The right of an excess insurer to subrogate against the primary carrier was upheld under a Commercial General Liability policy. The court reiterated the standard in Tennessee that equitable subrogation does not arise from any contractual relationship between the parties, but takes place as a matter of equity with or without an agreement to that effect. It found that equitable subrogation is based on the principle that substantial justice should be attained regardless of form, that is, its basis is the doing of complete, essential and perfect justice without regard to form. In a footnote, the court noted that only two states, Alabama and Idaho have not adopted the equitable subrogation doctrine.
Great American Insurance Co. of NY v. Federal Insurance Co., 2010 Tenn.App.LEXIS 296 (2010)
Date: April 28, 2010