Black Diamond Asphalt, Inc. v. Superior Court

Jesus Garcia Adames, the owner of a truck, leased two trailers from Black Diamond Asphalt, Inc. (Black Diamond), a material supplier and trucking company, and contracted with Black Diamond to transport freight for the company. The contracts required Adames to maintain liability insurance naming Black Diamond as an additional insured, and to indemnify and hold it harmless for any liability arising out of Adames’s performance of the contracts.

While hauling freight for Black Diamond, Adames was involved in an accident that killed one person and injured another. After the accident, Adames’s liability insurer was declared insolvent, and the California Insurance Guarantee Association (CIGA) undertook the insurer’s obligations. (Ins. Code, § 1063 et seq.; further section references are to the Insurance Code unless otherwise specified.)

A personal injury and wrongful death action ensued, alleging Black Diamond was Adames’s employer and was responsible for his torts under the doctrine of respondeat superior. Black Diamond, which was self-insured for the costs of defense and the first $1 million in damages, filed a cross-complaint against Adames for indemnity. However, when CIGA…