Article
Conflicts of Interest and Choice of Counsel in Duty to Defend Insurance Policies: Should There Be Goldfarb Miranda Warnings?
Mealey's Emerging Insurance Disputes
(2012)
Abstract
New York and California, along with several other jurisdictions,
have embraced precedents permitting a policyholder
to select its own counsel, at the carrier’s
expense, provided that there is a conflict of interest
affecting coverage. Not just any conflict of interest
would trigger the insured’s right to Cumis/Goldfarb
conflict counsel. Rather, the courts have held that an
insured is only entitled to select independent counsel
when the complaint alleges multiple theories, some of
which are covered by insurance and others are not.
Moreover, precedent in both New York and California
suggests that conflict counsel even then should only be
available when strategic decisions made by defense
counsel can affect the insured’s coverage.
Not all jurisdictions have adopted this analysis, and
several have held that both the insurance industry and
the legal profession are sufficiently regulated to insure
the avoidance of conflicts of interests. Cumis counsel,
while sometimes appropriate, should be invoked judiciously,
as excessive or multiple counsel can erode the
policy. Particularly where Cumis counsel is duplicative
or requires considerable time to get up to speed, the net
result may be to reduce insurance coverage.
Keywords
- cummis counsel,
- insurance coverage,
- attorney ethics
Disciplines
Publication Date
May 3, 2012
Citation Information
Barry R. Temkin and Robert J. Usinger. "Conflicts of Interest and Choice of Counsel in Duty to Defend Insurance Policies: Should There Be Goldfarb Miranda Warnings?" Mealey's Emerging Insurance Disputes Vol. 17 Iss. 9 (2012) Available at: http://works.bepress.com/barry_temkin/77/