Judge: Virginia Keeny, Case: 24STCV31459, Date: 2025-03-06 Tentative Ruling

Case Number: 24STCV31459    Hearing Date: March 6, 2025    Dept: 45

ROGER ANDERSON AS TRUSTEE OF THE RWA TRUST V. FIDELITY NATIONAL TITLE INSURANCE COMPANY, ET AL.

MOTION TO STAY PROCEEDINGS

Date of Hearing:          March 6, 2025                         Trial Date:       N/A

Department:               45                                            Case No:          24STCV31459

Moving Party:             Defendants Fidelity National Title Insurance Company and Fidelity National Title Company

Responding Party:       Plaintiff Roger Anderson as Trustee of the RWA Trust

Notice:                         Proper

FACTUAL BACKGROUND

Plaintiff Roger Anderson, as Trustee of the RWA Trust dated March 14, 2014, (“Plaintiff”) filed this action against Defendants Fidelity National Title Insurance Company and Fidelity National Title Company (“Defendants”) on November 27, 2024. Plaintiff filed this action to determine Defendants’ duty to defend and indemnify Plaintiff in the underlying action, Antonio Becerra, et al. v. Roger Anderson, et al., Los Angeles Superior Court Case No. 23STCV29374 (the “Underlying Action”). In that case, Plaintiff was sued by the Becerras on the basis that a modification to a loan had rendered the loan usurious. Plaintiff thereafter submitted a claim to Defendants to defend him in that action. Defendants argue that they denied that claim because Plaintiff’s policy does not afford any coverage for him in that instance, although Defendants claim that they voluntarily agreed to defend Plaintiff against one of the eight claims in that action, which was the usury claim.

Plaintiff has alleged five causes of action against Defendants in this action: (1) Declaratory Judgment; (2) Breach of Contract; (3) Bad Faith/Breach of Covenant of Good Faith and Fair Dealing; (4) Violation of the California Unfair Business Practices Act; and (5) Professional Negligence.

Defendants filed this motion to stay proceedings on January 29, 2025. Defendants are requesting that Plaintiff’s entire action be stayed pending the resolution of the underlying action because if Plaintiff wins the underlying action, then it will not be necessary for Defendants to indemnify Plaintiff.

In Plaintiff’s opposition, filed on February 21, 2025, Plaintiff argues that it would not be appropriate to stay the entire action because in this action Plaintiff also seeks to establish Defendants’ duty to defend Plaintiff in the underlying action. In the underlying action, Defendants only voluntarily agreed to defend Plaintiff against one of the eight claims against Plaintiff. Plaintiff argues that Defendants’ refusal to defend Plaintiff against these other claims is harming Plaintiff and increasing Plaintiff’s damages because Plaintiff had to employ his own counsel at great cost to Plaintiff.

Defendants argue in their reply, filed on February 27, 2025, that there would be no harm to Plaintiff if this action were stayed. Defendants further argue that this action is unnecessary and will yield little more than attorney fees for both sides.

TENTATIVE RULING: DENY

“Trial courts generally have the inherent power to stay proceedings in the interest of justice and to promote judicial efficiency.” (Freiberg v. City of Mission Viejo (1995) 33 Cal.App.4th 1484, 1489.)

ANALYSIS

Plaintiff filed this action in order to determine the extent to which Defendants must defend Plaintiff in the underlying action (See Comp., ¶ 213) and to determine whether Defendants must indemnify Plaintiff (See Comp., ¶ 215).

Defendants’ primary argument in their motion to stay proceedings is that it will not be known whether Defendants must indemnify Plaintiff until the underlying action against Plaintiff is resolved. Therefore, Defendants’ argue, this action should be stayed until that is known.

Plaintiff argues in his opposition that the primary purpose of this action is to determine the extent to which Defendants must defend Plaintiff in the underlying action, as Defendants have only agreed to defend Plaintiff as to one of the eight claims against Plaintiff.

Plaintiff’s prayer for relief requests “a declaration establishing that Fidelity has a duty to defend and/or indemnify the RWA Trust against the allegations in the Underlying Complaint.” (Comp., Prayer for Relief, ¶ A.)

In Defendants’ motion and reply, Defendants cite authority showing that they only indemnify in the event of loss. (See Karl v. Commonwealth Land Title Ins. Co. (1993) 20 Cal. App. 4th 972, 980; Summers Decl., ¶ 2; Exh. A, Title Policy Section 9(b).) Here, there has not yet been any “loss” beyond attorney fees.

However, Defendants do not cite any authority that a determination as to the extent to which Defendants must defend Plaintiff has to wait until the resolution of the underlying action. Nor have Defendants cited any authority showing that a stay is appropriate in such a case. In fact, it would stand to reason that the extent to which Defendants have a duty to defend Plaintiff in the underlying action should be determined before the underlying action is resolved.

Because Plaintiff’s complaint requests a determination as to defense and/or indemnity, then it would not be appropriate to stay the entire action at this time. If Defendants had sought to stay just the determination of indemnity, or to bifurcate the issues of defense and indemnity, that may have been an appropriate way to proceed. But Defendants requested to stay the entire action, which would have unfairly delayed a determination as to the extent to which Defendants must defend Plaintiff in the underlying action. That would not serve the interests of justice or promote judicial efficiency.

Therefore, no stay shall be issued in this case at this time.

As for the parties’ arguments regarding the extent to which Defendants must defend Plaintiff, the Court will not decide that issue in relation to the motion to stay proceedings.

Accordingly, Defendants’ motion to stay proceedings is DENIED.