Judge: Upinder S. Kalra, Case: 22STCV32532, Date: 2024-01-31 Tentative Ruling

1. If you wish to submit on the tentative ruling, please email the clerk at SMCdept51@lacourt.org (and “cc” all other parties in the same email) and notify all other parties in advance that you will not be appearing at the hearing.  Include the word "SUBMISSION" in all caps in the subject line and include your name, contact information, the case number, and the party you represent in the body of the email. If you do not have access to the internet, you may call the clerk at (213) 633-0351.

If you submit on the tentative and elect not to appear at the hearing, the opposing party may nevertheless appear and argue the motion, and the Court may decide not to adopt the tentative ruling. Please note that the tentative ruling is not an invitation, nor an opportunity, to file any further documents relative to the hearing in question which are not authorized by statute or Rule of Court.

2. For any motion where no parties submit to the tentative ruling in advance, and no parties appear at the motion hearing, the Court may elect to either adopt the tentative ruling or take the motion off calendar, in its discretion.

3. DO NOT USE THE ABOVE EMAIL FOR ANY PURPOSE OTHER THAN TO SUBMIT TO A TENTATIVE RULING.  The Court will not read or respond to emails sent to this address for any other purpose.

Case Number: 22STCV32532    Hearing Date: January 31, 2024    Dept: 51

Tentative Ruling

Judge Upinder S. Kalra, Department 51

HEARING DATE:    January 31, 2024                                            

CASE NAME:           Lewis Cohen, et al. v. Starr Indemnity & Liability Company

CASE NO.:                22STCV32532

MOTION FOR SUMMARY JUDGMENT, OR ALTERNATIVELY, SUMMARY ADJUDICATION

MOVING PARTY:  Defendant Starr Indemnity & Liability Company

RESPONDING PARTY(S): Plaintiffs Lewis Cohen and Alejandra Cohen

REQUESTED RELIEF:

1.     Summary Judgment in Defendant’s Favor;

2.     Summary Adjudication in Defendant’s Favor of the First Cause of Action because Plaintiffs failed to establish Defendant unreasonably withheld benefits and there exists at most a genuine dispute as to whether any amounts claimed under the Policy are covered under the Policy;

3.     Summary Adjudication in Defendant’s Favor of the Second Cause of Action because the undisputed facts show there was no coverage under the Policy for Plaintiffs’ claim;

4.     Summary Adjudication of Defendant’s Fourteenth Affirmative Defense in Defendant’s favor because Plaintiff’s claim is barred by a genuine dispute as to policy benefits owed under the Policy; and

5.     Summary Adjudication of Defendant’s Thirty-Seventh Affirmative Defense in Defendant’s favor because there is no coverage under the Policy for the claims at issue.

TENTATIVE RULING:

Motion for Summary Judgment is DENIED.

STATEMENT OF MATERIAL FACTS AND/OR PROCEEDINGS:

On October 4, 2022, Plaintiffs Lewis Cohen and Alejandra Cohen (Plaintiffs) filed a Complaint against Defendant Starr Indemnity & Liability Company with two causes of action for: (1) Breach of Duty of Good Faith and Fair Dealing; and (2) Breach of Contract.

According to the Complaint, Plaintiffs purchased trip protection from Defendant related to a cruise to Antarctica. Plaintiffs allege that they began their trip but were ordered to quarantine by the ship’s physician due to close contact with COVID-19. Plaintiffs allege that they submitted a Trip Interruption claim to Defendant who subsequently denied the claim.

On November 23, 2022, Defendant filed a Motion to Strike portions of the Complaint pertaining to punitive damages, which the court GRANTED on February 27, 2023.

On January 18, 2023, Defendant filed a motion to transfer and consolidate, which the court DENIED on February 15, 2023. On April 27, 2023, Plaintiffs filed a Petition for Writ of Mandate pertaining to this decision.

On March 17, 2023, Defendant filed an Answer.

On November 15, 2023, Defendant filed the instant motion for summary judgment or, in the alternative, summary adjudication (MSJ).

On January 17, 2024, Plaintiffs filed an opposition.

On January 26, 2024, Defendant filed a reply.

LEGAL STANDARD:

“[T]he party moving for summary judgment bears the burden of persuasion that there is no triable issue of material fact and that he is entitled to judgment as a matter of law.” (Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 850, fn. omitted (Aguilar).) “When a defendant seeks summary judgment, he/she has the “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 of Civ. Proc. § 437c(p)(2).)¿ 

¿ 

The opposing party on a motion for summary judgment is under no evidentiary burden to produce rebuttal evidence until the moving party meets his or her initial movant’s burden.¿ (Binder v. Aetna Life Insurance Company (1999) 75 Cal.App.4th 832, 840.)¿ Once the initial movant’s burden is met, then the burden shifts to the opposing party to show, with admissible evidence, that there is a triable issue requiring the weighing procedures of trial.¿ (Code Civ. Proc. § 437c(p).)¿ The opposing party may not simply rely on his/her allegations to show a triable issue but must present evidentiary facts that are substantial in nature and rise beyond mere speculation.¿ (Sangster v. Paetkau (1998) 68¿Cal.App.4th 151, 162.)¿ Summary judgment must be granted “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.)¿¿ 

¿ 

As to any alternative request for summary adjudication of issues, such alternative relief must be clearly set forth in the Notice of Motion and the general burden-shifting rules apply but the issues upon which summary adjudication may be sought are limited by statute.¿ (Code Civ. Proc., §¿437c(f)(1).)¿ “A motion for summary adjudication shall be granted only if it completely disposes of a cause of action, an affirmative defense, a claim for damages, or an issue of duty.”¿ (Ibid.)¿ 

ANALYSIS:

Second Cause of Action – Breach of Contract

Defendant contends that Plaintiff cannot establish that their claim was covered by the Policy because the plain and clear language of the Policy only provides Trip Interruption coverage if Plaintiffs were “prevented from continuing or resuming Your Covered Trip due to any of the Unforeseen Events” and the Policy only pays for “1. The unused, non-refundable travel arrangements prepaid to the Travel Supplier(s); 2. additional transportation expenses incurred by YOU; or 3. return air travel up to the lesser of the cost of an economy flight or the amount shown on the Schedule of Benefits.” (MSJ 9:1-6.) Defendant contends that loss of enjoyment after becoming sick is not covered by the Policy and Plaintiffs are prohibited from creating ambiguity in the Policy where none exists.  Plaintiffs argue that the court may consider extrinsic evidence to interpret the Policy and that their discovery responses do not include information discovered after those responses were served. Plaintiffs additional argue that the only reasonable interpretation of the Policy, in the context of a cruise to Antarctica, was that because Plaintiffs were quarantined they were prevented from visiting Antarctica and participating in the other cruise activities and that accepting Defendant’s interpretation renders the Policy illusory since there would never be an opportunity to disembark the ship before its return to port at the end of the trip.  

Here, even if this Court concludes that Defendant met its initial burden showing, the Court finds that a reasonable trier of fact could find that a disputed material of fact exists as to whether the policy included participating in all of the amenities and activities that the trip offered. it is entitled to summary adjudication in its favor. The policy was to “participate” in the covered trip on a cruise to Antarctica. The policy was not to for a journey from point a, South America, to point b, Antarctica, and then back to point a. Three days into the adventure, they were ordered by ships doctor to quarantine in their room. For the remaining eight days of the trip, Plaintiffs were ordered to remain quarantined in their room. The undisputed evidence offered by Defendant was that while Plaintiffs remained on the ship, they could not “participate in the covered trip” which included exploring the ships amenities, including a lounge with a 270-degree domed roof, a gym, a spa, and a theater where travelers could receive lectures on the history, geography and wildlife of Antarctica. (Cohen Dec. ¶¶10-12.) The expedition also included up to three excursions a day off he ship. (Cohen Dec. ¶¶13-14.) As Plaintiffs assert, the purpose of the trip was not to travel from South America to Antarctica, but to experience the and explore Antarctica, hike, see wildlife, kayak and enjoy the ships amenities. (Cohen Dec. ¶ 30.)

First Cause of Action – Breach of Duty of Good Faith and Fair Dealing

“[T]here are at least two separate requirements to establish breach of the implied covenant: (1) benefits due under the policy must have been withheld; and (2) the reason for withholding benefits must have been unreasonable or without proper cause.” (Mosley v. Pacific Specialty Insurance Company (2020) 49 Cal.App.5th 417, as modified on denial of reh'g (June 24, 2020), review denied (Aug. 12, 2020).)

“Thus, to succeed on a claim for breach of the implied covenant, the insured must show that “the insurer acted unreasonably or without proper cause.” [citation omitted] The insured must show the insurer's conduct “demonstrates a failure or refusal to discharge contractual responsibilities, prompted not by an honest mistake, bad judgment or negligence but rather by a conscious and deliberate act, which unfairly frustrates the agreed common purposes and disappoints the reasonable expectations of the other party thereby depriving that party of the benefits of the agreement.” (Mosley v. Pacific Specialty Insurance Company (2020) 49 Cal.App.5th 417, 436, as modified on denial of reh'g (June 24, 2020), review denied (Aug. 12, 2020).)

Defendant contends that Plaintiff cannot establish that Defendant breached the Policy or that Defendant acted unreasonably or without proper cause. Defendant additionally contends that whether it acted in bad faith is a question of law. Plaintiffs argue that Defendant denied the claim without any investigation, that Defendant’s denial was unsupported by any facts, and that Defendant’s interpretation contradicts language in the Policy triggering coverage for being quarantined.

The Court finds that the Defendant did meet their initial burden. As stated above, for a cause of action for breach of implied covenant of good faith and fair dealing, the party must demonstrate that withholding policy benefits was unreasonable. Defendant has sufficiently established that the withholding of policy benefits as reasonable.

Based on the evidence, the Court finds that there is a genuine issue of fact. Specifically, Plaintiffs  have demonstrated that a reasonable person could determine that the Defendant  did not act reasonably in the review. Rather, Ms. Park responded, by email, without conducting any investigation, that Plaintiffs would have ended the trip and return home. (Ex. N. 4.) The timing of this reply email, 28 minutes after receipt, and the lack of any evidence that one could get off of a cruise ship in the middle of the Drake Passage en route to Antarctica could demonstrate to a finder of fact that the investigation and review process was wholly unreasonable. Moreover, the policy also covered for accommodations if a covered illness occurs. Clearly, the only accommodation was on the cruise and then three days in Argentenia after the cruise. Still, Defendant denied the entire claim.Therefore, the Plaintiff has met its burden to establish that a genuine issue of fact exists.

Motion for Summary Adjudication as to the Cause of Action for Breach of Implied Covenant of Good Faith and Fair Dealing is DENIED.

CONCLUSION:

            For the foregoing reasons, the Court decides the pending motion as follows:

            Motion for Summary Judgment is DENIED.

Moving party is to give notice.

IT IS SO ORDERED.

Dated:             January 31, 2024                     __________________________________                                                                                                                        Upinder S. Kalra

                                                                                    Judge of the Superior Court