Wooddale Builders, Inc. v. Maryland Casualty Co.
Minnesota Supreme Court
722 N.W.2d 283 (2006)
- Written by Sheryl McGrath, JD
Facts
Several insurance companies issued insurance policies that indemnified Wooddale Builders, Inc. (Wooddale) (plaintiff). In addition to indemnification, the policies also covered the cost of defending Wooddale in lawsuits. Some of Wooddale’s customers filed a lawsuit against Wooddale for damages. Regarding indemnification, each insurance company was liable for a pro rata percentage of Wooddale’s liability, based on the length of time each company’s policy was in effect. Regarding defense costs, the insurance companies participated in Wooddale’s defense of the underlying lawsuit, apparently without an agreement among the companies as to how defense costs would be allocated. Later, some of the insurance companies argued that the defense costs should be allocated in the same way that indemnification was allocated. The district court rejected this argument and allocated defense costs equally among the insurance companies. The intermediate appellate court reversed and held that defense costs would be allocated according to the length of time each insurance company’s policy was in effect. Some of the insurance companies appealed the intermediate appellate court’s decision.
Rule of Law
Issue
Holding and Reasoning (Anderson, J.)
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