A high-stakes insurance dispute has erupted over a significant water damage incident in San Francisco, leading to a legal battle between two major insurance companies. On September 13, 2024, Lexington Insurance Company filed a complaint in the Superior Court of California, County of San Francisco, against Great American Insurance Company. The lawsuit centers around claims for declaratory relief and equitable contribution/subrogation.
According to the court documents, Lexington Insurance Company is acting as the subrogee of Public Entity Property Insurance - San Francisco Real Estate. The case involves a water damage incident that occurred on January 9, 2022, at the Yerba Buena Gardens Center for the Arts (YBCA), located at 701 Mission Street in San Francisco. The water damage was traced back to a malfunctioning hands-free toilet valve at the facility. Lexington Insurance Company had insured the property through three policies and paid out $785,368.87 in damages.
The plaintiff contends that YBCA has an insurance policy with Great American Insurance Company and that under an agreement dated June 15, 2004, YBCA was responsible for maintaining and repairing the building. This agreement included provisions making YBCA accountable for various aspects of building upkeep such as fire prevention, security, repairs, janitorial services, and energy conservation.
Lexington Insurance Company is seeking a judicial declaration to determine the respective rights and obligations concerning defense fees and costs incurred due to this incident. The plaintiff argues that Great American Insurance Company is obligated to indemnify them for any sums they may be compelled to pay as a result of damages or judgments recovered by any party involved in this action against Great American Insurance Company.
In addition to seeking declaratory relief, Lexington Insurance Company is also pursuing equitable contribution from Great American Insurance Company. They allege that despite having policies covering the subject property as either named or additional insureds, Great American has failed to participate in defending or indemnifying Lexington adequately. This failure has resulted in Lexington incurring more costs than it would have if Great American had contributed its fair share toward defense and indemnity.
The plaintiff's prayer for judgment includes reimbursement for all amounts expended to defend and settle claims against Great American Insurance Company. They are also seeking monetary damages exceeding $785,368.87 along with prejudgment interest according to California Civil Code §3287, post-judgment interest, costs of suit incurred herein, attorneys' fees per contract, and any other relief deemed proper by the court.
The case is being handled by attorneys David Kestenbaum and Jordan Everakes from Grotefeld Hoffmann LLP. The case ID is CGC-24-618089.