The opinion of the court was delivered by: GASCH
GASCH, Senior District Judge.
This case, which was transferred to this Court from Judge Corcoran, involves an attempt to recover money paid under an insurance policy. In January, 1983, plaintiff paid $599,947.51 to settle Erby, et al. v. Columbia Hospital for Women, No. 82-0799 (D.D.C.), a medical malpractice case. Plaintiff contends that the claim at issue in Erby was not within the policy coverage and seeks recovery of the settlement payment. Plaintiff has moved for summary judgment as to all counts; defendant has moved for partial summary judgment.
In January, 1982, defendant purchased an excess liability insurance policy from plaintiff which provided retroactive coverage from November 14, 1976 to January 14, 1982 for claims arising out of hospital professional services. The policy included two exclusion provisions: first, that it did not cover "any claim pending on the effective date of this policy," and second, that it did not cover claims arising from "any event, if on such effective date, an insured has been advised or received notice that a claim will result therefrom." The effective date of the policy was January 14, 1982.
The Erby case was filed on March 22, 1982. Defendant notified plaintiff of the case on August 23, 1982, and plaintiff began its defense of defendant in October, 1982. In November, plaintiff informed defendant that it would continue to "investigate and review" the case subject to reservation of its rights to disclaim coverage because of untimely notice. Erby was settled in January, 1983, with all parties participating. Defendant paid $1 million from its self-insurance; plaintiff paid $599,947.51 under the excess liability policy.
On October 14, 1983, plaintiff filed a two-count complaint against defendant, seeking recovery of the settlement payment and alleging breach of contract and breach of duty to insurer. Both counts arose from defendant's asserted failure to give timely notice of the Erby claim.
During discovery, plaintiff deposed Robert Sloan, associate administrator of Columbia Hospital, who disclosed that the Medical Records Office of the Hospital had received a letter from Erby's attorney in November, 1981. The letter stated:
As per our telephone conversation of 2 November 1981, enclosed herewith is a Medical assignment and authorization allowing the release of [Erby's] medical records to this office.
I am requesting that these records be sent out as quickly as possible due to the present course of treatment for cancer at Georgetown University Hospital. We are requiring [sic] the records on Mrs. Erby for the purpose of seeking alternative modes of treatment and medical opinions through our own physicians. . . .
Discovery also revealed that, after receiving the letter, defendant opened a "potential claims file" on Mrs. Erby one month before the January 14, 1982 effective date of the policy.
Plaintiff later amended its complaint to add count III, which asserts that plaintiff is entitled to recovery because defendant had received notice of the Erby claim prior to the effective date and that the claim thus falls within the exclusion provisions of the policy. Defendant moved to dismiss count III on the ground that plaintiff's failure to reserve its rights in the exclusion provisions before undertaking defense of the Erby case constituted waiver and estoppel. Judge Corcoran denied the motion on March 27, 1985, noting that plaintiff conceivably could prove a set of facts entitling it to recover under count III.
The pending motions focus on two issues. The first is whether defendant breached the policy by not notifying plaintiff of Erby's March 22, 1983 claim until August, 1983. Plaintiff has moved for summary judgment on this issue. The second issue is whether the Erby matter was within the ...