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Supreme Court of Ohio
December 15, 2009, Submitted; May 4, 2010, Decided
[***422] LANZINGER, J.
[**P1] We accepted this discretionary appeal to determine whether an insurer must pay an attorney-fee award on behalf of its insured under her insurance policy and whether payment of attorney fees awarded solely as a result of punitive damages violates the public policy of Ohio. After reviewing [****2] the policy, we affirm the judgment of the court of appeals, holding that the policy does cover attorney-fee awards and that public policy does not prevent such coverage.
[**P2] Appellee, Kimberly Neal-Pettit, filed suit against Linda Lahman for compensatory and punitive damages due to personal injuries sustained in an automobile accident on March 27, 2003. As alleged in the complaint, when Lahman struck Neal-Pettit's vehicle, she was intoxicated and fleeing the scene of an earlier collision. The case was heard by a jury, which returned a verdict against Lahman for compensatory damages totaling $ 113,800 and punitive damages totaling $ 75,000. In addition, the jury awarded attorney fees to Neal-Pettit based on a finding that Lahman had acted with malice. The trial court set the amount of attorney fees at $ 46,825 and also awarded Neal-Pettit $ 10,084.96 in expenses.
[**P3] [*328] Lahman maintained automobile insurance through appellant, Allstate Insurance Company ("Allstate"). Allstate paid Neal-Pettit the amounts awarded as compensatory damages, interest, and expenses, but denied payment of the punitive damages and attorney fees.
[**P4] Neal-Pettit filed a supplemental complaint against Allstate for payment [****3] of the attorney fees. The trial court entered summary judgment in favor of Neal-Pettit on the issue. Allstate appealed, arguing that it had not contracted to pay attorney [***423] fees and that an attorney-fee award is an element of punitive damages, which public policy prevents an insurer from covering. The Eighth District affirmed the trial court's decision, holding that attorney fees are "conceptually distinct" from punitive damages and that attorney fees are not expressly excluded from coverage by the language of the policy. Neal-Pettit v. Lahman, 8th Dist. No. 91551, 2008 Ohio 6653, 2008 WL 5259726, P 5.
[**P5] We accepted jurisdiction over Allstate's appeal on three issues: (1) whether it is against public policy for an insurer to pay an attorney-fee award made in conjunction with a punitive-damages award, (2) whether an attorney-fee award can be characterized as "[damages] because of bodily injury," as required for coverage under Allstate's policy, and (3) whether Allstate's policy term excluding coverage of "punitive or exemplary damages, fines or penalties" excludes coverage of attorney fees that are awarded in conjunction with a punitive-damages award.
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125 Ohio St. 3d 327 *; 2010-Ohio-1829 **; 928 N.E.2d 421 ***; 2010 Ohio LEXIS 1034 ****
NEAL-PETTIT, APPELLEE, v. LAHMAN ET AL.; ALLSTATE INSURANCE COMPANY, APPELLANT.
Prior History: [****1] APPEAL from the Court of Appeals for Cuyahoga County, No. 91551, 2008 Ohio 6653.
Neal-Pettit v. Lahman, 2008 Ohio 6653, 2008 Ohio App. LEXIS 5547 (Ohio Ct. App., Cuyahoga County, Dec. 18, 2008)
Disposition: Judgment affirmed.
attorney's fees, punitive damages, coverage, attorney-fee, insurer, punitive, award of attorney's fees, punitive-damages, damages, bodily injury, public policy, award of punitive damages, compensatory damages, exemplary damages, argues, awards, malice
Insurance Law, Claim, Contract & Practice Issues, General Overview, Civil Procedure, Remedies, Damages, Compensatory Damages, Torts, Types of Damages, Costs & Attorney Fees, Punitive Damages, Attorney Fees & Expenses, Punitive Damages, Policy Interpretation, Ambiguous Terms, Construction Against Insurers, Exclusions, Punitive Damages Exclusions, Motor Vehicle Insurance, Exclusions, Governments, Legislation, Interpretation