1. Did the Lelands present sufficient evidence to support damages for mental anguish in this case?

2. What purpose is served by the state statute that provided for a penalty of two times the actual damages attributable to the insurer’s breach of its duty of good faith and fair dealing in servicing the Leland’s claims?

Don and Myna Leland owned rental property in Lake Charles, Louisiana, that was damaged by a tree falling into the building, shearing off a portion of the facade during Hurricane Rita in September 2005. By October 7, 2005, they notified their insurer, Lafayette Insurance Co., of the damages to this property. In September 2007, two years after the hurricane, the Lelands filed a lawsuit against the issuer for breach of the insurer’s duty of good faith and fair dealing in adjusting losses associated with the hurricane. The jury found in favor of the Lelands, concluding that the plaintiffs sustained losses in excess of the amount paid under the defendant’s policy in the amount of $144,800.00. Further, the jury concluded that the defendant: (1) failed to initiate a loss adjustment to the property within 30 days after notification of loss; (2) was arbitrary, capricious, or without probable cause in failing to pay any claim due within 60 days after receipt of satisfactory proof of loss; (3) failed to make an offer to settle the property damage within 30 days of receipt of satisfactory proof of loss; and (4) misrepresented pertinent facts or insurance policy provisions related to coverage at issue. From a judgment for the Lelands, Lafayette appealed.

JUDICIAL OPINION

AMY, J.… [The court of appeals affirmed the trial court’s damages as amended as follows: $5,000 for loss of rental income, $53,000 for loss of personal income, $30,000 in interest and $45,000 each for the Lelands for mental anguish and emotional distress for a total of $178,000 in damages attributable to the insurer’s breach of its duties. State law added a penalty of two times these damages or $356,000. The insurer was also obligated to pay $144,800 in contractual damages for repairs owed under the insurance contract, and $226,266 in attorneys fees. The court responded to Lafayette’s contention that the evidence did not support the mental anguish awards to the Lelands.]

Mental Anguish

… Lafayette does not question the availability of mental anguish damages following a violation of La.R.S. 22:1220, now La.R.S. 22:1973. Instead, it asserts that the plaintiffs did not present sufficient evidence to support the individual awards of $45,000.00 to each of them. Primarily, Lafayette asserts that the figure is not supported as they did not present medical support for their claims.

We do not disturb the jury’s award in this regard, finding adequate support in the record. Both plaintiffs offered testimony on this element of recovery. Mr. Leland testified extensively regarding the frustrations encountered in pursuing this multi-year claim and in making little progress toward a satisfactory conclusion. The record is replete with ……………..