Judge Ronald F. Frank, Case Number: 24TRCP00208, Date: 2025-02-04 Tentative Ruling

Judge: Ronald F. Frank, Case: 24TRCP00208, Date: 2025-02-04 Tentative Ruling

Case Number: 24TRCP00208 Hearing Date: February 4, 2025 Dept: 8

Tentative Ruling

HEARING DATE: February 4, 2025

CASE NUMBER: 24TRCP00208

CASE NAME: Joshua Alavez v. Greenwich Insurance Company, et al.

MOVING PARTY: Petitioner, Joshua Alavez

RESPONDING PARTY: Respondent, Greenwich Insurance Company

TRIAL DATE: Not Set.

MOTION: (1) Petition to Compel Arbitration of Underinsured Motorist Claim

Tentative Rulings: (1) ARGUE. Greenwich has presented proof that there is only $15k of UIM coverage and that Petitioner has already received $15,000, but Petitioner has not shown any other coverage limits for UIM that need to be arbitrated.

I. BACKGROUND

A. Factual

On May 20, 2024, Petitioner, Joshua Alavez (“Petitioner”) filed a Petition to Compel Arbitration of Underinsured Motorist Claim against Defendants, Greenwich Insurance Company, AXA XL, and DOES 1 through 10.

Petitioner submits that on November 3, 2021, at about 12:30PM, Petitioner legally parked the insured vehicle, a 2012 Ford F150 truck along the shoulder of the eastbound lanes of Imperial Highway in Torrance, California and was attempting to attach a trailer to the rear of the vehicle. (Petition, ¶ 11.) At the same time, Petitioner states that underinsured motorist, Cosmas Uchenna Undengwu was driving his 2015 Toyota Prius eastbound along Imperial Highway when he veered into the shoulder of the roadway, striking Petitioner and the insured truck from behind. (Petition, ¶ 11.) Petitioner alleges the Toyota Prius pinned Petitioner between the truck and the trailer, that the insured truck was damaged, and that the Toyota Prius was totaled. (Petition, ¶ 11.) Petitioner asserts that he was transported by ambulance to UCLA Medical Center where he was treated for serious injuries including head trauma, trauma to his neck and spine, wounds to his right thigh and a fracture to his right arm, both of which required surgery. (Petition, ¶ 12.) Thereafter, Petitioner learned the underinsured motorist, Undengwu, was insured against liability for $15,000, the legal minimum allowed under California law. (Petition, ¶ 13.)

On January 5, 2022, Petitioner filed a separate legal action against Mr. Undengwu, which settled for the full available policy limits on October 2, 2023, but that the available policy limit was grossly inadequate and failed to compensate petitioner adequately or properly for the

injuries he sustained and the trauma he suffered. (Petition, ¶ 14.) On November 3, 2021, Petitioner alleges the Respondents issued a policy which the Ford F150 Petitioner was operating for liability, collision, and uninsured / underinsured motorist coverage. (Petition, ¶ 15.) On February 23, 2023, Petitioner states he contacted Respondents requesting to open a claim for underinsured motorist coverage under the policy covering the Ford F150, to which Respondents issued no response. (Petition, ¶ 18.) Further, on October 16, 2023, Petitioner contends he sent a formal demand letter for arbitration of his underinsured motorist claim to Respondents by certified mail, return receipt requested, supported by the signed declaration of his counsel. (Petition, ¶ 19.) However, as of the date of this filing, Petitioner asserts Respondents have issued no response to Petitioner’s demand. (Petition, ¶ 21.)

B. Procedural

On May 20, 2024, Petitioner filed this Petition to Compel Arbitration of Underinsured Motorist Claim. On October 28, 2024, Respondent, Greenwich Insurance Company, erroneously sued as “Greenwich Insurance Company and AXA XL (“Greenwich”) filed an opposition brief. On January 14, 2025, Petitioner filed a reply brief. On January 28, 2025, Greenwich filed a sur-reply.

II. EVIDENTIARY OBJECTIONS:

Sustain: none.

Overrule: all.

III. ANALYSIS

A. Legal Standard

Code Civ. Pro. section 1281.2 permits a party to file a petition to request that the Court order the parties to arbitrate a controversy.¿ The Court may grant the motion if the Court determines that an agreement to arbitrate the controversy exists, unless the petitioner has waived the right to arbitrate or there are other grounds for rescission. (Id.)

Insurance Code section 11580.2 establishes certain rules governing uninsured and underinsured motor vehicle insurance policies. Subdivision (f) of section 11580.2 requires that “the determination as to whether the insured shall be legally entitled to recover damages ... shall be made by agreement between the insured and the insurer or, in the event of disagreement, by arbitration.” The provisions of section 11580.2 are deemed to be a part of every uninsured motorist policy. (See Quintano v. Mercury Casualty Co. (1995) 11 Cal.4th 1049, 1053; Harford Fire Insurance Co. v. Macri (1992) 4 Cal.4th 318, 324; Travelers Indemnity Co. v. Kowalski (1965) 233 Cal.App.2d 607, 609.)

Insurance Code section 11580.2 further provides that “[i]f the insured has or may have rights to benefits, other than nonoccupational disability benefits, under any workers’ compensation law, the arbitrator shall not proceed with the arbitration until the insured's physical condition is stationary and ratable. ... .” (Ins. Code, § 11580.2, subd. (f).)

Further undesignated statutory references are to the Insurance Code, and undesignated subdivision references to section 11580.2 of that Code.

B. Analysis

The Petition outlines the predicate facts for a UIM arbitration proceeding, but the Petition fails to specify what the limits of UIM coverage might be. The Court has reviewed the policy attached to the Petition and the coverage limits for UIM are either blank or state “See Specific Endorsements.” In opposition to the Petition, Greenwich acknowledges that pursuant to Insurance Code section 11580.2, subdivision (f), Petitioner seeks to compel arbitration of his claim for underinsured motorist benefits under a policy of automobile insurance that Greenwich issued to his employer. However, Greenwich contends that the only issues that may be arbitrated under section 11580.2, subdivision (f), are: (1) the underinsured driver’s fault and (2) the amount of damages suffered by the injured claimant. Here, Greenwich asserts that both issues are moot because the policy provide provides only $15,000 per person in UIM coverage, which is offset entirely as a matter of law by the $15,000 that Alavez admits he already recovered in settlement of his prior lawsuit against the underinsured driver. Some of the Limits of Insurance provisions in the lengthy policy appear to bar duplicate payments for the same elements of “loss” under the stated coverage and any UIM coverage endorsement.

Insurance Code section 11580.2, subd. (f) imposes a stay of arbitration regarding UIM benefits to prevent double compensation. The purpose of this reduction is “clearly to shift the cost of an industrial injury sustained by an employee, as the result of the negligence of an uninsured motorist, from the motoring public (who pay the premium for uninsured motorist coverage) to the employer or workmen’s compensation carrier.” (Cal. State Auto. Assoc. Interinsurance Bureau v. Jackson (1973) 9 Cal. 3d 859, 869.) In permitting “a reduction in the value of the loss payable under the uninsured motorist coverage of the policy, the Legislature intended to prevent the insured from recovering twice for the same injury.” (Interinsurance Exchange v. Marquez (1981) 116 Cal. App. 3d 652, 656-657.) California law states that “if the insured has or may have rights to benefits, other than nonoccupational disability benefits, under any workers’ compensation law, the arbitrator shall not proceed with the arbitration until the insured’s physical condition is stationary and ratable…[t]hus, in order to prevent double recovery, the Legislature has expressly permitted insurers to delay arbitration of uninsured motorist claims while a workers’ compensation claim is pending, in the absence of showing of good cause.” (Rangel v. Interinsurance Exch. (1992) 4 Cal. 4th, 1, 8.)

Greenwich maintains, in its opposition, that the 2021-2022 policy was a renewal of policy number CAH745991, which Greenwich issued to HP Communications for the prior policy period (“the 2020-2021 policy”). When purchasing the earlier 2020-2021 policy, HP Communications executed and submitted to Greenwich a valid “California Uninsured Motorists Coverage Selection/Rejection form” dated July 15, 2020 (the “UIM Selection/Rejection form”). (James Park Declaration (“Park Decl.”), ¶ 3, Exhibit 1.) By executing and submitting that form, Greenwich states HP Communications elected to purchase UM/UIM coverage with statutory minimum limits of only $15,000 per person and $30,000 per accident. As such, Greenwich notes that HP Communications’ election of these UM/UIM limits carried over to the renewal 2021-2022 policy under which Alavez is seeking coverage. Accordingly, Greenwich asserts that the limit applicable to Alavez’s claim for UIM coverage under the 2021-2022 policy is only

$15,000. Plaintiff challenges the foundation for this evidence and seeks a hearing (either in court or in arbitration) as to the veracity of Greenwich’s Selection/Rejection form.

Greenwich contends that because the policy only provides for $15,000 in UIM coverage, that this limit is offset entirely by Alavez’s recovery from the underinsured driver. Greenwich contends that Alavez admits in his petition that he settled his lawsuit against the underinsured driver in exchange for the driver’s policy limits of $15,000, and that the $15,000 recovery offsets the applicable $15,000 per person limit under the Greenwich UIM coverage entirely, meaning the net amount of UIM coverage available to Alavez is zero.

In Petitioner’s reply brief, he argues that even if the attached alleged “California Uninsured Motorist Coverage Selection/Rejection form” along with – what Respondents describe as – “the broker’s transmission email” (Park Decl., ¶ 3, Exhibit 1), was to be viewed in the light most favorable to Respondent, it does not warrant denial of Petitioner’s Petition to Compel Arbitration as the right and authority to arbitrate a dispute of this nature is defined by statute, and thus, the issue is whether the underinsured motorist coverage applies, not whether Petitioner is entitled to resolve its dispute via arbitration.

In Greenwich’s sur-reply, it cites to Insurance Code Section 11580.2, subdivision (f) and Bouton v. USAA Casualty Ins. Co.. Bouton stands for the proposition that the trial court, not an arbitrator, determines whether a party is an insured under the policy. (Bouton v. USAA Casualty Ins. Co. (2008) 167 Cal.App.4th 412, 425.)

The Court will take oral argument as to whether a further hearing is required and whether that hearing should be before a UIM arbitrator or a Superior Court concerning the foundation and veracity of the Selection/Rejection form. Given that Petitioner sought the so-called “waiver” form for months without Greenwich’s response, the Court will allow both sides to be heard as to whether witness testimony as to who signed the Selection/Rejection form and its foundation before the Court would be prepared to bar any further remedy to Petitioner. The Court will also take argument from Petitioner as to what he contends the coverage limits are for UIM here either by reference to a specific page of the policy and endorsement pages attached tot eh Petition or otherwise. The Court is reluctant to send a case to arbitration where the proceedings would be futile, which might be the case if there is no UIM coverage at all or if the limits are the $15,000 statutory limits already paid.