Opinion
E051523
08-09-2011
HEIDI M. GRENZOW, Plaintiff and Appellant, v. JUSTIN JONES, Defendant and Respondent.
The Marks Law Firm, Inc. and Scott A. Marks for Plaintiff and Appellant. Arias & Lockwood, Christopher D. Lockwood; Bell, Orrock & Watase, Inc. and Dennis G. Popka for Defendant and Respondent. Plaintiff Heidi M. Grenzow (Grenzow) and her two minor daughters were injured in a car accident allegedly caused by defendant Justin Jones (Jones). Jones was insured by Topa Insurance Company (Topa).
NOT TO BE PUBLISHED IN OFFICIAL REPORTS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 This opinion has not been certified for publication or ordered published for purposes of rule 8.1115
(Super.Ct.No. RIC484956)
OPINION
APPEAL from the Superior Court of Riverside County. Douglas E. Weathers, Judge. Affirmed.
The Marks Law Firm, Inc. and Scott A. Marks for Plaintiff and Appellant.
Arias & Lockwood, Christopher D. Lockwood; Bell, Orrock & Watase, Inc. and Dennis G. Popka for Defendant and Respondent.
Plaintiff Heidi M. Grenzow (Grenzow) and her two minor daughters were injured in a car accident allegedly caused by defendant Justin Jones (Jones). Jones was insured by Topa Insurance Company (Topa).
Counsel for the Grenzows made a policy limits settlement offer. Grenzow contends that it was an offer to settle her own individual claim, not her daughters' claims; Jones contends that it was an offer to settle all three claims, as a package deal.
Topa then responded to the offer. According to Grenzow, however, Topa's response did not accept the offer; therefore, it constituted a mere counteroffer. She contends that it included an offer to settle her own individual claim, which she accepted, but Topa refused to settle with her unless and until a court approved a minor's compromise with her daughters. Over a year later, Grenzow (as guardian ad litem for her daughters) sought, and the trial court approved, such a compromise.
The trial court granted summary judgment for Jones. It ruled that there had been a "package deal" settlement. Either as support for this conclusion, or as an alternative ground, it also ruled that, "[h]aving accepted a part of the settlement as guardian ad litem for the two minors, . . . Grenzow waived the right to rescind that portion of the settlement involving only her personal damages." (Capitalization omitted.)
Grenzow appeals. We agree with Grenzow that her counsel's policy limits offer, together with Topa's response, did not result in an enforceable settlement agreement. However, we also agree with Jones — and with the trial court — that Grenzow's subsequent acceptance of the settlement on behalf of her daughters effectively constituted acceptance of a settlement of her own individual claims, as well. Hence, we will affirm.
I
FACTUAL BACKGROUND
The following facts were shown by the evidence submitted in support of and in opposition to the motion for summary judgment.
In August 2006, Grenzow and her two daughters, Heidi P. Grenzow (Heidi) and Katja Grenzow (Katja), were injured when Jones, who was driving drunk, rear-ended their car.
Jones was insured by Topa. His policy had limits of $15,000 per person and $30,000 per accident.
A. Freeman's March 7 Letter.
The Grenzows were represented by Attorney Stan Freeman. On March 7, 2007, Freeman sent a letter to Topa. In it, he asked Topa to "tender[] 'all applicable limits of liability insurance' in full settlement of . . . Grenzow's claim . . . ." This offer was subject to the condition that Topa provide (1) proof of the policy limits, (2) proof that Jones had not been acting in the course and scope of his employment, and (3) proof that there was no other applicable insurance. The latter two items were to be in the form of a signed, sworn statement by Jones. The letter stated that the settlement offer would expire on April 16, 2007.
The letter also stated: "[T]he nature and extent of the injuries sustained by . . . Grenzow are extremely serious and the above-mentioned policy limit demand . . . applies to her claim alone." It continued: "In addition to her claim are the claims of several other claimants. At this stage, I am submitting their medicals for your evaluation and anticipate that you will get back to me at your earliest convenience to discuss the resolution of their claims." It itemized the girls' individual medical expenses, then concluded, "I would recommend a settlement in the sum of $11,000.00 for Katja Grenzow and $4,000.00 for Heidi P. Grenzow."
The Topa representative who received and reviewed the letter testified that he regarded it as a settlement offer on behalf of all three of the Grenzows.
B. Topa's March 29 Letter.
In a letter sent on March 29, 2007, Topa responded to Freeman's March 7 letter. It stated, "[W]e are prepared to offer the following policy limit settlements to your clients:
"Heidi Marie Grenzow: $15,000.00
"Kat[j]a Grenzow: $11,000.00
"Heidi P. Grenzow: $4,000.00"
It also stated, "Please be advised that due to the fact that Kat[j]a and Heidi are minors, we may need a court approved Minors Compromise. Please discuss this issue with [a Topa representative]."
Freeman regarded this as a counteroffer.
C. Further Discussions Regarding Settlement.
Freeman reminded Topa several times that it still needed to provide him with proof of the policy limits, proof that Jones was not acting within the course and scope of his employment, and proof that there was no other applicable insurance.
Meanwhile, Topa sent Freeman a blank release, to be signed by Grenzow, and asked him to provide a "Minor's Compromise for Kat[j]a . . . and the legal guardian names for Heidi . . . ."
On June 26, 2007, Freeman spoke to a Topa representative. She orally indicated that she was going to "offer $15,000 on [Grenzow], $11,000 on Katja, and $4,000 on [Heidi]." She said that she would be sending proof of the policy limits. However, she told him that Topa was having trouble getting a signed, sworn statement from Jones; his telephone had been disconnected, and he was not responding to letters. She pointed out that it was unlikely that he had been acting in the course and scope of his employment, because the accident happened on a Saturday, he was driving his own vehicle, and he was intoxicated.
On July 18, 2007, Topa sent Freeman another blank release, to be signed by Grenzow, along with proof of the policy limits. Its cover letter stated:
"In our effort to properly investigate and evaluate your claim, we have determined that additional time will be required to give it the proper consideration and/or make a final determination. The reason(s) for the additional time needed is (are) as follows:
"Attached, please [find a] copy of the bodily injury release that was sent to your office. . . . Please provide the legal guardian name of your client Heidi . . . ." (Italics omitted.)
Freeman advised Grenzow to forgo a signed, sworn statement from Jones and to settle her individual claim for $15,000. Accordingly, Grenzow signed the release. On October 2, 2007, Freeman sent the signed release to Topa and asked Topa to send him $15,000.
On October 3, 2007, a Topa representative made a notation in the claim activity log stating that she had issued a $15,000 payment to Grenzow. On October 4, 2007, however, a different Topa representative vetoed this. She noted that no payment should be made to Grenzow unless and until the court approved a settlement with her daughters. Accordingly, on October 5, 2007, Topa wrote to Freeman, acknowledging receipt of Grenzow's release, but adding, "Please be advised that we are unable to issue any payments until we have the court[']s approval for the settlement amounts for the minors."
On October 11, 2007, Freeman responded by asserting that Topa had already entered into a binding agreement to settle Grenzow's individual claim for $15,000, and that it was "chang[ing] the terms of her settlement" by refusing to pay Grenzow unless and until the court approved a settlement with her daughters. He announced that Grenzow was rescinding her settlement and release.
D. Proceedings in This Action.
In November 2007, Grenzow filed this action, individually and as guardian ad litem for her daughters.
In September 2008, Topa filed a complaint in interpleader; it deposited the $30,000 aggregate policy limits into court.
In December 2008, Freeman filed a motion for approval of a minors' compromise. In January 2009, the trial court approved the compromise; as a result, the girls were paid a total of $15,000 out of the deposit. The remaining $15,000 remained on deposit for Grenzow.
II
PROCEDURAL BACKGROUND
In December 2009, Jones filed a motion for summary judgment, on the ground that there had been an accord and satisfaction. After hearing argument, the trial court granted the motion. It explained:
"There are three claimants to the single per accident limits of $30,000.00. Plaintiffs accepted a settlement that settled the claims of all three claimants for the total per accident limits of $30,000.00.
"The requirement that the portion of the settlement involving the minors be approved by the Court is not a new condition . . . . Conditions that are necessary to make the agreement legal and reasonable are implied into the agreement, . . . Civil Code § 1655. Approval of the minor's compromise was required by law and implied by law into the settlement agreement. Because the offer to settle with . . . Grenzow was always contingent upon a settlement of all claims on the policy, approval of the minor's compromise was a necessary condition to the entire settlement.
"Although there apparently were two written settlement agreements, the settlements were part of a single transaction. When two documents are part of a single transaction, they are construed together. The undisputed facts have established that plaintiffs have accepted the payment of $15,000.00 to the minors upon approval of the minor's compromise. Having accepted a part of the settlement as guardian ad litem for the two minors, Heidi Grenzow waived the right to rescind that portion of the settlement involving only her personal damages.
"The settlement of the minors' claims and the settlement of Ms. Grenzow's personal claims were not distinct or severable and a party may not rescind only a part of a single indivisible contract." (Capitalization & italics omitted.)
The trial court therefore entered judgment awarding Grenzow the remaining $15,000 on deposit.
III
DISCUSSION
A. Review of a Summary Judgment.
"A trial court may only grant a motion for summary judgment if no triable issues of material fact appear and the moving party is entitled to judgment as a matter of law. [Citations.]" (Schachter v. Citigroup, Inc. (2009) 47 Cal.4th 610, 618.)
"We owe the superior court no deference in reviewing its ruling on a motion for summary judgment; the standard of review is de novo. [Citation.] Furthermore, „[i]t is axiomatic that we review the trial court's rulings and not its reasoning.' [Citation.] Thus, a reviewing court may affirm a trial court's decision granting summary judgment for an erroneous reason. [Citation.]" (Coral Construction, Inc. v. City and County of San Francisco (2010) 50 Cal.4th 315, 336.)
B. As of March 29, 2007, There Was No Settlement.
Jones's position (although not entirely clear) seems to be that Freeman's March 7 letter offered a package settlement of Grenzow and her daughters' claims and that Topa's March 29 letter accepted this offer. If so, we disagree.
Freeman's March 7 letter was an offer to settle only Grenzow's individual claim. It was not even ambiguous in this respect. It stated, "[T]he nature and extent of the injuries sustained by Heidi Marie Grenzow are extremely serious and the above-mentioned policy limit demand. . . applies to her claim alone." (Italics added.) It then noted that there were "several other claimants." While it did list their medical expenses, and it did indicate that Freeman "would recommend a settlement" totaling $15,000 for them, it explicitly stated that he was "anticipat[ing]" further "discuss[ion] . . . of their claims."
Moreover, even assuming Freeman's March 7 letter could be read as an offer to settle all three claims, Topa's March 29 letter cannot be read as accepting such an offer, for two reasons. First, and most obviously, it never said that Topa was accepting Freeman's offer. Quite the contrary, it said that Topa was making an offer. Second, Freeman's offer had required Topa to supply proof of the policy limits, proof that Jones was not acting in the course and scope of his employment, and proof that there was no other insurance. Topa's March 29 letter did not mention these items, much less provide them or even agree to provide them. "The terms of an offer must be '"met exactly, precisely and unequivocally for its acceptance to result in the formation of a binding contract . . . ; and a qualified acceptance amounts to a new proposal or counteroffer putting an end to the original offer . . . ."' [Citations.]" (Marcus & Millichap Real Estate Investment Brokerage Co. v. Hock Investment Co. (1998) 68 Cal.App.4th 83, 89, italics omitted.) Thus, Freeman correctly regarded Topa's March 29 letter as a counteroffer.
If Topa unreasonably refused an offer to settle for the policy limits, it could potentially be exposed to a recovery in excess of the policy limits. (See Comunale v. Traders & General Ins. Co. (1958) 50 Cal.2d 654, 661.) Thus, stratregically, counsel for Grenzow would not have been altogether displeased if Topa rejected his offer, as he could argue that it thereby became liable for damages far in excess of its $30,000 limit. In that event, Topa surely would have argued that it is reasonable for an insurer to refuse an offer made on behalf of one claimant when there are other claimants. (See Croskey et al., Cal. Practice Guide: Insurance Litigation (The Rutter Group 2010) ¶¶ 12:308-12:318, pp. 12B-22-12B-25.) We need not decide this issue, nor need we decide whether Topa acted reasonably in general.
C. As of October 11, 2007, There Still Was No Settlement.
Grenzow's position, on the other hand, seems to be that Topa's March 29 letter offered to settle her individual claim and/or her daughters' claims, at her option. She claims that initially, Freeman accepted the offer to settle her daughters' claims, and later, he accepted the offer to settle her individual claim (though he thereafter rescinded this acceptance). Once again, we disagree.
First and foremost, Topa never offered to settle any of the claims separately. Its March 29 letter offered, at best, a package deal. It could not reasonably be read as allowing Freeman to accept a settlement as to Katja and Heidi only, but not as to Grenzow (any more than it could be read as allowing him to accept a settlement as to Katja only, but not as to Heidi). Thus, there was no separate settlement offer for Freeman to accept.
The letter was not necessarily an offer at all. Various terms remained to be agreed upon. For example, it stated, "[D]ue to the fact that Kat[j]a and Heidi are minors, we may need a court approved Minors Compromise. Please discuss this issue with [a Topa representative]'." (Italics added.)
Second, there is no evidence that Freeman actually accepted a separate settlement as to Katja and Heidi (at least, not when it was supposedly offered). Admittedly, in his declaration, he stated, "[The] settlement offer as to the 2 minor children was accepted by myself and Ms. Grenzow." However, this was a mere legal conclusion, which is insufficient to raise a triable issue of fact. (Guthrey v. State of California (1998) 63 Cal.App.4th 1108, 1120.) Moreover, he did not say when it was accepted, nor did he say that this acceptance was ever communicated to Topa. Both sides were careful to document their communications with each other, yet there is no record of any such acceptance (again, at least until Freeman filed the motion for approval of a minors' compromise, in December 2008). Needless to say, if Freeman had attempted to accept a settlement solely as to Katja and Heidi, that would have alerted Topa to the fact that he viewed its March 29 letter as offering separate settlements.
Similarly, there is no evidence that Freeman accepted a separate settlement as to Grenzow. Supposedly, he accepted it on October 2, 2007, when he returned Grenzow's signed release and requested payment of her $15,000. Earlier, however, on July 18, 2007, Topa had notified him that "additional time will be required to give [your claim] the proper consideration and/or make a final determination." Topa had specifically requested not only a signed release from Grenzow, but also legal guardian information about Heidi. Thus, even assuming that a separate settlement offer by Topa had been on the table, this revoked it. And again, Topa had never offered to settle any claim separately.
Grenzow makes much of the fact that on October 3, 2007, after receiving her release, a Topa representative made a notation in the claim activity log stating that she had issued a $15,000 payment to Grenzow. She argues that this constituted acceptance of an offer by her. However, "„[i]t is . . . hornbook law that an acceptance of an offer must be communicated to the offeror to become effective.' [Citation.]" (Hofer v. Young (1995) 38 Cal.App.4th 52, 56.) No such payment was ever actually issued; the fact that Topa was even considering making such a payment was never communicated to Grenzow. To the contrary, on October 5, 2007, Topa told Freeman, "[W]e are unable to issue any payments until we have the court[']s approval for the settlement amounts for the minors." And finally, separately and alternatively, even assuming that Freeman did accept a separate settlement as to Grenzow, on October 11, 2007, he expressly rescinded it.
In sum, then, by November 2007, when this action was filed, there was no enforceable settlement agreement whatsoever.
D. Grenzow's Acceptance of the Minors' Settlement Effectively Settled Her Own Claim, Too.
All this changed — as the trial court correctly concluded — when Freeman sought, and the trial court granted, approval of a minor's compromise.
It is a general maxim of equity that "[h]e who takes the benefit must bear the burden." (Civ. Code, § 3521.) More specifically, Civil Code section 1589 provides: "A voluntary acceptance of the benefit of a transaction is equivalent to a consent to all the obligations arising from it, so far as the facts are known, or ought to be known, to the person accepting." Thus, for example, if a prospective purchaser accepts the disclosure of a creative idea, knowing that the disclosure is being made on certain conditions, an implied-in-fact contract to comply with the conditions arises. (Desny v. Wilder (1956) 46 Cal.2d 715, 739; Gunther-Wahl Productions, Inc. v. Mattel, Inc. (2002) 104 Cal.App.4th 27, 35-43.)
Similarly, in Veterans of Foreign Wars v. City of El Paso de Robles (1998) 62 Cal.App.4th 1077, an American Legion unit sold certain property to a county. The county built a veterans' facility on the property. (Id. at p. 1079.) Counties that provided veterans' facilities had a statutory obligation to continue to provide them; cities did not. (Id. at p. 1081 & fn. 1.) After many years, the county sold the property to a city; a few years after that, the city closed it down. (Id. at pp. 1079-1080.) The appellate court held that the city was bound by the obligation to maintain the property as a veterans' facility: "When the veterans conveyed the property to the County . . . , they had a reasonable expectation that a veterans' building would be provided and maintained. This expectation was met by [the] County until . . . [the] City acquired ownership of the property. The City knew, or should have known, that the property had a burden. (Civ. Code, § 1589.)" (Id. at p. 1081.) "When the City purchased the dog, it also purchased its tail. It could not take the benefit without the burden." (Id. at p. 1082.)
Here, as of December 2008, Topa had made its position abundantly clear — it would not agree to any separate settlement. However, it was willing to settle Grenzow's claim for $15,000 and her daughters' claims for $15,000, as a package deal, subject to the court's approval of the minor's compromise. As the trial court stated, these settlements were "indivisible." Nevertheless, Freeman filed a motion for approval of a minor's compromise. Moreover, the trial court granted the motion, and the daughters received $15,000 of Topa's deposit. This all required the approval of Grenzow, as guardian ad litem for her daughters. As in Veterans of Foreign Wars, she could not purchase the dog without also purchasing the tail. By accepting a settlement on behalf of her daughters, Grenzow also necessarily accepted a settlement on her own behalf.
Jones argues that Grenzow had a conflict of interest arising out of her dual capacity as guardian ad litem and as an individual claimant. It also argues that plaintiffs' counsel had a similar conflict of interest arising out of their simultaneous representation of Grenzow and her daughters. It is not clear how these arguments are relevant to the issues that Grenzow is raising on appeal. Topa never filed a motion to disqualify plaintiffs' counsel or to remove Grenzow as guardian ad litem. In light of our other conclusions, these arguments appear moot, at best.
In sum, then, we conclude that the trial court properly granted summary judgment awarding Grenzow just $15,000.
IV
DISPOSITION
The judgment is affirmed. Jones is awarded costs on appeal against Grenzow. NOT TO BE PUBLISHED IN OFFICIAL REPORTS
RICHLI
Acting P.J.
We concur:
KING
J.
CODRINGTON
J.