Defendant insurance agency appealed a judgment from the Superior Court of Los Angeles County (California), which, following a bench trial, found the insurance agency liable to plaintiff insureds for negligently procuring insurance.

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Overview

The insureds opened a new dealership and consulted an agent who represented that she was very familiar with the insurance needs of such dealerships. The agent provided an insurance package that omitted workers compensation coverage. The insureds did not realize that they lacked workers compensation coverage until after an employee was injured. The employee obtained a judgment against the insureds in excess of their liability coverage. The court held that the evidence supported the trial court's finding that a special duty existed because the agent held herself out as having particular expertise in dealership insurance needs, which necessarily included mandatory workers compensation coverage. A special duty could exist even if the insureds failed to read their policy thoroughly. The action was timely commenced under the two-year limitations period of Code Civ. Proc., § 339, subd. 1, which did not begin to run until the excess judgment was entered. The trial court did not err in assigning no fault to the insureds; Evid. Code, § 669, did not apply because the insureds' violation of the statute requiring workers compensation insurance did not cause any injury to the agency.

Outcome

The court affirmed the trial court's judgment.