Jan 22, 2021
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TENTATIVE RULINGS                                            
LAW & MOTION CALENDAR                      
Friday, January 22, 2021, 2:30 p.m.    
Courtroom 17 – Hon. Arthur A. Wick          
3035 Cleveland Avenue, Santa Rosa           
 
 
In accordance with the Addendum to First Amended Omnibus Order of the Presiding Judge issued May 27, 2020, only those persons with court hearings in criminal actions shall enter a Sonoma County Superior Court facility. Until further notice, all matters set for hearing in this courtroom shall be heard remotely through Zoom. No party or representative of a party may appear personally in Courtroom 17. CourtCall is not permitted for this calendar.
 
If the tentative ruling is accepted, no appearance is necessary via Zoom unless otherwise indicated.
 
TO JOIN ZOOM ONLINE:
 
D17 – Law & Motion 3:00 pm Wednesday (2:30 pm Friday) 
 
TO JOIN ZOOM BY PHONE:  
By Phone (same meeting ID and password as listed):
+1 669 900 6833 US (San Jose)
 
 
The following tentative rulings will become the ruling of the Court unless a party desires to be heard. If you desire to appear and present oral argument as to any motion, YOU MUST notify Judge Wick’s Judicial Assistant by telephone at (707) 521-6725, and all other opposing parties of your intent to appear by 4:00 p.m. on Thursday, January 21st. Parties in small claims cases and motions for claims of exemption are exempt from this requirement.
 
 
 
PLEASE NOTE:  The Court WILL provide a Court Reporter for this calendar.  If there are any concerns, please contact the Court at the number provided above.
 
 
1.         SCV-264956, Garcia v. Ford Motor Company:
 
At the request of the Discovery Facilitator, this matter has been continued to March 24, 2021, at 3:00 p.m. in Department 17.
 
 
 
2.         SCV-265308, Felchlin v. Northwest Insurance Agency, Inc.:
 
Plaintiff Vera F. Felchlin, individually and as Trustee of the Vera F. Felchlin Trust dated November 5, 2013 (“Plaintiff”) initiated this action and then filed the First Amended Complaint (“FAC”) against defendants Northwest Insurance Agency, Inc., Travelers Commercial Insurance Company, Inc. (“Travelers”), George Peterson Insurance Agency, and Sheila Harden (collectively “Defendants”). Travelers filed a demurrer to the second cause of action in the FAC for negligence and a motion to strike the punitive damages allegations. The Court’s tentative ruling, which was adopted on August 5, 2020 without objection, overruled the demurrer and granted the motion to strike with leave to amend, and a written order conforming to the ruling was entered on September 8, 2020 (the “Prior Order”).
 
Plaintiff filed the presently operative second amended complaint (“SAC”) on September 21, 2020. The SAC revised the bad faith cause of action and associated punitive damages allegations, and it also added Travelers to the first cause of action for professional negligence (which previously only named other defendants). This matter is now on calendar for the motion by Travelers pursuant to Cal. Code Civ. Proc. (“CCP”) § 435 to strike: 1) the first cause of action as applied to Travelers on the grounds that it exceeds the scope of permissible amendment; and 2) the punitive damages allegations and prayer for relief. The request to strike the punitive damages allegations of the SAC is DENIED. Plaintiff has since filed a dismissal of the first cause of action as to Travelers, rendering the request to strike the first cause of action MOOT. Travelers shall file its answer to the SAC within fifteen (15) days of notice of entry of the order on this Motion.
 
I.                   Legal Standard
 
CCP § 435 authorizes a motion to strike when the facts alleged do not rise to the level of “malice, fraud or oppression” required to support a punitive damages claim. See, e.g. Turman v. Turning Point of Central Calif., Inc. (2010) 191 Cal.App.4th 53, 63 (allegations of gender discrimination did not show defendant acted with requisite state of mind for punitive damages). However, an allegation that defendant was guilty of “oppression, fraud and malice” is not properly stricken where the complaint contains sufficient facts to support such allegation. Perkins v. Sup.Ct. (1981) 117 Cal.App.3d 1, 6. In evaluating the sufficiency of the allegations, the Court reviews the complaint as a whole and assumes the truth of the allegations. Clauson v. Sup. Ct. (1998) 67 Cal.App.4th 1253. Yet “[s]omething more than the mere commission of a tort is always required for punitive damages”; there “must be circumstances of aggravation or outrage, such as spite or ‘malice,’ or fraudulent or evil motive on the part of the defendant, [o]r such a conscious and deliberate disregard of the interests of others that his conduct may be called willful or wanton.” Taylor v. Sup. Ct. (1979) 24 Cal.3d 890, 894.
 
Cal. Civ. Code § 3294(a) provides that in an action for the breach of an obligation not arising from contract, “where it is proven by clear and convincing evidence that the defendant has been guilty of oppression, fraud, or malice, the plaintiff, in addition to the actual damages, may recover damages for the sake of example and by way of punishing the defendant.” CCP § 3294(c)(1) defines “malice” as “conduct which is intended by the defendant to cause injury to the plaintiff or despicable conduct which is carried on by the defendant with a willful and conscious disregard of the rights or safety of others.” “‘Conscious disregard’ means ‘that the defendant was aware of the probable dangerous consequences of his conduct, and that he willfully and deliberately failed to avoid those consequences’” or, in other words, “the defendant must ‘have actual knowledge of the risk of harm it is creating and, in the face of that knowledge, fail to take steps it knows will reduce or eliminate the risk of harm.’” Pac. Gas & Elec. Co. v. Sup. Ct. (2018) 24 Cal.App.5th 1150, 1159 (internal citations omitted). CCP § 3294(c)(2) defines “oppression” as “despicable conduct that subjects a person to cruel and unjust hardship in conscious disregard of that person’s rights.” CCP § 3294(c)(3) defines “fraud” as “an intentional misrepresentation, deceit, or concealment of a material fact known to the defendant with the intention on the part of the defendant of thereby depriving a person of property or legal rights or otherwise causing injury.”
 
In College Hospital Inc. v. Sup. Ct. (1994) 8 Cal.4th 704 the California Supreme Court explained that the Legislature added the words “despicable” and “willful” in 1987, and that the reference to “despicable” conduct “seems to represent a new substantive limitation on punitive damages awards.” Id. at 725. The Supreme Court explained that “[u]sed in its ordinary sense, the adjective ‘despicable’ is a powerful term that refers to circumstances that are ‘base,’ ‘vile,’ or ‘contemptible.’” Id. See also Mock, Mock v. Michigan Millers Mut. Ins. Co. (1992) 4 Cal.App.4th 306, 331 (despicable is defined as conductthat “is so vile, base, contemptible, miserable, wretched or loathsome that it would be looked downupon and despised by ordinary decent people.”); Tomaselli v. Transamerica Ins. Co. (1994) 25 Cal.App.4th 1269, 1287 (despicable conduct has been described as having “the character of outrage frequently associated with a crime.”) “As amended to include this word, the statute plainly indicates that absent an intent to injure the plaintiff, ‘malice’ requires more than a ‘willful and conscious’ disregard of the plaintiff's interests. The additional component of ‘despicable conduct’ must be found.” College Hospital, 8 Cal.4th at 725.
 
Plaintiff’s contention is that Travelers’s claims-handling as detailed in the SAC rises to the level of oppressive and malicious conduct. Opp. at 6:7-8.
 
II.                The Prior Order and the SAC
 
The Prior Order granting the motion to strike the punitive damages allegations of the FAC stated in relevant part: “The allegations regarding the conduct of Travelers and its alleged agents—failure to provide adequate coverage and wrongfully and in bad faith withholding benefits due under the policy and other acts of alleged bad faith (failure to timely investigate, failure to respond to inquiries, taking frivolous positions, and failing to explain why claims were not being paid, see FAC ¶ 44; Opp. at 8:3-7)—and characterizing it as ‘willful, malicious and oppressive and [ ] calculated by Travelers to advance its own financial interests at Plaintiffs’ expense’ (FAC ¶ 47) is insufficient. ‘The conduct required to award punitive damages for the tortious breach of contract, however, is of a different dimension [than for other torts involving “intentionally wrongful conduct”].’ Tomaselli, 25 Cal.App.4th at 1286 (holding that evidence was sufficient to support jury verdict in favor of plaintiffs on bad faith claim but not punitive damages claim). As Plaintiff’s own case explains, ‘[t]o find the requisite intent for an award of punitive damages, it is necessary to search beyond the facts of [un]reasonable response to those adducing motive and intent.’ Fleming, 160 Cal.App.3d at 44.” Prior Order 11:12-24.
 
The Prior Order thus concluded that the factual allegations in the FAC regarding Travelers’s alleged acts and omissions did not rise to the level of conduct for which punitive damages may be awarded but that because Plaintiff pled a tort for which punitive damages are not unavailable as a matter of law, leave to amend was appropriate. Prior Order at 11:25-12:8.
 
The SAC, like the FAC, contains the following causes of action: 1) professional negligence (against the Broker Defendants only, now that Travelers has been voluntarily dismissed); 2) negligence (against all Defendants); 3) breach of contract (against Travelers); and 4) breach of the implied covenant of good faith and fair dealing (against Travelers).
 
The SAC alleges that Travelers issued the policy insuring Plaintiff’s 23 acre property located at 1995 Lawndale Road, Santa Rosa (the “Property”), which was in effect when the main house was damaged and the “other structures” (guest house, redwood barn, horse stalls, tack room, and carport) were destroyed by the Adobe Fire in October, 2017.
 
First, the SAC (like the FAC) alleges that the Property was underinsured due to Defendants’ negligence. Specifically, it alleges that Plaintiff informed the Broker Defendants (defined as the defendants other than Travelers) that she remodeled the Property and had doubts that the Property was fully protected under the policy. It alleges that Ms. Harden informed Plaintiff that the amount of coverage could not be increased until the Property was appraised and then she failed to bring about the necessary appraisal despite promising to do so. Second, the SAC (like the FAC) alleges that Travelers refused to pay for damage to the siding of the main home even though: (1) the damage was apparent upon visual inspection, (2) the siding had been brand new prior to the wildfire, and (3) the contractor who installed the siding represented to Travelers that it was properly seasoned and installed, so it would not have warped except for the intense heat from the wildfire. SAC ¶¶ 27-29. Third, the SAC newly alleges that Travelers refused to pay for damage to the significantly fire damaged pergolas because it classified them as “other structures” rather than as part of the “dwelling” even though the coverage for other structured had been exhausted by the insufficiently insured guesthouse and barn and the pergolas were one inch from the main home and bolted into the patios abutting the main home. SAC ¶¶ 30-32.
 
The fourth cause of action for breach of the covenant of good faith and fair dealing (SAC ¶¶ 54-66) incorporates the preceding allegations and is based on Travelers “failing to acknowledge that the pergolas should be included within the ‘Dwelling’ coverage according to the plain language of the Policy” contrary to the plain language and a reasonable understanding of the Policy (SAC ¶¶ 56-58), and for “refusing to pay for the damage to the siding of the main home,” even though it was “obvious” just by observing the siding that it had been damaged by the fire (SAC ¶ 59). It also alleges that Travelers breached the covenant of good faith and fair dealing by: failing to promptly and thoroughly investigating the components of her claim; putting its own interests above Plaintiff’s interests; failing to timely respond to correspondence from Plaintiff; failing to provide a prompt and reasonable explanation of the basis relied on under the terms of the policy for the denial and underpayment of claims; compelling Plaintiff to institute litigation to recover amounts due under the contract; asserting frivolous positions for the purpose of evading its obligations to Plaintiff and for the purpose of oppressing her; and breaching the duty by other means of which she is presently unaware. SAC ¶ 60.
 
The SAC now pleads, in addition to the underlying conduct and that it was “willful, malicious and oppressive,” (SAC ¶ 65), supporting allegations as follows: that Plaintiff is an elderly woman and that Travelers’s unreasonableness and refusal to pay damages plainly covered by the Policy caused a great deal of stress, worry, and anguish, and that it was obvious to Travelers’s representatives that their dismissal of her claims, which they knew to be valid but denied in order to advance its financial interests, were causing her mental pain and anguish and that their persistence in maintaining their flawed positions in spite of the harm they knew they were causing constitutes despicable conduct. SAC ¶ 63. The SAC also alleges on information and belief that the Travelers representatives who were responsible for these denials were managing agents and/or that they were ratified at the highest level at Travelers and that all conduct was done by or ratified by managing agents. SAC ¶¶ 64-65. Compare FAC ¶ 47 (only alleging: “The conduct of Travelers as alleged herein was in complete disregard of Plaintiffs’ rights and interests. Said conduct was willful, malicious and oppressive and was calculated by Travelers to advance its own financial interests at Plaintiffs’ expense. All of the conduct alleged herein was done by or on behalf of and ratified by one or more officers, directors, or managing agents of Travelers.”)
 
III.             Analysis
 
To plead the right to punitive damages the plaintiff must allege specific facts showing that defendant’s conduct was oppressive, fraudulent or malicious. See, e.g. Smith v. Sup.Ct. (1992) 10 Cal.App.4th 1033, 1041-1042 (issuing writ ordering trial court to vacate its order on the motion to strike and issue order striking punitive damages allegations, among others; “[a]s noted above, that paragraph is devoid of any factual assertions supporting a conclusion petitioners acted with oppression, fraud or malice.”); Anschutz Entertainment Group, Inc. v. Snepp (2009) 171 Cal.App.4th 598, 643 (allegations that defendant’s conduct was “intentional, and done willfully, maliciously, with ill will towards Plaintiffs, and with conscious disregard for Plaintiff's rights” did not satisfy the “specific pleading requirement”).
 
The additional factual allegations in the SAC not present in the FAC, mainly SAC ¶ 63, speak to the key issue of whether, in committing the alleged tort of insurance bad faith, Travelers acted with malice, fraud, or oppression. See Turman, 191 Cal.App.4th at 64. At least for pleading purposes, these allegations are sufficient because Plaintiff asserts more than overzealousness and unreasonableness of the coverage position plus conclusory allegations that Travelers acted with fraud, malice, or oppression. Rather, these new allegations cure the deficiency identified in the Prior Order and are sufficient at the because they assert that Travelers’s agents persisted in asserting its unreasonable coverage positions notwithstanding their knowledge: 1) that the coverage position was invalid; and 2) of the injury asserting the knowingly invalid coverage position was causing Plaintiff.
 
Travelers argues that the SAC does not address howTravelers was aware of Plaintiff’s mental state or when it became aware of her alleged injuries, or why Plaintiff’s alleged stress and worry have any relevance to the underlying, preceding coverage decision. Motion at 12:15-17. The first two issues are a purported failure to allege evidentiary facts, not ultimate facts showing that in committing the alleged tort of bad faith Travelers acted out of malice, fraud or oppression. And there are specific facts pled to support an inference that the coverage position was knowingly flawed, for example, based on Plaintiff’s allegation that Travelers representatives refused to pay for “obvious” fire damage to the siding of the main house (SAC ¶¶ 26-32). See, e.g. Mazik v. Geico General Ins. Co. (2019) 35 Cal.App.5th 455, 459 (“An insurer is not permitted to rely selectively on facts that support its position and ignore those facts that support a claim. Doing so may constitute bad faith. [citations] When sufficiently egregious, an insurer’s intentional disregard of facts supporting a claim also meets the standard for punitive damages.”) And as to the third point made by Travelers, an insurer’s duty to act in good faith persists, so there is no reason to conclude that maintaining a knowingly unreasonable coverage position could not give rise to punitive damages if it was done maliciously, oppressively, or fraudulently.
 
IV.             Conclusion
 
For the reasons set forth above, insofar as the Motion is directed at the punitive damages allegations (SAC ¶¶ 63, 65; Prayer ¶ 4) the Motion is DENIED, and insofar as it is directed at the first cause of action as applied to Travelers, it is MOOT since Plaintiff filed a dismissal of that cause of action as to Travelers. Travelers shall file its answer to the SAC within fifteen (15) days of notice of entry of the order on this Motion. 
 
Plaintiff’s counsel shall submit a written order to the Court consistent with this tentative ruling and in compliance with Rule of Court 3.1312(a) and (b).
 
 
 
3.         SCV-267287, Edenfield v. Chiaramonte Construction & Plumbing Inc:
 
Petitioners/plaintiffs Eric B. Edenfield and Christopher Morano, and Brian W. Scott and Jacqueline L. Scott, individually and as trustees of the Brian W. Scott & Jacqueline L. Scott Trust of August 25, 2007 (altogether “Petitioners”) filed the verified petition in this action against defendant/respondent Chiaramonte Construction & Plumbing Inc. (“Respondent”) to release the two specified properties from mechanic’s liens recorded by Respondent. This matter is on calendar for Petitioners’ motion pursuant to Cal. Civ. Code (“CC”) §§ 8480 and 8484, and Cal. Code Civ. Proc. (“CCP”) § 405.32, to release the mechanic’s liens recorded against their respective properties by Respondent on June 4, 2019 ($70,132.75) and May 13, 2019 ($110,132.75). The Petition is GRANTED.
 
CC § 8480(a) provides that unless the property owner has entered into an extension agreement, he or she may petition the court for an order to release the property from the claim of lien if the claimant has not commenced an action to enforce the lien within the time provided in section 8460, which is 90 days after recordation of the lien. Petitioners have met their initial burden of producing evidence supporting the Petition, including compliance with CC §8484. No opposition has been filed. 
 
Petitioners also request attorneys’ fees pursuant to CC § 8488(c). The Petition requests $5,000 in attorneys’ fees plus costs, and the declaration by counsel filed in support of the Petition requests $5,945 total, representing both costs and fees. The Freeman Declaration states that counsel spent twelve hours preparing the moving papers (at $350/hr) and estimates spending “another three hours in perfecting the filing and service of these documents as well as reviewing and responding to any Opposition as well as appearing at the Motion.” Freeman Decl. ¶ 10. His supplemental declaration filed on January 19, 2021 confirms that no opposition was received. Supp. Freeman Decl. ¶ 5. Twelve hours for researching and preparing the Petition and accompanying moving papers is reasonable, but it is not reasonable to award $350/hr for the administrative tasks of coordinating filing and service, and no opposition necessitating a reply was filed.
 
Based on the foregoing, attorneys’ fees and costs are awarded pursuant to CC § 8488(c) in the amount of $4,895, comprised of: $4,200 in attorneys’ fees (12 hours at $350/hr); plus $695 in costs ($435 in filing fees for the Petition, $60 in filing fees for the motion, and an estimated $200 for service fees, per Freeman Decl. ¶ 10).
 

The Court will sign the [proposed] order submitted on January 19, 2021, except that it will revise the attorney fee and cost award as stated above.

 
 
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