Nothing too fascinating today from the Ninth Circuit or the California appellate courts. Just a single opinion from the Ninth Circuit -- albeit on a somewhat interesting criminal discovery issue, with a dissent by Judge Willie Fletcher -- and similarly only one published opinion from the California Court of Appeal. We'll see if the latter cranks something fun out in the afternoon.
The only thing I wanted to say about this case -- the one from the Court of Appeal today -- is that it's a great example of how an opinion can sometimes be both incredibly concise and incredibly persuasive. The first two paragraphs of the opinion by Justice Mallano basically say it all. Sure, there are twenty-two subsequent pages, and they flesh out the details pretty well. But read these first two paragraphs and see if you don't agree that they pretty much alone persuade you that Justice Mallano is correct:
"This appeal raises issues concerning whether a directors and officers (D&O) liability policy covers a breach of contract claim where an officer entered into a contract without stating that he was acting on behalf of the corporation. The corporation subsequently disputed liability under the contract, and the other contracting party brought suit against the corporation and the officer, seeking to recover the contract price. The officer sought a defense from the D&O insurer, which denied the claim. The corporation and the officer settled the suit for the contract price.
In this action against the insurer for bad faith, the trial court entered judgment for the insurer after sustaining a demurrer without leave to amend. We affirm because the D&O policy did not cover the corporation’s contractual debt or the officer’s liability for breaching a contract. The breach of the contractual obligation asserted in this case did not give rise to a loss caused by a wrongful act within the meaning of the policy. Rather, the corporation was simply being required to pay an amount it voluntarily contracted to pay. To hold the insurer liable for the contract price would be tantamount to making it a business partner of the corporation and the officer, which was not the mutual intention of the insurer and the insured under the policy."
I wish that I could write something that's a tenth as concise and persuasive.
P.S. - On a more superficial level, maybe I'm still woozy from my run into work today, but is this an incredibly good-looking picture of Justice Mallano or what? Now I'm jealous on multiple levels.
