CONSTRUCTION DEFECT JOURNAL

"News and Information for Construction Defect and Claims Professionals"

CONSTRUCTION DEFECT JOURNAL - ISSUE 242749 - THURSDAY, JANUARY 16, 2025

After Breaching Its Duty to Defend, Insurer Must Pay Market Rates for Defense Counsel

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Edison was sued in numerous lawsuits for property damage caused by the Bobcat wildfire in the Angeles National Forest.

October 30, 2023
Tred R. Eyerly - Insurance Law Hawaii

After breaching its duty to defend, the insurer could not take advantage of a California statute allowing insurers to establish rates for defense counsel. S. Cal. Edison Co. v. Greenwich Ins. Co., 2023 U.S. Dist. LEXIS 151695 (C.D. Cal. July 28, 2023).

Edison was an additional insured under a policy issued by Greenwich Insurance Company to Utility Tree Service, Inc. (UTS). UTS contracted with Edison to provide vegetation management services near Edison's transmission lines. The Greenwich policy provided additional insured coverage to third parties to the extent of UTS's obligations under the contract.

Edison was sued in numerous lawsuits for property damage caused by the Bobcat wildfire in the Angeles National Forest (Bobcat Wildfire lawsuits). Edison tendered the defense in each lawsuit to Greenwich. Coverage was denied, however, based on a lack of underlying allegations or extrinsic evidence that Edison's liability resulted from UTS's negligent actions.

Mr. Eyerly may be contacted at te@hawaiilawyer.com


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