Judge: Yolanda Orozco, Case: 22STCV38962, Date: 2023-02-03 Tentative Ruling

Case Number: 22STCV38962    Hearing Date: February 3, 2023    Dept: 31

MOTION TO COMPEL ARBITRATION 

TENTATIVE RULING 

Petitioner’s Motion to Compel Arbitration is DENIED WITHOUT PREJUDICE. 

Background 

On December 15, 2022, Petitioner Farkhondeh Torabi filed a Petition to Open Superior Court file for the purpose of Establishing Superior Court Jurisdiction under Insurance Code section 1158.2(f). 

On December 19, 2022, Petitioner filed a Motion to Compel Arbitration against Respondent Blue Hill Specialty Insurance Company. 

Legal Standard 

Insurance Code section 11580.2 governs the provision of uninsured and underinsured motorist arbitration. (See Pilimai v. Farmers Ins. Exchange Co. (2006) 39 Cal.4th 133, 140.)

Section 11580.2 mandates arbitration of uninsured and underinsured motorist claim disputes between insurers and insureds regarding liability, damages, or both: 

“The policy or an endorsement added thereto shall provide that the determination as to whether the insured shall be legally entitled to recover damages, and if so entitled, the amount thereof, shall be made by agreement between the insured and the insurer or, in the event of disagreement, by arbitration.”

(Ins. Code, § 11580.2, subd. (f) 

Section 11580.2 subdivision (f)(1) states: 

“Whenever in Title 4 (commencing with Section 2016.010) of Part 4 of the Code of Civil Procedure, reference is made to the court in which the action is pending, or provision is made for application to the court or obtaining leave of court or approval by the court, the court that shall have jurisdiction for the purposes of this section shall be the superior court of the State of California, in and for any county that is a proper county for the filing of a suit for bodily injury arising out of the accident, against the uninsured motorist, or any county specified in the policy or an endorsement added thereto as a proper county for arbitration or action thereon.” 

(Id. [italics added].) 

“Any demand or petition for arbitration shall contain a declaration, under penalty of perjury, stating whether (i) the insured has a workers' compensation claim; (ii) the claim has proceeded to findings and award or settlement on all issues reasonably contemplated to be determined in that claim; and (iii) if not, what reasons amounting to good cause are grounds for the arbitration to proceed immediately.”

(Ins. Code, § 11580.2.) 

Discussion 

Petitioner moves for an order compelling arbitration pursuant to Insurance Code section 11580.2(f). 

Petitioner asserts he maintained a policy that included coverage for Uninsured/Underinsured Motorist Policy at the time of the accident in the underlying action through Respondent Blue Hill Specialty Insurance Company. Petitioner asserts that Respondent has delayed the arbitration proceeding asserting that an Occupational Policy by the name of Intact should first process the Petitioner’s special damages before Respondent proceeds with the arbitration. 

According to Petitioner, Respondent maintains that the new Uber auto policies for their California Uber drivers contain a unique and contractual provision or term called Occupational Accident Insurance (“OAI”) which requires uninsured/underinsured to make “special damages” claims through a third party insurance company called INTACT, which represents itself as “secondary insurance coverage” under the OAI provision of Respondent’s “auto policy for Petitioner as injured Uber Driver.” (Petition at 3:22-25.) In other words, Respondent’s insurance policy with the Petitioner contains an insurance policy within an insurance policy that specifically addresses injury claims for uninsured/underinsured that are of “special damages” nature (i.e. past medical bills, future medical bills, past lost earnings and future lost earnings/earning capacity) through INTACT. 

Petitioner asserts that the OAI provision is an unconscionable and bad faith impediment intended to delay and deprive uninsured/underinsured persons of their right to arbitrate their damages with insurers and obtain compensation. Petitioner also argues that his general damages are not subject to the OAI provision and he should be able to proceed with arbitration under Insurance Code section 11580.2. 

The Court need not decide if Petitioner’s claims must first be assessed by INTACT before Plaintiff can proceed with arbitration because the provisions of section 11580.2 are clear: 

“The policy or an endorsement added thereto shall provide that the determination as to whether the insured shall be legally entitled to recover damages, and if so entitled, the amount thereof, shall be made by agreement between the insured and the insurer or, in the event of disagreement, by arbitration. The arbitration shall be conducted by a single neutral arbitrator. . . 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.”

(Ins. Code, § 11580.2 [italics added].) 

The determination of whether Petitioner’s special damages must first be assessed by INTACT before Respondent assesses Plaintiff’s general damages claims are issues that are to be decided by the arbitrator in an arbitration proceeding as mandated by the Insurance Code. 

However, Petitioner has failed to comply with the requirements of section 11580.2: 

“Any demand or petition for arbitration shall contain a declaration, under penalty of perjury, stating whether (i) the insured has a workers' compensation claim; (ii) the claim has proceeded to findings and award or settlement on all issues reasonably contemplated to be determined in that claim; and (iii) if not, what reasons amounting to good cause are grounds for the arbitration to proceed immediately.” 

(Ins. Code, § 11580.2, subd. (f).) 

No such declaration has been submitted to the Court. Moreover, as evidenced by Petitioner’s attached correspondence to Respondent, no formal demand that complies with section 11580.2 has been made to Respondent. 

The words “We would like to proceed with an uninsured motorist arbitration in this matter” have been found to be insufficient to trigger a formal demand for arbitration if it fails to strictly comply with formal demands requirements outlined section 11580.2(f). (See Allstate Ins. Co. v. Gonzalez (1995) 38 Cal.App.4th 783, 792.) “Thus, 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 a showing of good cause.” (Rangel v. Interinsurance Exchange (1992) 4 Cal.4th 1, 8.) 

Without a formal demand for arbitration to Respondent which complies with Insurance Code section 11580.2, this Motion is premature. 

Based on the foregoing, the Motion to Compel Arbitration is DENIED WITHOUT PREJUDICE. 

The Petitioner may refile this Motion after a formal demand that complies with Insurance Code section 11580.2(f) is served on the Respondent. Furthermore, to the extent that Petitioner may in the future ask the Court to select an arbitrator pursuant to section 1281.6 of the Code of Civil Procedure, Petitioner is to attach a copy of the uninsured/underinsured motorist policy, in order to verify that the policy does not provide for a method of appointing an arbitrator. 

Conclusion 

Petitioner’s Motion to Compel Arbitration is DENIED WITHOUT PREJUDICE. 

Petitioner to give notice.