Parks

Respondent Jamey Lynn Parks obtained a personal injury judgment of $2,187,886 against 16-year-old Michelle Miller. Safeco Insurance Company of America (Safeco) issued a homeowner’s policy to Eddie Barnette, the man with whom Michelle’s mother lived and with whom Michelle periodically stayed. It issued a similar policy to Michelle’s grandmother Evelyn Miller, with whom Michelle and her father Charles resided. Safeco declined to defend Michelle, to settle Parks’s action against her, and to indemnify her under the policy it issued to Barnette. Michelle assigned her causes of action against Safeco to Parks. When Parks later made a claim under the belatedly discovered policy issued to Evelyn Miller, Safeco paid Parks the $100,000 policy limits but refused to pay any part of the excess judgment.

A jury found that Safeco breached the covenant of good faith and fair dealing implied in the policy issued to Evelyn Miller when Safeco failed to settle the personal injury case or to defend or indemnify Michelle Miller. The trial court entered judgment in favor of Parks against Safeco for $3,245,333.76. It later awarded Parks costs of $70,104.23 and attorney fees of $426,208 as cost…