Opinion
A146561
06-29-2018
MICHAEL BRASHER, Plaintiff and Appellant, v. CALIFORNIA STATE AUTOMOBILE ASSOCIATION et al., Defendants and Respondents.
NOT TO BE PUBLISHED IN OFFICIAL REPORTS
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115. (Humboldt County Super. Ct. No. DR110490)
As a result of an incident of "road rage," plaintiff Michael Brasher was injured in a physical altercation with Steve Morris, and sued Morris. Morris tendered the defense to his automobile and renter's insurance carriers, which declined to defend the action. Plaintiff and Morris settled their action, and Morris assigned his claims against his insurer. Plaintiff then brought this action against defendants AAA Northern California, Nevada & Utah Insurance Exchange (AAA) and ACA Insurance Company (ACA) (collectively defendants or the insurers). Defendants moved for summary judgment. The trial court concluded neither insurance policy covered the incident, and granted summary judgment to defendants. We shall affirm the judgment.
I. BACKGROUND
A. Allegations of the Complaint
We begin by quoting the allegations of the operative complaint regarding the underlying incident: "On February 12, 2009 at approximately 7:30 a.m., plaintiff was riding his bicycle on Valley West Boulevard in Arcata, California. While riding his bicycle, plaintiff swerved in front of Morris, who was driving his automobile on Valley West Boulevard. Morris slammed on his brakes in order to avoid hitting plaintiff with his car. Plaintiff got out of Morris' way and Morris passed plaintiff. As Morris was passing plaintiff, plaintiff flipped Morris off. Morris drove his vehicle down Valley West Boulevard a little farther and pulled over to the side of the road to make sure plaintiff was okay. By the time Morris stepped out of his car, plaintiff had already caught up to Morris and was directing profanity towards Morris. At this point, Morris began directing profanity back at plaintiff. Next, plaintiff jabbed Morris with his forearm at which point Morris began defending himself, and a physical altercation ensued in which plaintiff and Morris struck each other several times. Plaintiff received substantial injuries from Morris' actions, which required plaintiff to seek medical care."
Plaintiff brought the underlying action against Morris. (Michael Brasher v. Steven Eugene Morris et al., Humboldt County Super. Ct. case No. DR090832.) Morris tendered the defense of the lawsuit to AAA (his renter's insurance carrier) and ACA (his automobile insurance carrier), and the insurers denied coverage. Plaintiff alleged defendants did not conduct a thorough, fair, and objective investigation of the facts giving rise to the potential for coverage and duty to defend Morris.
Morris entered into an agreement with plaintiff to assign plaintiff all assignable causes of action Morris might have against AAA in exchange for a covenant not to execute on any judgments obtained against Morris. The trial court entered judgment for plaintiff against Morris for $600,000, an amount that represented both economic and noneconomic damages. Plaintiff then submitted demands to AAA and ACA, which refused to pay the judgment.
The assignment recited that plaintiff and Morris settled their dispute "for an assignment of any and all claims Morris may have against his insurance company, CSAA [previously known as AAA], for any and all claims Morris and/or Brasher may have against said company, and for the sum of $7,500 will be paid Morris to Brasher." The assignment did not name ACA. We deny plaintiff's request for judicial notice of a declaration of Steven E. Morris regarding the assignment, a declaration of Carlton D. Floyd regarding the assignment, and the attached assignment, dated December 1, 2016, naming both CSAA and ACA.
In this action, plaintiff alleged the following causes of action against AAA and ACA: a "Direct Action by Judgment Creditor" under Insurance Code section 11580, subdivision (b)(2); breach of the implied covenant of good faith and fair dealing owed to a judgment creditor; breach of insurance contract by assignment; and breach of the implied covenant of good faith and fair dealing.
All statutory references are to the Insurance Code.
B. The Road Rage Incident
The parties presented somewhat different versions of the underlying events. In support of their motions for summary judgment, defendants offered evidence that, after the incident, a police officer spoke with both Morris and plaintiff. Morris told the officer that after plaintiff had cut him off while riding a bicycle, Morris got out of his car to confront plaintiff. Plaintiff rode up to Morris, berated him with profanity, "got up in [his] face," and shoved him with his forearm. Fearing for his safety, Morris then "threw the first punch." Plaintiff told the officer that Morris stopped his car in plaintiff's path, got out of the car, and began yelling at plaintiff. Plaintiff was straddling his bicycle. Morris yelled at plaintiff and punched him four times, knocking him to the ground.
A few days after the incident, Morris submitted a statement indicating that when he got out of his car, plaintiff was at the back end of the car. By the time Morris reached the back of the car, plaintiff was hurling insults at him. Plaintiff was larger and heavier than Morris, and Morris feared he would be seriously injured if plaintiff hit him. Plaintiff struck Morris on his left forearm without provocation, and Morris responded with a defensive blow. Plaintiff tried to pull Morris's jacket over his head and continued hitting him. Morris punched plaintiff repeatedly until plaintiff let go of him and walked away.
In his deposition, Morris testified that, after the initial exchange with plaintiff, Morris stopped his car and got out; by the time he reached the back of his car, plaintiff was already there. They met "at the back of [his] bumper," where plaintiff was standing straddling his bicycle. His car never struck plaintiff or his bicycle. He added, "I wish it had. AAA told me that they thought it should have too, because then they would have defended me." He testified that he struck plaintiff only after plaintiff struck him, and that he continued striking until plaintiff let go of Morris's jacket. Before plaintiff pulled the jacket over Morris's head, Morris punched him in his left eye socket. Morris was aiming for the jaw center, because he knew that "if you can catch somebody with one good punch right there, it will knock them out and that would have been it. I missed."
In opposition to the motions for summary judgment, plaintiff submitted excerpts from his deposition. He testified that, after Morris pulled his car over on the side of the road, plaintiff approached on his bicycle, parallel to the car. Morris was still in the car. As he stepped out of the car, the car door "aggressively" struck the front wheel of plaintiff's bicycle, and plaintiff fell to the ground. Morris yelled at plaintiff and started hitting him as he lay on the ground. Plaintiff grabbed Morris's jacket to try to defend himself, and he struck back at Morris. Plaintiff testified that Morris threw the first punch.
C. The Underlying Action and Denial of Defense
Plaintiff sued Morris for personal injury, alleging causes of action for general negligence and intentional tort. As to both causes of action, the complaint alleged that after the initial exchange, defendant pulled his vehicle to the curb and stopped. When plaintiff approached, "[d]efendant, without provocation began striking plaintiff in the face and head causing plaintiff to fall with his bicycle to the ground. On the ground, plaintiff continued to be pummeled by defendant." The cause of action for intentional tort further alleged that Morris's conduct was willful and malicious.
Morris tendered the defense to AAA and ACA. The insurers sought the advice of counsel, who concluded the insurers had no duty to defend or indemnify Morris. Counsel concluded there was no duty to defend or indemnify under the automobile policy because there was no contact between Morris's vehicle and plaintiff's person or bicycle and there was no duty under the renter's policy because Morris's conduct did not constitute an "occurrence." The insurers therefore declined to defend Morris in the underlying action. Morris's attorney asked the insurers to reconsider their decisions. Counsel remained of the opinion that there was no duty to defend, and the insurers informed plaintiff they were denying coverage on the grounds that Morris's conduct was deliberate, rather than accidental, and that the injuries did not arise out of Morris's "use" of the automobile.
D. The Insurance Policies
Morris's AAA renter's insurance policy provided liability coverage for damages because of personal injury or property damage caused by an occurrence, subject to certain exclusions. An "occurrence" was defined as "an accident, including exposure to conditions which results during the policy period in: [¶] a. personal injury; or [¶] b. property damage." (Italics added, emphasis omitted.) Among the exclusions were personal injury "the type of which is expected or intended by any insured," and personal injury arising from "ownership, maintenance, use, loading or unloading of motor vehicles . . . ." (Emphasis omitted.)
The ACA automobile policy covered Morris for all damages, except punitive or exemplary damages, which he was obligated to pay because of bodily injury to anyone other than an insured "caused by accident, arising out of the ownership, or use, of an owned automobile by an insured or arising out of the use of a non-owned automobile by an insured." (Italics added.) ACA was obligated to "defend the insured against any suit, alleging bodily injury or property damage for which this policy provides indemnity." (Emphasis omitted.) The policy excluded "bodily injury or property damage caused intentionally by or at the direction of the insured[.]" (Emphasis omitted.) The policy also provided, "Assault and battery shall not be deemed an accident."
E. Summary Judgment
The trial court granted defendants' motions for summary judgment. The court concluded that all causes of action against both defendants failed because neither the renter's policy nor the automobile policy provided coverage for the underlying action. The court also concluded plaintiff lacked standing to sue ACA because the assignment of rights executed by Morris did not name ACA. Plaintiff appealed from the ensuing judgment.
II. DISCUSSION
A. Legal Standards
"A trial court properly grants a motion for summary judgment where 'all the papers submitted show that there is no triable issue as to any material fact and that the moving party is entitled to a judgment as a matter of law.' [Citation.] 'Because this case comes before us after the trial court granted a motion for summary judgment, we take the facts from the record that was before the trial court when it ruled on that motion. [Citation.] " 'We review the trial court's decision de novo, considering all the evidence set forth in the moving and opposing papers except that to which objections were made and sustained.' " [Citation.] We liberally construe the evidence in support of the party opposing summary judgment and resolve doubts concerning the evidence in favor of that party.' [Citation.]" (Hartford Casualty Ins. Co. v. Swift Distribution, Inc. (2014) 59 Cal.4th 277, 286.)
" 'A different analysis is required for our review of the trial court's . . . rulings on evidentiary objections. Although it is often said that an appellate court reviews a summary judgment motion "de novo," the weight of authority holds that an appellate court reviews a court's final rulings on evidentiary objections by applying an abuse of discretion standard. [Citations.]' [Citation.]" (Miranda v. Bomel Construction Co., Inc. (2010) 187 Cal.App.4th 1326, 1335; accord, Serri v. Santa Clara University (2014) 226 Cal.App.4th 830, 852.) We find such an abuse of discretion only if the trial court has exceeded the bounds of reason. (DiCola v. White Brothers Performance Products, Inc. (2008) 158 Cal.App.4th 666, 679.) We consider and construe liberally only admissible evidence in deciding whether there is a triable issue of fact. (Bozzi v. Nordstrom, Inc. (2010) 186 Cal.App.4th 755, 761.)
"A liability insurer owes its insured a broad duty to defend against claims creating a potential for indemnity. [Citation.] The duty to defend is broader than the duty to indemnify, and may exist even if there is doubt about coverage. [Citations.] When determining whether a duty to defend exists, the court looks to all of the facts available to the insurer at the time the insured tenders its claim for a defense. . . . [¶] On summary judgment, '[t]o prevail [on the duty to defend issue], the insured must prove the existence of a potential for coverage, while the insurer must establish the absence of any such potential. In other words, the insured need only show that the underlying claim may fall within policy coverage; the insurer must prove it cannot." (Albert v. Mid-Century Ins. Co. (2015) 236 Cal.App.4th 1281, 1289-1290 (Albert).)
B. The Underlying Incident Was Not an "Accident"
Plaintiff raises a number of issues on appeal: whether the trial court improperly excluded an expert declaration; whether he had standing to bring this action against ACA; whether the incident arose from the use of a car; whether his conduct was intentional; whether defendants properly relied on the advice of counsel in denying Morris's claim; whether he has a bad faith claim against the insurers; and whether he may recover from both the renter's and the automobile insurance policies. Our task in considering this appeal, however, is more straightforward than it may originally seem. As the trial court noted—and as plaintiff does not dispute—all of the causes of action depend on whether the policies covered the incident in which plaintiff was injured. We see no potential for coverage of the incident as alleged.
Both the renter's and the automobile insurance policies provided coverage for "accidents," and both contained exclusions for injury caused by intentional conduct by the insured. Also of note, section 533 provides, "An insurer is not liable for a loss caused by the wilful act of the insured; but he is not exonerated by the negligence of the insured, or of the insured's agents or others." Plaintiff contends there is a triable issue of fact as to whether Morris's conduct during the incident was intentional. He bases this contention on evidence that he asserts shows Morris was acting in self-defense; for instance, Morris testified plaintiff started the fight and Morris saw himself as the victim; Morris testified plaintiff threw the first punch and he needed to defend himself; and Morris testified that plaintiff was taller and bigger than he was.
In declining coverage on the ground Morris's actions were deliberate, defendants relied heavily on Delgado v. Interinsurance Exchange of Automobile Club of Southern California (2009) 47 Cal.4th 302 (Delgado).) There, an injured party sued an insured for assault and battery, alleging the incident fell within the insurance policy's coverage of an "accident" because the insured had acted in the unreasonable belief that he had to defend himself. (Id. at p. 305.) Our high court concluded the incident did not qualify as an accident, even if the insured believed he was acting in self-defense. "In the context of liability insurance, an accident is ' "an unexpected, unforeseen, or undesigned happening or consequence from either a known or an unknown cause." ' [Citations.]" (Id. at p. 308.) The court reasoned: "We begin by noting that an injury-producing event is not an 'accident' within the policy's coverage language when all of the acts, the manner in which they were done, and the objective accomplished occurred as intended by the actor. [Citations.] Here, [the insured's] assault and battery on [the plaintiff] were acts done with the intent to cause injury; there is no allegation in the complaint that the acts themselves were merely shielding or the result of a reflex action. Therefore, the injuries were not as a matter of law accidental, and consequently there is no potential for coverage under the policy. [Citation.]" (Id. at pp. 311-312, italics added.) The court in Delgado rejected the plaintiff's argument that an insured's mistaken belief in the need for self-defense converted the assault into an accidental act. The court explained, "Here, [the plaintiff's] complaint alleges acts of wrongdoing by the insured against him. Those are the acts that must be considered the starting point of the causal series of events, not the injured party's acts that purportedly provoked the insured into committing assault and battery on [the plaintiff]. The term 'accident' in the policy's coverage clause refers to the injury-producing acts of the insured, not those of the injured party." (Id. at p. 315.) The court concluded "that an insured's unreasonable belief in the need for self-defense does not turn the resulting purposeful and intentional act of assault and battery into 'an accident' within the policy's coverage clause," and the insurer therefore had no duty to defend the insured in a lawsuit brought by the injured party. (Id. at p. 317; see Swain v. California Casualty Ins. Co. (2002) 99 Cal.App.4th 1, 10 ["We know of no case from this or any other jurisdiction where a harm knowingly and purposefully inflicted was held 'accidental' merely because the person inflicting it erroneously believed himself entitled to do so"].)
The court in Delgado relied on Quan v. Truck Ins. Exchange (1998) 67 Cal.App.4th 583, in which the insured was sued for assault and battery based on his act in raping the victim, and contended there was a potential for coverage under a policy insuring against bodily injury caused by accident because he could be found to have negligently believed the victim consented. (Delgado, supra, 47 Cal.4th at p. 316.) The court explained: "Quan first observed that to determine whether an injury resulted from an accident, and thus fell within the policy's coverage, one needs to consider the nature of the insured's act. Quan then concluded that the insured's conduct could not have been accidental because it was intentional, and that an unreasonable belief in the victim's consent could not alter the nature of the act of forcible rape itself. ([Quan] at pp. 596-598.) Other courts have come to similar conclusions. (E.g., Lyons v. Fire Ins. Exchange [(2008)] 161 Cal.App.4th 880 [false imprisonment relating to alleged sexual attack not an accident even when insured may have acted under mistaken belief victim would not rebuff advances]; Modern Development Co. v. Navigators Ins. Co. (2003) 111 Cal.App.4th 932, 942 [citation] ['A mistake of fact in an employment termination does not transform the intentional act of terminating an employee into an accident']; Swain v. California Casualty Ins. Co., supra, 99 Cal.App.4th 1 [insured's belief that he was entitled to inflict harm does not transform wrongful eviction into an accident]; Merced Mutual Ins. Co. v. Mendez [(1989)] 213 Cal.App.3d 41 [unreasonable belief in victim's consent did not make oral copulation and attempted oral copulation accidents].)" (Delgado, supra, 47 Cal.4th at p. 316.)
The court in Albert, supra, 236 Cal.App.4th at p. 1291, explained further: "The term 'accident' refers to the nature of the insured's conduct, and not to its unintended consequences. [Citation.] An accident 'is never present when the insured performs a deliberate act unless some additional, unexpected, independent, and unforeseen happening occurs that produces the damage.' [Citation.] When an insured intends the acts resulting in the injury or damage, it is not an accident 'merely because the insured did not intend to cause injury. . . . The insured's subjective intent is irrelevant.' [Citations.]" (Accord, State Farm General Ins. Co. v. Frake (2011) 197 Cal.App.4th 568, 579-581.)
This case falls squarely within the rule of these cases. Whether or not Morris believed he needed to defend himself against plaintiff, the undisputed evidence shows his action in attacking plaintiff was "done with the intent to cause injury," rather than "merely shielding or the result of a reflex action." (Delgado, supra, 47 Cal.4th at p. 312.) The statements of Morris and plaintiff close to the time of the incident and their deposition testimony establish that Morris punched plaintiff repeatedly. Morris testified that he was aiming at plaintiff's jaw in order to knock him out. The complaint alleges the two engaged in a physical fight in which they struck each other several times. This undisputed evidence shows Morris's actions were deliberate, and they do not fall within California's definition of an accident. (See Delgado, 47 Cal.4th at pp. 308, 311-312; Albert, supra, 236 Cal.App.4th at p. 1291.) Plaintiff's injuries were not caused by an accident.
Plaintiff relied below, and relies again now, on an expert declaration of David H. Frangiamore, who had experience with insurance claims handling, claims adjustment, and settlement practices. Frangiamore opined that AAA and ACA had a duty to defend and, if necessary, indemnify Morris for the claims made in the underlying action. He stated that the insurers' counsel "assumed the truth of certain hotly disputed facts, and further chose to ignore the sworn testimony of its own insured and that of Plaintiff Brasher. . . ." According to Frangiamore, the insurers violated industry custom and standards as well as California law by failing to investigate plaintiff's claims fully; for example, they did not investigate certain disputed facts, such as who struck the first blow, whether plaintiff was struck by Morris's car door, whether Morris was trying to get away from plaintiff, and how they ended up on the ground.
The trial court sustained defendants' objections to much of Frangiamore's declaration. On appeal, plaintiff contends the declaration was fully admissible. We need not consider this contention because we conclude that it does not raise a disputed issue of material fact. Nothing in the declaration changes the fact that the undisputed evidence shows Morris acted deliberately in punching plaintiff repeatedly.
Plaintiff's belated testimony in his deposition that Morris's car door struck him aggressively, causing him to fall to the ground, does not affect this conclusion. Plaintiff argues that this testimony creates an issue of fact as to whether his injuries were caused by the "use" of a vehicle for purposes of Morris's automobile insurance policy. This contention is unpersuasive. Neither plaintiff nor Morris mentioned this purported fact in their statements to the police, and plaintiff told the officer that Morris's punches caused him to fall to the ground. Morris indicated consistently that plaintiff reached him after he was out of the car. Plaintiff made no allegation in the complaint in this action that Morris's car door struck him. In his complaint in the underlying action against Morris, plaintiff alleged: "Defendant, without provocation began striking plaintiff in the face and head causing plaintiff to fall with his bicycle to the ground." (Italics added.) (See Valerio v. Andrew Youngquist Construction (2002) 103 Cal.App.4th 1264, 1271 ["The admission of fact in a pleading is a 'judicial admission' "].) On this record, the trial court properly concluded that plaintiff's deposition testimony that the car door caused him to fall to the ground did not create a disputed issue of fact where it was inconsistent not only with his contemporaneous statements but with his own pleadings. In any case, even if Morris hit plaintiff with the car door, there is no evidence that his action was not intentional. Finally, the gravamen of the underlying complaint was that Morris's blows injured plaintiff, and there is no basis for a conclusion that any asserted contact with the car door caused plaintiff's injuries.
Where a vehicle is merely used to transport the tortfeasor to the site where an injury takes place, the injuries do not arise from the use or operation of the vehicle for purposes of an automobile insurance policy. (California Automobile Ins. Co. v. Hogan (2003) 112 Cal.App.4th 1292, 1300.)
Our conclusion disposes of all of plaintiff's causes of action. The first two counts are direct causes of action as a judgment creditor under section 11580, subdivision (b)(2). "Section 11580 requires a policy issued or delivered in this state which covers liability for injuries to a person . . . to include a provision that whenever judgment is secured against the insured in an action based upon bodily injury, death, or property damage, the judgment creditor may sue the insurer on the policy, subject to its terms and limitations, to recover on the judgment (§ 11580, subd. (b)(2))." (Wright v. Fireman's Fund Ins. Companies (1992) 11 Cal.App.4th 998, 1014-1015, fn. omitted.) Among the elements of a cause of action under this section, the third party claimant must plead and prove " 'the policy covers the relief awarded in the judgment[.]' " (Garamendi v. Golden Eagle Ins. Co. (2004) 116 Cal.App.4th 694, 710, italics added; see Delgado, supra, 47 Cal.4th at p. 308, fn. 1 [conclusion that insurer had no duty to defend dispositive of claim that plaintiff was judgment creditor under § 11580, subd. (b)(2)].) The undisputed evidence shows the policies do not cover the relief plaintiff obtained in the underlying judgment.
For the same reason, the fifth and sixth causes of action, for breach of defendants' contractual duty to defend and indemnity in accordance with the insurance policies, fail. A liability insurer owes a duty to defend an insured against claims that create a potential for indemnity. (Montrose Chemical Corp. v. Superior Court (1993) 6 Cal.4th 287, 295; Albert, supra, 236 Cal.App.4th at pp. 1289-1290; Scottsdale Ins. Co. v. MV Transportation (2005) 36 Cal.4th 643, 655 ["[I]f, as a matter of law, neither the complaint nor the known extrinsic facts indicate any basis for potential coverage, the duty to defend does not arise in the first instance"].) Because the incident at issue was not an "accident" under California law, there was no potential for coverage, and defendants did not breach their contractual obligations to Morris by declining to defend or indemnify him.
The third and fourth causes of action are for breach of the implied covenant of good faith and fair dealing owed to a judgment creditor. The seventh and eighth are for breach of the implied covenant of good faith and fair dealing owed to Morris and assigned to plaintiff. "It is clear that if there is no potential for coverage and, hence, no duty to defend under the terms of the policy, there can be no action for breach of the implied covenant of good faith and fair dealing because the covenant is based on the contractual relationship between the insured and the insurer." (Waller v. Truck Ins. Exchange, Inc. (1995) 11 Cal.4th 1, 36.) Because defendants had no contractual duty to defend, "the implied covenant [had] nothing upon which to act as a supplement . . . ." (Ibid.)
Because this conclusion disposes of all of the causes of action based on the implied covenant of good faith and fair dealing, we need not address the additional contentions raised by the parties on appeal.
III. DISPOSITION
The judgment is affirmed.
/s/_________
Schulman, J. We concur: /s/_________
Streeter, Acting P.J. /s/_________
Reardon, J.
Judge of the Superior Court of California, City and County of San Francisco, assigned by the Chief Justice pursuant to article VI, section 6 of the California Constitution.