’s employee’s liability was never beyond dispute, and appellee’s conduct could not, as a matter of law, be outrageous or otherwise constitute bad faith. 

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