View Opinion

Horvitz & Levy LLP represented defendant Fire Insurance Exchange in these writ proceedings challenging a trial court’s denial of Fire’s motion for summary judgment in this breach of contract/bad faith action. Fire’s policyholders, Kenneth and Dorothy Bourguignon, built their home in such a way that it encroached a few inches on neighboring property. When a dispute with the neighbors followed, the Bourguignons sued the neighbors, claiming adverse possession and seeking to quiet title. The neighbors cross-complained, alleging fraud and seeking declaratory and injunctive relief and to quiet title. The Bourguignons tendered the defense of the cross-complaint to Fire under their homeowners policy. That policy covered damages resulting from an “occurrence,” and “occurrence” was defined to mean “an accident.”

Fire declined to defend, and the Bourguignons sued Fire. The Bourguignons argued Fire had a duty to defend because they “accidentally” encroached on the neighboring property since they, in good faith, believed they were building entirely on their own property. Fire moved for summary judgment, but the trial court denied the motion and Horvitz & Levy filed a petition for writ of mandate on Fire’s behalf. The Court of Appeal issued a writ, ruling that the intentional act of building a home is not an “accident” and the Bourguignons’ error in believing they were building on their own property did not convert their deliberate conduct into an “accident” covered by the policy.