Opinion
G060545
01-13-2023
MID-CENTURY INSURANCE COMPANY, Respondent, v. PATRICK ERGINA, Appellant.
Kyle Scott Law and Kyle J. Scott for Appellant. Demler, Armstrong &Rowland, David W. Jennings and James P. Lemieux for Respondent.
NOT TO BE PUBLISHED
Appeal from an order of the Superior Court No. 30-2020-01151889 of Orange County, Fred W. Slaughter, Judge. Affirmed.
Kyle Scott Law and Kyle J. Scott for Appellant.
Demler, Armstrong &Rowland, David W. Jennings and James P. Lemieux for Respondent.
OPINION
SANCHEZ, J.
Patrick Ergina appeals from the court's order granting Mid-Century Insurance Company's (Mid-Century) petition to dismiss arbitration. Ergina was in a car accident with an uninsured motorist and subsequently proceeded with arbitration against Mid-Century, his insurance company. But he failed to complete arbitration within the five-year period provided by Insurance Code section 11580.2, subdivision (i)(2)(A).
All further statutory references are to the Insurance Code.
On appeal, Ergina contends Mid-Century should be estopped from raising the five-year deadline to complete arbitration. He also claims Mid-Century waived the right to assert the deadline. For the reasons below, we disagree and affirm the order.
FACTS
The Underlying Accident and Arbitration Demand
In March 2013, Ergina was in a car accident with an uninsured motorist. In January 2015, Mid-Century sent a letter to Ergina explaining the two-year statute of limitations for his claims would expire on March 9, 2015. On March 5, 2015, Ergina's counsel sent a timely demand for uninsured motorist arbitration to Mid-Century. Given the March 5, 2015 demand, the arbitration had to be "concluded" by March 5, 2020, five years "from the institution of the arbitration proceeding." (§ 11580.2, subd. (i)(2)(A).)This deadline is central to the instant appeal.
While § 11580.2, subd. (i)(2)(A) states that any arbitration involving uninsured motorist coverage must be "concluded" within five years, we use the term "completed" interchangeably with "concluded" for the sake of convenience, but do not decide whether the two terms are synonymous in all situations.
On March 6, 2015, Ergina also filed a complaint against the uninsured motorist and the owner of the vehicle. He later amended the complaint to include a cause of action against Mid-Century for breach of the covenant of good faith and fair dealing.
The Parties' Settlement Efforts
After receiving the demand for arbitration, Mid-Century's adjuster contacted Ergina's counsel, and the parties agreed Mid-Century could hold off on assigning the matter to defense counsel to see if they could settle the case. In April 2015, Mid-Century made a settlement offer of $4,618.69. In July 2016, Ergina's counsel sent a letter detailing Ergina's medical treatment and demanding "full and fair compensation." In August 2016, Mid-Century provided a new offer of $6,000 to a paralegal in the office of Ergina's counsel. Mid-Century did not hear back from Ergina's counsel.
In June 2017, Ergina's counsel sent a letter to Mid-Century claiming MidCentury had failed to assign the matter to counsel and requesting counsel be assigned so the matter could proceed to arbitration. In December 2017, Mid-Century retained counsel.
Discovery, Mediation, and Arbitrator Selection
In 2018, the parties engaged in some discovery. Mid-Century took Ergina's deposition in June 2018 and arranged for his medical examination in August 2018. In December 2018, the parties participated in a mediation that was ultimately unsuccessful. From January 2019 to May 2019, the parties discussed potential arbitrators and eventually agreed on an arbitrator.
Arbitration Scheduling
In late May 2019, Mid-Century contacted the arbitrator's office for available arbitration dates. In June 2019, the parties agreed to proceed with arbitration on October 24, 2019.
On September 24, 2019, Ergina's counsel sent an e-mail to the arbitrator's office requesting to continue the arbitration to January 2020 due to a trial conflict. Three days later, Ergina's counsel informed Mid-Century that he had to continue the October 2019 arbitration and provided the arbitrator's availability in January, February, and March 2020. On September 30, 2019, Mid-Century's counsel responded with the dates that worked for him and his expert in January, February, and March 2020. All of the dates were before the expiration of the five-year period on March 5, 2020. Having received Mid-Century's availability, the arbitrator's office responded on the same day stating that they looked forward to receiving Ergina's counsel's availability.
On October 9, 2019, the arbitrator's office followed up again and asked when Ergina's counsel was available for arbitration. It appears that Ergina's counsel did not respond. On October 18, 2019, the arbitrator's office sent an e-mail to the parties and offered different arbitration dates because some of the previously offered dates were no longer available. The new offered dates in 2020 were: January 6; February 10, 24, 25; March 5, 9, 10, 11, 12, 16, 23, 25, 26, 30; April 1, 2, 6, and 7. The post March 5, 2020 dates were after the five-year period would expire.
On October 22, 2019, a legal assistant for Mid-Century's counsel replied: "Best dates that work for [Mid-Century's counsel] are March 11 or March 25 ...." The next day, the arbitrator's office responded that it had "placed a 48-hour tentative hold to allow opposing counsel to confirm their availability." On October 30, 2019, the legal assistant for Mid-Century's counsel asked: "Have we heard of a firm date for this Binding Arbitration? March 11 or March 25?" The arbitrator's office indicated it would release the two offered dates if Ergina's counsel did not respond by November 1, 2019. On October 31, 2019, a paralegal working for Ergina's counsel responded that counsel was available the first week of April 2020 "with the latter dates being better." The parties selected April 8, 2020, for the arbitration.
Post-scheduling Communications
We deny Ergina's request in his reply brief to take judicial notice of four e mails sent by the parties' counsel on December 17, 2019, January 3, 2020, March 3, 2020, and February 3, 2021. (Cal. Rules of Court, rule 8.252 [request must be made in separate document].) Aside from Ergina's failure to seek judicial notice by a separate motion, the e-mails were not before the trial court. "It has long been the general rule and understanding that 'an appeal reviews the correctness of a judgment as of the time of its rendition, upon a record of matters which were before the trial court for its consideration.'" (In re Zeth S. (2003) 31 Cal.4th 396, 405; see Pulver v. Avco Financial Services (1986) 182 Cal.App.3d 622, 632.) We accordingly cannot consider the three emails as a basis for reversal.
On February 6, 2020, new counsel for Mid-Century sent a letter to Ergina's counsel advising that Mid-Century had reassigned the matter to him. On February 25, 2020, Mid-Century's counsel in the pending bad faith litigation sent an e-mail to Ergina's counsel attaching a draft stipulation to continue the trial. The e-mail stated: "It is my understanding that the underlying arbitration is scheduled for 4/8/20. With the bad faith trial set for 6/1/20, this leaves less than 60 days between the two for discovery and trial preparations. This would seem inadequate."
On March 3, 2020, Mid-Century served a notice of intention to introduce certain documents at the arbitration hearing. The five-year period for completion of the arbitration ran on March 5, 2020. On March 17, 2020, Mid-Century's bad faith counsel sent a letter to Ergina's counsel questioning the viability of plaintiff's uninsured motorist claim. Among other things, the letter stated that the arbitration had to be concluded within five years of the institution of arbitration pursuant to section 11580.2, subdivision (i)(2). Because Ergina had not concluded the arbitration within the five-year time period, the letter suggested Ergina's right to arbitration was lost unless there was some basis for tolling.
On March 31, 2020, the arbitrator's office sent an e-mail to the parties indicating they could proceed with a virtual or telephonic arbitration but there would be no live hearings before May 1, 2020, due to the COVID-19 pandemic. On April 1, 2020, Mid-Century's counsel sent an e-mail to the arbitrator's office noting the parties had discussed scheduling and wanted to continue the arbitration "in light of this virus situation." He requested dates in June or July 2020 because the parties wanted to present live testimony. The arbitration ultimately was rescheduled to February 4, 2021.
On May 4, 2020 and June 3, 2020, Mid-Century's bad faith counsel followed up with Ergina's counsel to ask for a response to its prior letter as to whether grounds might exist for excusing noncompliance with the five-year period for completion of the arbitration. Ergina did not respond.
Mid-Century's Petition to Dismiss the Arbitration
In August 2020, Mid-Century filed a petition to dismiss the uninsured motorist arbitration and argued Ergina had failed to conclude the arbitration within the required five-year statutory timeframe. Ergina filed an opposition in October 2020, claiming his failure to comply with the deadline was excused by the doctrines of estoppel, waiver, impossibility, impracticability, and futility. Mid-Century filed its reply brief later that month.
In November 2020, the court deemed Mid-Century's petition related to Ergina's pending complaint for insurance bad faith, and the hearing was scheduled for January 2021. In January 2021, Ergina filed an "opposition to petitioner's reply" without leave of court. About a week later, the court continued the hearing to February 2021.
After the court issued a tentative ruling, Ergina made a peremptory challenge to the assigned judge. The matter was then reassigned to Judge Slaughter. In February 2021, Ergina filed a third opposition brief containing new arguments, and MidCentury subsequently filed a sur-reply. Both were filed without leave of court.
Order Granting Mid-Century's Petition to Dismiss the Arbitration
In April 2021, the court granted Mid-Century's petition to dismiss the arbitration because Ergina had not proven circumstances excusing his noncompliance with the five-year statutory timeframe. (§ 11580.2, subd. (i)(2), (3).) Given the March 5, 2015 arbitration demand, the court found the five-year time period elapsed on March 5, 2020. The court next held Mid-Century was not estopped from raising the five-year time limit. According to the court, "Ergina was not reasonably 'prevented' by [Mid-Century] from exercising his rights." In other words, Mid-Century did nothing to induce Ergina to forbear arbitrating within the required five years. The court also explained that most of the complained events took place when there was sufficient time for Ergina to act. Ergina was represented by counsel and could have petitioned the court to compel the appointment of arbitrators if Mid-Century was delaying arbitration. With respect to waiver, the court emphasized waiver is the intentional relinquishment of a known right and Ergina had not proven this by clear and convincing evidence. Finally, the court held the doctrines of impracticability, impossibility, and futility were not supported by the record.
In June 2021, the court dismissed the arbitration without prejudice, and Ergina timely appealed.
DISCUSSION
Ergina contends the court erred by finding his failure to conclude arbitration within the five-year period was not excused by the doctrines of estoppel or waiver. We disagree.
Estoppel Does Not Apply
Section 11580.2 mandates contractual arbitration of disputes involving uninsured motorist claims. (§ 11580.2, subd. (f); Pilimai v. Farmers Ins. Exchange Co. (2006) 39 Cal.4th 133, 140.) Absent an exception, the arbitration must be concluded within five years. (§ 11580.2, subd. (i)(2)(A).) The statute provides in relevant part: "Any arbitration instituted pursuant to this section shall be concluded" "[w]ithin five years from the institution of the arbitration proceeding." (Ibid.) "The statute imposes an absolute obligation on the insured to comply with its mandates or else the insured forfeits his claim." (Blankenship v. Allstate Ins. Co. (2010) 186 Cal.App.4th 87, 94.) While an insurer must notify the insured of the upcoming expiration of an applicable statute of limitations, "[t]he notice shall not be required if the insurer has received notice that the insured is represented by an attorney." (§ 11580.2, subd. (k).) A court may excuse a party's noncompliance with the statutory timeframe if "[t]he doctrines of estoppel, waiver, impossibility, impracticability, [or] futility apply ...." (§ 11580.2, subd. (i)(3).)
Here, the parties do not dispute the five-year period for completion of arbitration ran five years after Ergina's arbitration demand - on March 5, 2020. Ergina contends his noncompliance with the statutory deadline is excused based on equitable estoppel. "'The essence of an estoppel is that the party to be estopped has by false language or conduct "led another to do that which he [or she] would not otherwise have done and as a result thereof that he [or she] has suffered injury."'" (Steinhart v. County of Los Angeles (2010) 47 Cal.4th 1298, 1315.) "Equitable estoppel requires that (1) the party to be estopped was aware of the operative facts and either intended that its act or omission be acted upon, or acted in such a way that the party asserting estoppel rightfully believed it was intended; and (2) the party asserting estoppel was unaware of the facts and relied on the other party's conduct to its detriment. (Gaines v. Fidelity National Title Ins. Co. (2016) 62 Cal.4th 1081, 1097; see Behnke v. State Farm General Ins. Co. (2011) 196 Cal.App.4th 1443, 1462.) "The party asserting estoppel has the burden to establish these elements." (Gaines, at p. 1097.) We review a trial court's rejection of an estoppel argument for substantial evidence. (Id. at p. 1098.) Where there are undisputed facts, estoppel presents a question of law that we review de novo. (Jordan v. City of Sacramento (2007) 148 Cal.App.4th 1487, 1496.)
Ergina claims Mid-Century's statements and conduct induced him to agree to an arbitration date beyond the March 5, 2020 deadline. He points to Mid-Century's October 22, 2019 e-mail to the arbitrator's office indicating Mid-Century's counsel was available on March 11 or March 25, 2020. He also points to Mid-Century's follow-up email on October 30, 2020 asking if arbitration would proceed on March 11 or March 25, 2022. He next notes Mid-Century later agreed to proceed with arbitration on April 8, 2020. But Ergina omits other critical facts preceding these events. We repeat these facts below.
The parties initially scheduled arbitration for October 2019, which was well within the five-year period, but Ergina's counsel unilaterally took the arbitration off-calendar due to a trial conflict. In September 2019, the arbitrator's office provided new dates in January, February, and March 2020. All of those dates were within the five-year period. Mid-Century promptly responded with the dates that worked for its counsel. Again, all of those dates were within the five-year period. Ergina's counsel never responded even though the arbitrator's office attempted to follow up with him. After a few weeks passed, the arbitrator's office offered different arbitration dates because the previous dates were no longer available. Some of the newly offered dates were after the March 5, 2020 deadline, and Mid-Century indicated it was available on two of those dates - March 11 or March 25, 2020. Ergina's counsel was not available until April 2020. In short, Mid-Century did not make any representations about the five-year period to induce Ergina to delay arbitration. Instead, Mid-Century was agreeable to arbitration dates well before the statutory deadline expired, but Ergina's counsel lost those available dates by failing to timely schedule the arbitration. While Mid-Century indicated it was available on dates after the statutory deadline, the record suggests neither party was aware of the upcoming deadline at that time. "[W]here the material facts are known to both parties and the pertinent provisions of law are equally accessible to them, a party's inaccurate statement of the law or failure to remind the other party about a statute of limitations cannot give rise to an estoppel." (Jordan v. City of Sacramento, supra, 148 Cal.App.4th at p. 1496.)
Ergina next contends Mid-Century's post-scheduling statements and conduct further induced him to "reasonably rely on the arbitration date being properly set and to refrain from taking any action to change the date to an earlier date within the five-year period." He points to the February 2020 e-mail from Mid-Century's bad faith counsel attaching a draft stipulation to continue the bad faith trial given the April 2020 arbitration. He also relies on Mid-Century's notice of intention to introduce certain documents at the arbitration hearing. These communications do not reveal any basis for an estoppel. Ergina was represented by counsel, and there is no evidence his counsel was unaware of material facts needed to calculate the deadline. Instead, his counsel had all the information necessary to calculate when the five-year deadline would expire. (Steinhart v. County of Los Angeles, supra, 47 Cal.4th at p. 1316 ["In general, the law 'particularly' disfavors estoppels 'where the party attempting to raise the estoppel is represented by an attorney at law'"].) Mid-Century also was not obliged to warn Ergina of the deadline because he was represented by counsel. (§ 11580.2, subd. (k).) In short, Ergina was not relieved of his responsibility to ensure arbitration was timely completed and should have sought clarification from Mid-Century as to whether it was intending to waive the deadline. (Allstate Ins. Co. v. Gonzalez (1995) 38 Cal.App.4th 783, 792 ["[T]he burden of prosecution is always with the plaintiff or claimant"].)
Ergina points to other e-mails that were not before the trial court. As discussed, ante, we do not consider those e-mails as a basis for reversal.
Griffis v. S. S. Kresge Co. (1984) 150 Cal.App.3d 491 (Griffis), which Ergina cites, is inapposite. In Griffis, the Court of Appeal found the defendant's counsel was estopped from seeking dismissal based on expiration of a five-year statutory deadline to bring the action to trial. (Id. at pp. 498-500.) The plaintiff's counsel had presented her calculation of the five-year limitation period to the trial court. (Id. at p. 495.) The trial court then asked the defendant's counsel if he agreed with the calculation. (Ibid.) The defendant's counsel "stated he had not made the computations, but had "no reason to dispute" [the plaintiff's attorney's] computations." (Ibid.) The Court of Appeal found this response "at best" "negligently withheld from the [trial] court the vital information that the matter had been ordered to arbitration on a date substantially later than that relied upon by [the plaintiff's attorney]; at worst, the response was an overtly false statement, for [the defendant's attorney] did have, or should have known he had reason to dispute the basis for the calculations." (Id. at p. 500.) In reaching this conclusion, the court emphasized the defendant's counsel must have known "the matter . . . was referred to arbitration at the February 1982 mandatory settlement conference rather than the September 1981 arbitration conference, in that he had been present at both . . . conferences." (Id. at p. 499.) The court also found the defendant's counsel should have known the plaintiff's attorney was unaware of the true facts because he presumably read the declaration explaining the plaintiff's calculation. (Ibid.)
Unlike the plaintiff's counsel in Griffis, Ergina's counsel never raised the five-year deadline or presented a calculation as to when it would expire. Mid-Century also never made any representations about the deadline, and there are no facts suggesting Mid-Century knew or should have known Ergina was miscalculating the five-year deadline. Instead, the record suggests both parties were not monitoring the upcoming deadline at the time when they were scheduling the arbitration. Thus, the facts in Griffis are distinguishable from the facts in the instant case.
Waiver Does Not Apply
Ergina also argues Mid-Century waived its right to assert the five-year statutory deadline. He relies on Mid-Century's subsequent conduct in agreeing to continue the April 2020 arbitration to a later date. As discussed, ante, on March 17, 2020, Mid-Century's bad faith counsel sent a letter to Ergina's counsel mentioning the five-year limitation period. This correspondence was sent less than two weeks after the deadline had passed. On March 31, 2020, the arbitrator's office indicated the parties could not proceed with live testimony due to the COVID-19 pandemic. The next day, Mid-Century sent an e-mail to the arbitrator's office stating the parties had discussed scheduling and wanted to continue the arbitration. Mid-Century requested dates in June or July 2020. Meanwhile, on May 4, 2020 and June 3, 2020, Mid-Century's bad faith counsel followed up with Ergina's counsel to ask for a response to its prior letter as to whether noncompliance with the five-year statutory period was excused. Ergina did not respond. In July 2020, the arbitration was rescheduled to February 4, 2021. Having not heard back from Ergina, Mid-Century filed a petition to dismiss the arbitration in August 2020. These facts do not support a waiver.
"'"Waiver always rests upon intent. Waiver is the intentional relinquishment of a known right after knowledge of the facts. [Citations]. The burden, moreover, is on the party claiming a waiver of a right to prove it by clear and convincing evidence that does not leave the matter to speculation, and "doubtful cases will be decided against a waiver."'" (DRG/Beverly Hills, Ltd. v. Chopstix Dim Sum Cafe &Takeout III, Ltd. (1994) 30 Cal.App.4th 54, 60.)
Here, the above facts do not present clear and convincing evidence of MidCentury's relinquishment of a known right. Instead, Mid-Century raised the five-year deadline for completion of arbitration less than two weeks after it had passed. As MidCentury argues, it raised the issue two more times without any response from Ergina and continued the arbitration "to not hold a potentially moot arbitration until that legal issue could be decided." Mid-Century's agreement to move the arbitration hearing while it was contemporaneously seeking an explanation as to why the arbitration was not time barred does not constitute a waiver.
DISPOSITION
The order is affirmed. Mid-Century shall recover its costs incurred on appeal.
WE CONCUR: BEDSWORTH, ACTING P. J. MOTOIKE, J.