Rice

dissenting.

I respectfully dissent. In my view, the California Supreme Court should and *644 would reach a result different from the Court of Appeal’s decision in Presley Homes, Inc. v. American States Insurance Co.

Presley Homes strikes me as an outlier. It held that “public policy” compels an insurer to provide a full defense to an entire action upon tender by an additional insured, regardless of the terms of the parties’ insurance contract, the parties’ reasonable expectations, or whether any premiums had been paid. Presley Homes extends Buss v. Superior Court 2 beyond its limits in reaching this result. Buss held that an insurer has a broad duty to defend a mixed action tendered by a named insured on a commercial general liability insurance policy.2 3 This obligation to defend, imposed by Buss as a matter of policy, stems from “the fact that the insurer has been paid premiums by the insured for a defense.” 4 It is one thing to broaden the duty to defend a named insured that pays the premium, but quite another, logically and practically, to broaden the duty for an additional insured. The practical effect of Presley Homes is to saddle subs with the expense of defending the…

MEMORANDUM *

In this breach of contract action, Fred Rice and Suntree Company, developers of and general contractors for the Los Cabos project in Santa Maria, California, appeal the district court’s grant of summary adjudication and entry of judgment in favor of Safeco Property & Casualty Insurance Company (“Safeco”) and American States Insurance Company (“American States”), as well as the court’s denial of their motion for reconsideration.

This action arises from the failure of Safeco and American States to defend an underlying construction defect action, *643 Abram v. Suntree Co., No. SM 109471 (Cal.Super. Ct. filed Aug. 11, 1998), in which Rice and Suntree were sued for the allegedly defective work of numerous subcontractors who had named them as “additional insureds.” Safeco and American States insured only ten of these subcontractors and asserted in the district court that their duty to defend Rice and Suntree was limited solely to the activities of the ten subcontractors that they insured. The district court agreed and determined that Rice and Suntree were not entitled to a complete defense because the coverage due from Safeco and American States extended only to the work…