Summaries of the principles of the duty to defend lawsuits often note that the merits of the underlying action are irrelevant. The duty extends even to seemingly frivolous claims if they could potentially result in covered liability. Example: a cause of action barred on its face by the statute of limitations would still trigger a defense if it otherwise might be covered. In that case, the insured still would be required to appear and raise the affirmative defense to secure a dismissal. Accordingly, an insurer could not deny a defense on the ground that its investigation shows the plaintiff could not prove up the claim asserted.Continue Reading
The following insurance issues are likely to be decided in 2016 by the California Supreme Court and the United States Court of Appeals for the Ninth Circuit.
Brandt Fees: In Nickerson v. Stonebridge Life Ins. Co., Case No. S213873, the California Supreme Court is considering the following issue: Is an award of attorney fees under Brandt v. Superior Court (1985) 37 Cal.3d 813 properly included as compensatory damages for purposes of calculating the ratio between punitive and compensatory damages where the fees are awarded by the jury, but excluded from compensatory damages when they are awarded by the trial court after the jury has rendered its verdict?Continue Reading