Confidential
Settlement – $289,786Judge
Court
L.A. Superior Central
Attorneys
Plaintiff
Mark B. Wilson
(Klein & Wilson)
Defendant
Martin E. Rosen
(Hinshaw & Culbertson LLP)
Maryann R. Marzano
(Gradstein & Marzano PC)
Mario M. De La Rosa
(Law Office of Mario M. De La Rosa)
Facts
A Los Angeles oil company awarded a contract to plaintiff, a general contractor (the contractor), to construct a building. In October 1995, the contractor entered into a subcontract with a subcontractor to install a holding tank, fuel system and vapor piping system at the project site. Under the subcontract, the subcontractor was required to have insurance covering itself, the contractor, the oil company and to insure that each of the sub-subcontractors had insurance naming the contractor and the oil company as additional insureds. During the construction project, the subcontractor and the sub-subcontractors damaged a fuel system with a backhoe. The contractor filed a claim against the subcontractor and its insurance carrier. The contractor believed he was an additional insured under the subcontractor's policy based on the certificates provided by the subcontractor's broker. The subcontractor's insurance company denied the claim based on its position that the contractor was not an additional insured under its policy. It alleged the insurance broker had no authority to write the coverage as set forth in the certificates of insurance and the subcontractor lied on its application. The insurance company rescinded its insurance policy issued to the subcontractor. The insurance carrier for the contractor also denied the coverage.
Settlement Discussions
The court later entered judgment against the insurance broker for $165,327 in damages, $46,562 in interest, $1,500 in sanctions and $396 in costs. The contractor's total recovery was $289,786.
Damages
The contractor incurred $177,000 in damages caused by the subcontractors. The contractor recovered damages in excess of this amount because it received payments from its insurance carriers and the other defendants were not entitled to set off those amount pursuant to the collateral source rule.
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