Fireman's Fund Ins. Cos. v. Atlantic Richfield Co

In Fireman's Fund Ins. Cos. v. Atlantic Richfield Co. (2001) 94 Cal. App. 4th 842, an employee of a construction company was injured in the course of work he was doing for an oil company at the oil company's plant. The injury arose from the collapse of a step owned and maintained by the oil company. When the employee sued the oil company, it sought a defense under the contractor's liability policy to which the oil company had been added as an additional insured. The endorsement provided that the oil company's entitlement to coverage under the policy was limited to "liability arising out of the contractor's work for the oil company . . . ." Following resolution of the employee's claim, the insurer sued the oil company to recover its defense and settlement costs. The trial court granted the oil company's motion for summary judgment. (Fireman's Fund, supra, 94 Cal. App. 4th at pp. 845-846.) In affirming that judgment, the Fireman's Fund court held that the fact that the employee had been injured while performing work called for by the general contractor's agreement with the oil company was a sufficient causal connection to trigger coverage under the contractor's policy. (Fireman's Fund, supra, 94 Cal. App. 4th at p. 851.) The court rationalized its conclusion as follows. " 'California courts have consistently given a broad interpretation to the terms "arising out of" or "arising from" in various kinds of insurance provisions. It is settled that this language does not import any particular standard of causation or theory of liability into an insurance policy. Rather, it broadly links a factual situation with the event creating liability, and connotes only a minimal causal connection or incidental relationship. ' " (Id. at p. 849.)