Hartford Casualty Insurance Company, Cross-Complainant and Appellant v. J.r. Marketing, L.L.C.…

Summary

The court held that, under the unusual circumstances presented, an insurer may seek restitution directly from independent counsel for objectively unreasonable and unnecessary defense fees paid pursuant to a final enforcement order that expressly preserved the insurer's right to seek reimbursement. The insurer bears the entire burden of proving that the charges were unreasonable and unnecessary, judged objectively based on circumstances known when the work was performed. The court reversed the dismissal of the direct claim against counsel but otherwise affirmed. Justice Liu, concurring, would require a presumption that disputed fees primarily benefited the insured and would place a heavier burden on the insurer to show that counsel's conduct provided little or no benefit to the insured.