Facts

Defendant Moorefield Construction Inc. was sued for construction defects in the slab of a Visalia Best Buy Store. Plaintiff Navigator's Specialty Insurance Co.'s agreed to defend under a reservation of rights. Navigator's paid $1 million towards settlement, and then sued Moorefield for reimbursement. The court found in favor of Navigator's and ordered Moorefield to reimburse the $1 million Navigator's had paid towards settlement, plus costs. Moorefield appealed.

In a published decision, the court reversed in part and ordered a new trial limited to the issue of what portion of the $1 million settlement payment was allocable to damages, and what portion was allocable to supplementary payments. The appellate court ruled the trial court had erred in holding Moorefield had the burden of proof, but affirmed the trial court's decision that the portion of the settlement allocable to damages was not covered. It remanded the case for retrial.

PLAINTIFF'S CONTENTIONS: Navigators contended that none of the $1 million it paid towards settlement was covered under CGL policies issued to Moorefield.

DEFENDANT'S CONTENTIONS: Moorefield contended that all of the $1 million paid by Navigators towards settlement was covered under the CGL policies issued to Moorefield.

The court held there was no coverage for the damages sought against Navigator's, because Moorefield's liability did not arise from an occurrence, but rather from a conscious decision to disregard manufacturer's specifications for vapor emission testing.

Insurer

Navigator's Specialty.

Result

On retrial, the court ruled that Navigator's had failed to meet its burden of proof and entered judgment in Moorefield's favor.

Other Information

Navigator's paid $1 million to settle the underlying action. The case was first tried before the Hon. David Chaffee. The appellate case name was, Navigator's Specialty Insurance Company v. Moorefield Construction, Inc. (2016) 6 Cal.App.5th 1258.