Commercial Capital Bankcorp, Inc. v. St. Paul Mercury Insurance

PROCEEDINGS: (IN CHAMBERS) ORDER DENYING PLAINTIFF’S MOTION FOR SUMMARY JUDGMENT (filed 11/21/05)

Plaintiff, the insured on a directors’ and officers’ and company liability insurance policy issued by Defendant, moves for summary judgment in its favor on the issue of whether Defendant owes a duty to advance on a current basis 100 percent of the reasonable attorneys’ fees and costs Plaintiff becomes obligated to pay in defending itself, its subsidiary, and several officers and employees in a currently-ongoing lawsuit. Because Defendant has no contractual or other duty to advance those fees and costs on a current basis, Plaintiffs motion is DENIED.

A. Background

1. The Policy

Defendant St. Paul Mercury Insurance Company issued Plaintiff a directors’ and officers’ and company liability policy (the “St. Paul Policy”), with a policy period of June 4, 2005 to June 4, 2006. (Plaintiffs Exh. A.) The policy has a $20,000,000 limit of liability, and provides for a retention amount of either $500,000 or $250,000 depending on the type of underlying claim for which liability coverage is sought and the applicable insuring agreement. The policy further provides in relevant part:

“Insured…