Arch Insurance Co. v. Kubicki Draper, LLP
Arch Insurance retained Kubicki Draper to defend its insured accounting firm, then sued the firm for malpractice after alleging the firm failed to timely raise a statute of limitations defense, increasing the settlement cost. The trial court and Fourth District held Arch lacked standing because it was not in privity with the law firm. The Florida Supreme Court quashed, holding that although the law firm was in privity only with the insured, the insurer has standing to maintain a legal malpractice action against defense counsel where the insurer is contractually subrogated to the insured's rights under the policy.
Key facts
- Arch Insurance retained Kubicki Draper, LLP to defend Arch's insured accounting firm in litigation; Arch later alleged the law firm committed malpractice by failing to timely raise a statute of limitations defense, which increased the settlement cost.
- The trial court dismissed Arch's malpractice claim for lack of standing based on absence of privity between Arch and the law firm; the Fourth District affirmed.
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Why it matters
This is a landmark ruling resolving a long-contested question in the insurer-insured-defense counsel tripartite relationship: insurers can now sue panel or retained defense counsel for malpractice via contractual… — full analysis with a trial
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