Brian Margolies, Partner, Traub Lieberman Straus & Shrewsberry LLP
In its recent decision in BioChemics, Inc. v. AXIS Reinsurance Co., 2013 U.S. Dist. LEXIS 111218 (D. Mass. Aug. 7, 2013) [enhanced version available to lexis.com subscribers], the United States District Court for the District of Massachusetts had occasion to consider when an insurer is entitled to rely on extrinsic evidence for determining its duty to defend.
The court acknowledged a line of cases cited by BioChemics standing for the proposition that insurers cannot rely on extrinsic evidence for the purpose of determining a duty to defend. The court went on to note, however, that this line of cases does not apply to extrinsic facts that will not be litigated in the underlying matter. The court further observed that in the context of claims made and reported policies, the rule against consideration of extrinsic facts cannot be rigidly applied since coverage issues such as the timing of the claim are unlikely to be alleged in the underlying complaint. While the court acknowledged it a close question, it ultimately held that:
Read more at the Traub Lieberman Insurance Law Blog, Edited by Brian Margolies.
For more information about LexisNexis products and solutions, connect with us through our corporate site