Common Fund Doctrine Cases
Before applying the common fund doctrine, the court should examine all of the circumstances of the case, including the nature and extent of the subrogee's activities.
See Dunn, Brady, Goebel, Ulbrich, Morel, Kombrink & Hundman v. State Farm Ins. Co., 100 Ill. App. 3d 93, 426 N.E.2d 315, 319-20, 55 Ill. Dec. 340 (Ill. App. Ct. 1981).
The common fund doctrine is grounded on equitable principles and applied on a case-by-case basis.
See Norwood, 463 N.W.2d at 68 (equitable principles underlie rule that right to subrogation carries with it duty to pay proportionate share of attorney's fees);
Hedgebeth, 378 A.2d at 230 (common fund doctrine is based on equitable principle that insurer should not be entitled to enjoy fruits of insured's judgment against tortfeasor without contributing in any way to costs or burdens of litigating that claim).
In cases where the insurer demonstrates that it "actively participated in or substantially contributed to," recovery of the common fund, "the trial court may reduce or waive the insurer's proportionate contribution" to attorney's fees and court costs incurred in securing the fund. Amica Mut. Ins. Co. v. Maloney, 120 N.M. 523, 903 P.2d 834, 840 (1995).
To claim active participation in a settlement, the insurer must demonstrate that it participated in settlement negotiations and contributed to obtaining the award. See id.