 |
 |
to fill out a simple form to connect to Personal Injury Lawyers in your area.
|
|
|
|
|
Schaefer/Karpf Productions v. CNA Insurance Companies6/18/1998
NOT ESTOPPED FROM LITIGATING THE COVERAGE ISSUE.
Schaefer initially argues CNA was estopped from denying coverage because the coverage issue was adjudicated against it in the underlying liability action between Schaefer, TVC and Matrix.
Under the policies issued to TVC and Matrix, CNA promised to "pay those sums that the insured becomes legally obligated to pay as damages because of . . . `property damage' to which this insurance applies." "Property damage" is defined as: "Physical injury to tangible property, including all resulting loss of use of that property; or loss of use of tangible property that is not physically injured." The judgment in the underlying action, drafted by Schaefer, contained a finding Schaefer's loss "result from physical injury to or the loss of use of tangible property, the videotapes of `The Best Christmas Pageant Ever.'" According to Schaefer the effect of the judgment in the underlying action is the same as if the court had found "Schaefer's loss resulted from `property damage' as defined in Section V, paragraph 12 of CNA's Commercial General Liability Coverage Form CG 1185." We reject this argument.
One of the prerequisites for collateral estoppel is the "`identity of the issue presented in the second action with one necessarily decided [actually litigated] in the first.'" (Ceresino v. Fire Ins. Exchange (1989) 215 Cal.App.3d 814, 820.) This requirement is not met here.
It is well-settled an insurer who is on notice of an action against its insured and refuses to defend on the ground the alleged claim is not within the policy coverage is bound by a judgment in the action, absent fraud or collusion, "as to all material findings of fact essential to the judgment of liability [and damages] of the insured." (Geddes & Smith, Inc. v. St. Paul Mercury Indemnity Co. (1959) 51 Cal.2d 558, 561 (Geddes I), (italics added); see also Clemmer v. Hartford Insurance Co. (1978) 22 Cal.3d 865, 884-886.) The insurer is not bound, however, as to issues "not necessarily adjudicated in the prior action and can still present any defenses not inconsistent with the judgment against the insured." (Geddes I, supra, 51 Cal.2d at pp. 561-562.)
Generally speaking, in an action by an injured party against the party who allegedly caused the injury the court does not adjudicate the issue of insurance coverage. The only questions litigated are the defendant's liability and the amount of damages. The plaintiff is not concerned with the theory of liability which produces victory; only with procuring the largest possible judgment. Similarly, the defendant is concerned only with avoiding, or at least minimizing, a judgment for the plaintiff. (Gray v. Zurich Insurance Co. (1966) 65 Cal.2d 263, 279.) Whether the plaintiff's loss is covered by the defendant's insurance is not germane to the action and evidence on that issue would be excluded as irrelevant. (See Law Rev. Com. Comment, Evid. Code ยง 1155.)
The present case is not an exception to the rule. It is clear from the record the issue of coverage under the CNA policies was not adjudicated in the underlying action.
In determining what issues were "actually litigated" in the underlying action the court in the subsequent action cannot rely exclusively on the findings in the underlying action but must "carefully scrutinize" the pleadings and proof. (Clark v. Lesher (1956) 46 Cal.2d 874, 880-881.) This scrutiny includes looking behind the findings at the evidence presented to determine what was actually decided. (See, e.g., County of L. A. v. Continental Corp. (1952) 113 Cal.App.2d 207, 218-219.) The party asserting collateral estoppel must prove the issue was raised, actually submi
Page 1 2 3 4 5 6 7 8 9 10 11 12 California Personal Injury Attorneys
Personal Injury Lawyers
|
| |
to fill out a simple form to connect to Personal Injury Lawyers in your area.
|
|