Beaudry v. Insurance Co. of the West
In Beaudry v. Insurance Co. of the West, 203 Ariz. 86, 50 P.3d 836 (App. 2002), the Court noted that the supreme court in Dodge v. Fidelity & Deposit Co. of Maryland, 161 Ariz. 344, 778 P.2d 1240 (1989), had identified the "'two most important factors'" in determining whether a tort action for bad faith will lie:
"'(1) whether the plaintiff contracted for security or protection rather than for profit or commercial advantage, and;
(2) whether permitting tort damages will "provide a substantial deterrence against breach by the party who derives a commercial benefit from the relationship."'" Beaudry, 203 Ariz. 86, P25, 50 P.3d at 842.
Under the facts in Beaudry, the Court held that contract damages for breach of the implied covenant of good faith and fair dealing would adequately protect the insured. Id. P30.