Calif. High Court Reinstates Asbestos Contribution Action in ‘Vertical Exhaustion’ Ruling

SACRAMENTO, Calif. – California’s highest court has held that a primary insurer could possibly obtain contribution from first-level excess insurers once the primary policy for that period has been exhausted, reversing a lower court’s determination that the excess policies require “horizontal exhaustion” of the primary policies.

In a June 17 opinion, the California Supreme Court asked an appellate court to determine whether Kaiser Cement and Gypsum Corp.’s primary insurer is entitled to receive equitable contribution from excess insurers for underlying asbestos bodily injury claims.

The court resolved the question it left open in Montrose Chemical Corp. of California v. Superior …