 |
 |
to fill out a simple form to connect to Personal Injury Lawyers in your area.
|
|
|
|
|
Sawyer v. Westchester Fire Insurance Company11/20/2002
R>
Thus, we find that the trial court did not err in concluding that the stipulated judgment was unreasonable as a matter of law and that appellants were not entitled to the evidentiary presumption of liability.
Appellants' judgment was not covered by the St. Paul policy
Because the judgment against the State was not based on a default or uncontested trial subject to judicial review, appellants were required to prove that the judgment was covered by the policy in order to enforce it against St. Paul. "We necessarily acknowledge that plaintiff's ultimate recovery against the insurers will depend upon it being established that there was coverage and that the insurers, or at least some of them, were obligated to indemnify [the insured] under their respective policies." (Pruyn, supra, 36 Cal.App.4th at p. 514.) Where the issues upon which coverage depends were not raised or necessarily adjudicated in the underlying action, the insurer is free to litigate those issues in the subsequent action and present any defense not inconsistent with the judgment against its insured. (Hogan v. Midland National Ins. Co. (1970) 3 Cal.3d 553, 564-565; Pruyn, at p. 514, fn. 15.) "If, in that subsequent action, it is determined that there was no coverage, then the measure of damages for a wrongful failure to defend would be limited to the costs and attorney fees expended by the insured in defending the underlying action." (Pruyn, at p. 514, fn.15; Amato v. Mercury Casualty Co. (1993) 18 Cal.App.4th 1784, 1793-1794.) Thus, under either their direct action against St. Paul under Insurance Code section 11580 or their actions as assignees of the State for breach of contract and bad faith for failing to defend and indemnify, appellants were required to prove that the policy provided coverage for the judgment against the State. (Zahn v. Canadian Indemnity Co. (1976) 57 Cal.App.3d 509, 513 [direct action]; Love v. Fire Ins. Exchange (1990) 221 Cal.App.3d 1136, 1151-1153 [bad faith].) Appellants' failed to do so.
It is clear that coverage under the additional insured endorsement was not litigated in the underlying actions. Under the endorsement, the State is covered for bodily injury only if it arises out of operations performed by MCM for the State, or out of the State's acts or omissions in supervising MCM's operations. If a claim falls within the insuring agreement, it is still excluded from coverage if the bodily injury arises out of the "sole negligence" of the State, or any act or omission by the State other than its supervision of MCM's work (exclusion (c)). Furthermore, any bodily injury is excluded if it arises out of the State's preparation or approval of plans or specifications (exclusion (h)).
The trial court found that MCM's act of disconnecting the lights arguably was an "operation" of MCM performed for or on behalf of the State since it was pursuant to its contract with the State and therefore a "covered operation." The trial court went on to state: "Regardless, this court concludes that the holding of the Court of Appeal establishes that the State was `solely negligent' (vis-a-vis MCM) and, therefore, any judgment for this negligence against the State is barred as a matter of law by exclusion (c) of the additional insured endorsement . . . ." As discussed above, the summary judgment in favor of MCM, affirmed on appeal, determined as a matter of law that MCM had no liability for the lack of lighting at the accident site. Thus, as between the State and MCM, the State was "solely negligent." Appellants contend that the trial court misinterpreted the policy language. They argue that a layperson would understand the phrase "sole negligence" to mean that if anyone other than the insure
Page 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 California Personal Injury Attorneys
Personal Injury Lawyers
|
| |
to fill out a simple form to connect to Personal Injury Lawyers in your area.
|
|