Insurance bad faith is a tort claim that an insured person may have against an insurance company for its bad acts. The Ohio Supreme court has held that an insurer owes a duty of good faith to its insured in the processing, payment, satisfaction, and settlement of the insured's claims. Hart v. Republic Mut. Ins. Co. (1949), 152 Ohio St. 185, 87 N.E.2d 347. This duty is often referred to as the "implied covenant of good faith and fair dealing" which automatically exists by operation of law in every insurance contract. If an insurance company violates that covenant of good faith, the insured person (or "policyholder") may sue the company on a tort claim in addition to a standard breach of contract claim. The contract-tort distinction is significant because as a matter of public policy, punitive or exemplary damages are unavailable for contract claims, but are available for tort claims.
In Motorists Mutual Ins. Co. v. Said (1992), 63 Ohio St.3d 690, 590 N.E.2d 1228, the Ohio Supreme Court held that a cause of action for the tort of bad faith exists:
“ * * * when an insurer breaches its duty of good faith by intentionally refusing to satisfy an insured's claim where there is either (1) no lawful basis for the refusal coupled with actual knowledge of that fact or (2) an intentional failure to determine whether there was any lawful basis for such refusal. Intent that caused the failure may be inferred and imputed to the insurer when there is a reckless indifference to facts or proof reasonably available to it in considering the claim.”
“‘No lawful basis' for the intentional refusal to satisfy a claim means that the insurer lacks a reasonable justification in law or fact for refusing to satisfy the claim. Where a claim is fairly debatable the insurer is entitled to refuse the claim as long as such refusal is premised on a genuine dispute over either the status of the law at the time of the denial or the facts giving rise to the claim.” Said, supra at 699-700, 590 N.E.2d 1228.
A claim of bad faith cannot be brought against an insurer by a third-party claimant. Pasipanki v. Morton (1990), 61 Ohio App.3d 184, 185, 572 N.E.2d 234, citing Hoskins v. Aetna Life Ins. Co. (1983), 6 Ohio St.3d 272, 275-276, 452 N.E.2d 1315. The duty to act in good faith runs only from the insurer to its own insured. Pasipanki, at 185, 572 N.E.2d 234. Although an insurer owes a duty to its insured to negotiate in good faith with a party injured by the insured, there is no such independent duty to the injured party, nor is he a third party beneficiary to the insurance contract. Achor v. Clinton Cty. Bd. of Mental Retardation & Developmental Disabilities (June 5, 1986), Franklin App. No. 86AP-60.
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Prior to practicing law, Mr. Phillips received a Bachelor of Science in Nuclear Engineering and a Master of Science in Engineering. He worked as an engineer in Cincinnati, Boston and Minneapolis prior to practicing law. As an engineer he was responsible for Quality Assurance and Regulatory Compliance at three nuclear power plants.
Mr. Phillips received his law degree from the William Mitchell College of Law in St. Paul, Minnesota. While living in Minnesota, he was appointed twice by Governor Rudolph Perpich to serve on the Hazardous Substance Injury compensation Board where he was Vice Chairman. He left Minnesota to join the litigation department of Taft, Stettinius and Hollister where he focused his practice on environmental law and litigation. In 1994, he left Taft, Stettinius and Hollister to become managing partner of what is now Phillips Law Firm, Inc.
Mr. Phillips lives in Anderson Township with his wife and four children. He is actively involved in his community where he has been President of the Hamilton County Board of Health, Secretary of the Park W. Gast, Jr. Education Foundation, Vice President of the Board of Trustees of the Cincinnati Chapter of Triangle, Inc. (an engineering, architecture and science fraternity at the University of Cincinnati), and President and Founder of a non-profit organization for continuing legal education programs known as the Northeast Lawyers Club. He is a member of the Cincinnati Bar Association, and serves on the environmental law committee, professional responsibility and ethics committee, and real estate committee. He is also a member of the Ohio Free and Accepted Masons and the Syrian Shrine in Cincinnati, Ohio
Mr. Phillips handles a wide variety of cases for clients. He handles personal injury cases, business disputes, legal malpractice, and insurance claims. He has litigated cases from Texas to Minnesota, and from New York to Oregon. He represents businesses and individual clients in the areas of personal injury cases, business disputes, legal malpractice, insurance claims, construction law and building code compliance, real estate law and development, landlord-tenant, business formations, non-profit corporations, and estate planning. Mr. Phillips also has significant experience handling complex litigation and environmental issues. He represents clients with issues regarding the Comprehensive Environmental Response, Compensation and Liability Act (Superfund), Clean Air Act, Clean Water Act, Resource Conservation and Recovery Act, Toxic Substances Control Act, Emergency Planning and Community Right-to-Know Act, Atomic Energy Act, and National Environmental Policy Act, to name a few.
He served two terms as a member and President of the Hamilton County Board of Health.
He was twice appointed to the Hazardous Substance Injury Compensation Board by Minnesota Governor Perpich. He served as Vice Chairman on this state board which reviews personal injury and property damage claims related to the release of hazardous substances.
He is Vice President of the Board of Trustees of the Cincinnati Chapter of Triangle, Inc. (an engineering, architecture and science fraternity at the University of Cincinnati).
He was awarded the National Triangle Fraternity Outstanding Alumnus Award in 2002.
He is the President and Founding Member of the Northeast Lawyers Club (an Ohio Not-For-Profit Corporation Providing Continuing Legal Education to attorneys).
He is secretary of the Board of Trustees of the Park W. Gast, Jr. Education Foundation (an Education Foundation at the University of Cincinnati).
He is an experienced litigator and trial attorney with multiple bench trials, jury trials, and administrative hearings too numerous to count including legal malpractice, medical malpractice, personal injury, contract, business, environmental law, and zoning.
He has drafted many ordinances including an anti-nuisance zoning ordinance for a local village to prevent undesirable businesses from moving into an area, an environmental justice ordinances to prevent the spread of environmental hazards on low income areas, and regulations on rabies, sewage disposal and other public health issues.
He has brought private enforcement cases against government officials that ultimately resulted in the felony conviction and five-year prison sentence of a City Mayor.
He has been an Adjunct Professor at the University of Cincinnati’s in the Biology Department teaching “Environmental Law for Non-Lawyers”, and he has been an Adjunct Professor in the Nuclear Engineering Department teaching “Reactor Lab” and “Radiation Detection and Measurement.”
William Mitchell College of Law, Saint Paul, MN – 1989. Received Juris Doctor by attending law school evenings while working full time as a nuclear engineer.
University of Cincinnati College of Engineering, Cincinnati, OH – 1984. Received a Master of Science in Engineering while attending on full scholarship as a Teaching Assistant and Associate Professor.
University of Cincinnati College of Engineering, Cincinnati, OH – 1982. Received a Bachelor of Science in Nuclear Engineering.
Phillips Law Firm, Inc. Cincinnati, OH – 1994 – present. General practice law firm which has o a very strong business law, personal injury, legal malpractice, environmental law, tax law, bankruptcy, adoption, and bike law practice.
Taft, Stettinius and Hollister, Cincinnati, OH – 1990 to 1994. Associate attorney practicing in the litigation department. Handled all aspects of environmental law, litigation, and regulatory compliance.
Northern States Power Company, Minneapolis, MN – 1979 to 1981 and 1984 to 1990. Senior Engineer with experience in Quality Assurance, Nuclear Fuel Management, Core Analysis, Safety Analysis, and Licensing.
Yankee Atomic Electric Company, Framingham, MA – 1984. Loss of Coolant Accident Analysis and Thermal Hydraulic Engineer.
University of Cincinnati, Cincinnati, OH – 1982 to 1983 Adjunct Professor in the nuclear engineering department.
Cincinnati Gas and Electric, Cincinnati, OH – 1982. Nuclear Fuel Performance Engineer.
“Legal Alert,” a monthly environmental column published in “Metal Finishing” magazine.
Professionalism among lawyers – “What’s wrong with us?” – An analysis on lawyers, litigating and public perception of lawyers.
Ethics – “The year in review” an analysis of changes in the law affecting all lawyers.
Substance Abuse in the Legal Profession – “What drives you to drink?” An analysis of danger signs and where lawyers can get help for substance abuse problems
Legal Analysis – “Does RCRA Really Apply to Your Environmental Remediation?”
Legal Analysis – “Potential Contractor Liabilities and Indemnifications for the Environmental Restoration Management Contractor at the Fernald Environmental Management Project”
Legal Analysis – “Decommissioning America’s Commercial Nuclear Power Plants: Running the Regulatory Gamut”
Engineering Analysis – “Reactor Coolant Pump Operation During Small Break Loss of Coolant Accidents at the Yankee Rowe Nuclear Plant”
Education Analysis – “Teaching Radiation Health Physics at the University Level,” The University of Cincinnati was a recipient of a $30,000 grant based upon this work.
He has testified in legal malpractice cases as to standard of care, reasonableness of attorney fees, and damages for both Plaintiff and Defense Cases.