Continental Casualty Co. v. Rohr, Inc.

Excerpt

The plaintiff insurance companies sought a declaratory judgment to deter- mine the rights and obligations of the parties under certain policies that the plaintiffs and certain of the defendant insurance companies had issued to the defendant manufacturer R Co. with respect to underlying lawsuits against R Co. concerning environmental contamination at vari- ous locations, principally in California, dating back to the 1940s. The plaintiffs sought a judgment declaring that they had no duty to defend or to indemnify R Co. in connection with the underlying claims and that, if the trial court found that they were obligated to defend or to indemnify R Co., they were entitled to contribution from the defendant primary, umbrella and excess insurers. The plaintiff insurance compa- nies included C Co., L Co., and certain London market insurers. The defendants included secondary insurers E Co., S Co., F Co., T Co. and U Co., which had issued certain excess policies to R Co. between 1982 and 1986. Prior to this litigation, the substantive issues of which are governed by California law, R Co. settled certain of its coverage claims with the defendant A Co., the successor in interest to I Co., which had issued to R Co. two primary policies that were in effect between 1959 and 1971. The plaintiffs, which had issued policies to R Co. that were in excess to the 1959–1971 policies, claimed that R Co. had settled with A Co. for less than the total amount of coverage under the 1959–1971 I Co. policies and, thus, R Co. did not fully exhaust its coverage under those policies. The trial court stayed the plaintiffs' contribution claims and bifurcated the proceedings, the first phase of which was limited to the question of when the obligations, if any, of the excess insurers arose in light of the limits of the underlying primary policy or policies. Thereafter, C Co. and several other plaintiffs filed a motion for partial summary judgment in which they claimed that the I Co. primary policies fi