Two third-party claimants who were customers of G&C Auto Body in Northern California had won small claims court cases filed against State Farm insureds when the insurer refused to pay all of G&C’s charges. The insurer appealed both cases, and the court heard the two appeals together over two days.
Following his review of the cases, Bertoli told State Farm it could use whatever method it specified in the insurance policy to determine a reasonable price in first-party claims, even if it determined that price, by reading chicken entrails, and consulting with the three witches from Macbeth, which is just about as accurate as the survey. Bertoli believed State Farm’s process for determining prevailing rate, from a statistical standpoint, would earn a first-year college student a flunking grade.
But in a third-party case, the judge said a reasonable charge implies a range of charges and no particular charge can be said to be the only reasonable charge.
He said State Farm didn’t try to establish that G&C’s rate was unreasonable and the shop’s rate appeared to fall within a reasonable range of prices.
“With regard to the third-party claims, this court doesn’t believe they should’ve been litigated,” Bertoli said in finding for G & C’s customers. "It’s an effort on behalf of the insurer to try and suppress the price charged by someone outside of their range.”
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About the Author
John Yoswick
Contributing Editor
John Yoswick is a freelance writer based in Portland, Ore., who has been writing about the automotive collision repair industry since 1988. He can be contacted by e-mail at [email protected].