Continental Casualty Co. v. Argonaut Ins. Co.

“The insurer’s duty to defend is determined by comparing the complaint to the insurance policy”, West Hills Development Co. v. Chartis Claims, 360 Or 650, 653 (2016), and “the construction of the insurance policy requires ascertaining the parties’ intent”, which is revealed by the terms and conditions”. Groshong v. Mutual of Enumclaw Ins. Co., 329 Or 303 (1999).

Appellant appealed an order for summary judgement in favor of Respondent. Appellant assigned error to the trial court for holding that they were subject to a contribution claim from Respondent. On appeal, Appellant argued that there should be no allocation of any portion of defense costs because their policies were to provide excess coverage, not primary, and that before their coverage could be triggered, there must be an exhaustion of all policies held by the insured. Respondent responded that Appellant’s defense endorsement was triggered if the underlying insurance was not available to pay damages on the claim. “The insurer’s duty to defend is determined by comparing the complaint to the insurance policy”, West Hills Development Co. v. Chartis Claims, 360 Or 650, 653 (2016), and “the construction of the insurance policy requires ascertaining the parties’ intent, revealed by the terms and conditions”. Groshong v. Mutual of Enumclaw Ins. Co., 329 Or 303 (1999). The Court found that Appellant’s construction of the defense endorsement was correct. The Court reasoned that the endorsement was only triggered when the underlying insurance and other policy limits were exhausted because it gave the defense endorsement a meaning that did not conflict and was consistent with other provisions of the policy. Therefore, the trial court did err in concluding that Respondent was entitled to seek contribution from Appellant. Reversed and Remanded.