## Facts

- Frances Quigley negligently caused an automobile accident that injured Michelle Macola.
- Inge Quigley (the insured) was covered by a GEICO automobile liability policy with $300,000 bodily-injury limits and $100,000 property-damage limits.
- Macola offered to settle her bodily-injury claim against Quigley for the $300,000 policy limit.
- GEICO did not accept the policy-limits settlement offer.
- Macola filed a personal-injury lawsuit against Quigley.
- While the personal-injury action was pending, Quigley filed a Civil Remedy Notice (CRN) with GEICO and the Florida Department of Insurance under Fla. Stat. § 624.155, alleging bad-faith failure to settle.
- Within the 60-day statutory response window, GEICO tendered $300,000 to Quigley.
- The personal-injury case proceeded and resulted in a final judgment of about $1.54 million (reported as $1,586,450) in Macola’s favor, far above the $300,000 policy limit.
- Macola (the injured third party) and Quigley (the insured) then sued GEICO for common-law third-party bad faith, seeking the amount of the judgment above policy limits.
- GEICO removed the bad-faith case to federal court and argued that its within-60-day tender of the policy limit barred any common-law third-party bad-faith claim.
- The federal district court agreed and entered summary judgment for GEICO.
- On appeal, the Eleventh Circuit certified a question to the Florida Supreme Court on whether the tender precluded the common-law bad-faith action.

## Issues

1. Does an insurer’s tender of policy limits within the 60-day period after the insured files a CRN under Fla. Stat. § 624.155—made after a tort suit is filed but before entry of an excess judgment—preclude a common-law third-party bad-faith action by the insured and the injured third party?

## Decision

- The Florida Supreme Court answered the rephrased certified question “no.”
- A policy-limits tender made in response to a § 624.155 CRN, after the tort suit begins but before entry of an excess judgment, does not preclude a common-law third-party bad-faith action by the insured or injured third party.
- The court explained that the statutory notice-and-payment mechanism addresses statutory remedies, but it does not eliminate the separate common-law cause of action for third-party bad faith.
- The court returned the case to the Eleventh Circuit for further proceedings consistent with its opinion.

## Legal Principles

- A liability insurer owes the insured a duty of good faith in handling claims and settlement opportunities, including acting with due regard for the insured’s interests when an excess judgment is a real risk.
- Florida recognizes a common-law third-party bad-faith cause of action when an insurer’s failure to act in good faith results in an excess judgment against the insured.
- Fla. Stat. § 624.155 provides a statutory civil remedy and requires a CRN with a 60-day period during which the insurer may pay and thereby avoid statutory bad-faith liability for the noticed statutory violation.
- The § 624.155 cure mechanism does not, by its terms, bar or erase common-law third-party bad-faith claims; the Legislature did not end the common-law third-party remedy when it created the statutory scheme.
- A tender of policy limits within the 60-day window may affect statutory exposure, but it does not automatically defeat common-law liability for damages tied to an excess judgment caused by earlier claim-handling and settlement conduct.
- Prior decisions interpreting § 624.155’s cure provision in the first-party context (including Talat) do not convert the statutory cure into a defense that eliminates common-law third-party bad-faith actions.

## Conclusion

Macola v. Government Employees Insurance Company holds that GEICO’s tender of the $300,000 policy limit within 60 days after the insured filed a § 624.155 civil remedy notice—though made before the tort court entered an excess judgment—did not bar Macola and Quigley from pursuing a common-law third-party bad-faith claim seeking recovery of the judgment amount above policy limits.


Macola v. Government Employees Insurance Company, 953 So. 2d 451 (2006)