Can the Attorney's Fees and Costs Be Awarded to An Insured Where the Insurer's Refusal to Defend Was Unreasonable and In Bad Faith ?
In Kelmo Enterprises v. Commercial Union Ins., 285 Pa. Super. 13, 426 A.2d 680 (Pa.Super. 1981), this court addressed the issue whether the trial court erred when it awarded attorneys' fees and costs to an insured who brought a declaratory judgment action to establish his insurer's duty to defend.
The Court concluded that such an award was appropriate where the insurer's refusal to defend was unreasonable and in bad faith. Kelmo, 426 A.2d at 685.