Judge: Barbara M. Scheper, Case: 21STCV47417, Date: 2022-10-20 Tentative Ruling

Case Number: 21STCV47417    Hearing Date: October 20, 2022    Dept: 30

Dept. 30

Calendar No.

Hakak vs. Interinsurance Exchange of the Automobile Club, et. al., Case No. 21STCV47417

Tentative Ruling re:  Defendant’s Motion for Judgment on the Pleadings

Defendant Interinsurance Exchange of the Automobile Club (Defendant) moves for judgment on the pleadings as to the first, third, fourth, and fifth causes of action in the Complaint of Plaintiff Lev Hakak (Plaintiff). The motion is granted without leave to amend.

A motion for judgment on the pleadings may be made after the time to demur has expired and an answer has been filed. (Code Civ. Proc., § 438, subd. (f).) A motion by a defendant may be made on the grounds that the complaint or cross-complaint “does not state facts sufficient to constitute a cause of action against that defendant.” (Code Civ. Proc., § 438, subd. (c)(B)(ii).) A motion for judgment on the pleadings has the same function as a general demurrer but is made after the time for demurrer has expired. Except as provided by statute, the rules governing demurrers apply. (Cloud v. Northrop Grumman Corp. (1998) 67 Cal.App.4th 995, 999.)

Like a general demurrer, “ordinarily, a [motion for judgment on the pleadings] does not lie as to a portion of a cause of action, and if any part of a cause of action is properly pleaded, the [motion] will be overruled.” (Fire Ins. Exchange v. Superior Court (2004) 116 Cal.App.4th 446, 452.) In considering a motion for judgment on the pleadings, courts consider whether properly pled factual allegations—assumed to be true and liberally construed—are sufficient to constitute a cause of action. (Stone Street Capital, LLC v. Cal. State Lottery Com’n (2008) 165 Cal.App.4th 109, 116.)

On December 12, 2015, Plaintiff was struck by a car driven by Danielle Otero. (Comp. ¶ 11.) Plaintiff settled with Otero’s insurer, GEICO, for the sum of $100,000. (Comp. ¶ 14.) On August 9, 2016, Plaintiff made an underinsured motorist claim to Defendant, his insurer, for the policy limit of $1,000,000. (Comp. ¶¶ 9, 31.) In March 2017, Plaintiff made a demand for arbitration of the claim. (Comp. ¶ 34.) The claim proceeded to arbitration in August 2020. (Comp. ¶ 74.) The arbitrator awarded Plaintiff $900,000, based on the policy limit of $1,000,000 minus the $100,000 Plaintiff had received from Otero’s insurer. (Comp. ¶ 74.)

First Cause of Action for Breach of Contract

            Plaintiff’s first cause of action for breach of contract alleges that Defendant breached the parties’ insurance contract by failing and refusing to promptly pay Plaintiff’s August 2016 claim. (Comp. ¶¶ 78-81.) Plaintiff has not pled which specific provision of the insurance contract was breached by Defendant. (Comp. ¶¶ 77-81.)

“Facts alleging a breach, like all essential elements of a breach of contract cause of action, must be pleaded with specificity. (See generally 4 Witkin, Cal. Procedure (4th ed. 1996) Pleading, § 4495, pp. 585–586; Bentley v. Mountain (1942) 51 Cal.App.2d 95, 98 … [general averments that defendants violated contract insufficient; pleader must allege facts demonstrating breach]; Thompson v. Purdy (1931) 117 Cal.App. 565, 567 … [general averments that defendant failed to perform duties or comply with contract insufficient].)” (Levy v. State Farm Mutual Automobile Ins. Co. (2007) 150 Cal.App.4th 1, 6.)

Plaintiff has not alleged any specific provision in the insurance contract that was breached by Defendant. In his Opposition, Plaintiff argues that the cause of action is premised on Defendant’s breach of its duties under Insurance Code § 790.03.

Insurance Code section 790.03 defines certain conduct as “unfair methods of competition and unfair and deceptive acts or practices in the business of insurance.” There is no private right of action under section 790.03, with enforcement limited to administrative proceedings carried out by the Insurance Commissioner. (Moradi-Shalal v. Fireman's Fund Ins. Companies (1988) 46 Cal.3d 287, 304-305.) Section 790.03 does not support Plaintiff’s cause of action for breach of contract.

Third Cause of Action for Fraud/Deceit

            Plaintiff’s cause of action for fraud alleges that Defendant made unspecified misrepresentations regarding the provisions of the insurance policy and the fairness of Defendant’s investigation into Plaintiff’s claim. (Comp. ¶ 101.)

The elements of fraud are: (1) misrepresentation (false representation, concealment, or nondisclosure); (2) knowledge of falsity (scienter); (3) intent to defraud or induce reliance; (4) justifiable reliance; and (5) damages. (See Civil Code §1709.) Fraud actions are subject to strict requirements of particularity in pleading. (Committee on Children’s Television, Inc. v. General Foods Corp. (1983) 35 Cal.3d 197, 216.) “The particularity requirement demands that a plaintiff plead facts which show how, when, where, to whom, and by what means the representations were tendered.” (Cansino v. Bank of America (2014) 224 Cal.App.4th 1462, 1469.) 

Plaintiff argues that this cause of action may be based on Defendant’s alleged responses to discovery propounded by Plaintiff in 2018. (Comp. ¶¶ 42-51.) Plaintiff alleges that Defendant failed to produce the full applicable insurance policy in response to a Demand for Production for that policy, and that Defendant’s responses to discovery concerning the policy limits were evasive.

These alleged representations are protected by the litigation privilege and so cannot support Plaintiff’s cause of action for fraud. Civil Code section 47(2) provides an absolute privilege applicable to “any communication (1) made in judicial or quasi-judicial proceedings; (2) by litigants or other participants authorized by law; (3) to achieve the objects of the litigation; and (4) that have some connection or logical relation to the action.” (Silberg v. Anderson (1990) 50 Cal.3d 205, 212.) “To effectuate its vital purposes, the litigation privilege is held to be absolute in nature.” (Id. at 215.) Defendant’s discovery responses were made during the course of litigation and so fall within the scope of the litigation privilege.  Plaintiff has not specifically pled any other misrepresentations made by Defendant

Fourth Cause of Action for Intentional Infliction of Emotional Distress

            “The elements of the tort of intentional infliction of emotional distress are: (1) extreme and outrageous conduct by the defendant with the intention of causing, or reckless disregard of the probability of causing, emotional distress; (2) the plaintiff's suffering severe or extreme emotional distress; and (3) actual and proximate causation of the emotional distress by the defendant's outrageous conduct. Conduct to be outrageous must be so extreme as to exceed all bounds of that usually tolerated in a civilized community.” (Christensen v. Superior Court (1991) 54 Cal.3d 868, 903.)

In order for conduct to be outrageous, there must be (1) a specific intent to injure, or (2) a reckless disregard of the substantial certainty of a severe emotional injury. (Id. at p. 210 [“Absent an intent to injure, such inaction is not the kind of ‘extreme and outrageous conduct’ that gives rise to liability under the ‘intentional infliction of emotional distress’ tort”]; Christensen v. Superior Court, supra, 54 Cal.3d at p. 903 [“substantially certain to cause extreme emotional distress”].)

The Court agrees with Defendant that Plaintiff has failed to allege any “extreme or outrageous” conduct by Defendant. The delayed payment of insurance benefits, as a matter of law, does not constitute outrageous conduct supporting a cause of action for intentional infliction of emotional distress. (Schlauch v. Hartford Accident & Indemnity Co. (1983) 146 Cal.App.3d 926, 936; Ricard v. Pacific Indemnity Co. (1982) 132 Cal.App.3d 886, 895.)

Fifth Cause of Action for Negligence

Plaintiff’s fifth cause of action is based on general allegations that “the acts and omissions of [Defendant] . . . as alleged herein were negligent.” (Comp. ¶ 119.) Plaintiff asserts in his Opposition that this cause of action is one for negligent infliction of emotional distress.

“If an insured seeks to recover in tort for an insurer's mishandling of a claim, it must allege more than mere negligence.” (Adelman v. Associated Intern. Ins. Co. (2001) 90 Cal.App.4th 352, 369.) “[N]egligence is not among the theories of recovery generally available against insurers.” (Sanchez v. Lindsey Morden Claims Services, Inc. (1999) 72 Cal.App.4th 249, 254.) Additionally, California law does not allow recovery for emotional suffering damages in cases involving negligence with bad faith, and does not “recognize a cause of action for recovery of damages for emotional distress based on garden-variety negligence concepts.” (Soto v. Royal Globe Ins. Corp. (1986) 184 Cal.App.3d 420, 434.)