Commercial Union Assurance Companies v. Safeway Stores, Inc.

How later courts described this case

• explaining that "£i]t has been held in California and other jurisdictions that the excess carrier may maintain an action against the primary carrier for [] [wrongful] refusal to settle within the latter's policy limits” (alterations in original)
• explaining that under equitable subrogation, an excess carrier “stands in the shoes of the insured and should be permitted to assert all claims against the primary carrier which the insured himself could have asserted”
• explaining that the theoretical basis of equitable subrogation is that the excess insurer has discharged the insured’s liability in the underlying litigation
• disapproving Transit Casualty in part and holding that an excess carrier’s right to sue a primary carrier for wrongful refusal to settle is based on theory of equitable subrogation and not negligence

Written by the judges who cited it.