Argonaut Insurance v. Colonial Insurance

Colonial Insurance Company (hereinafter Colonial) and Fireman’s Fund American Insurance Company (hereinafter Fireman’s) have appealed from a judgment declaring their rights and obligations, and those of Argonaut Insurance Company (hereinafter Argonaut) under certain contracts of insurance in connection with a personal injury action brought against Willamette-Western Corporation (hereinafter Willamette).

The case was submitted to the trial court upon the following agreed facts:

The record also establishes that Argonaut was tendered the defense of the Graham suit, and undertook that defense under a reservation of its rights. Thereafter, Argonaut commenced an action against Colonial and Fireman’s, seeking a declaration of the respective rights and obligations of the three insurers whose policies provided concurrent coverage for the accident. The Graham lawsuit subsequently was settled and dismissed without prejudice to and reserving all rights of the respective parties to this appeal. A total of $71,000 was paid to Graham, and it is the allocation of this loss and the cost of the defense of the Graham action which is at issue here.

At the time of the injury in question,…