Judge: Cherol J. Nellon, Case: 23STCV04473, Date: 2024-02-07 Tentative Ruling

Case Number: 23STCV04473    Hearing Date: February 7, 2024    Dept: 14

Bell vs AIG Claims

Case Background

Plaintiffs allege that a solar installer removed roofing materials on their home, leaving them exposed to a heavy rain that caused significant water damage. Plaintiffs initially sued the solar installer, but they settled that case for (1) a stipulated judgment of $300,000 against the installer and (2) an assignment of the installer’s claims against the installer’s insurance company and insurance brokers.

Pursuant to that assignment, Plaintiffs have now filed suit against the insurance companies and insurance broker, alleging that the insurance companies were obliged to cover and defend the installer. Plaintiffs include the insurance broker, on the theory that they failed to properly advise the installer on how to avoid the issues that ultimately arose.

            On September 27, 2023 Plaintiffs filed their First Amended Complaint (“FAC”) for (1) Breach of Contract, (2) Insurance Bad Faith, (3) Negligence and (4) Declaratory Relief against Defendants AIG Claims, Inc. (“AIG”), National Union Fire Insurance Company of Pittsburgh, PA (“National Union”), Pascal Burke Insurance Brokerage, Inc. (“Pascal”), and DOES 1-20.

            Only the third cause of action is asserted against Defendant Pascal, and no other defendant is party to that claim.

            Defendants AIG and National Union filed Answers to the initial complaint, but have not yet filed Answers to the FAC.

            No trial date has yet been set.

Instant Motion

Defendant Pascal now moves this court for an order striking the Plaintiffs’ prayer for attorney’s fees and punitive damages.

Decision

            The request to strike the prayer for punitive damages is GRANTED as to Defendant Pascal only.

            The request to strike the prayer for attorney’s fees is GRANTED, with 10 days leave to amend.

Discussion

            Plaintiffs agree that Defendant Pascal is not liable for punitive damages. Defendant Pascal suggests that Plaintiffs be ordered to make that clear by creating a different prayer for each cause of action, or a different prayer for each defendant. This is not necessary. The parties’ stipulation, recorded here and resulting in an order of the court striking the request as to Defendant Pascal, is sufficient on that score.

Attorney’s Fees

            If a defendant’s tort has caused the plaintiff to maintain or defend a different lawsuit against a third person, the attorney’s fees for that other case become part of the damages that plaintiff may recover. Third Eye Blind, Inc. v. Near North Entertainment Ins. Services, LLC (2005) 127 Cal.App.4^th 1311, 1325. In the insurance context, this rule has been extended a bit further: an insured who asserts both a breach of contract claim and a bad faith claim against his insurer may recover his attorney’s fees on the breach of contract claim as an element of damages in the bad faith claim, even if both claims were brought simultaneously. Brandt v. Superior Court (1985) 37 Cal.3d 813.

            Plaintiffs’ argument is that these “Brandt fees,” as they are colloquially known, may be recovered from insurance brokers as well as insurance carriers. Third Eye, supra, 127 Cal.App.4^th at 1325. Defendant Pascal does not directly disagree that these fees are theoretically available to Plaintiffs. On reply, Defendant Pascal instead argues that there must be facts pled to support the presence and amount of these damages.

            Defendant Pascal is correct. Where attorney’s fees are requested as an element of damages, they should be separately identified as such in the body of the complaint. Plaintiffs need to identify the case or claims for which they seek fee compensation, so that Defendants can prepare a response. Of course, if these are truly Brandt fees in the sense that Plaintiffs seek compensation for the first cause of action in this case, obviously Plaintiffs can no more plead a precise amount than they (or anyone) can predict the future. It should be adequate that they provide an estimate, clearly labeled as such.

Conclusion

            Plaintiffs have agreed that Defendant Pascal is not liable for punitive damages. Plaintiffs are also theoretically entitled to recover Brandt fees from Defendant Pascal if they prove their cause of action. However, these fees have not been properly identified in the body of the complaint as a separate category of damages. Therefore, the request to strike the prayer for punitive damages is GRANTED as to Defendant Pascal only. The request to strike the prayer for attorney’s fees is GRANTED, with 10 days leave to amend.