ONEBEACON AMERICA INSURANCE CO. V. TRAVELERS INDEMNITY COMPANY OF ILLINOIS
465 F.3d 38 (1st Cir. 2006)
NATURE OF THE CASE: OneBeacon (P) file suit seeking reformation based on mutual mistake. On cross-motions for summary judgment, the district court refused to reform the policy and ordered P to pay the $1,000,000 to Travelers (D). P appealed.
FACTS: P issued insurance to LAI. LAI leases cars and trucks to businesses. It contracted with P for general insurance coverage for the company's vehicles. Language in the policy could clearly be read to extend coverage to LAI's lessees. P claims that this language was a mutual mistake. Capform leased cars from LAI. It insured them with D. A Capform employee severely injured a pedestrian, Manuel Pedreira. D defended Capform and eventually settled Pedreira's personal injury suit for $5,000,000. D became aware of the LAI policy with P. D asked P to contribute $1,000,000, the policy's single-occurrence limit, to the Pedreira settlement. P refused and filed suit seeking a declaratory judgment that Capform was not covered by its policy. P also asked that the insurance contract be reformed to match the parties' intent that it would cover only those lessees who had specifically applied for, and been approved for, coverage under the P policy. P and D moved for summary judgment. The trial court ruled against P. It failed to 'present full, clear, and decisive proof of mistake.'' P appealed.
ISSUE:
RULE OF LAW:
HOLDING AND
DECISION:
LEGAL ANALYSIS:
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