Arrowood Indemnity Co. v. Travelers Indemnity Co. of Connecticut

Two insurers issued commercial general liability (CGL) policies to the same insured in different years. Several years later, the insured, a general contractor, was sued for negligence allegedly committed during the second policy period, and it tendered its defense to the second insurer. The second insurer learned during discovery that the insured also had done work for plaintiff during the first policy period, and it asked the first insurer to participate in the defense. The first insurer did so. However, after the jury returned a verdict against the insured, the first insurer refused to indemnify the insured, asserting that the jury had found negligence only during the second policy period. The second insurer indemnified the insured and then sued the first insurer for equitable contribution. It lost after a bench trial, and this appeal followed.

We conclude that the jury's verdict against the insured did not clearly indicate whether the jury found negligence during the first policy period, the second policy period, or both. We thus address the following issue of first impression: Which insurer bears the burden of proving the existence (or nonexistence) of coverage…