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LESLIE SALT CO. v. ST. PAUL MERCURY INS. CO.

Nos. 78-2576, 78-2649.

637 F.2d 657 (1981)

LESLIE SALT CO., Plaintiff/Appellee, v. ST. PAUL MERCURY INSURANCE COMPANY, a corporation, Defendant/Third Party Plaintiff/Appellant, FM Insurance Co., Ltd., a corporation, Third Party Defendants/Appellees. LESLIE SALT CO., Plaintiff/Appellant, v. ST. PAUL MERCURY INSURANCE CO., a corporation, Defendant, and FM Insurance Company, Ltd., a corporation, Defendant/Appellee.

United States Court of Appeals, Ninth Circuit.

Decided March 30, 1981.

Attorney(s) appearing for the Case

Augustus Castro, Cooley, Godward, Castro, Huddleson & Tatum, San Francisco, Cal., on brief; James A. Richman, San Francisco, Cal., for St. Paul.

Chickering & Gregory, San Francisco, Cal., on brief; James E. Burns, Jr., San Francisco, Cal., for Leslie Salt.

Robins, Davis & Lyons, Minneapolis, Minn., on brief; Robert Wattson, Minneapolis, Minn., for FM Insurance.

Before WRIGHT and POOLE, Circuit Judges, and CRAIG, Senior District Judge.

EUGENE A. WRIGHT, Circuit Judge:

Upon petition for rehearing, the opinion filed on October 29, 1980 is withdrawn and replaced by the following disposition.

We must decide whether the trial court correctly ruled (1) that Leslie's loss was covered by its policy with St. Paul and (2) that St. Paul breached its duty of good faith by denying coverage and forcing Leslie to litigate. We also must determine whether the trial...

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