 |
 |
to fill out a simple form to connect to Personal Injury Lawyers in your area.
|
|
|
|
|
Foster-Gardner Inc. v. National Union Fire Insurance Co.8/3/1998
er has a duty to defend when no third-party suit has been filed.
Furthermore, in AIU, we interpreted the phrase "legally obligated" to refer to relief ordered by a court of law. (AIU, supra, 51 Cal.3d at p. 824.) We stated that if the insured was not "legally obligated" to pay the relevant costs, the insurers had no duty to provide coverage under the policies. (Id. at p. 818 ["Only if all three conditions [were] fulfilled [would] the insurers' duty to provide coverage arise under the policies."]; cf. Montrose Chemical Corp. of Calif. v. Admiral Ins. Co. (1995) 10 Cal.4th 645, 692 [When insured receives PRP letter, "there is uncertainty about the imposition of liability and no `legal obligation to pay' yet established, [thus] there is an insurable risk" for which coverage may be purchased under a third party policy. (Italics omitted.)].)
Here, the policies likewise require the insurers to "pay on behalf of the insured all sums which the insured shall become legally obligated to pay as damages because of . . . bodily injury or . . . property damage." Thus, there is also coverage pursuant to this language only for those "damages" ordered by a court of law. The administrative activity for which Foster-Gardner asserts there is a duty to defend has occurred prior to a lawsuit ever being filed. In addition, to the extent the Order seeks prophylactic rather than remedial or mitigative measures, Foster-Gardner's reliance on AIU is in any event inapt. (AIU, supra, 51 Cal.3d at pp. 841, 843.)
Foster-Gardner asserts that we have recently held in Aerojet-General Corp. v. Transport Indemnity Co. (1997) 17 Cal.4th 38 that "environmental investigation expenses may constitute defense costs that the insurer must pay in fulfilling its duty to defend. . . . Since the Court held that an insurer has a duty to pay investigative costs pursuant to an administrative order, logic dictates that such administrative orders constitute `suits' triggering the Carriers' duty to defend."
Aerojet, however, did not involve the issue of an insurer's duty to defend its insured prior to a complaint being filed. Rather, the issue was "whether site investigation expenses . . . may constitute defense costs that the insurer must incur in fulfilling its duty to defend" or whether such costs were solely indemnification. (Aerojet-General Corp. v. Transport Indemnity Co., supra, 17 Cal.4th at p. 45.) The parties and all but one insurer stipulated that the insurers had or would pay Aerojet's defense costs, and "would litigate whether site investigation expenses were defense costs." (Id. at pp. 50-51.) Moreover, Aerojet had been sued in state and federal court by the State of California and the United States in three actions in 1979 and 1986. (Id. at p. 47.)
We concluded that "the insured's site investigation expenses constitute defense costs that the insurer must incur in fulfilling its duty to defend if, and only if, the following requirements are satisfied. First, the site investigation must be conducted within the temporal limits of the insurer's duty to defend, i.e., between tender of the defense and Conclusion of the action. Second, the site investigation must amount to a reasonable and necessary effort to avoid or at least minimize liability. Third and final, the site investigation expenses must be reasonable and necessary for that purpose." (Aerojet-General Corp. v. Transport Indemnity Co., supra, 17 Cal.4th at pp. 60-61, italics added.) "By contrast, if and to the extent that the site investigation is not conducted within the temporal limits of the insurer's duty to defend . . . the related site investigation expenses cannot even possibly be defense costs that the insurer must incur in fulfilling
Page 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 California Personal Injury Attorneys
Personal Injury Lawyers
|
| |
to fill out a simple form to connect to Personal Injury Lawyers in your area.
|
|