San Diego Breach of Contract Attorney
Although an insurance bad faith lawsuit may reflect a breach of contract case, the two have distinct differences. While a breach of contract indicates a failure to meet the requirements of a contract, insurance bad faith indicates unethical, deceptive, or exploitative behaviors on the part of the insurer to avoid paying on a legitimate claim made in good faith. If you think you have a case on your hands, contact us for a free consultation.
What Is a Breach of Contract?
A breach of contract describes any instance in which a contracting party fails to uphold the requirements of the contract. For example, an insurance policy is a contract that dictates the policyholder must pay premiums on time and the insurer will cover the scope of the policy’s coverage if a claim meets the specified criteria. A material breach describes a contract entirely and irreparably broken.
The other type of contract breach is an anticipatory breach or repudiation, which describes a contracting party refusing to fulfill contractual obligations. For example, an insurance company selling an insurance package it couldn’t conceivably cover would be a material breach, whereas an insurance company refusing to pay out on a legitimate claim would be repudiation.
Is a Breach of Contract the Same as Insurance Bad Faith?
Insurance bad faith practices include:
- Unreasonably delaying processing a claim,
- Failing to conduct an acceptable investigation of a claim’s legitimacy,
- Failing to disclose the existence of coverage that applies to a particular claim,
- Offering a low payment on a claim without a legitimate reason,
- Misrepresenting a valid claim or elements of a policy, or
- Refusing to pay a valid claim.
Bad faith can also include threatening, intimidating, or intentionally deceitful behaviors.
What Are the Differences?
The difference between insurance bad faith and a breach of contract is the insurance company’s requirements regarding contract law and good faith business laws. Any duties rooted in insurance policy contracts and disputes thereof fall under contract law, whereas an insurance company’s duties for processing claims in good faith fall under common law and state provisions. A breach of contract occurs when an insurance company fails to meet the requirements outlined in the contract. Bad faith occurs when the insurance company does so intentionally.
Breach of Contract in California
Proving a breach of contract, you will need to focus on a few key points:
- There was a contract between two parties
- You met the terms of the contract
- The other party DID not meet the terms of the contract
- Due to the breach, you sustained damages
There are also two main types of breach of contract to consider: material breaches and minor breaches.
A material breach consists of one party receiving a product different from what was initially promised within the contract. For a material breach of contract, the actions of the breaching party must impact the other party in a way they did not expect. You can also decide not to perform the responsibilities outlined in the contract due to the other party’s initial breach. You can also sue for monetary damages.
A minor or non-material breach is when the non-breaching party is entitled to compensation because the breach damaged them. This often occurs when one party does not perform a part of the contract, but the other party still receives the product or services that was agreed upon.
It is essential to note the differences between the two types of breaches, as this can be crucial to your case. This will often be determined by your San Diego breach of contract attorneys.
What is Bad Faith in California?
A bad faith claim in California can ensue when an insurance company does not act in good faith. An insurer must uphold a few things, the first being equal consideration. The insurer has to treat the claimant’s interest as equal. Next is a reasonable investigation which, as the phrase suggests, is when an insurance company conducts a claim investigation. Fair application of policy terms is how the insurer interprets the language and terms of the policy. Promptly paying valid claims consists of the insurance company paying valid claims within a reasonable period.
Can You Force Someone to Uphold a Contract?
This is a question our San Diego breach of contract attorneys often get. The court can order the breaching party to take action through specific performance. Under the contract, they may be required to pay for damages but not perform specific tasks. This often happens when the monetary solution would not suffice. This is most often seen in real estate ventures when their specific task requires the transfer of ownership for a property.
What Are the Laws in San Diego?
The California Civil Jury Instructions indicate that juries in breach of contract lawsuits must assess the harm sustained by the plaintiff due to the defendant’s actions and award compensation accordingly. Compensatory damages can include coverage for a contract party’s failure to meet a contract’s requirements and the resulting financial damage to the other party. In insurance bad faith cases, plaintiffs often receive punitive damages in addition to compensatory damages beyond the limits of the policy. A jury will award punitive damages based on an insurance company’s overall wealth and the severity of the bad faith in question.
San Diego Breach of Contract Attorneys
You might be wondering why you need a San Diego breach of contract attorney, and it is because these kinds of cases can be some of the most complex. Insurance companies will do everything in their power to not have to pay or have to perform tasks under specific performance. Third-party bad faith claims are also rarely acknowledged in California, another reason to hire an attorney. A San Diego breach of contract attorney will be able to compile evidence and build a strong case on your behalf.
If you believe an insurance company failed to meet the requirements of an insurance contract or processed your claim in bad faith, you need a San Diego bad faith insurance attorney to help you reach a timely and acceptable solution. The lawyers at Dawson & Rosenthal specialize solely in insurance bad faith cases, so we keep a small and tightly focused caseload at all times. This allows us to provide every client with personalized representation and our undivided attention.