Judge: William D. Claster, Case: 20-01161160, Date: 2023-07-14 Tentative Ruling
1.
Defendant/Cross-Complainant/ Cross-Defendant's Travelers Casualty Insurance
Company of America's Notice of Motion and Motion for Summary Judgment or in
the Alternative, Summary Adjunction Against LaBarre-Olsnee Insurance Agency,
LLC ROA 290
2. Status Conference
Cross-Defendant Travelers Casualty Insurance Company of America moves for summary judgment against Cross-Complainant LaBarre/Oksnee Insurance Agency, LLC. In the alternative, Travelers moves for summary adjudication of each cause of action in LaBarre’s Second Amended Cross-Complaint (2AXC). For the reasons set forth below, the motion is DENIED.
EVIDENTIARY MATTERS
A. LaBarre’s Objections to Travelers’ Evidence
All objections are overruled.
B. LaBarre’s Objections to Travelers’ Separate Statement
Objections are properly raised to evidence, not facts in a separate statement. Objections cannot be raised in separate statements because “interposing objections into the separate statement defeats the goal of allowing the trial court to quickly and efficiently determine what particular piece of evidence is admitted and what is not.” (Hodjat v. State Farm Mut. Auto. Ins. Co. (2012) 211 Cal.App.4th 1, 9.) The Court has not considered this document.
C. Travelers’ Objections
Objections 1-5, 7-13, and 19 are overruled.
Objections 6 and 14 are sustained on foundation grounds to the extent Bordenave testifies to Travelers’ actual knowledge, but otherwise overruled.
Objection 17 is sustained as to the phrase “she further admitted she could not recall ever inspecting a business park with only one building” on the grounds that this misstates the deposition testimony, but otherwise overruled.
Objection 18 is sustained on foundation grounds.
Objection 20 is sustained on relevance grounds.
GROUNDS FOR RULING
I. Background
Plaintiff Sirco/Irvine Business Park II Association is the community association for a commercial condominium park located in Santa Ana. (FAC ¶ 1.) The park consists of three buildings located at 1901, 1911 and 1921 Carnegie Avenue. (UMF 1.) Sirco used the services of LaBarre, an insurance broker, to procure insurance for the park. (UMF 8-9.) LaBarre submitted an insurance application to Travelers on or around August 1, 2008. (UMF 10.) Travelers issued a policy to Sirco on or about August 12, 2008. (UMF 15.) The policy was regularly renewed, up through the subject policy applicable in 2019. (UMF 16.)
On September 25, 2019, the 1921 Carnegie building was damaged in a fire. It was the only building in the park to be damaged. (UMF 3.) Sirco tendered the loss to Travelers. (UMF 34.) In December 2019, Travelers denied coverage. It took the position that the policy covered only the 1901 Carnegie building, not 1911 Carnegie or 1921 Carnegie. (UMF 35.)
This coverage dispute followed. Sirco brought suit against LaBarre and Travelers, LaBarre brought cross-claims against Travelers, and Travelers brought cross-claims against LaBarre. The Court entered summary judgment in favor of Travelers on Sirco’s underlying claims in March 2023. The Court granted LaBarre’s motion for a new trial to the extent that ruling adjudicated Travelers’ direct negligence to Sirco, an allegation never made in Sirco’s pleadings, which focused on Travelers’ vicarious liability for LaBarre’s actions.
As relevant to this motion, the operative pleading is LaBarre’s 2AXC. It contains claims for equitable indemnity, apportionment/contribution, and declaratory relief. (A fourth claim, alleging Travelers’ negligence toward LaBarre, did not survive demurrer.)
II. Discussion
As pled, LaBarre’s three remaining causes of action depend on a finding that Travelers is responsible in whole or in part for Sirco’s claimed injuries. From the Court’s review of the papers, there are two potential bases for LaBarre to argue Travelers is responsible: either Travelers is vicariously liable to Sirco for LaBarre’s own negligence, or Travelers is directly liable to Sirco for its own negligence.
A. Vicarious Liability for LaBarre’s Negligence
The argument that Travelers is vicariously liable for LaBarre’s own negligence is foreclosed by the Court’s ruling on the Travelers/Sirco summary judgment motion. The Court held the undisputed facts showed LaBarre was acting as an agent for Sirco, not for Travelers, and thus LaBarre’s negligence could not be imputed to Travelers on a respondeat superior theory. (ROA 349, at pp. 12-15.)
LaBarre argues it isn’t bound by this ruling because it was precluded from opposing Travelers’ motion against Sirco. This does not accurately describe what happened, because LaBarre never filed an opposition. It filed evidentiary objections that the Court refused to consider. The Court granted a new trial, on the direct negligence issue alone, in part because it was error to disregard LaBarre’s evidentiary objections. In its memorandum in support of its new trial motion, LaBarre never mentioned the Court’s refusal to consider its opposition to the motion, only the refusal to consider its evidentiary objections. (Of course, because LaBarre never filed an opposition, there would be no reason to mention it in the new trial motion.)
LaBarre’s new trial motion cited authority holding that if LaBarre believed summary adjudication of the agency/vicarious liability issue could affect its cross-complaint, it should have addressed that issue head-on. (See Columbus Line, Inc. v. Gray Line Sight-Seeing Companies Associated, Inc. (1981) 120 Cal.App.3d 622, 631 [“it was incumbent on Columbus to protect its own interests by vigorously opposing the motion instead of merely relying on plaintiffs’ opposition, for Columbus knew (or should have known) that summary judgment exonerating Gray Line from liability to plaintiffs, if it became final, would preclude any claim of indemnity”].) By failing to file an opposition to Travelers’ motion against Sirco, LaBarre waived any claim of error associated with failure to consider an opposition.
In any event, nothing LaBarre says in its opposition provides any reason to depart from the Court’s prior ruling. The potential basis for vicarious liability is an alleged principal-agent relationship between Travelers and LaBarre. As the Court previously explained, a broker-agent like LaBarre wears two hats. When the broker procures coverage on behalf of the insured, the broker acts as the insured’s agent. When the insurer responds through the broker to the insured’s request for a bid, the broker acts as the insurer’s agent. (ROA 349, at p. 13.) LaBarre’s alleged negligence here centers on negligently filling out an insurance application on Sirco’s behalf. This is an act done for Sirco, not for Travelers. As such, LaBarre was Sirco’s agent, not Travelers’, and its alleged negligence cannot be imputed to Travelers.
LaBarre contends its Agency Agreement with Travelers “specifically stated that LaBarre was authorized to act as Travelers’ agent for ‘Commercial property-casualty excluding National Accounts,’ and that LaBarre was authorized to bind coverage for Travelers.” (Opp. at p. 2., citing AMFs 6-7.) This is true, but irrelevant. There is no dispute that LaBarre was an agent for Travelers. The question is whether LaBarre was acting in that capacity when it committed the acts complained of.
For example, the scope of LaBarre’s agency included the power to bind coverage. Had LaBarre bound coverage for Sirco, and had that caused Sirco a loss, perhaps Travelers would be vicariously liable. But there is no allegation that LaBarre bound coverage. (LaBarre’s Zachary Miller testified the requested coverage exceeded LaBarre’s authority to bind. See LaBarre App’x, Ex. A, at p. 22.) Rather, Sirco alleges that LaBarre negligently filled out an application on Sirco’s behalf. LaBarre points to no evidence suggesting that when it filled out the application, it was doing so in its capacity as an agent for Travelers rather than as an agent for Sirco. For the reasons set forth in the prior MSJ ruling, there is no dispute about whether LaBarre was acting as Travelers’ agent. It was not. The vicarious liability argument fails.
B. Direct Liability
The Court previously found Travelers was not directly negligent to Sirco. When the Court granted LaBarre’s new trial motion, it removed this portion of the prior ruling, so the prior ruling is not binding. As with the prior motion, Travelers’ initial memorandum does not discuss direct negligence at all, only vicarious liability. But LaBarre’s 2AXC, unlike Sirco’s FAC, expressly alleges Travelers’ direct negligence as a cause of Sirco’s injuries. (2AXC, ¶¶ 16-17.)
“[T]he party moving for summary judgment bears an initial burden of production to make a prima facie showing of the nonexistence of any triable issue of material fact; if he carries his burden of production, he causes a shift, and the opposing party is then subjected to a burden of production of his own to make a prima facie showing of the existence of a triable issue of material fact.” (Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 850.)
LaBarre’s 2AXC alleges Travelers’ direct negligence as a cause of Sirco’s injuries. Because Travelers’ initial memorandum does not discuss direct negligence, Travelers fails to meet its initial burden on this theory, and the burden never shifts to LaBarre to show the existence of a triable fact issue. And because Travelers’ direct negligence would be a viable basis for all of LaBarre’s surviving claims, both summary judgment and summary adjudication are denied. However, going forward, Travelers’ direct negligence will be the only viable theory for LaBarre to pursue.