In its Decision and Order on Cross-Motions for Summary Judgment (2021 WL 681119), the District Court of Maine was presented with the issue of when a duty to defend terminates. The court looked to Section 18 of Restatement of the Law, Liability Insurance (Restatement) for guidance.

The central issue in the case, Burka v. Garrison Property and Casualty Insurance, is whether an insurer has a duty to defend the insured, a doctor, against two lawsuits.

The below is excerpted from the Opinion (footnotes omitted):

The Maine Law Court has not addressed when a duty to defend terminates. But the recent Restatement of Liability Insurance does so in section 18. It states in relevant part that a duty to defend terminates upon final adjudication or settlement of the insurable part of the underlying lawsuit or settlement. Moreover, “Adjudication eliminating the covered cause from the action, so that the only remaining cause of action is not covered, ends the insurer’s duty to defend the action, provided that the time for taking an appeal from that adjudication has expired, any appeals have been resolved, or the claimant has relinquished its appeal rights.” Restatement of Liab. Ins. § 18 cmt. d (Am. Law Inst. 2019) (emphasis added). 

The Restatement was published in 2019, and is organized into four chapters covering a range of liability insurance law topics: Basic Liability Insurance Contract Rules; Management of Potentially Insured Liability Claims; General Principles Regarding the Risks Insured; and Enforceability and Remedies. 

Black letter for Section 18 is included below. The publication contains Comments (with Illustrations) and Reporters’ Notes. 

Jennifer Morinigo

The American Law Institute

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