Mass. High Court Limits Duty To Defend Other Insurers

Law360, New York (March 23, 2009, 12:00 AM EDT) -- Massachusetts' highest court has ruled that an insurance company is not obligated to pay another insurer's defense costs resulting from a declaratory judgment action, setting limits on how state insurers can apply duty-to-defend precedents against one another.

In the decision, Associate Justice Margot Botsford of the Massachusetts Supreme Judicial Court said courts must distinguish between a policyholder's defense costs and those incurred by the policyholder's insurer when invoking an exception to the American rule known as the Gamache exception.

The ruling resolves a dispute between two...
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