DISSENTING OPINION OF
RICHARDSON, CJ.I respectfully dissent.
For the majority, the case at bar appears to turn on the absence of a contractual or statutory authority for suit against an insurance company. Citing Appleman, the majority asserts that “for lack of privity between himself and the insurer, [an injured third party] has no right of action at law against the insurer and cannot join the insured and the liability insurer as parties defendant.” As a rationale for this rule of law, the majority suggests that the jury may be influenced in finding liability or in assesssing damages if it believes that an affluent institution such as an insurance company will bear the loss. The rationale may well be applied to the cited rule of law in the usual case where it is alleged that the acts or omissions of the insured harmed the *74plaintiff and that the insurer has contracted to pay such claims on behalf of the insured. In the case at bar, the cited rationale does not adequately answer the issue raised. Here the allegation is that the insurance company’s actions in handling the claim were in and of themselves actionable.1 Unless we are prepared to say that no affluent defendant, such as an insurance company, should ever be tried for alleged misdeeds because of a fear of improper jury action, we must reach the underlying issue raised by this case: Where liability upon a claim has been clearly established and the amount to be paid is not in dispute, may liability be predicated upon a wilful refusal to pay? I think that on the facts of the instant case liability can be predicated upon such a theory and that such an action can be brought along with the related claim against the insured2 or as an independent action.3
*75Underlying this dissent is the idea that courts should not countenance practices which rely upon imperfections in the mechanics of justice — herein, the cost of litigation itself — to work a clear injustice. Here a claim for a liquidated sum based upon facts which clearly impute negligence was presented by plaintiff. The First Insurance Company of Hawaii, Ltd., which interceded on behalf of its insured, had an adequate opportunity to ascertain whether the facts as stated by plaintiff were true and whether, under the established principles of tort law, a demand upon a legal claim had been made. The insurer repeatedly refused demand for payment, thus compelling plaintiff to file suit three days prior to the date upon which the statute of limitations would have barred an action on the claim. First Insurance Company of Hawaii, Ltd., knew or should have known at some time prior to initiation of suit that there was no colorable argument in law or fact to deny payment on the claim. For this court to allow First Insurance Company of Hawaii, Ltd., to argue that it truly did not know whether the claim was valid would be to allow this state regulated enterprise4 to practice a “studied ignorance to which [it] is not entitled.” See United States v. Turner, 396, U.S. 398, 418 (1970).
*76The allowing of recovery in the amount of attorneys’ fees would leave untouched the absolute right of a party to defend an action, even where such defense is patently frivolous. In the interest of maintaining a proper allocation of the burdens of litigation, I would reverse.
The majority omits from its description of the case.certain facts which I believe to be relevant to the nature of the claim asserted against the defendant insurance company. Suit was brought in the instant case three days prior to the running of the statute of limitations for actions based upon injury to persons or property. See HRS § 657-7. Prior to that time, demand for payment was repeatedly refused.
Again, the language of Appleman, supra, would seem to militate against joinder. The claims are related and should be joined in the interest of judicial economy. Clearly, there can be no prejudice to the insurer from supposed jury misconduct. If the underlying claim against the insured presents issues of law or fact which would entitle defendant to an evidentiary hearing, then, the cause of action, based upon wrongful refusal to pay would be effectively barred by the very fact that the underlying claim is one which necessitates a hearing. If plaintiff prevails on the underlying claim upon summary judgment, as in the instant case, there can be no prejudice of the sort in question, since the jury will not be considering the acts or omissions of a tortfeasor in light of the existence or nonexistence of insurance; the jury will be considering the alleged misconduct of the insurer.
The import of the majority opinion is to negate the possibility of treating plaintiff’s claim against the insurer as anything other than a claim ancillary to the claim for damages to the tractor and low-bed trailer. There is authority, however, to grant recovery for damages in the amount of attorneys’ fees even within the analytical framework set by the majority. In Yokochi v. Yoshimoto, 44 Haw. 297, 307, 353 P.2d 820, 826 (1960), while rejecting a claim for attorneys’ fees, we recognized the existence of “exceptions to the general rule.” In Von Holt v. Izumo Taisha Mission, 44 Haw. 147, 152, petition for rehearing granted, 44 Haw. 260, aff’d on rehearing, 44 Haw. 365, 355 P.2d 40, 44 (1960), *75we stated that “in a proper case, counsel fees could be considered as an element of punitive damages for the perpetration of a fraud. . . .” Earlier, in Glover v. Fong, 42 Haw. 560, 565 (1958), an action in the nature of mandamus to compel a city auditor to draw warrants for the payment of sewer construction claims, it was stated, “There is an exception to the general rule which allows the inclusion of counsel fee in the measure of damages where the facts are such as to authorize an award of punitive damages.”
HRS § 431-1 provides in part:
Compliance required. No person shall transact a business of insurance in this ’ State without complying with the applicable provisions of this chapter. . . .
HRS § 431-2 provides:
Public interest. The business of insurance is one affected by the public interest, requiring that all persons be actuated by good faith, abstain from deception, and practice honesty and equity in all insurance matters. Upon the insurer, the insured, and their representatives rests the duty of preserving inviolate the integrity of insurance.