Kuperstein v. Superior Court

California Court of Appeal Sep 13, 1988 No. D008396Published

Before: Todd

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Holding. The trial court abused its discretion by allowing an insurer to intervene in a liability lawsuit against its insured to seek a declaration of non-coverage, as the insurer lacked a direct interest and intervention would improperly expand the scope of the litigation.

Issues

Whether an insurer has a direct interest sufficient to permit intervention in a liability suit against its insured when the insurer disputes coverage.
Whether allowing an insurer to intervene in a liability suit constitutes an abuse of discretion when it expands the issues and interferes with the insured's control of the defense.

Disposition. Peremptory writ issued; trial court order vacated.

Quotations verified verbatim against the opinion

“Allstate does not have a direct interest such that it will gain or lose by the direct legal operation of the judgment.”

“To permit intervention in these circumstances was an abuse of discretion.”

Opinion

TODD, J.

Fred D. Kuperstein (Kuperstein), doing business as Sports Arena Tropicals (Sports Arena), sold a salt water aquarium to Ronald and Vicki Beaubien (Beaubien). The aquarium started a fire and Beaubien brought suit. Real party, Allstate Insurance Company (Allstate), never issued insurance to Sports Arena, which has not been an active business since 1981.

Kuperstein currently is doing business as Clairemont Tropical Fish (Clairemont) located at 4633 Convoy Street. On January 22, 1986, Allstate

[600]

issued to Clairemont a business insurance policy limited to the Convoy Street premises.

Suit was filed May 5, 1987. Kuperstein made a claim under the Clairemont business policy. Allstate investigated the claim and reserved its rights. Allstate then moved to file a complaint in intervention in the underlying Beaubien suit seeking a declaration of rights and duties under the policy, including a declaration that it had no duty to defend or indemnify. The trial court granted the motion. Kuperstein sought review in this court. We stayed all proceedings connected with the complaint in intervention which we now vacate as part of the grant of relief.

The motion brought by Allstate was under Code of Civil Procedure section 387, subdivision (a), which permits “permissive intervention.” Intervention thus is at the trial court’s discretion and we look to see if there has been an abuse of that discretion.

For permissive intervention three factors are paramount: the intervener must have a direct interest in the lawsuit, the intervener must not enlarge the issues raised by the original parties and the intervener must not tread on the rights of the original parties to conduct their own lawsuit.

(People

ex rel.

Rominger

County of Trinity

(1983) 147 Cal.App.3d 655, 660-661 [195 Cal.Rptr. 186].)

Kuperstein v. Superior Court

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TODD, J.

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