 |
(A version of this article appears in the California Construction
Law Reporter, published by the West Group.)
By James E. Acret
Santa
Susana was performing a contract to replace pipe culverts
for the County of Los Angeles when it caused damage to neighboring
property. Gulf was the surety on Santa Susana's performance
bond, and TIG was the carrier of its liability insurance.
When Santa Susana failed to repair the damage, the county
declared Santa Susana in default and called upon Gulf to
perform. Gulf then employed a contractor to repair the damage
and filed a claim, as subrogee, against TIG under the liability
policy. TIG rejected the claim, and Gulf filed suit for
breach of the insurance contract and also asserted a cause
of action for bad faith. The trial court sustained TIG's
demurrer to the bad faith cause of action and, after trial,
awarded Gulf a judgment of $43,593 against TIG.
Affirmed
in Gulf Insurance Co. v. TIG Insurance Co., ___ Cal.App.4th
___, ___ Cal.Rptr.2d ___, 2001 Daily Journal D.A.R. 747
(2001).
Gulf,
having satisfied Santa Susana's obligation, became subrogated
to its rights under the insurance policy issued by TIG.
However, Gulf could not pursue a bad faith claim against
TIG because TIG's alleged wrongful conduct did not result
in any injury to the insured. (The Court of Appeal also
affirmed the trial court's implied finding that Gulf had
given proper notice of the claim to Pinnacle Insurance Services,
which was properly held to be an agent of TIG.)
If you would like to receive legal reports and updates
more quickly, by e-mail, click here and fill out the mailing list form. If you would like to subscribe to our RSS feeds or learn more about RSS, click here.
For more information about books and other legal materials written by James Acret, click here and enter "Acret" in the site search engine.
©2001 ConstructionWebLinks, Inc.
|
