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Appeals Court Rules Insured’s Settlement In Construction Defects Litigation Is Not Valid

February 9, 2011 — CDJ Staff February 9, 2011

In a recent ruling and Arizona appeals court found an insurance company’s settlement agreement relevant to a class action construction defect litigation to be invalid. In Charles Leflet, et al. v. Redwood Fire and Casualty Insurance Co., the court found that the agreement in question avoids a primary insurers obligation to pay policy limits and passes liability in excess of those limits on to other insurers. In its conclusion the court stated “we affirm the judgment of the trial court concerning the validity of the settlement agreement as to the NPIs. We vacate and remand the award of attorney’s fees. In our discretion, we decline to award the NPIs the attorney’s fees they have requested on appeal pursuant to A.R.S. 12-341.01(A).”

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Appeals Court Rules Insured’s Settlement In Construction Defects Litigation Is Not Valid