Opinion
No. COA02-1090
Filed 6 May 2003 This case not for publication
Appeal by plaintiff from order entered 11 April 2002 by Judge James U. Downs in Cherokee County Superior Court. Heard in the Court of Appeals 28 April 2003.
Charles R. Brewer for plaintiff appellant. Parker, Poe, Adams Bernstein L.L.P., by Josephine H. Hicks, for Cameron M. Harris Company defendant appellee. Russell, King Johnson, P.A., by J. William Russell, for Michigan Mutual Insurance Company defendant appellee.
Cherokee County No. 99 CVS 96.
Plaintiff appeals from an order denying its motion for attorney's fees. We affirm.
Plaintiff obtained a commercial automobile insurance policy from defendant Michigan Mutual Insurance Company (Michigan Mutual). On 12 March 1998, one of plaintiff's vehicles was involved in a collision in Norfolk, Virginia, resulting in multiple claims against plaintiff. Plaintiff contacted Michigan Mutual to defend these claims. Michigan Mutual initially denied coverage on the ground that the vehicle involved in the accident was not included under plaintiff's policy.
Thereafter, plaintiff filed suit against Michigan Mutual seeking a declaratory judgment "that the vehicle in question was in fact covered by the policy of insurance . . . on March 12, 1998, the date of the accident." In the alternative, plaintiff alleged that its broker, defendant Cameron M. Harris Co., was negligent in failing to add the vehicle to the insurance policy prior to 12 March 1998, as plaintiff had requested. On 8 November 1999, plaintiff moved for summary judgment. Before plaintiff's motion was heard, however, Michigan Mutual acknowledged coverage and "proceeded to defend and settle the claims arising from the accident in Virginia." Plaintiff did not pursue its claims against defendants, and its motion for summary judgment was never heard.
During the trial court's 25 March 2002 clean-up calendar, plaintiff advised the trial court that its dispute with defendants regarding insurance coverage had been "settled and resolved[.]" Plaintiff also moved to recover the attorney's fees it had incurred in bringing the declaratory judgment action. After hearing from the parties, the trial court found "no statutory or contractual basis for awarding attorney's fees in this case." The trial court found that Michigan Mutual had honored its obligations under the insurance policy, and that plaintiff had not alleged or proved that defendants exercised bad faith in initially denying coverage. Based on these findings, the trial court entered its order denying plaintiff's attorney's fees request. The order also dismissed plaintiff's underlying action against defendants in light of the parties' representation that the matter was resolved.
On appeal, plaintiff argues that the trial court erred in denying its request for attorney's fees. Plaintiff notes that an insurer who wrongfully refuses to defend a claim is liable to its insured for costs incurred in defending the claim. Plaintiff contends that, absent an award of fees in this case, it is left less than whole. We do not agree.
Plaintiff has not assigned error to any of the trial court's findings of fact. "Where no error is assigned to the findings of fact, such findings are presumed to be supported by competent evidence and are binding on appeal." McConnell v. McConnell, 151 N.C. App. 622, 626, 566 S.E.2d 801, 804 (2002). Here, the trial court found that the parties had resolved the coverage dispute, that Michigan Mutual had defended and indemnified plaintiff for the claims arising from the 12 March 1998 automobile accident, and that plaintiff had not alleged or offered any evidence of bad faith by defendants in initially denying coverage of the vehicle at issue.
In Collins Aikman Products Co. v. Hartford Accident Indem. Co., 125 N.C. App. 412, 481 S.E.2d 96, disc. review denied, 345 N.C. 752, 485 S.E.2d 51 (1997), this Court announced the following rule regarding an insured's right to recover attorney's fees from its insurer in this context:
We hold that attorney's fees incurred by the insured (the non-breaching party here) are not recoverable as damages where those fees are incurred in the course of litigation to determine coverage and compel the insurer to perform its duties. Our decision today does not hold that an insured's attorney's fees can never be recovered in coverage litigation. Attorney's fees clearly can be recovered in situations, for example, where an insurer acts in bad faith in denying coverage or where recovery of fees is otherwise authorized by contract or statute.
Id. at 415, 481 S.E.2d at 97-98. As in Collins Aikman, plaintiff sought to recover attorney's fees incurred in the course of litigation to determine coverage and to compel its insurer to perform its duties. Plaintiff made no allegation that Michigan Mutual acted in bad faith and has identified no contractual or statutory provision under which it is entitled to an award of attorney's fees. We note that plaintiff effectively dropped its suit against defendants in 1999, after Michigan Mutual acknowledged coverage.
The trial court's ruling is consistent with our holding in Collins Aikman and is, therefore, affirmed.
Affirmed.
Judges MARTIN and CALABRIA concur.
Report per Rule 30(e).