Low
Low v. Golden Eagle Insurance
Opinion
Opinion
Lambden, J.
Claimants Leonard Armato (Armato) and Liz Stewart Development & Design, Inc. (LSD&D), successor in interest to insured general contractor Armato Development, Inc. (ADI), applied in these proceedings (Ins. Code, § 1032 et seq.) for an order to show cause (OSC) why insurer-in-conservation Golden Eagle Insurance Company (Golden Eagle) should not pay expenses they incurred in resolving a third party action brought against them for construction defects. Golden Eagle Insurance Corporation (GEIC), as third party claims administrator, appeals a judgment that grants the application in part. We reverse the grant of relief.
BACKGROUND
This case involves a Southern California lawsuit filed in September 1996 against Armato, LSD&D (ADI’s successor in interest) and others by two homeowners based on alleged construction defects in a residence ADI had built beginning in late 1990 and sold to the plaintiffs in January 1993 (Newcombe et al. v. Lott et al. (Super. Ct. L.A. County, 1996, No. SC 043 565) (the lawsuit or Newcombe lawsuit).
A commercial general liability (CGL) policy (No. CCP 17 25 74) was issued to ADI by Golden Eagle effective December 24, 1991 and was canceled effective…