Judge: Nathan R. Scott, Case: Patterson vs. Automobile Club of Southern California, Date: 2023-01-06 Tentative Ruling

Motion for Summary Judgment/Adjudication

Defendant Interinsurance Exchange of the Automobile Club’s motion for summary judgment/adjudication is denied.  

Defendant fails to meet its initial burden to show the action has no merit.  (See Code Civ. Proc., § 437c, subds. (a), (p)(2) [burden]; Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 850-851 [same].)

1st cause of action, breach of contract.  Defendant fails to meet its initial burden to establish its “fraud and concealment” affirmative defense.  (See Cummings v. Fire Ins. Exchange (1988) 202 Cal.App.3d 1407, 1414-1417 & fn. 7 [fraud and concealment clause]; Fazio v. Fairbanks Ranch Country Club (2015) 233 Cal.App.4th 1053, 1057-1058 [burden]; see also Def. Ex. A at p. 16 [policy’s “Misrepresentation or Fraud” clause]; Mot. at pp. 15-16.)

Defendant fails to show plaintiff’s misstatements (1) relate to a material matter, (2) were knowingly and willfully made with knowledge of falsity, and (3) were made with the intent to defraud or deceive.  (Cummings, supra, 202 Cal.App.3d at pp. 1414-1415 & fn. 7.)

On reply, defendant asserts it can avoid coverage even if plaintiff’s misstatements were unintentional.  (See Reply at pp. 6-7.)  That standard applies to misstatements in an insurance application.  (See Mitchell v. United National Ins. Co. (2005) 127 Cal.App.4th 457, 467-469.) 

That standard does not apply to misstatements while making a claim, where the insurer’s right to void a policy is “more limited” and requires that “‘the false statement must have been knowingly and willfully made with the intent (express or implied) of deceiving the insurer.’”  (Mitchell, supra, 127 Cal.App.4th at p. 470.) 

In any event, plaintiff raises triable issues of material fact.  (See Pl. resp. to Def. SSUF #6, 7, 14, 16, 17, 23, 37, 51; see also Pl. Add’l SSUF #1.)

2nd cause of action, breach of implied covenant.  Defendant fails to meet its initial burden to establish its “fraud and concealment” affirmative defense, as discussed above.

Similarly, defendant fails to meet its initial burden to show it did not act unreasonably or without proper cause in denying plaintiff’s claim. (See Century Sur. Co. v. Polisso (2006) 139 Cal.App.4th 922, 949.)  Defendant has not shown it was reasonable to deny coverage based on plaintiff’s misstatements and inconsistencies, which it has not shown were “‘knowingly and willfully made with the intent (express or implied) of deceiving the insurer.’”  (Mitchell, supra, 127 Cal.App.4th at p. 470.) 

In any event, plaintiff raises triable issues of material fact.  (See Pl. resp. to Def. SSUF #6, 7, 14, 16, 17, 23, 37, 51; see also Pl. Add’l SSUF #1.)

Punitive damages.  Defendant fails to meet its initial burden to show the punitive damages claim has no merit.  Triable issues of material fact exist as to whether defendant acted with malice or oppression in denying plaintiff’s claim.  (See Civ. Code, § 3294, subd. (c)(1), (2) [malice, oppression]; see also Egan v. Mutual of Omaha Ins. Co. (1979) 24 Cal.3d 809, 818 [punitive damages for bad faith].)

Defendant’s request for judicial notice is granted.  (See Evid. Code, § 452, subds. (g), (h).)

The court declines to rule on the parties’ objections, which are not material to the disposition of the motion. (See Code Civ. Proc., § 437c, subd. (q).)

Motion to Compel Compliance

Defendant’s motion to compel compliance is denied.

Plaintiff states he has now produced all documents in his possession, custody, or control that are responsive to defendant’s requests (set one).  (See Jorgenson Decl. ¶¶ 3, 7-17 & Exs. 2-9, 13.)

Defendant asserts the production is incomplete but fails to show that.

Defendants’ sanctions request is denied.  Plaintiff provided and confirmed his production by the agreed 10/24/22 deadline.  (See Jorgensen Decl. ¶¶ 3, 5, 7-17 & Exs. 1, 2-9, 11.)

Motion to Compel Responses

Defendant’s motion to compel responses is denied except as to sanctions.  (See Cal. Rules of Court, rule 3.1348(a).)

Plaintiff has now served verified responses to defendant’s requests (set two).  (See Jorgensen Decl. ¶ 21, Ex. 14 [verified responses to requests for production Nos. 52-57, located at pp. 43-45]; see also Colula Moncada Decl. ¶ 2, Ex. A [same].)

Plaintiff shall pay $2010 in discovery sanctions to defendant.

Defendant shall give notice.