Zurich American Ins. v. AIU Ins. CA1/2
Opinion
Opinion
Haerle, J.
I. INTRODUCTION
This appeal arises out of a protracted dispute regarding liability and insurance coverage for property damage to an office building caused by a construction defect. In this round of litigation, Zurich American Insurance Company (Zurich) sought equitable indemnity and subrogation from AIU Insurance Company (AIU) for a $900,000 payment that Zurich made to settle claims against the parties’ mutual insured, Frederick Meiswinkel Co., Inc. (FMI). Zurich also sought equitable contribution from Lexington Insurance Company (Lexington) for a portion of the defense costs it paid in the underlying property damage case against FMI. After a non-jury trial, the superior court found that AIU was not liable for the settlement payment that Zurich paid on behalf of FMI because the claims against FMI in the underlying action were excluded from coverage under an AIU policy exclusion for
1 damages caused by FMI’s work. The court also found, however, that Lexington failed to pay its share of the defense costs of the underlying lawsuit against FMI and that it owed that amount to Zurich. Both Zurich and Lexington filed appeals. We affirm.