Camelot by Bay Condominium Owners' Ass'n v. Scottsdale Insurance

Scottsdale Insurance Company (Scottsdale) appeals a judgment for damages and attorney fees and costs in the amount of $626,513.74 entered against it after court trial in an action by Camelot by the Bay Condominium Owners’ Association, Inc. (Camelot). Camelot brought this action for damages for breach of the covenant of good faith and fair dealing as assignee of a policyholder of Scottsdale, the developer of Camelot’s premises, Breihan Development, Inc. (Breihan). Camelot cross-appeals the judgment insofar as it represents a reduction by 30 percent of the damages awarded in Camelot’s favor, representing Breihan’s comparative fault. All of these claims arise out of an underlying action between Camelot and Breihan for construction defects (Camelot by the Bay v. Breihan Development, Inc. (Super. Ct. San Diego County, 1989, No. 610814), the underlying action), in which Breihan agreed with Camelot to have a stipulated judgment in the amount of $675,000 entered against it in exchange for a covenant not to execute, coupled with an assignment of Breihan’s rights against Scottsdale to Camelot.

On appeal, Scottsdale first makes a group of related arguments that it did not breach…