GRUENBERG v. AETNA INSURANCE CO. 510 P.2d 1032 (1973) CASE BRIEF

GRUENBERG V. AETNA INSURANCE CO.

510 P.2d 1032 (1973)

NATURE OF THE CASE: This was an appeal from a dismissal of a dispute over insurance payments from a fire. Gruenberg (P) sought review of an order sustaining Aetna's (D) general demurrers and dismissing P's action for breach of their implied duty of good faith and fair dealing, with regard to benefits under fire insurance policies.

FACTS: Gruenberg (P) was the owner of a cocktail lounge and restaurant known as the Brass Rail. The premises were insured for $35,000 from three different insurance companies. A fire occurred and an insurance adjuster stated that the premises were insured for more than their value. P was charged with arson but the charges were eventually dismissed for lack of probable cause. During that period, the insurance companies had demanded that P submit to examination of them under oath. P was advised by his attorney not to do so and that the insurance companies waive that requirement while criminal charges were pending. P then told the insurers that he was ready to submit to examination but they maintained that they were relieved of liability. P sued them and filed a suit based on tort for breach of an implied duty of good faith and fair dealing. That suit was dismissed from a general demurrer by the insurance companies. This appeal resulted.

ISSUE:

RULE OF LAW:

HOLDING AND DECISION:

LEGAL ANALYSIS:

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