Zahn v. General Ins. Co. of America

In Zahn v. General Ins. Co. of America, 1980 OK 79, 611 P.2d 645, the Supreme Court permitted a judgment creditor to proceed directly against the defendant's insurance company based on policy language allowing recovery under the policy by any person who had secured a judgment. Zahn was not a garnishment action but a subsequent lawsuit filed directly against the judgment debtor's insurer. In Zahn, the defendant's insurers withdrew representation shortly before a scheduled trial. The Zahns (plaintiffs) entered into an agreed judgment with the defendant for $50,000 and then sued defendant's insurers for breach of contract. The insurers argued the Zahns' judgment did not meet policy-defined preconditions to a right of action. The Supreme Court held the insurers were estopped from relying on unmet conditions precedent because they disclaimed liability only a few days before the trial.