Opinion ID: 2035718
Heading Depth: 1
Heading Rank: 5

Heading: consolidation of fokken's and miller's cases

Text: The district court consolidated the appellees' cases against Coregis. Thereafter, Coregis filed an amended answer to garnishment interrogatories alleging the Policy did not provide coverage for the claims made by the appellees. The appellees then filed an amended application to determine Coregis' liability. All parties moved the district court for summary judgment. In its motion, Coregis asserted that it had no obligation to indemnify. Steichen because Steichen executed a policyholder release in favor of Coregis. Coregis asserted before the district court that in exchange for Coregis' agreement to relinquish its rights to defend, investigate, and negotiate with regard to Fokken's claim under the Policy, Steichen executed a policyholder release wherein Steichen and his law firm released Coregis from any and all liability based upon, arising out of, or relating in any manner to Fokken's lawsuit against Steichen. Coregis further asserted that it had no obligation to indemnify Steichen because exclusions A and L of the Policy precluded coverage for the judgments obtained by the appellees. Exclusion A of the Policy provides that the Policy does not apply to any CLAIM that results in a final adjudication against any INSURED that an INSURED has committed any criminal, dishonest, fraudulent or malicious acts, errors, omissions or PERSONAL INJURIES. Exclusion L of the Policy provides that the Policy does not apply to any CLAIM arising out of conversion, misappropriation or improper commingling of funds. The district court denied Coregis' motion for summary judgment, but granted the appellees' motion for summary judgment. The court found that exclusion A does not preclude coverage because the summary judgments entered against Steichen did not adjudge him to have committed criminal, dishonest, or fraudulent conduct. The court also found that Steichen's disbarment by this court was not dispositive. The district court explained that exclusion A applies to claims and that the definitions section of the Policy provides a separate definition for `disciplinary proceeding', which does not include any mention of the word `claim.' The court also found that exclusion L does not preclude coverage. The court explained that Coregis incorrectly argued the genesis of the appellees' malpractice claims against Steichen because he wrongly kept, or converted, the proceeds from settlements he failed to disclose to the appellees. The court instead found that the appellees' malpractice claims stemmed from Steichen's failing to communicate settlement offers and Steichen's agreeing to the dismissal of the appellees' claims after the statute of limitations had run without the appellees' knowledge. The court further found that the policyholder release is void as against public policy and unenforceable. The court stated that Coregis and Steichen contracted for legal malpractice insurance and that upon receipt of notice of Fokken's legal malpractice claim against Steichen, Coregis had a duty, not a right, to defend Steichen. The district court further stated that permitting Steichen to release Coregis after a claim had been filed and received by both parties is against public policy and unlawfully deprives Fokken of the ability to pursue financial redress against Steichen. The district court entered judgment in favor of Fokken and against Coregis in the amount of $50,058. The court entered judgment in favor of Miller and against Coregis in the amount of $325,058. The appellees filed a motion requesting the district court to enter a final order taxing costs, including a reasonable attorney fee, and computing the amount of interest owing on the underlying original judgments entered against Steichen, in order to determine the specific dollar amount of judgment against Coregis. On April 12, 2006, the district court entered an order in which it determined in part that the appellees are entitled to postjudgment interest from the date of the district court's January 25 judgment. The appellees filed a motion requesting the court to reconsider its calculation of the court's postjudgment interest. In an amended final order, the district court determined that the appellees are entitled to postjudgment interest from the dates of their original judgments against Steichen. For Fokken, that date is October 24, 2001, and for Miller, that date is June 28, 2001. The court awarded Fokken interest in the amount of $12,269.24 and Miller interest in the amount of $85,427.12. In addition, the court corrected the judgment amount entered in Miller's favor to $360,058. Coregis now appeals.