Chinese Drywall Supplier Can Pursue Settlement Indemnification from Insurer, Court Rules

DENVER — A Colorado appeals court has reversed a trial court’s decision to dismiss a Chinese drywall coverage case after determining that dismissal of a supplier’s prior suit for coverage of unresolved underlying claims did not preclude an indemnification claim brought after the claims were settled.

In an unpublished decision, the Colorado Court of Appeals ruled Sept. 6 that Probuild Holdings Inc. may seek indemnification now that it has settled the drywall claims, because the prior ruling to dismiss wasn’t made on the merits and, therefore, did not trigger the doctrine of claim preclusion.

Probuild was sued by numerous plaintiffs …