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The Collaborative Clearinghouse for Lawsuits and Other Claims Against ACE Group Insurance Companies

ACE PROPERTY AND CASUALTY INSURANCE COMPANY v. ONEBEACON AMERICA INSURANCE COMPANY et al

ATTENTION: It is possible that this information may no longer be current and therefore may be inaccurate. The index contains both open and closed cases and is not a complete list of cases in which an ACE Insurance Group company is involved. This information is provided to give interested persons an idea of the issues disputed in the indexed cases. For a full understanding of a case, one should read the rest of the court file, including the response. For the most up-to-date and complete information on a case, visit www.pacer.gov or contact the clerk of the relevant court.

Case Number: 
8:13-cv-00797 Search Pacer
Court Type: 
Federal
US District Court: 
Southern District of California
Date Filed: 
May 21 2013

"First Cause of Action in Subrogation for Breach of the Implied Covenant of Good Faith and Fair Dealing

23. Plaintiff ACE re-alleges and incorporates heron by reference the allegations of paragraphs 1-21, inclusive, of this Complaint.

24. Pursuant to the terms, conditions and implied obligation of its primary policy of insurance, including the implied convenient of good faith and fair dealing, it was OneBeacon's duty to among other things, properly manages and oversee the Herron Action; properly and thoroughly investigate Herron's claim against Nederlander; properly conduct settlement negotiations, and with respect thereto, settle within the OneBeacon policy limits if possible; priorly and accurately evaluate he issues of damages and liability to the Herron Action; properly and accurately apprise Nederlander and excess insurers, including Plaintiff ACCE, of Herron's settlement demands and negotiation isn connection wherewith; and properly and accurately evaluation settlement and settle he Herron aCtion where the was a substantial likelihood of a judgement for more than OneBeacon's policy limits.

25. Defendant OneBeacon breached its obligations and dues under the terms and conditions of its primary policy of insurance by failing to do all of the aforementioned in paragraph 20, above, among other things.

26. As the sole, direct and proximate result of OneBeacon's failure to fulfill its contractual and implied obligations to Nederlander as previously alleged, OneBeacon unreasonably failed and refused to settle or even attempt to settle the case at the limits of its primary policy, although Herron made a policy limits demand to settle the Herron Action, although evidence presented and rulings made during trial increased the already substantial likelihood of an excess verdict and although ACE demanded such a settlement by OneBeacon.  Despite the evidence that would have led a reasonable insurer to conclude that the reasonable settlement value of the case was more than $1 million, and that likely erasable verdict was well in excess of $1 million, OneBeacon unreasonably failed to accept the policy limits demand and failed and refused to settle or even attempt to settle at the limits of the policy.  As a direct result of its breach of the implied convenient of good faith and fair dealing, OneBeacon has caused harm and damage to Nederlander by allowing a judgment in excess of the OneBeacon policy limits to be rendered against Nederlander.

27. Under the principles of equitable subrogation, as well as the contractual subrogation provision in the ACE policy, Plaintiff ACE stands in the shoes of its insured and is surrogated to Nederlander's right under the OneBeacon primary policy and thus ACE has the right to assert any and all rightist that Nederlander has thereunder against OneBeacon for breach of its contractual and good faith obligations to Nederlander in the underlying Herron Action. Accordingly, ACE, as the subrogee of Nederlander is entitled to recover from OneBeacon policy, along with any prejudgement interest throne an costs.

28.  The damages incurred by Nederlander, and paid by Plaintiff ACE, would have been avoided if Defendant OneBeacon had properly and reasonably fulfilled its obligations under the covenant of good faith and fair dealing to settle the case within the policy limits.  It is thus inequitable and unjust for ACE, and not OneBeacon, to suffer said harm and damages.

29. Plaintiff ACE has demanded that Defendant OneBeacon pay all amounts ACE paid in excess of the available limits of the OneBeacon policy, along with any pre-judgment interest thereon and costs.  Defendant OneBeacon has failed and refused to pay any of said sums to ACE. "

The provided text is an excerpt from a document filed in this case. For a full understanding of the case, one should read the complete court file, including the response.

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