St. Paul Fire & Marine Insurance Company v. Liberty Mutual Insurance Company.

Opinion of the Court by

WILSON, J.

The United States District Court for the District of Hawai'i 1 (district court) certified the following question to this court:

May an excess liability insurer bring a cause of action, under the doctrine of equitable subrogation to the rights of the insured, against a primary liability insurer for failure to settle a claim against the mutual insured within the limits of the primary liability policy, when the primary insurer has paid its policy limit toward settlement?

We modify the certified question slightly to hold that an excess liability insurer can bring a…