Judge Gary Y. Tanaka, Case 19TRCV00386 2022-08-10 Tentative Ruling

LOS ANGELES SUPERIOR COURT – SOUTHWEST DISTRICT

Honorable Gary Y. Tanaka Wednesday, August 10, 2022

Department B Calendar No. 10

Plaintiffs filed their Complaint on April 29, 2019. Plaintiffs’ First Amended Complaint was filed on July 12, 2019. Plaintiffs allege the following facts. Plaintiffs Michael Gael and Ronald A. Sturtz were involved in a multi-vehicle motor vehicle accident while on vacation in Costa Rica. Each suffered serious injuries. Due to concerns regarding hygiene, equipment, and care at the hospital in Costa Rica (CIMA Hospital), they were transported via air ambulance by Plaintiff Jet I.C.U. to a hospital in Torrance, California. Defendant California Physicians Service dba Blue Shield (health insurer for both Gael and Sturtz) improperly denied the charges ($675,000+) as not medically necessary, but paid ground ambulance charges on both ends. Plaintiffs allege the following causes of action: (1) Breach of Contract (by Michael Gael); (2) Breach of Contract (by Ronald A. Sturtz); (3) Third Party Beneficiary Breach of Contract (by Jet ICU); (4) Breach of Implied in Fact Contract (by Jet ICU); (5) Quantum Meruit (by Jet ICU); (6) Unjust Enrichment (by Jet ICU). The third cause of action was subsequently dismissed.

Objections to Alan McElfresh deposition, page 30:1-6; page 31:6-20 – Sustained.

Objections to Michael Gael deposition, page 26:18-22; page 27:18-28:19 – Sustained.

Objections to Ronald A. Sturtz deposition, page 33:2-13; page 36:2-9 – Sustained.

The purpose of a motion for summary judgment or summary adjudication “is to provide courts with a mechanism to cut through the parties’ pleadings in order to determine whether, despite their allegations, trial is in fact necessary to resolve their dispute.” (Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 843.) “Code of Civil Procedure section 437c, subdivision (c), requires the trial judge to grant summary judgment if all the evidence submitted, and ‘all inferences reasonably deducible from the evidence’ and uncontradicted by other inferences or evidence, show that there is no triable issue as to any material fact and that the moving party is entitled to judgment as a matter of law.” (Adler v. Manor Healthcare Corp. (1992) 7 Cal. App. 4th 1110, 1119.)

“On a motion for summary judgment, the initial burden is always on the moving party to make a prima facie showing that there are no triable issues of material fact.” (Scalf v. D. B. Log Homes, Inc. (2005) 128 Cal. App. 4th 1510, 1519.) A defendant moving for summary judgment or summary adjudication “has met his or her burden of showing that a cause of action has no merit if the party has shown that one or more elements of the cause of action . . . cannot be established, or that there is a complete defense to the cause of action.” CCP § 437c(p)(2). “Once the defendant . . . has met that burden, the burden shifts to the plaintiff . . . to show that a triable issue of one or more material facts exists as to the cause of action or a defense thereto.” CCP § 437c(p)(2). “If the plaintiff cannot do so, summary judgment should be granted.” Avivi v. Centro Medico Urgente Medical Center (2008) 159 Cal. App. 4th 463, 467.

“A plaintiff or cross-complainant has met his or her burden of showing that there is no defense to a cause of action if that party has proved each element of the cause of action entitling the party to judgment on the cause of action. Once the plaintiff or cross-complainant has met that burden, the burden shifts to the defendant or cross-defendant to show that a triable issue of one or more material facts exists as to the cause of action or a defense thereto.” Code Civ. Proc., § 437c(p)(1).

“When deciding whether to grant summary judgment, the court must consider all of the evidence set forth in the papers (except evidence to which the court has sustained an objection), as well as all reasonable inferences that may be drawn from that evidence, in the light most favorable to the party opposing summary judgment.” (Avivi, 159 Cal.App.4th at 467; CCP § 437c(c).)

Defendant moves for summary judgment on the ground that there is no dispute as to the material facts and Blue Shield is entitled to judgment as a matter of law as to the claims brought by Plaintiffs Michael Gael. Alternatively, Defendant moves for summary adjudication of the first, second, fourth, fifth, and sixth causes of action.

“The elements of a cause of action for breach of contract are: (1) the contract, (2) plaintiff's performance or excuse for nonperformance, (3) defendant's breach, and (4) the resulting damages to plaintiff.” Coles v. Glaser (2016) 2 Cal.App.5th 384, 391.

Defendant has met its burden to show that the causes of action have no merit by showing that essential elements of the causes of action cannot be established. Plaintiffs have not met their burden to show that a triable issue of one or more material facts exists as to the causes of action. CCP § 437c(p)(2). Essential elements of a cause of action for Breach of Contract are breach and damages resulting from the breach. Plaintiffs fail to demonstrate the existence of a triable issue of material fact as to these essential elements.

Plaintiffs fail to submit evidence to show the existence of a triable issue of material fact as to breach. Plaintiffs’ plan covers ambulance services “used to transport a Member from place of illness or injury to the closest medical facility where appropriate treatment can be received.” (Defendant’s Ex. 1, page 31); (Defendant’s Separate Statement of Facts and Supporting Evidence, 4-9, 46-51.) Here, the air ambulance services were not used to transport Plaintiffs from the place of illness or injury which was the location of the traffic accident, but, instead to transport Plaintiffs from CIMA Hospital to Torrance, California. In addition, Plaintiffs’ plans cover only ambulance services when the services are “used to transport a Member from place of illness or injury to the closest medical facility where appropriate treatment can be received.” (Id.) Here, the air ambulance services were used to transport Plaintiffs from Costa Rica to Torrance, California, which was not the closest medical facility where appropriate treatment could be rendered. (Id. at 27, 30, 70.) Finally, Plaintiffs fail to provide competent evidence to demonstrate that emergency air ambulance services were medically necessary. (Id. at 13-16, 23-29, 55-56, 59-60, 67). Plaintiffs rely on speculation that perhaps they were more susceptible to infections at CIMA Hospital without competent evidence to corroborate this speculation. In addition, Plaintiffs fail to provide evidence to show that they ever did contract any infection. Also, Plaintiffs rely on objectionable hearsay testimony provided by a witness of what this witness was purportedly told by a doctor at CIMA Hospital regarding what may or may not have been medically necessary. The Court notes that no first-hand competent evidence from any physician at CIMA Hospital was provided by Plaintiffs to corroborate any medical necessity for the emergency air transport services that were provided by Jet ICU to Gael and Sturtz.

In addition, Defendant submitted evidence that neither Gael nor Sturtz suffered damages resulting from the denial of coverage for air ambulance services. Plaintiffs Gael and Sturtz admit that they were never billed for Jet ICU services and did not pay any amount for the Jet ICU services. (Defendant’s Separate Statement of Material Facts and Supporting Evidence, 41-42, 76-77.) In fact, Jet ICU’s bill was paid by a third party who has declined repayment or reimbursement from Gael and Sturtz. (Id.) Plaintiffs submitted no competent evidence to demonstrate damages related to the purported breach. Plaintiffs argue that the benefits of the contract were not realized. However, Plaintiffs did, in fact, obtain the specific type of air transport services they requested and no out of pocket payment was made by Plaintiffs. Also, Plaintiffs speculate, but provide no evidence to show that “maybe” the payment made by a friend was a loan. (Opposition, page 10, lines 12-16). There is no competent evidence to demonstrate that this payment was a loan which Gael and Sturtz must repay. Thus, because Gael and Sturtz have no damages, the breach of contract causes of action also fail as lacking competent evidence of an essential element of the cause of action.

“A contract is either express or implied. [Citation.] The terms of an express contract are stated in words. [Citation.] The existence and terms of an implied contract are manifested by conduct. [Citation.] The distinction reflects no difference in legal effect but merely in the mode of manifesting assent. [Citation.] Accordingly, a contract implied in fact ‘consists of obligations arising from a mutual agreement and intent to promise where the agreement and promise have not been expressed in words.” Moen v. Regents of the University of California (2018) 25 Cal.App.5th 845, 854–55. “The elements of a cause of action for breach of contract are: (1) the contract, (2) plaintiff's performance or excuse for nonperformance, (3) defendant's breach, and (4) the resulting damages to plaintiff.” Coles v. Glaser (2016) 2 Cal.App.5th 384, 391.

Defendant has met its burden to show that the cause of action has no merit by showing that an essential element of the cause of action cannot be established. Plaintiff has not met its burden to show that a triable issue of one or more material facts exists as to the cause of action. CCP § 437c(p)(2). An essential element of a cause of action for Breach of Implied Contract is the existence of a contract. Here, Plaintiff submits no competent evidence to demonstrate a mutual agreement and intent to promise which can show that an implied contract was created by the parties.

Jet ICU alleges that an implied contract was created between Jet ICU and Defendant which mandates Defendant to reimburse Jet ICU for the “reasonable and customary” value of its services as “mandated under California Health & Safety Code § 1371.4(b) and 28 Cal. Code Regs. § 1300.71(a)(3). (FAC ¶ 15, 45.) However, the statute and regulation only mandate “reasonable and customary” reimbursement for emergency services.

Plaintiff provides no competent evidence to show the existence of a triable issue of material fact that it provided emergency services. The deposit Jet ICU demanded prior to transporting Gael and Sturtz forecloses any emergency services claim. (Defendant’s Separate Statement of Material Facts and Supporting Evidence, 17-18, 57-58.) The evidence is undisputed that Jet ICU conditioned its services on Sturtz and Gael’s ability to ultimately pay for those services. Such conditions are prohibited when providing emergency care and services. “Emergency services and care shall be rendered without first questioning the patient or any other person as to his or her ability to pay therefor.” Health & Saf. Code § 1317. In addition, emergency service providers are prohibited from billing members of Knox-Keene Act regulated plans, the type of plans taken by Sturtz and Gael, for emergency medical services. Prospect Med. Grp., Inc. v. Northridge Emergency Med. Grp. (2009) 45 Cal.4th 497, 507. However, Jet ICU demanded payment from the members up front. Thus, there could not have been a reasonable meeting of the minds in which Defendant contracted to reimburse Plaintiff Jet ICU for emergency air ambulance services.

In addition, Plaintiff lacks evidence of an implied contract for payment of non-emergency services. Again, any such communication or conduct by Defendant has not been demonstrated. Jet ICU did not obtain authorization from Defendant prior to providing its services. (Defendant’s Separate Statement of Facts and Supporting Evidence, 31, 71, 80.) The only evidence of an actual agreement involved one between Jet ICU and Gael and Sturtz. (Id, at 21-22, 63-64, 86.) Simply because Defendant reimbursed Jet ICU’s ground ambulance claim does not show that there was a separate contract established for air ambulance services. “[T]he allegations in the FAC, based on Blue Shield's payment of some of the invoices, does not exhibit any mutual intent as to the essential terms of the implied contract.” Pacific Bay Recovery, Inc. v. California Physicians' Services, Inc. (2017) 12 Cal.App.5th 200, 216.

Plaintiff also fails to demonstrate another essential requirement for the formation of a contract – consideration. “Civil Code section 1605 defines consideration as ‘[a]ny benefit conferred, or agreed to be conferred, upon the promisor, by any other person, to which the promisor is not lawfully entitled, or any prejudice suffered, or agreed to be suffered, by such person, other than such as he is at the time of consent lawfully bound to suffer, as an inducement to the promisor....’ Thus, there are two requirements in order to find consideration. The promisee must confer (or agree to confer) a benefit or must suffer (or agree to suffer) prejudice. We emphasize either alone is sufficient to constitute consideration; “it is not necessary to the existence of a good consideration that a benefit should be conferred upon the promisor. It is enough that a prejudice be suffered or agreed to be suffered by the promisee. [¶] It is not enough, however, to confer a benefit or suffer prejudice for there to be consideration. ... [T]he second requirement is that the benefit or prejudice must actually be bargained for as the exchange for the promise.” Steiner v. Thexton (2010) 48 Cal.4th 411, 420–21 (internal citations and quotations omitted). Here, there is no evidence of consideration. Again, as shown above, the benefit or prejudice must actually be bargained for as the exchange for the promise. There is no evidence of any such bargain.

“Quantum meruit refers to the well-established principle that the law implies a promise to pay for services performed under circumstances disclosing that they were not gratuitously rendered. To recover in quantum meruit, a party need not prove the existence of a contract, but it must show the circumstances were such that the services were rendered under some understanding or expectation of both parties that compensation therefor was to be made.” Chodos v. Borman (2014) 227 Cal.App.4th 76, 96 (internal citations and quotations omitted).

Plaintiff fails to provide competent evidence to demonstrate that Defendant requested any of the services at issue. Where services are rendered by Plaintiff to a third person, such as here, there must have been a specific request by Defendant. Day v. Alta Bates Medical Center (2002) 98 Cal. App. 4th 243, 248-49. Here, no such specific request has been demonstrated. In contrast, the evidence points to Defendant specifically denying any such requests. There is no evidence that Blue Shield either expressly or implicitly requested that Jet ICU perform services. The evidence demonstrates that Gael and Sturtz requested the services, and Blue Shield never authorized them. (Defendant’s Separate Statement of Facts and Supporting Evidence, 31, 71, 86.)

“[Q]uantum meruit recovery is inappropriate where it would frustrate the law or public policy. . . . [Q]uantum meruit [cannot be used] to recover something to which it is not entitled under the Knox-Keene Act or its applicable regulations.” Pacific Bay Recovery, Inc. v. California Physicians' Services, Inc. (2017) 12 Cal.App.5th 200, 215. Here, Plaintiff is attempting to utilize the theory of quantum meruit to obtain a benefit to which it was not entitled under the Knox-Keene Act which governs Gael and Sturtz’s health care plan.

Unjust Enrichment is not a cause of action. See, Hill v. Roll Int'l Corp. (2011) 195 Cal.App.4th 1295, 1307. The Court may, however, recognize a cause of action based on quasi-contract to obtain the remedy of restitution. See, McKell v. Washington Mutual, Inc. (2006) 142 Cal.App.4th 1457, 1490. "The elements of an unjust enrichment claim are the receipt of a benefit and [the] unjust retention of the benefit at the expense of another." Peterson v. Cellco Partnership (2008) 164 Cal.App.4th 1583, 1593-94. “The term benefit denotes any form of advantage. Thus, a benefit is conferred not only when one adds to the property of another, but also when one saves the other from expense or loss. Even when a person has received a benefit from another, he is required to make restitution “only if the circumstances of its receipt or retention are such that, as between the two persons, it is unjust for him to retain it.” Ghirardo v. Antonioli (1996) 14 Cal.4th 39, 51 (internal citations and quotations omitted).

Here, for the same reasons noted above in the ruling to the first and second causes of action, Plaintiff fails to show the existence of a triable issue of material fact that Plaintiff provided a benefit to Defendant which was unjust for Defendant to retain. Plaintiff argues that Defendant benefited by saving itself from expense or loss. However, no benefit was gained to Defendant because Defendant was not obligated to pay any more benefits than that which were already afforded to Plaintiffs.