California Union Insurance v. Poppy Ridge Partners

After a trial by the court sitting without a jury, California Union Insurance Company, Inc., and Allianz Underwriters, Inc., (collectively, Cal Union) appeal an adverse judgment in their action to recover approximately $720,000 paid under a reservation of rights to Cal Union’s insured, Poppy Ridge Partners (Partners), a partnership engaged in a co-generation project producing electricity from natural gas fueled generators. The $720,000 was paid after a gas well failure which was the risk against which Cal Union had issued two identical policies of insurance.

Partners cross-appeals from a portion of the judgment awarding Cal Union salvage value in the amount of $220,000 pursuant to a provision in the insurance contract.

Cal Union contends no evidence exists to support the trial court’s decision that Partners did not fail to disclose conditions which affected the risk; the court erred prejudicially in failing to find on several material issues; the judgment in its favor against Partners should include the individual members of the partnership; and the court erred in limiting the testimony of Cal Union’s expert. Finding no merit in these contentions, we affirm the judgment…