Brown v. State Farm Mutual Automobile Insurance Co.

Full title: Leonard S. BROWN, Plaintiff--Appellant, v. STATE FARM MUTUAL AUTOMOBILE…

Court: United States Court of Appeals, Ninth Circuit

Date published: Apr 24, 2003

64 F. App'x 62 (9th Cir. 2003)

Opinion

64 Fed.Appx. 62 (9th Cir. 2003) Leonard S. BROWN, Plaintiff--Appellant, v. STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY; State Farm Insurance Company, Defendants--Appellees. No. 02-15194. D.C. No. CV-00-02001-WBS/JFM. United States Court of Appeals, Ninth Circuit. April 24, 2003

Argued and Submitted April 7, 2003.

NOT FOR PUBLICATION. (See Federal Rule of Appellate Procedure Rule 36-3)

Insured brought suit against his automobile insurer, alleging that insurer breached its contract and the implied covenant of good faith and fair dealing by delaying payment of underinsured motorist benefits. The United States District Court for the Eastern District of California, William B. Shubb, J., entered judgment for insurer, and insured appealed. The Court of Appeals held that: (1) insurer did not breach the contract given that insured recovered all benefits due to him, and (2) insurer was not unreasonable in proceeding to trial to determine its exposure given unresolved liability issues concerning insurer's other insured driver.

Affirmed. Appeal from the United States District Court for the Eastern District of California, William B. Shubb, District Judge, Presiding.

Before BROWNING, MCKEOWN, and RAWLINSON, Circuit Judges.

MEMORANDUM ^*

* This disposition is not appropriate for publication and may not be cited to or by the courts of this circuit except as provided by Ninth Circuit Rule 36-3.

Appellant Leonard S. Brown ("Brown") contends that State Farm Mutual Automobile Insurance Company and State Farm Insurance Company (collectively "State Farm") breached both the insurance contract and the implied covenant of good faith and fair dealing by delaying the payment of underinsured motorist insurance benefits.

Because Brown recovered all the benefits due to him under his policy, State Farm did not breach its contract with Brown for insurance coverage. See Quintano v. Mercury Cas. Co., 11 Cal.4th 1049, 1056, 48 Cal.Rptr.2d 1, 906 P.2d 1057 (1995).

State Farm did not breach the covenant of good faith and fair dealing. Unresolved liability issues concerning State Farm's other insured driver made it reasonable for State Farm to proceed to trial for a determination of its exposure. Questions of coverage negate a bad faith claim as a matter of law. See Guebara v. Allstate Ins. Co., 237 F.3d 987, 992 (9th Cir.2001).

AFFIRMED.