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Washington shop wins case against Safeco

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March 31, 2011 — Stroud’s Auto Rebuild in Tacoma, Wash., announced this week it won its tortious interference case against Safeco Insurance Company.

The lawsuit argued the insurance company tortiously interfered with a repair contract Stroud’s had with a customer. Stroud’s convinced the arbitrator that it lost a job and the profit it would have generated after Safeco pressured a customer to remove his vehicle from the shop and use one of the insurer’s “preferred” shops instead.

Stroud’s was awarded $9,462.23 back in December for the amount of profit lost, but Safeco appealed the decision, which led to the arbitration. In the end, Stroud’s retained the arbitration award and won payment of attorney’s fees.

“I am so pleased that the arbitrator understood the real issues in this matter, said Mike Harber, owner of Stroud’s. “I am a small business person trying to perform quality services and take care of my customers in the process. To have an insurance company put my business and my customers at risk because it wants to save money and increase its own profits is reprehensible.”

Allen Shabino, Stroud’s attorney, said prevailing in this type of case is difficult because the legal standard is vague and hard to meet.

“By rendering the award that she did, the arbitrator agreed that Safeco either was actuated by an improper motive or had used inappropriate means to induce the consumer to move his vehicle to their preferred shop,” Shabino said.

Shabino and Harber hope the case will discourage insurers from interfering with customers’ body shop choices.

“Consumers need to know they can have their vehicles repaired at the shops of their choice and not feel forced by insurers to have someone they don’t know or trust fix their damaged vehicles,” Harber said.
 

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