Court Opinion

ID: 4101359
Source: CourtListenerOpinion
Date Created: 2016-11-22 22:01:13.976838+00
Date Added: 2024-06-11T07:46:03.136514
License: Public Domain

NOT FOR PUBLICATION

                    UNITED STATES COURT OF APPEALS
                                                                           FILED
                            FOR THE NINTH CIRCUIT
                                                                           NOV 22 2016
                                                                        MOLLY C. DWYER, CLERK
                                                                         U.S. COURT OF APPEALS
NAVIGATORS SPECIALTY                             Nos. 14-17085
INSURANCE COMPANY, a New York                         15-16295
Corporation,
                                                 D.C. No. 2:13-cv-01062-GMS
              Plaintiff-Appellee,

 v.                                              MEMORANDUM*

NATIONWIDE MUTUAL INSURANCE
COMPANY,

              Defendant-Appellant.

                    Appeal from the United States District Court
                             for the District of Arizona
                     G. Murray Snow, District Judge, Presiding

                          Submitted November 18, 2016**
                             San Francisco, California

Before: GOULD, CLIFTON, and WATFORD, Circuit Judges.

      1. We affirm the district court’s holding that the Business Auto Policy

issued by Nationwide Mutual Insurance Company (Nationwide) to Titan Framing

      *
             This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
      **
             The panel unanimously concludes this case is suitable for decision
without oral argument. See Fed. R. App. P. 34(a)(2).
                                                                            Page 2 of 3
Company (Titan) provided coverage for the defense and settlement of Susan

McArdle’s wrongful death action against Titan. The policy’s plain language states

that it covers “any auto,” but it is unclear whether “any auto” covers the vehicle

here. In First American Title Insurance Co. v. Johnson Bank, 372 P.3d 292, 296

(Ariz. 2016), the Arizona Supreme Court explained that uncertainties in an

insurance contract, such as the meaning of “any auto” in Nationwide’s policy, must

be resolved in the following manner: “If a clause appears ambiguous, we interpret

it by looking to legislative goals, social policy, and the transaction as a whole. If

an ambiguity remains after considering these factors, we construe it against the

insurer.” Consideration of the legislative goals, social policy, and the transaction

between Nationwide and Titan as a whole does not resolve the uncertainty of the

term “any auto.” Accordingly, under Arizona Supreme Court law, the term “any

auto” must be construed against Nationwide. The district court correctly

concluded that the Business Auto Policy covered the claims in the McArdle action.

      2. The district court did not err in holding that the principle of equitable

subrogation entitled Navigators Specialty Insurance Company (Navigators) to

contribution from Nationwide. Under the principle of equitable subrogation, an

insurer that has provided a defense to an insured can compel contribution from

“another insurer who had a similar obligation to the same insured.” National
                                                                             Page 3 of 3
Indemnity Co. v. St. Paul Insurance Companies, 724 P.2d 544, 545 (Ariz. 1986)

(en banc); see also Sourcecorp, Inc. v. Norcutt, 258 P.3d 281, 285 (Ariz. Ct. App.

2011) (noting that equitable subrogation extends not only to defense costs but also

to any debt that ought to be paid by one creditor rather than another). Nationwide

and Navigators had similar obligations to Titan—under Arizona law, they both

provided primary coverage for McArdle’s claims. See Harbor Insurance Co. v.

United Services Automobile Ass’n, 559 P.2d 178, 183 (Ariz. Ct. App. 1976). The

district court did not err in holding that Nationwide must reimburse Navigators in

the amount of $218,357.46, half of Navigators’ settlement costs and half of its

defense costs from the date of tender to Nationwide. See Nucor Corp. v.

Employers Insurance Co. of Wausau, 296 P.3d 74, 85 (Ariz. Ct. App. 2012)

(allocating defense costs among insurers is a matter of equitable judicial

discretion).

      3. The district court did not err in awarding Navigators reasonable

attorney’s fees under Arizona Revised Statutes § 12-341.01(A). See California

Casualty Insurance Co. v. American Family Mutual Insurance Co., 94 P.3d 616,

622 (Ariz. Ct. App. 2004).

      AFFIRMED.