Vandenberg v. Superior Court
| Decision Date | 30 August 1999 |
| Docket Number | No. S067115.,S067115. |
| Court | California Supreme Court |
| Parties | John B. VANDENBERG et al., Petitioners, v. The SUPERIOR COURT of Sacramento County, Respondent; Centennial Insurance Company et al., Real Parties in Interest. |
Eisen & Johnston, Jay-Allen Eisen, Marian M. Johnston, Sacramento; Douglas R. Thorn, Pilot Hill; Montague, Cochrane & Viglione and Dennis L. Viglione, Sacramento, for Petitioners.
Cotkin & Collins and Roger W. Simpson, Los Angeles, for Mercury Air Group, Inc., as Amicus Curiae on behalf of Petitioners.
Law Offices of John K. Saur and John K. Saur, Laguna Hills, as Amicus Curiae on behalf of Petitioners.
Brown & Bain, Palo Alto, Jack E. Brown, Craig W. Soland, David P. Brooks, Dan L. Bagatell and Richard M. Harvey for Apple Computer, Inc., as Amicus Curiae on behalf of Petitioners.
Newmeyer & Dillion, Gregory L. Dillion, Gene M. Witkin and Timothy S. Menter, Newport Beach, for the Irvine Company, Presley Homes, Inc., Catellus Residential Group, Standard Pacific, Fieldstone Communities, Inc., William Lyon Homes, Inc., and Kaufman and Broad Home Corporation as Amici Curiae on behalf of Petitioners.
Joseph A. Hearst, Berkeley; Pillsbury Madison & Sutro, Robert M. Westberg and Reginald D. Steer, San Francisco, for Shade Foods, Inc., as Amicus Curiae on behalf of Petitioners.
Heller, Ehrman, White & McAuliffe and David B. Goodwin, San Francisco, for Atlantic Richfield Company as Amicus Curiae on behalf of Petitioners.
Law Offices of Crawford & Bangs, William J. Crawford and E. Scott Holbrook, Jr., West Covina, for American Subcontractors Association and American Subcontractors Association California as Amici Curiae on behalf of Petitioners.
Gauntlett & Associates and Stanley H. Shure, Irvine, for Anthem Electronics, Inc., as Amicus Curiae on behalf of Petitioners.
Stapke & Harris, Mark R. Stapke and Timothy D. Kevane for Western Council of Construction Consumers as Amicus Curiae on behalf of Petitioners.
Anderson Kill & Olick, Scott C. Turner and Jordan S. Stanzler, San Francisco, for United Policyholders, California Building Industry Association and American Institute of Architects California Council as Amici Curiae on behalf of Petitioners.
Abdulaziz & Grossbart, Sam K. Abdulaziz, Kenneth S. Grossbart, Bruce D. Rudman and Catherine R. Finamore, North Hollywood, as Amici Curiae on behalf of Petitioners.
Adleson, Hess & Kelly, Duane W. Shewaga and Randy M. Hess, Campbell, for
California Trustees Association as Amicus Curiae on behalf of Petitioners.
Atkinson, Andelson, Loya, Ruud & Romo and Thomas W. Kovacich, Cerritos, for Southern California Contractors Association as Amicus Curiae on behalf of Petitioners.
Brobeck, Phleger & Harrison and David M. Halbreich, Los Angeles, for Parsons Infrastructure & Technology Group Inc., as Amicus Curiae on behalf of Petitioners.
Eric R. Carleson, Sacramento, for California Spa and Pool Industry Educational Council as Amicus Curiae on behalf of Petitioners.
Cook & Roach, J. Mark Lawless, Austin, TX, Robert M. Roach, Houston, TX; and A. Scott Anderson for Texas Independent Producers & Royalty Owners Association as Amicus Curiae on behalf of Petitioners.
Cox, Castle & Nicholson, Jeffrey D. Masters, Timothy M. Truax and Jeffrey A. Gagliardi, Los Angeles, for Parsons Energy & Chemicals Group Inc., as Amicus Curiae on behalf of Petitioners.
Ernest, Brown & Company, Ernest C. Brown and Michael K. Wolder, Irvine, as Amicus Curiae on behalf of Petitioners.
Robert M. Hirth for Scott Drywall, Inc., as Amicus Curiae on behalf of Petitioners.
John F. Hodges, Arroyo Grande, for ITEQ Storage Systems, Inc., as Amicus Curiae on behalf of Petitioners.
Hunt, Ortmann, Blasco, Palffy & Rossell and Gordon Hunt, Pasadena, as Amicus Curiae on behalf of Petitioners.
Knopfler & Robertson, Alexander T. Robertson IV and Deborah E. Broom, Woodland Hills, as Amicus Curiae on behalf of Petitioners.
Kahn, Soares & Conway and Ronald P. Jones, Hanford, as Amicus Curiae on behalf of Petitioners.
Paul J. Meyer, Sacramento, for Consulting Engineers and Land Surveyors of California as Amicus Curiae on behalf of Petitioners.
Popov, McCullough & Cohan and R. Patrick McCullough, La Jolla, as Amicus Curiae on behalf of Petitioners.
Dennis H. Quade, Pasadena, for Parsons Corporation as Amicus Curiae on behalf of Petitioners.
Berne Rolston, Santa Monica, for Paragon Homes, Inc, Paragon Enterprises, Inc., Paragon Development Corp, Brian Catalde Developments, Spencer & Morin, Inc., Bekirk Development Corp, BG Enterprises, Inc., Malibu Plaza, Inc., Wildrose Associates, L.P, SR Associates, PAV Associates, Paragon Westminster Associates, L.P, Paragon Hayward Associates, L.P, Paragon Westwind Associates, L.P, Paragon Del Rey Associates, L.P, Paragon Playa Associates, L.P, Paragon Canyon Country Associates, L.P, Paragon Mission Viejo Assisted Living, L.P, and Paragon West Hills Assisted Living, L.P, as Amici Curiae on behalf of Petitioners.
Sachnoff & Weaver, Chicago, IL, and Clifford J. Shapiro, San Francisco, as Amicus Curiae on behalf of Petitioners.
Les Shayo, for California Rental Association as Amicus Curiae on behalf of Petitioners.
Spriggs & Hollingsworth, Marc S. Mayerson and Douglas L. Patin, Washington, DC, as Amicus Curiae on behalf of Petitioners.
The Ford Law Firm and William H. Ford III, Los Angeles, as Amicus Curiae on behalf of Petitioners.
Michael Touff, Denver, CO, for MDC Holdings, Inc., as Amicus Curiae on behalf of Petitioners.
Trump, Alioto, Trump & Prescott, San Francisco, and Janice E. Bressler for Olympian Oil Company, Surtec, Inc., and Rinehart Oil, Inc., as Amici Curiae on behalf of Petitioners.
Whitman, Breed, Abbott & Morgan and Paul C. Workman, Los Angeles, for Shinmaywa Industries, Ltd, as Amicus Curiae on behalf of Petitioners. No appearance for Respondent.
Long & Levit, Robert M. Peterson, San Francisco, Michael C. Cooper, Stephen P. Randall and John H. Quinn, San Francisco, for Real Parties in Interest Continental Insurance Company, Phoenix Assurance Company of New York and Glenn Falls Insurance Company.
Larson & Burnham, Gary R. Selvin and Bradley M. Zamczyk, Oakland, for Real Party in Interest Centennial Insurance Company.
Bullivant, Houser, Bailey, Pendergrass & Hoffman, Bullivant Houser Bailey, James G. Driscoll, San Francisco, and Kevin S. Mapes, Gold River, for Real Party in Interest United States Fidelity & Guaranty.
Wiley, Rein & Fielding, Laura A. Foggan, Daniel E. Troy, Washington, Dist. of Columbia, Paula L. Primost; Bien & Summers and Elliot L. Bien, San Francisco, for the Insurance Environmental Litigation Association as Amicus Curiae on behalf of Real Parties in Interest.
Craig A. Berrington, Washington, DC, Laura L. Kersey, Alexandria, VA; Thelen Reid & Priest, Gary L. Fontana, San Francisco, and Mary E. Wilcox, for American Insurance Association as Amicus Curiae on behalf of Real Parties in Interest.
Lewis, D'Amato, Brisbois & Bisgaard, Richard L. Antognini, Sacramento, and Thomas L. Vazakas, San Diego, for TIG Insurance Company as Amicus Curiae on behalf of Real Parties in Interest.
Hollins, Schechter & Feinstein, Andrew S. Hollins, Kenneth E. Gertz, Orange; Greines, Martin, Stein & Richland, Irving H. Greines and Marc J. Poster, Beverly Hills, for Truck Insurance Exchange as Amicus Curiae on behalf of Real Parties in Interest.
This case presents two issues. First, we must consider when, if ever, a judicially confirmed award in an arbitration governed by California's private arbitration law (Code Civ. Proa, § 1280 et seq.) is entitled to collateral estoppel, or "issue preclusion," effect in favor of a nonparty to the arbitration.1 Second, we must determine whether a commercial general liability (CGL) insurance policy that provides coverage for sums the insured is "legally obligated to pay as damages" may cover losses arising from a breach of contract.
We reach the following conclusions: First, a private arbitration award, even if judicially confirmed, may not have nonmutual collateral estoppel effect under California law unless there was an agreement to that effect in the particular case.2 Second, the coverage phrase "legally obligated to pay as damages," as used in a CGL insurance policy, may provide an insured defendant with coverage for losses pleaded as contractual damages. Accordingly, we will affirm the judgment of the Court of Appeal.
The underlying litigation involves damage to a parcel of land that Vandenberg3 used as an automobile sales and service facility. Before 1958, owners Eugene and Kathryn Boyd4 operated an automobile dealership on the property. From 1958 to 1988, Vandenberg leased the property from Boyd under a series of leases. In 1988 Vandenberg discontinued the business and possession of the land reverted to Boyd.
To prepare the property for sale, Boyd removed three underground waste oil storage tanks. Testing revealed contamination of soils and groundwater underlying the property. Boyd filed an action against Vandenberg, alleging causes of action for breach of contract, breach of the covenant of good faith and fair dealing, public and private nuisance, negligence, waste, trespass, strict liability, equitable indemnity, declaratory relief, and injunctive relief. The Boyd complaint alleged Vandenberg had installed and operated the waste oil storage tanks and the tanks were the source of the petroleum contamination.
Vandenberg had obtained CGL insurance from several companies over the years, including Phoenix Assurance Company of New York (Phoenix), the Glens Falls Insurance Company (Glens Falls), Continental Insurance Company (Continental), TIG Insurance Corporation (TIG), Centennial Insurance Company (Centennial), and United States Fidelity and Guaranty Company (USF & G) (collectively insurers). The policies provided coverage to Vandenberg for sums he was ...
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