When Michael A. Jaffe, a child psychiatrist practicing in California, was accused of Medi Cal fraud and theft he requested that his malpractice insurer, Cranford Insurance Company (Cranford), provide his criminal defense. Cranford refused to defend Jaffe, citing the terms of Jaffe’s malpractice insurance policy. The policy describes the insured risk as “psychiatrist’s professional liability in respect of insured’s practice of psychiatry.” Another clause of the policy states that Cranford “ agrees to pay such damages as may be awarded in respect of professional services rendered by Jaffe, or which should have been rendered by him, resulting from any claims or suits based solely upon malpractice, error, or mistake.” After Cranford refused to defend him, Jaffe hired his own criminal defense lawyer. The case went to trial, and Jaffe was found innocent of all charges. After his acquittal, Jaffe demanded that Cranford reimburse him for the expenses incurred during trial. When Cranford refused this request, Jaffe sued. Who wins? Jaffe v. Cranford Insurance Company, 168 Cal. App. 3d 930, 214 Cal. Rptr. 567, 1985 Cal. App. Lexis 2153 (Court of Appeal of California)
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