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2009AP2331 Kubichek v. Kotecki

By: WISCONSIN LAW JOURNAL STAFF//February 23, 2011//

2009AP2331 Kubichek v. Kotecki

By: WISCONSIN LAW JOURNAL STAFF//February 23, 2011//

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Civil Procedure
Settlement offers; double costs and interest

An insurer has a duty to clarify an ambiguous settlement offer.
“Based on Prosser, we conclude Wisconsin Mutual had a duty to clarify Kubichek’s settlement offer. Admittedly, the precise issue in Prosser was the insurer’s duty to clarify ambiguity regarding whether a settlement offer applies to both the insurer and the insured. Here, the ambiguity relates to the settlement offer’s failure to address a subrogated claim. Despite this factual difference, the Prosser rationale is applicable. In both situations, the insurer’s fiduciary duty regarding settlement mandates that the insurer must clarify an ambiguous offer in order to fully protect its insured’s interests.”

“Wisconsin Mutual was presented with an offer to settle Kubichek’s case, which involved exposure in the millions of dollars,[4] for an amount within its $300,000 policy limit. Its insured, Kotecki, had surrendered his right to control the litigation to Wisconsin Mutual. Wisconsin Mutual owed him a fiduciary duty with regard to settlement of the case. As part of this fiduciary duty, Wisconsin Mutual was obligated to clarify Kubichek’s ambiguous offer to settle. Because Wisconsin Mutual failed to clarify the ambiguity, Kubichek’s offer is valid pursuant to Wis. Stat. § 807.01.”

Affirmed in part, and Reversed in part.

Recommended for publication in the official reports.

2009AP2331 Kubichek v. Kotecki

Dist. III, Oconto County, Delforge, J., Peterson, J.

Attorneys: For Appellant: Konz, Michael P., Appleton; Fuehrer, Erik L., Appleton; For Respondent: Covelli, Claude J., Madison; Gilson, Jeffrey J., Green Bay

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