Jeffrey William Merriman v. Progressive Insurance

DEMURRER TO FIRST AMENDED COMPLAINT

 

MOVING PARTY: Defendant Progressive Direct Insurance Company 

RESPONDING PARTY(S): Plaintiff Jeffery William Merriman

STATEMENT OF MATERIAL FACTS AND/OR PROCEEDINGS:

Plaintiff Jeffery William Merriman alleges he was involved in two separate car accidents. Plaintiff alleges that his insurer, Defendant Progressive, failed to disclose to Plaintiff that he had an Uninsured Motorist Policy with Defendant for coverage up to $50,000, and instead tried to cap Plaintiff’s insurance recovery at $20,000. It was not until Plaintiff retained an attorney, who eventually settled each claim for the total amount of $100,000, that Plaintiff learned of the “fraud.” Plaintiff alleges he was forced to incur legal fees of approximately $26,600 to obtain the full recovery. Plaintiff asserts causes of action for (1) breach of contract, (2) fraud, (3) misrepresentation, (4) negligence, (5) harassment, and (6) intentional infliction of emotional distress. 

Defendant Progressive now demurrers to the First Amended Complaint. Plaintiff opposed.

TENTATIVE RULING:

Defendant’s Demurrer to the First Amended Complaint is SUSTAINED IN ITS ENTIRETY. Plaintiff is given leave to amend only where expressly stated herein. 

Plaintiff is to file and serve a Second Amended Complaint within 30 days of this ruling.

Defendant is ordered to give notice, unless waived..  

DISCUSSION:

Demurrer

I. Meet and Confer

The Declaration of Kenny C. Brooks, Counsel for Defendant, reflects that the meet and confer requirement was met.

II. Plaintiff’s Untimely Opposition

Plaintiff submitted an untimely opposition on September 17, 2024, only six court days before the hearing. (See CCP § 1005(b) [“All papers opposing a motion so noticed shall be filed with the court and a copy served on each party at least nine court days…before the hearing.”].) 

The court exercises its discretion to consider the untimely opposition. To the extent it wishes to be heard, Defendant will be afforded the opportunity at the hearing to make any arguments it would have raised in reply.

III. Legal Standard

A demurrer for sufficiency tests whether the complaint states a cause of action.  (Hahn v. Mirda (2007) 147 Cal. App. 4th 740, 747.)  When considering demurrers, courts read the allegations liberally and in context.  (Taylor v. City of Los Angeles Dept. of Water and Power (2006) 144 Cal. App. 4th 1216, 1228.)  In a demurrer proceeding, the defects must be apparent on the face of the pleading or by proper judicial notice.  (CCP § 430.30(a).)  A demurrer tests the pleadings alone and not the evidence or other extrinsic matters.  (SKF Farms v. Superior Court (1984) 153 Cal. App. 3d 902, 905.)  Therefore, it lies only where the defects appear on the face of the pleading or are judicially noticed.  (Id.)  The only issue involved in a demurrer hearing is whether the complaint, as it stands, unconnected with extraneous matters, states a cause of action.  (Hahn, 147 Cal.App.4th at 747.)  

IV. Analysis

Defendant demurs to each cause of action in the First Amended Complaint.  Each is addressed in turn.

A. First Cause of Action for Breach of Contract

First, Defendant demurrers to the Breach of Contract cause of action. To establish breach of contract, Plaintiff must allege: (1) the existence of contract; (2) Plaintiff’s performance or excuse for nonperformance; (3) Defendant’s breach (or anticipatory breach); and (4) resulting damage.  (Wall Street Network, Ltd. v. N. Y. Times Co. (2008) 164 Cal.App.4th 1171, 1178.)

The rule in California is that “[a] written contract may be pleaded either by its terms—set out verbatim in the complaint or a copy of the contract attached to the complaint and incorporated therein by reference—or by its legal effect. [Citation.] In order to plead a contract by its legal effect, plaintiff must ‘allege the substance of its relevant terms. This is more difficult, for it requires a careful analysis of the instrument, comprehensiveness in statement, and avoidance of legal conclusions.’ [Citation.]”  (Heritage Pac. Fin., LLC v. Monroy, (2013) 215 Cal. App. 4th 972, 993.)

Plaintiff alleges Defendants “had a contractual Duty to Explain to to [sic] make Clear to the Plaintiff all available coverage including the with [sic] regards to the Uninsured Motorist Policy.” (FAC ¶ 12.) 

Here, Plaintiff has not provided the policy or any other contract. He has also failed to sufficiently plead the contractual duty he alleges existed “by its legal effect.” (Id.) 

Accordingly, Defendant’s Demurrer to the First Cause of Action is SUSTAINED. [FN 1]

Generally speaking, leave to amend must be allowed where there is a reasonable possibility of successful amendment. (Goodman v. Kennedy (1976) 18 Cal.3d 335, 348.) Plaintiff is given leave to amend to attach the governing contract to the complaint, or, to adequately plead the relevant terms of the insurance policy by their legal effect. 

B. Demurrer to Third Cause of Action for Fraud and Fourth Cause of Action for Misrepresentation

Next, Defendant argues Plaintiff’s fraud-based claims fail because Plaintiff has not alleged the claims with the requisite specificity. 

To plead fraud, a Plaintiff must allege “(1) a representation, (2) that is false, (3) made with knowledge of its falsity, and (4) with an intent to deceive, coupled with (5) actual detrimental reliance and (6) resulting damage.” (Lim v. The.TV Corp. Internat. (2002) 99 Cal. App. 4th 684, 694.) Fraud-based claims 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.) To advance a cognizable fraud claim, “every element of the cause of action . . . must be alleged in full, factually and specifically, and the policy of liberal construction of pleading will not usually be invoked to sustain a fraud claim deficient in any material respect.” (Wilhelm v. Pray, Price, Williams & Russell (1986) 186 Cal.App.3d 1324, 1331).

Here, Plaintiff alleges that Defendant “[k]new that Plaintiff was unaware that he could possibly make a claim for up to an additional Liability Damages for up to $50,000,” but “intentionally did not explain the Uninsured Motorist to the plaintiff ever.” (Id. ¶¶ 7, 8.) Plaintiff alleges that an unidentified claims manager “and her supervisor” colluded to “cheat and mislead and defraud” Plaintiff. (Id. ¶ 11.) 

Considering these bare allegations, Plaintiff has failed to allege fraud with the requisite specificity. 

Accordingly, Defendant’s Demurrer to the Third and Fourth Causes of Action is SUSTAINED, with leave to amend. Because fraud and intentional misrepresentation are interchangeable and require the same elements, it is duplicative to include both. (See Anderson v. Deloitte & Touche (1997) 56 Cal. App. 4th 1468, 1474.) When amending, Plaintiff is to reduce these two causes of action into a single cause of action for fraud. 

C. Demurrer to Fifth Cause of Action for Harassment

Next, Defendant argues Plaintiff has failed to allege any facts to support the elements of civil harassment. Code of Civil Procedure section 527.6 “establishes a special procedure specifically designed to provide for expedited injunctive relief to persons who have suffered civil harassment.” (Thomas v. Quintero (2005) 126 Cal. App. 4th 635, 648.) The statute defines “harassment” as: 

…unlawful violence, a credible threat of violence, or a knowing and willful course of conduct directed at a specific person that seriously alarms, annoys, or harasses the person, and that serves no legitimate purpose. The course of conduct must be that which would cause a reasonable person to suffer substantial emotional distress, and must actually cause substantial emotional distress to the petitioner.

(CCP § 527.6(b)(3).)

Here, Plaintiff alleges only that Defendant defrauded him by failing to provide the details of his uninsured motorist policy. (FAC ¶¶ 7-9.) But he has not alleged any form of violence, nor a “course of conduct” sufficient to state a claim under section 527.6.

Accordingly, Defendant’s Demurrer to the Fifth Cause of Action is SUSTAINED. Because it appears unlikely that Plaintiff can successfully amend this cause of action, NO LEAVE TO AMEND IS GIVEN.

D. Demurrer to Sixth Cause of Action for Negligence

Next, Defendant argues the negligence cause of action fails because a negligence theory is not available against insurers like Progressive. 

In most instances, “negligence is not among the theories of recovery generally available against insurers.” (Sanchez v. Lindsey Morden Claims Servs., Inc. (1999) 72 Cal. App. 4th 249, 254.) Instead, the proper cause of action is one for insurance bad faith.

Here, Plaintiff has not established any duty owed by the insurer in this context, and therefore, his cause of action for negligence fails.

Accordingly, Defendant’s Demurrer to the Sixth Cause of Action is SUSTAINED WITHOUT LEAVE TO AMEND.

E. Demurrer to Seventh Cause of Action for IIED

Finally, Defendant demurrers to the Seventh Cause of Action for intentional infliction of emotional distress, arguing Plaintiff has failed to allege any outrageous conduct. 

“A cause of action for intentional infliction of emotional distress exists when there is ‘(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.  A defendant's conduct is ‘outrageous’ when it is so ‘extreme as to exceed all bounds of that usually tolerated in a civilized community. And the defendant's conduct must be ‘intended to inflict injury or engaged in with the realization that injury will result.’”  (Hughes v. Pair (2009) 46 Cal.4th 1035, 1050-51, quoting Potter v. Firestone Tire & Rubber Co. (1993) 6 Cal.4th 965, 1001) (internal citations omitted). “Liability for intentional infliction of emotional distress ‘ “does not extend to mere insults, indignities, threats, annoyances, petty oppressions, or other trivialities.”  (Bock v. Hansen (2014) 225 Cal. App. 4th 215, 233.)  Severe emotional distress means “ ‘emotional distress of such substantial quality or enduring quality that no reasonable [person] in civilized society should be expected to endure it.’”  (Id.)

Although a claim for IIED will generally present multiple questions of fact, a court may sustain a demurrer to the claim when “the facts alleged do not amount to outrageous conduct as a matter of law.” (Bock, supra, 225 Cal. App. 4th at 235.)  The process has been described as “more intuitive than analytical.”  (So v. Shin (2013) 212 Cal.App.4th 652, 671–672.)

Here, the court would agree with Defendant that the conduct alleged by Plaintiff does not give rise to outrageous conduct as a matter of law. 

Accordingly, Defendant’s Demurrer to the Seventh Cause of Action is SUSTAINED. Based on the facts alleged and the nature of the dispute, it appears unlikely that Plaintiff can successfully amend this cause of action. Therefore, NO LEAVE TO AMEND IS GIVEN.

IT IS SO ORDERED.

Dated:   September 25, 2024 ___________________________________