Continental Casualty Co. v. Superior Court

Petitioner, Continental Casualty Company (Continental), seeks a writ of mandate compelling the trial court to vacate its order determining that Continental owed a duty to defend a particular lawsuit filed against its insureds, the real parties in interest, Paragon Homes, Inc., and related individuals and entities. Continental also seeks an order requiring the trial court to grant Continental’s motion for summary judgment on Paragon’s complaint against Continental for declaratory relief, breach of contract and breach of the implied covenant of good faith and fair dealing. These claims all arose out of Continental’s refusal to provide a defense to Paragon in certain litigation filed in 1994 against Paragon by FN Development Company (Alpha) and related entities.

As we review this record, it is clear that FN Development was a partner or joint venturer with Paragon in a number of development and construction projects and the FN Development action was brought against Paragon to resolve certain economic disputes then existing, to dissolve their several business relationships and to provide an accounting of their mutual affairs. One of the matters of financial dispute was the…