James K. Burns Patricia Ross Walter H. Ratcliff v. International Insurance Co. Crum & Forster

Plaintiffs, officers and directors of Centennial Savings and Loan Association, were sued in state and federal court for alleged professional misconduct. Defendants, International Insurance Company and Crum and Forster, refused to cover plaintiffs in these actions under a professional liability policy between them. In the present action, plaintiffs sought a judgment declaring that defendants owed them coverage under the policy. The district court granted summary judgment in favor of defendants. We affirm.

I

Plaintiffs James K. Burns, Patricia Ross, and Walter H. Ratcliff are former officers and directors of Centennial Savings and Loan Association (“Centennial”), a now bankrupt California corporation. Defendant International Insurance Company (“International”) is an Illinois insurance corporation. Defendant Crum and Forster is an underwriting corporation, not a party to this appeal.

Plaintiffs purchased professional liability insurance from International for the period March 3, 1982 through March 3, 1985. Under this agreement the insurer agreed to pay, up to the policy limits,

This policy provides that the insurer’s duties arise

This notice provision is a “condition precedent…