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CASTRO v. ALLSTATE INS. CO.

March 22, 1994

JESUS CASTRO, as Administrator of the Estate of JUAN CASTRO, Deceased, Plaintiff,
v.
ALLSTATE INSURANCE COMPANY, and DOES 1 through 50, inclusive, Defendants.



The opinion of the court was delivered by: MARILYN L. HUFF

ORDER GRANTING DEFENDANT'S AND DENYING PLAINTIFF'S MOTION FOR SUMMARY JUDGMENT

 I. INTRODUCTION

 Sometime prior to April 1989, Defendant Allstate Insurance Company issued a Deluxe Homeowner'S Policy (the "Policy") to Carmelita Cook. Both Carmelita Cook and her son, Ariel Cook, were "Insured Persons" within the meaning of the Policy. On April 14, 1989, Ariel Cook shot and killed Juan Castro at a public recreation center. On November 8, 1989, Ariel Cook was convicted of first degree murder.

 On April 13, 1990, Plaintiff Jesus Castro, as administrator of his deceased son's estate, filed a wrongful death action against Carmelita Cook in state court. In sum, the complaint alleged Carmelita Cook's negligence in supervising Ariel Cook caused Juan Castro's death. Carmelita Cook tendered the lawsuit to Allstate.

 Defendant agreed to retain Cumis counsel for Ms. Cook, but declined to defend and/or indemnify her in the action. It did so based on 1) California Insurance Code Section 533; and 2) the "intentional acts" and "criminal acts" exclusions set forth in the homeowner's policy.

 Carmelita Cook then settled the suit. Plaintiff's estate received a stipulated judgment of $ 100,000 against Carmelita Cook and a complete assignment of Carmelita's rights against Defendant Allstate. In return, Carmelita Cook received a covenant not to execute or record the judgment.

 On September 16, 1993, Plaintiff, as assignee of Carmelita Cook's rights against Allstate, filed suit against Defendant in the Superior Court of the State of California. Plaintiff asserted two causes of action: 1) Breach of Insurance Contract; and 2) Breach of the Covenant of Good Faith and Fair Dealing. On October 6, 1993, Defendant filed its notice of removal to this court. Plaintiff and Defendant now bring cross-motions for summary judgment.

 II. DISCUSSION

 Because Carmelita Cook had no reasonable expectation of coverage against Plaintiff's complaint in the underlying action, Allstate owed her no duty to defend. Accordingly, the court grants Defendant's and denies Plaintiff's motion for summary judgment.

 A. STANDARD

 The California Supreme Court, in Horace Mann Ins. Co. v. Barbara B., 4 Cal. 4th 1076, 846 P.2d 792 (1993), summarized the principles governing adjudication of the insurer's duty to defend its insured against a third party lawsuit: *fn1"

 
[A] liability insurer owes a broad duty to defend its insured against claims that create a potential for indemnity.... Implicit in this rule is the principle that the duty to defend is broader than the duty to indemnify; an insurer may owe a duty to defend its insured in an action in which no damages ultimately are awarded....
 
....
 
The determination whether the insurer owes a duty to defend usually is made in the first instance by comparing the allegations of the complaint with the terms of the policy. Facts extrinsic to the complaint also give rise to a duty to defend when they reveal a possibility that the claim may be covered by the policy....
 
....
 
Any doubt as to whether the facts give rise to a duty to defend is resolved in ...

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