Fire Insurance Exchange v. American States Insurance

American States Insurance Company (American States) appeals from a judgment ordering it to pay $487,500 on an action for equitable contribution. The trial court ruled that American States and another excess carrier, Truck Insurance Exchange (Truck), were co-insurers and share equally in the excess cost of settling a personal injury action brought against their insureds. We affirm. Substantial evidence supports the trial court’s finding that the cost of settlement should be equally prorated because the excess policies provided overlapping coverage and insured against the same risk.

Facts

In 1986 Azam Sher and his wife, Cynthia Yelvington, wanted to construct a home at 34 Appaloosa Lane in Bell Canyon. Alam Sher, Azam’s father, a licensed general contractor in Oregon, moved to California, lived with Azam and Yelvington, and supervised construction of the new home.

On June 9, 1988, Russell Gebhardt was seriously injured when a wood scaffold collapsed at the jobsite. The scaffold, which was 12 feet high, had no handrails and was too narrow. Deitrick & Quin, Gebhardt’s employer, built the scaffold with wood purchased by Alam. Alam hired Deitrick & Quin to do the framing…