Plaintiff, Bay State Insurance Company, filed a declaratory judgment action in the circuit court of Madison County against James Johnson (Johnson), plaintiff's insured, and Gerald Wilson, hereafter defendant. The suit was commenced to determine plaintiff's obligation under a $25,000 homeowner's insurance policy issued to Johnson. Defendant filed a counterclaim alleging plaintiff negligently or in bad faith refused an offer to settle a tort claim for the limits of its policy prior to a previously entered judgment against Johnson.
