BVRC Partner Ravi Sudan Obtains Summary Judgment on Insurance Bad Faith Case; Then He Defends the Summary Judgment On Appeal.
Cherokee Partners, LLC, et al. v. Clarendon National Insurance Company, et. al.
Venue: California - Orange County Superior Court, Central Justice Center
Results: Motion for Summary Judgment granted, Appeal affirmed
Type of Case: Bad Faith
Party Represented: Clarendon National Insurance Company, et al.
Plaintiff developer sued its insurer and insurance agent for bad faith, negligence and other causes of action arising out of the insurer's denial of coverage to plaintiff for a construction defect lawsuit. We represented the insurer. The trial court granted summary judgment for the insurer. The court of appeal affirmed noting that the trigger of coverage under the policy is damage within the policy period, not knowledge of defects, so the allegation of knowledge of defects does not raise the possibility of coverage. The court of appeal held that although "a bare 'potential' or 'possibility' of coverage [is] the trigger of a defense duty," "it is facts that count, not the possibility they may exist." Since the policy covers only property damage that first occurs during the policy period, and that was not alleged, there is no coverage. The court of appeal further held that the condominium exclusion also establishes there is no coverage.
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