Tuesday, October 24, 2017
   
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Category: Tripartite Relationship

Debunking the Stowers Myths :: Common Misperceptions Explained (Part III)

This is the third installment in an eight-post series examining common “Stowers myths,” which can obscure application of an insurance company’s duty to behave in a reasonably prudent manner in responding to settlement demands.  If you are beginning here, you may want to visit the first post, here, to learn more about the basic parameters of the Stowers doctrine. MYTH #3  ▪  The insured can make a Stowers demand that triggers an insurer’s duty to ...

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Debunking the Stowers Myths :: Common Misconceptions Explained (Part II)

In this eight-post series, we are examining the most common “Stowers myths” that sometimes confuse the practical application of an insurance company’s duty to behave in a reasonably prudent manner in responding to settlement demands.  If you are new to the series, you may want to start here, at the beginning, to learn more about the basic parameters of the Stowers doctrine.  MYTH #2  ▪   The settlement demand must be in writing to trigger the ...

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Debunking the Stowers Myths :: Common Misconceptions Explained

When an insurance company fails to act reasonably in rejecting or failing to respond to a settlement demand, it may be subject to extra-contractual liability under the long-standing Stowers doctrine.  First articulated more than 80 years ago in G.A. Stowers Furniture Company v. American Indemnity Company, 15 S.W.2d 544 (Tex. Comm’n App. 1929), the common-law Stowers duty  applies when:  (1) the claim against the insured is within the scope of coverage; (2) the demand for sett ...

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Conflicts and Ethical Issues in the Tripartite Relationship

Amy Stewart’s presentation on the ethical considerations in the tripartite relationship is available here. Ms. Stewart has spoken and written extensively on this issue, most recently at a June 19 event for in-house counsel.  The tripartite relationship is the relationship between the insurer, its insured and defense counsel engaged by the insurer to represent the insured in a potentially covered third-party claim. The presentation, “Navigating the Ethical Current: Evaluating Conflicts an ...

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Amy Elizabeth Stewart Speaks on Ethical Issues in Tripartite Relationships

Amy Elizabeth Stewart, of Dallas’ Amy Stewart PC, will discuss the ethical landmines present in the tripartite relationship among an insurance company, its insured, and insurance defense counsel.   Her presentation, “Navigating the Ethical Current: The Tripartite Relationship,” is at 3 p.m. on June 19 at Pappadeaux Seafood Kitchen, Alexander Room, 18349 Dallas Parkway (at the North Dallas Tollway and Frankford). Ms. Stewart is one of three speakers presenting on behalf of Counsel On ...

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Navigating the Ethical Current :: Conflicts of Interest in the Tripartite Relationship (Part Three)

Considering the conflicts of interest imbedded like landmines in the tripartite relationship, the Texas Supreme Court has clearly articulated defense counsel’s obligations under Texas law.  Nearly 40 years ago, the Texas Supreme Court addressed these issues in the Tilley case.  Employers Cas. Co. v. Tilley, 496 S.W.2d 552 (Tex. 1973).  The standard is surprisingly simple.  The lawyer appointed by the insurer to defend the insured owes a duty of undivided loyalty to the insured.

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Navigating the Ethical Current :: Conflicts of Interest in the Tripartite Relationship (Part Two)

This is the second post in a four-part series analyzing the competing interests inherent in the tripartite relationship, which has long been recognized as "a source of unending ethical, legal, and economic tension.”  State Farm Mut. Auto. Ins. Co. v. Traver, 980 S.W.2d 625, 633 (Tex. 1998) (Gonzales, J., dissenting).  This post focuses on conflicts of interest commonly encountered in the tangled relationships between and among defense counsel, the insured, and the insurer.

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Navigating the Ethical Current :: Conflicts of Interest in the Tripartite Relationship (Part One)

The competing interests inherent in the relationship between the insurance company, its insured, and defense counsel—called the “tripartite relationship”—have long been recognized in the defense of lawsuits covered by insurance.  “[This] so-called tripartite relationship has been well documented as a source of unending ethical, legal, and economic tension.”  State Farm Mut. Auto. Ins. Co. v. Traver, 980 S.W.2d 625, 633 (Tex. 1998) (Gonzales, J., dissenting).  This four-post series will examine the inherent tension in the tripartite relationship, commonly-encountered conflicts, defense counsel’s ethical obligations, and best practices for defense counsel.

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Amy Stewart Law is a boutique law firm that represents policyholders in insurance coverage litigation and bad faith, with an emphasis in directors & officers liability, cyber insurance, fiduciary liability, professional liability and other specialty liability coverages.


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