Opinion ID: 2515119
Heading Depth: 4
Heading Rank: 2

Heading: The real dispute is between Glynwood and its insurance carrier.

Text: Glynwood's arguments for prevailing party status and discovery sanctions are based on its refusal to acknowledge the settlement agreement between its insurer and the tenants. The real dispute in this case is between Glynwood and its insurer as to the coverage guaranteed by its policy. The record on appeal reveals that Glynwood knew or should have known of the settlement between the tenants and its insurer at least two weeks before it moved to compel discovery: a filing by the tenants' attorney on January 17, 2007, informed the court that a global settlement had been negotiated with Glynwood's insurer on December 26, 2006. Yet a filing by Glynwood dated January 24, 2007, included an affidavit from Glynwood's counsel stating: I have not had any settlement discussions with Plaintiffs or their attorneys. My clients have not agreed to any settlement of this case. A week later Glynwood filed its order seeking a motion to compel discovery and sanctions. When asked about the settlement at the May 16, 2007 hearing, Glynwood's attorney answered, I don't know that the insurer has paid or agreed to pay anything other than what I see in the pleadings. Glynwood's attorney also twice referred to a secret agreement between its insurer and the tenants. The tenants, in turn, claimed that Glynwood's attorney was made aware of the settlement agreement, yet refused to agree to the dismissal of the case even though it would have absolved his clients from any liability. At the hearing, the tenants' attorney stated, as far as what we've heard from the insurance adjuster, they were in constant communication with Glynwood's attorney during the settlement process. We have not been provided with a copy of the settlement agreement. But the transcript of the hearing before the superior court indicates the tenants' attorney provided the court and Glynwood's attorney with copies of the settlement checks made payable to each of the tenants individually. It is thus puzzling that Glynwood continues to refer to the tenants' settlement as if it did not actually occur. [25] The real dispute in this case is between Glynwood and its insurer. Under most liability insurance policies, the insured relinquishes to the insurer its right to settle claims and its right to control the litigation during the post-injury to pre-judgment period. [26] As the superior court remarked, usually an insurance contract says that an insurance company retains the right to control the litigation and the insureds have an obligation to cooperate with the insurance company. There is no copy of Glynwood's insurance contract in the trial record. Glynwood's insurer has settled with the tenants and fully indemnified Glynwood as to all the allegations in the tenants' complaint. Yet Glynwood maintains it has been abandoned by its insurer and has been forced to bear the costs of litigation. Glynwood put forth this argument at the May 16, 2007 hearing, arguing that this abandonment constitutes a breach of the insurance contract and that, as a consequence, its insurer has no right to settle on its behalf. But as the superior court recognized, the questions whether the insurance contract gave the insurance company the right to settle without the insured's consent and whether Glynwood was abandoned by its insurer were not capable of resolution within the context of the tenants' lawsuit: I hear the argument, but it's not a fact that I'm finding or I'm able to find today. As the trial court recognized, those issues can be fully litigated in a separate case between Glynwood and its insurer.