Judge: Latrice A. G. Byrdsong, Case: 20STLC05790, Date: 2023-12-05 Tentative Ruling
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Case Number: 20STLC05790 Hearing Date: December 5, 2023 Dept: 25
Hearing Date: Tuesday, December 5, 2023
Case Name: INTERINSURANCE
EXCHANGE OF THE AUTOMOBILE CLUB v. VINCE QUIGG and DOES 1 through 10, inclusive
Case No.: 20STLC05790
Motion: Motion for Summary Judgment or, in
the Alternative, Summary Adjudication
Moving Party: Cross-Defendant Coast
National Insurance Company (Doe 3)
Responding Party: None
Notice: OK
Tentative Ruling: Cross-Defendant Coast National Insurance Company’s Motion
for Summary Judgment is GRANTED.
BACKGROUND
On July 13,
2020, Plaintiff Interinsurance Exchange of the Automobile Club (“IE”) commenced
this action against Defendants Vince Quigg (“Quigg”) and Does 1 through 10,
inclusive, by filing a Complaint for Subrogation Recovery (the “Complaint”).
The
Complaint alleges the following. At all relevant times, IE’s insured Rosalio Joya
(“Joya”) was the owner of a vehicle insured under a casualty insurance policy that
covered (among other things) risk of loss or damage. Compl., ¶ 4. On or about
December 3, 2017, Joya’s vehicle was being lawfully operated or parked in this
judicial district when the defendants, each of them, negligently entrusted,
managed, maintained, repaired, drove, and operated their motor vehicles,
causing it to collide with Joya’s vehicle and injure the occupants in that
vehicle. Compl., ¶ 7.
At the time of the accident, defendants Quigg and Does 1 to 2 were uninsured
owners of their vehicle. Compl., ¶
5.
On January
20, 2021, Quigg filed a Cross-Complaint against cross-defendants IE, Foremost
Insurance Group (erroneously sued as Bristol West Insurance Services of
California Inc. dba Foremost Insurance Group) (“Foremost”), Joya, and Does 1 to
5, inclusive, asserting causes of action for (1) contractual indemnity, (2)
indemnity, (3) partial indemnity, (4) breach of insurance contract, (5) bad
faith insurance practices, and (6) declaratory relief.
The
Cross-Complaint alleges the following, among other things. On or about
September 2017, Foremost, through its authorized agents, executed and delivered
to Quigg a written automobile liability insurance policy bearing number G-00837605100/3009929070-1-1.
XC, ¶ 8. On or about
December 3, 2017, while the policy was in full force and effect, Quigg was
involved in a collision with Joya on Downey Avenue near the City of Downey in
Los Angeles County. XC, ¶
23. As a result of the collision, Quigg’s vehicle was damaged, and Quigg paid
$9,250 to repair the vehicle. XC, ¶ 24. Quigg gave Foremost notice and proof of the loss on
or about December 3, 2017, and has performed all his obligations under the policy,
including making insurance payments. XC, ¶ 10. However, Foremost denied that the
policy covered the loss and has refused to reimburse Quigg. XC, ¶ 22. If Quigg
is found liable to any party in this action, his liability is expressly limited
by the policy. XC, ¶ 13. In addition, if Quigg is found liable, his liability
is passive and derivative only, and the liability of the cross-defendants was
active and primary under the insurance policy. XC, ¶ 15. Therefore, Quigg is
entitled to indemnification for any amounts he is required to pay in addition
to costs, expenses, and reasonable attorney’s fees. XC, ¶ 16.
On August 19, 2022, Quigg amended
his Cross-Complaint to substitute Cross-Defendant Coast National Insurance
Company (“Coast National”) for the defendant sued fictitiously as Doe 3.
On August 24, 2022, Quigg filed an Amendment to Complaint,
correcting Foremost’s name.
On April 4, 2023, Quigg dismissed Foremost
from the Cross-Complaint, without prejudice.
On May 9, 2023, the Court dismissed
IE and Joya from Quigg’s Cross-Complaint.
On September 18, 2023, Coast
National filed the instant motion for summary judgment or, in the alternative,
summary adjudication.
On November 30, 2023, Coast National
filed a Notice of Non-Opposition, informing the Court that the deadline for any
opposition to the motion for summary judgment was November 21, 2023, but no
opposition was filed or served.
MOVING PARTY’S
POSITION
Cross-complainant Quigg, an
attorney representing himself, is seeking liability and collision coverage for
an accident on December 3, 2017.
However, on the date of the
accident, his policy was not in force; it had been canceled for non-payment of
premiums more than 10 days following his receipt of a Notice of Cancellation.
Consequently, moving party Coast
National has no contractual obligations to him (or his spouse, Alondra Quigg,
who was also named as an insured on the policy at the time of the loss, but who
is not named in this action).
Quigg acknowledges that he missed a
premium payment and recognizes that the policy was canceled for nonpayment of
premiums. But rather than taking responsibility for his malfeasance, he blames
Coast National for not sufficiently warning him.
OPPOSITION
None filed.
REPLY
None filed.
ANALYSIS
I. MOTION
FOR SUMMARY JUDGMENT
A. Legal Standard
“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 … cross-defendant 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, even if not separately pleaded, cannot be
established, or that there is a complete defense to the cause of action.” Code
Civ. Proc., § 437c, subd. (p)(2).
“Once the … cross-defendant has met that burden, the burden
shifts to the … cross-complainant to show that a triable issue of one or more
material facts exists as to the cause of action or a defense thereto. The …
cross-complainant shall not rely upon the allegations or denials of its
pleadings to show that a triable issue of material fact exists but, instead,
shall set forth the specific facts showing that a triable issue of material
fact exists as to the cause of action or a defense thereto.” Code Civ. Proc., §
437c, subd. (p)(2).
“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.
B. Discussion
1.
The Fourth Cause of Action for Breach of
Contract and Sixth Cause of Action for Declaratory Relief
Coast National first argues under
the Legal Argument section of its motion, that Quigg’s fourth cause of action
for breach of insurance contract and sixth cause of action for declaratory
relief have no merit because there was no insurance policy between Coast
National and Quigg on December 3, 2017, the date of the alleged collision
between Quigg and Joya.
Specifically, Coast National argues
that Quigg’s insurance policy had been canceled at the time of the loss because
of Quigg’s failure to make premium payments.
“To prevail on a cause of action
for breach of contract, the plaintiff must prove (1) the contract, (2) the
plaintiff’s performance of the contract or excuse for nonperformance, (3) the
defendant’s breach, and (4) the resulting damage to the plaintiff.” Richman
v. Hartley (2014) 224 Cal.App.4th 1182, 1186.
“[I]n a declaratory relief action,
the defendant’s burden [on summary judgment] is to establish the plaintiff is
not entitled to a declaration in its favor. It may do this by establishing (1)
the sought-after declaration is legally incorrect; (2) undisputed facts do not
support the premise for the sought-after declaration; or (3) the issue is
otherwise not one that is appropriate for declaratory relief.” Gafcon, Inc.
v. Ponsor & Associates (2002) 98 Cal.App.4th 1388, 1402.
Under the California Insurance
Code, “cancellation” of an automobile insurance policy “means termination of
coverage by an insurer (other than termination at the request of the insured)
during a policy period.” Ins. Code, § 660, subd. (g).
“A notice of cancellation of [an
automobile insurance] policy shall be effective only if it is based on one or
more of the following reasons: ¶
(1) Nonpayment of premium.” Ins. Code, § 661, subd. (a)(1).
“‘Nonpayment of premium’ means
failure of the named insured to discharge when due any of his obligations in
connection with the payment of premiums on a policy, or any installment of such
premium, whether the premium is payable directly to the insurer or its agent or
indirectly under any premium finance plan or extension of credit.” Ins. Code, §
660, subd. (f).
“A notice of cancellation of a
policy shall not be effective unless mailed or delivered by the insurer to the
named insured, lienholder, or additional interest at least 20 days prior to the
effective date of cancellation; provided, however, that where cancellation
is for nonpayment of premium, at least 10 days’ notice of cancellation
accompanied by the reason for the cancellation shall be given.” Ins. Code,
§ 662, subd. (a) (emphasis added). “Unless the reason accompanies or is
included in the notice of cancellation, the notice of cancellation shall state
or be accompanied by a statement that upon written request of the named
insured, mailed or delivered to the insurer not less than 15 days prior to the
effective date of cancellation, the insurer will specify the reason for the
cancellation.” Ibid.
“Therefore, under California law,
an insurance policy may be cancelled by the insurer for failure of the named
insured to discharge ‘when due’ any of his or her obligations in connection
with the payment of premiums for the policy. ([Ins. Code] § 660, subd. (f).)
Where cancellation of the policy is for failure of the named insured to pay a
premium ‘when due,’ no less than 10 days written notice of cancellation to the
insured is required by section 662.” Mackey v. Bristol West Ins. Services of
Cal., Inc. (2003) 105 Cal.App.4th 1247, 1261 (“Mackey”).
“‘If a cancellation is defective,
the policy remains in effect even if the premiums are not paid. [Citation.]’
[Citation.]” Mackey, supra, 105 Cal.App.4th at p. 1258 (emphasis
removed). “In California, there is no such thing as substantial compliance in
furnishing notice that an insurance policy has been cancelled.” Ibid. “Termination
of coverage can only be accomplished by strict compliance with the terms of any
statutory provisions applicable to cancellation.” Ibid. “Likewise, the
insurer must adhere closely to all policy provisions setting forth requirements
as to the time and manner of giving notice of cancellation to the insured.” Ibid.
“The obvious purpose of providing
strict time limits for advance notice as a prerequisite to cancellation of an
automobile insurance policy is to protect the insured against unintended
termination of coverage caused by the inadvertent delay of a premium payment,
and thus, to give the defaulting policyholder at least a 10–day period to cure
the default or secure other insurance.” Mackey,
supra, 105 Cal.App.4th at p. 1261.
Here, to prove that Quigg’s
insurance policy with Coast National was properly canceled for nonpayment of
premiums at the time of loss on December 3, 2017, Coast National submits the declaration
of Latoya Vaughn (“Vaughn”), who attests to the following facts. She is a
personal lines Account Underwriter Specialist for Bristol West Insurance
Services of California, Inc. (“Bristol West”), which handles underwriting for
Coast National. Compendium of Evidence filed September 18, 2023 (“COE”),
Declaration of Latoya Vaughn (“Vaughn Decl.”), ¶ 1. As a personal lines Account Underwriter Specialist,
she is familiar with the policies issued by Coast National, as well as Bristol
West’s systems for recording events, communications, and premium payments. Vaughn
Decl., ¶¶ 2,
3. Quigg’s insurance policy premiums were recorded on an electronic “Billing
Payment Detail” page. Vaughn Decl., ¶
3; Exhibit 2 – a copy of the page. According to the billing records,
Quigg made some premium monthly payments but not others, resulting in a “lapse
in coverage,” whereby he would be covered for the period for which he paid but
was not covered for the period his premium had not been paid. For example, Quigg’s
spouse, Alondra Quigg, made a credit card payment on November 13, 2017, for
$560.40. Vaughn Decl., ¶
9. However, although that premium payment was made in “November 2017,” it went
to the outstanding premium payment of October 2017. Vaughn Decl., ¶ 9; see also COE, Declaration
of Michael Lynch, ¶
10 (explaining that the purpose of Quigg’s spouse’s phone call on November 13,
2017, was to make the October premium payment, not the November premium
payment). Therefore, since a $551.02 premium payment for November 2017 remained
due, a Notice of Cancellation for Non-Payment of Premium was mailed to Quigg
due to his failure to pay the November premium, warning him of a cancellation date
of November 30, 2017, which was more than the statutory 10-days notice. Vaughn
Decl., ¶ 12; Exhibit
10 – a copy of the letter. Quigg subsequently attempted to make a premium
payment on December 5, 2017, which would have resulted in a lapse in coverage
from November 30, 2023, the cancellation date of the policy and December 5,
2017, the date that payment was to be made. Vaughn Decl., ¶ 14. However, because the
December 5th payment bounced, the policy remained canceled as of
November 30, 2017, and was not reinstated on December 6, 2017. Vaughn
Decl., ¶ 15.
The Court finds that Coast National has met its initial
burden of showing that Quigg’s fourth cause of action for breach of
insurance contract and sixth cause of action for declaratory relief have no
merit because there was no effective insurance policy on December 3, 2017, the
date of the alleged collision between Quigg and Joya. Code
Civ. Proc., § 437c, subd. (p)(2).
Therefore, the burden shifts to
Quigg to show that a triable issue of one or more material facts exists as to
those claims. Code Civ. Proc., § 437c, subd. (p)(2).
Here, Quigg did not file an
opposition and, therefore, has failed to meet that burden. Code Civ. Proc., § 437c, subd. (p)(2).
Accordingly,
the request for summary adjudication of the fourth cause of action for breach of insurance
contract and sixth cause of action for declaratory relief is granted.
2.
The First Cause of Action for Contractual
Indemnity, Second Cause of Action for Indemnity, and Third Cause of Action for
Partial Indemnity
“The basis for the remedy of equitable indemnity is
restitution. ‘“[O]ne person is unjustly enriched at the expense of another when
the other discharges liability that it should be his responsibility to pay.”’
[Citation.]” Children’s Hospital v. Sedgwick (1996) 45 Cal.App.4th 1780,
1786 (“Children’s Hospital”). “California common law recognizes a right
of partial indemnity under which liability among multiple tortfeasors may be
apportioned according to the comparative negligence of each.” Ibid.
“[A]n action for equitable indemnity is premised upon a
joint legal obligation to another for damages.” Children’s Hospital, supra,
45 Cal.App.4th at p. 1787.
“‘[I]f the evidence establishes that a defendant is not a
concurrent tortfeasor responsible in any way for the plaintiff's injuries,
another defendant may not pursue a claim for indemnity against that defendant.’
[Citation.] This principle is often expressed in the shorthand phrase ‘there
can be no indemnity without liability.’ [Citation.]” Children’s Hospital,
supra, 45 Cal.App.4th at p. 1787 (emphasis added).
As Coast National argues, Quigg’s indemnity claims (i.e.,
the first, second, and third causes of action) are premised on the allegation
that an insurance policy existed between the cross-defendants and Quigg.
However, as discussed above, Coast National has submitted
evidence showing no insurance policy existed on December 3, 2017, the date of
the alleged collision between Quigg and Joya. Quigg has not filed any
opposition explaining on what theory Coast National can be held liable for
indemnity if there was no policy in existence at the time of the collision.
Therefore, the Court finds that Coast National has met its
initial burden of showing that Quigg’s indemnity claims have no merit and Quigg
has failed to meet his burden of showing a triable issue exists. Code Civ. Proc., § 437c, subd. (p)(2).
Accordingly, summary adjudication of the first cause of
action for contractual indemnity, second cause of action for indemnity, and
third cause of action for partial indemnity is granted.
3.
The Fifth Cause of Action for Bad Faith Insurance
Practices
“An insurer is said to act in ‘bad
faith’ when it breaches its duty to deal ‘fairly’ and ‘in good faith’ with its
insured. [Citation.] The term ‘bad faith’ does not connote ‘positive misconduct
of a malicious or immoral nature’ [citation]; it simply means the insurer acted
deliberately.” Major v. Western Home Ins. Co. (2009) 169 Cal.App.4th
1197, 1209, as modified on denial of reh’g (Jan. 30, 2009) (“Major”).
“[T]o establish the insurers’ ‘bad
faith’ liability, the insured must show that the insurer has (1) withheld
benefits due under the policy, and (2) that such withholding was ‘unreasonable’
or ‘without proper cause.’ [Citation.]” Major, supra, 169
Cal.App.4th at p. 1209. “The actionable withholding of benefits may consist of
the denial of benefits due [citation]; paying less than due [citation]; and/or
unreasonably delaying payments due [citation].” Ibid.
Here, Coast National has met its
initial burden of showing that Quigg’s bad faith claim lacks merit by proving
that there was no existing policy to begin with and, therefore, its failure to
pay for the loss was not unreasonable or without proper cause. Quigg has failed
to meet his burden of showing a triable issue exists as to that claim.
Accordingly, summary adjudication
of the fifth cause of action for bad faith insurance practices is granted.
4.
Other Arguments in the Moving Papers
Coast National also moves for
summary judgment or adjudication, arguing that Plaintiff’s estoppel argument
and request for punitive damages has no merit.
However, Quigg did not make any
allegations of estoppel in the Cross-Complaint. Indeed, according to Coast
National, Quigg made the estoppel allegation in its letter to the
cross-defendant. Motion, p. 8, fn. 6 (citing to COE, Exhibit 16, Quigg’s letter
to Coast National). “‘The pleadings delimit the issues to be considered on a
motion for summary judgment. [Citation.]’ [Citation.]” Laabs v. City of
Victorville (2008) 163 Cal.App.4th 1242, 1253. “Thus, a ‘defendant moving
for summary judgment need address only the issues raised by the complaint; the
plaintiff cannot bring up new, unpleaded issues in his or her opposing papers.’
[Citation.]” Ibid. “‘To create a triable issue of material fact, the
opposition evidence must be directed to issues raised by the pleadings. [Citation.]’”
Ibid.
In addition, given the Court’s
ruling above, that Coast National is entitled to summary adjudication as to all
claims raised in the Cross-Complaint, the prayer for punitive damages against
the cross-defendant is moot.
Accordingly, the Court will not
address the estoppel and punitive damages arguments.
Having found no triable issues concerning
Quigg’s Cross-Complaint against Coast National, the Court finds it proper to
grant Coast National’s request for summary judgment.
II. Conclusion
Cross-Defendant Coast National Insurance Company’s Motion
for Summary Judgment is GRANTED. The Cross-Complaint filed by Cross-Complainant
Vince Quigg against the cross-defendant is dismissed.