Confidential
Settlement – $2,000,000Facts
A parcel of oceanfront real estate in Malibu was subdivided into four parcels. The owner kept two bluff parcels overlooking the ocean and sold the two beach-front properties to two families, including the cross-complainants. The only beach access right legally preserved by the owner was a five-foot-wide pedestrian beach access. The cross-defendant title company / insurers insured the cross-complainants' title to their property. In 1976, the owner sold the other bluff property to the plaintiffs. The cross-complainants claimed that the defendant insurers erroneously insured that the plaintiffs would have a driveway easement down the cross-complainants' driveway. In 1986, the cross-complainants installed a driveway gate that blocked auto access to a parking area at the beach. The plaintiffs demanded a key to the gate, which was refused by the cross-complainants. The plaintiffs tendered a claim to the the insurers. The insurers tried to buy the easement from the cross-complainants, who refused to sell. The insurance company tried to pay the plaintiffs to compensate them for their mistake, but the plaintiffs refused money. The insurers then paid for the costs of a lawsuit brought by the plaintiffs against the cross-complainants. The cross-complainants tendered the defense to the insurers, which refused to provide a defense. The cross-complainants cross-complained against the insurers for bad faith, while paying for their own defense. Eventually, the cross-complainants prevailed in the quiet title case, and in April 1995 they sued the insurers for malicious prosecution in a separate action. Per the cross-defendants, the court refused to consolidate the malicious prosecution case with the insurance bad faith case.
Settlement Discussions
Various settlement demands and offers were exchanged.
Damages
The plaintiffs sought damages for emotional distress, for reimbursement of $60,000 in defense costs before the insurers accepted the tender of the defense and repaid this amount, and an additional $30,000 in attorney's fees to quiet title.
Injuries
The plaintiffs alleged they suffered emotional distress.
Other Information
The settlement was reached approximately six years and five months after the case was filed. A settlement conference was held on Oct. 9, 1996 before Judge Owen Kwong of L.A. Superior Court resulting in the reported settlement. Per the cross-defendants, the settlement was reached after the original $1.4 million jury verdict agaisnt the insurers in the insurance bad faith case was vacated and a new trial date was set. Per the cross-defendants, they agreed to pay the cross-complainants $1.95 million in exchange for a complete release of all claims and a dismissal of both the insurance bad faith and the malicious prosecution actions.
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