Turning the Tables on Big Insurance Companies:

Insurance Company Sues Accident Victim to Avoid Coverage – Result nearly $900,000 Recovery for Accident Victim

In February 2005 GEICO Insurance Company filed a lawsuit against Shelby . Shelby was surprised that her mother’s car insurance company was suing her. Just a few months before the lawsuit was filed, Shelby (age 34) was riding as a passenger when her mom suddenly lost control of the car they were traveling in and swerved into an adjoining lane of traffic. They were hit broadside by another car traveling about 50 miles per hour and Shelby took the brunt of the collision.

shelby personal injury attorney everett

Shelby was still recuperating from serious injuries at her mother’s home when she was handed the written notice that GEICO was suing her. The purpose of GEICO’s lawsuit was to get a judge decree that her mother’s insurance policy did not apply to this accident and GEICO was not required to pay any of Shelby’s nearly $200,000 in medical bills under the Personal Injury Protection (PIP) coverage included in her mom’s insurance policy. The lawsuit also asked the court to rule that GEICO did not have to pay Shelby anything for her serious injuries under her mother’s liability coverage either.

Shelby had never been sued before and the prospect of being sued by a large national insurance company was very unnerving. Even more unsettling was the fear that there could be no insurance available to help her pay her bills and help her rebuild her life. Fortunately Shelby was not willing to let GEICO bully her.

After she hired David Duce, he and Bruce Peterson went to work to sort out the complicated facts and assess the potential for insurance coverage that should provide help to her as she rebuilt her life after all that she had been through.

This case was rather unusual since her mom did not own the car she was driving at the time of the collision, in fact no one technically owned it. It had been purchased at a wholesale auto action by Shelby’s father. He was a car buyer for a local used car lot and could buy vehicles at dealer-only auto auctions. He purchased this particular car with the intention of using it for a family vacation the following week and then selling it through the car lot or taking it back to the auction after he got back from the trip. Shelby and her mom had just picked up her dad at the dealership and they were headed home to prepare for their upcoming vacation when the collision occurred. In its lawsuit GEICO claimed that Shelby’s mom’s personal car insurance was not applicable to this situation because she was driving a car that did not belong to her and she was also involved in a business endeavor at the time of the crash.

Shortly after Shelby hired Mr. Duce, the used car lot’s insurance company joined in the lawsuit against Shelby and asked the court to decree that it didn’t owe Shelby anything either. That large national insurance company claimed that Shelby’s mom was not working for the used car dealership at the time of the collision and that since the car was not purchased for the car lot’s inventory it was not covered under the business insurance policy either.

It was clear to our lawyers that Shelby should have coverage under her policy with GEICO because her mom was driving the car with permission or its owner and it was not being driven for business purpose. Our firm first brought a counter-suit against GEICO for breaching its contract by improperly denying coverage for this wreck and for failing to pay anything toward Shelby’s medical payments despite the fact that her mom’s insurance policy had $10,000 in coverage for medical bills. We also asked the court to dismiss GEICO’s claim that they did not have to provide payments under the liability section of the policy. Upon receipt of our counter-suit GEICO immediately sent the firm a check for $10,000 in medical (PIP) benefits. The issue of liability coverage was argued before a superior court judge who ruled in Shelby’s favor and ordered that the question of coverage be presented to a jury. Shortly after this favorable ruling GEICO offered Shelby $100,000 more to settle her claim against it. We refused that offer and turned our attention to the used car lot’s insurance company. The question of whether the car lot’s insurance company would have to pay anything involved plowing through piles of documents and taking several depositions. In the end, this issue was brought before a judge; the dealership’s insurance company asking for a decree saying that it would not have to pay anything for Shelby’s injuries while we asked the court to order them to pay for all of Shelby’s damages. After considering the case for nearly 3 months following our oral arguments, the court found that the matter could be presented to a jury for it to decide. An appeal of that court’s ruling was filed and shortly thereafter the two insurance companies worked out an arrangement where their combined contributions would pay Shelby $880,000 and settle the case.

Shelby was a fabulous client and through all of the ups and downs of a very complicated case she remained courageous and would not give in to the pressure from the insurance companies. When Shelby first came to my office she feared that she might not receive anything for her serious injuries, however, both she and the firm were very pleased by the result and felt that justice was served in the long run.


Each case handled by the Law Firm is unique and the results described on cases posted to this webpage are not a guarantee of similar results in other cases nor are they necessarily indicative of the actual results that will be achieved in your case.