Here is a blog commenting on a blog commenting on a blog.  It demonstrates the viral nature of this medium.  More to the point, it disucsses the relationship between a plaintiff, a defendant, his auto insruance comapny and the attorneys selected by the insurer.  As all know, there is an inherent conflict between the attorney, the insured and the insurer.  How this all plays out in legal malpractice and bad faith litigation is the subject of these cases.

"While perusing the Indiana Law Blog, I came upon this post entitled Ind. Decisions – Supreme Court decides insurance assignment case.

In this case styled State Farm Mutual Automobile Insurance Co. v. Ruth Estep, in which State Farm had offered its limits which were declined by the plaintiff. State Farm continued to defend, but a verdict was obtained against their insured in excess of those limits. The defendant assigned globally his/her causes of action to include those against State Farm and the lawyer whom they paid to defend the insured.

The Indiana Court held the assignment of the claim against State Farm was valid but not the legal negligence claim’s assignment.

This is an interesting thought since within the context of Kentucky jurisprudence, the fabled "tripartite" relationship in which the lawyer owes a duty to both the insurer AND the insured might be possibly suspect in the event that a conflict of interest arises, an excess verdict, a perceived legal malpractice in the representation, and then the subsequent assignment by the individual defendant of his claims against his insurer and his lawyer. Even if the assignment of the legal negligence claim is "disallowed", how then do you separate the two sides of that tripartite relationship when the relationship goes sour.

Could this happen in Kentucky? Well, let me remind you that insurance defense lawyer’s duties are being tested in the Court of Appeals in a case that has already been argued in which the focus is on which insurance policy will end up paying the plaintiff’s excess judgment? The insurance defense law firm’s malpractice policy or the insurance company that paid/hired them? See, Insurance Defense Lawyers Duties, Responsibilities, and Liabilities to be tested in Court of Appeals decision argued this past week which we posted this spring. "