Facts

Plaintiff and cross-defendant Neighborhood Spirit Property & Casualty Co. (Neighborhood Spirit) issued defendant and cross-complainant Billy Brown an insurance policy covering property in Oakland, California. On July 9, 2004, Charles Banks sued Brown, alleging that he sustained injuries while cutting grass on Brown's property in the scope of his employment with Brown. In 2006, the jury awarded Banks $281,132 against Brown with $26,636 in costs. On Oct. 23, 2007, a satisfaction of judgment specified that Brown paid Banks $265,000 to resolve the action. On June 27, Brown tendered the defense of the action to Neighborhood Spirit and sought indemnity. According to Brown, he informed defendant and cross-defendant insurance broker Paul Britto of the incident soon after it happened, but Britto told him that coverage did not exist for the incident. According to Neighborhood Spirit, Brown first informed it of the incident on June 27, 2007. Thus, Neighborhood Spirit rejected Brown's claim for indemnification and sought declaratory relief against Brown and Britto, as well as equitable contribution, equitable indemnity, and contractual indemnity against Britto. Brown filed a cross-claim against Neighborhood Spirit, Britto, and his counsel in the Banks action, Frank Ennix and Byron Thompson.

PLAINTIFF'S CONTENTIONS:
Neighborhood Spirit asserted that it was not responsible for providing Brown coverage.

DEFENDANT/CROSS-CLAIMANT'S CONTENTIONS:
Brown argued that he did notify Britto of the incident in July 2003 while Britto claimed that he did not receive notice until June 2007. Brown also contended that his counsel should have verified whether he did in fact have insurance coverage.

Result

Brown settled with Neighborhood Spirit, Thompson and Ennix prior to trial. The trial was limited to Brown's cross-action against Britto. The jury found in favor of Brown and against Britto, awarding Brown $290,430 in satisfaction of the Banks judgment, $5,159 for attorney fees Brown paid to Thompson, and $25,360 for attorney fees Brown paid to Ennix plus prejudgment interest and costs. The jury concluded that Banks was not Brown's employee, that Britto was 80 percent liable for Brown's harm on Brown's professional negligence claim, that Britto negligently misrepresented to Brown the lack of coverage, and that Britto breached his fiduciary duty to Brown. After taking settlements by other defendants into account totaling $35,000, Brown obtained a judgment against Britto in the amount of $333,727 (including prejudgment interest amounting to $36,093 and costs amounting to $11,685).

Other Information

FILING DATE: Aug. 31, 2007