Los Angeles partners Frances O’Meara and Holly Teel obtained a defense verdict in a legal malpractice action in the Los Angeles County Superior Court. The plaintiffs alleged that their former counsel negligently delayed in obtaining a $3.5 million default judgment in an underlying action which the plaintiffs had filed against their general contractor, with the result that the Plaintiffs were unable to collect that default judgment from the general contractor’s CGL carrier, as the carrier filed for liquidation one month after the default judgment was obtained. Plaintiffs alleged that had their former counsel obtained the default judgment sooner, the general contractor’s carrier would have had sufficient assets to pay all, or a part, of the default judgment.
The court bifurcated the trial on the initial issue of whether the general contractor’s CGL policy provided any coverage for Plaintiffs’ claims against the general contractor. After a full day of trial, the trial court held both that the carrier had no duty to defend Plaintiffs’ claims against the general contractor, and also that there was no coverage for Plaintiffs’ claims against the general contractor under his CGL policy. Since there was no coverage with the CGL carrier, Plaintiffs could not establish causation, damages, or collectability.