Robert McMullan & Son, Inc. v. United States Fidelity & Guaranty Co.

The single issue presented by the Robert McMullan & Son, Inc.’s (McMullan’s) appeal is the propriety of the trial court’s refusal to award McMullan attorney fees in this declaratory relief action successfully brought by McMullan against its insurance carrier, United States Fidelity and Guaranty Company (Fidelity), a Maryland corporation, by reason of the insurer’s wrongful withdrawal from the defense of an action brought against McMullan in the State of Florida.

Facts

Robert McMullan & Son, Inc., is a California corporation. It purchased a comprehensive general liability insurance policy from Fidelity in 1972 and again in 1976. The insurance contracts were purchased, issued and delivered in San Diego from insurance brokers in San Diego who, as authorized agents of Fidelity, countersigned the policies at time of issuance. McMullan by subcontract agreed to perform painting work in various structures at Sea World, Orlando, Florida. At McMullan’s request, Fidelity executed and provided certificates of insurance showing coverage for McMullan’s work at the Florida project. Based upon an audit of the McMullan business activities, McMullan paid Fidelity a premium for the…