UNIGARD

This is an allocation or apportionment case among insurers. Several insurers issued policies allegedly covering pollution-related damages sought in an underlying case, but only one defended. The defending insurer now seeks equitable contribution to defense costs from the nondefending insurers. The issue presented, however, is not what amounts the nondefending insurers should contribute, but instead whether they should contribute at all. The nondefending insurers contend that they have no duty to contribute to defense costs on the theory that they had no duty to defend the insured in the underlying case. The nondefending insurers contend that they were in possession of evidence extrinsic to the complaint in the underlying case, and that this extrinsic evidence established that the damages sought in the underlying case were all excluded from coverage. Thus although this is an allocation or apportionment case among insurers, the issue on appeal is the preliminary issue of duty to defend. The trial court found that the nondefending insurers had no duty to defend, and granted judgment in their favor. The defending insurer now appeals.

Each insurer’s duty to defend must be…