Opinion
NOT TO BE PUBLISHED
APPEAL from a judgment of the Superior Court of Los Angeles County No. BC341790, Mark V. Mooney, Judge. Affirmed.
Helfand Law Offices, Steven F. Helfand; and Marcus Daniel Merchasin for Cross complainants and Appellants.
Munro Smigliani & Jordan, R. Michael Jordan and David M. Plouff for Cross defendants and Respondents Sharon Shaw, American Commercial Management and Clarendon National Insurance Company.
Bishop Barry Howe Haney & Ryder, Jonathan Gross and Elaine I. Videa for Cross-defendant and Respondent Empire Fire and Marine Insurance Company.
CROSKEY, J.
A condominium homeowners association sued its property insurers after they denied its claim for earthquake damage. A federal trial court determined that the complaint was barred by contractual limitations provisions in the insurance policies and awarded summary judgment for the insurers. The homeowners association then sued its public insurance adjuster, Kapilow & Son, Inc., and Alan W. Kapilow (collectively Kapilow), alleging that he negligently handled the claim and misinformed the association regarding the contractual limitations period.
Kapilow filed a cross-complaint against the homeowners association, the insurers, the insurers’ claims administrator, and Sharon Shaw, an employee of the claims administrator. He alleges that Shaw, on behalf of the claims administrator and insurers, fraudulently or negligently misinformed him regarding the contractual limitations period. The trial court concluded that the homeowners association was the intended recipient of the alleged misrepresentations and that Kapilow had no standing to sue the other cross-defendants based on the alleged misrepresentations. The court concluded further that Kapilow failed to allege a tort committed by those cross defendants against Kapilow. The court therefore awarded summary judgment in favor of the insurers, claims administrator, and Shaw. Kapilow appeals the summary judgment.
We conclude that the evidence shows that Kapilow did not rely on the alleged misrepresentations by Shaw regarding the contractual limitations period and that he cannot establish the essential element of actual reliance. We therefore conclude that the summary judgment was proper.
FACTUAL AND PROCEDURAL BACKGROUND
1. Factual Background
The Via de la Paz Association (Via de la Paz) is a homeowners association for a condominium complex located in Pacific Palisades. Clarendon National Insurance Company (Clarendon) and Empire Fire & Marine Insurance Company (Empire) issued property insurance policies to Via de la Paz for the policy period from December 8, 2000, to December 8, 2001, including coverage for damage caused by earthquakes. Both policies contained provisions stating that no action for the recovery of a claim under the policies could be sustained unless the action was commenced within 12 months after “discovery by the insured of the occurrence which gives rise to the claim.”
An earthquake occurred in the Los Angeles area on September 9, 2001, purportedly causing damage to the property. Via de la Paz retained Kapilow in August 2002 as its agent to assist in the preparation and adjustment of an insurance claim, and agreed to pay him 35 percent of the amount recovered from the insurers. Counsel for Via de la Paz sent a letter to its insurance broker on August 23, 2002, advising the broker of a claim for benefits under the policies. Clarendon and Empire first received notice of the claim on September 17, 2002, when the broker faxed the letter to Clarendon’s general agent.
American Commercial Management served as the claims administrator for Clarendon and Empire. Shaw, an American Commercial Management employee who handled the claim, sent Via de la Paz a letter on April 29, 2003, stating that she was still investigating the claim and quoting several policy provisions that might apply to the claim, including the contractual limitations provisions in both policies. After receiving the letter, Via de la Paz expressed concern to Kapilow that the 12-month limitations period would expire in July 2003. Kapilow responded in an e-mail on May 27, 2003, stating:
“As far as your concern, about the 12 month right to sue, a well known precedent case ‘Prudential LMI v. California’ holds that the 12-month clock is tolled from the point that the claim is reported or accepted to the point that the insurance carrier adopts a position. That position may either be an offer or a refusal to pay. Accordingly, the clock has not begun to run other than the several days from our informing you of earthquake damage and our immediate retention through the reporting of this claim to the various carriers. I will fax this communication to Sharon Shaw so that she can refute this information if she deems it appropriate to do so.”
Shaw, on behalf of Clarendon and Empire, denied the claim in a letter dated August 13, 2003. The letter stated that the insurers’ experts had determined that the earthquake was too weak to cause the reported damage to concrete parking garage slabs and that several exclusions applied. The letter also reserved the insurers’ rights to assert other defenses to coverage. The letter referred to “the policy requirement concerning the filing of a lawsuit within twelve months,” and quoted the contractual limitations provisions.
Kapilow continued to correspond with Shaw in an effort to convince the insurers to accept coverage. Shaw sent several letters to Kapilow from February 24, 2004, to July 28, 2004, acknowledging his correspondence and stating, “In the event Via de la Paz desires to pursue this matter through litigation, suit must be filed on or before August 13, 2004.”
2. Prior Action
Via de la Paz filed a complaint against Clarendon and Empire in the Los Angeles Superior Court on August 12, 2004, seeking damages for breach of contract and breach of the implied covenant of good faith and fair dealing. Via de la Paz alleged that the insurers were precluded from asserting any policy provision to deny liability, “based on the doctrines of... estoppel, waiver, forfeiture,... and correspondence extending the applicable statute of limitations until August 13, 2004.” The defendants removed the action to federal district court.
Clarendon and Empire moved for summary judgment based on the 12 month contractual limitations provisions. They argued that Via de la Paz had admitted in discovery that the damage to the parking structure was obvious, and that the 12 month limitations period therefore expired on September 9, 2002, before they received notice of the claim, and was not equitably tolled. Via de la Paz asserted in opposition that it first discovered the damage in December 2001, when its building manager noticed cracks in the garage ceiling, and that the notice of claim given to its insurance broker constituted notice to the insurers.
The court granted the summary judgment motion in June 2005. The court concluded that the evidence presented in support of and in opposition to the motion established as a matter of law that Via de la Paz discovered the damage no later than December 31, 2001. The court stated that 235 days had elapsed from December 31, 2001, to August 23, 2002, and that an additional 130 days had elapsed from the denial of the claim on August 13, 2003, to December 21, 2003. The court therefore concluded that the contractual limitations period expired on December 21, 2003, at the latest, and that the complaint filed on August 12, 2004, was untimely.
The court rejected an argument by Via de la Paz that a letter dated May 5, 2004, from Shaw to Kapilow stating that the contractual limitations period would not expire until August 13, 2004, created an estoppel to assert the contractual limitations provision. The court concluded that the limitations period had already expired by the date of the letter and that the letter therefore did not create an estoppel. The court concluded further that Via de la Paz’s failure to assert the letter as a basis for estoppel in written discovery responses precluded Via de la Paz from asserting the letter as a basis for estoppel in opposition to the summary judgment motion.
Via de la Paz apparently did not present evidence of any other oral or written representations to that effect.
3. Complaint and Cross-complaint in this Action
Via de la Paz filed a complaint against Kapilow in October 2005 and filed a first amended complaint in March 2006. Via de la Paz alleges that Kapilow inspected the property in July 2002 and informed a director of the homeowners association at that time that the condominium complex had suffered earthquake damage. Via de la Paz alleges that it notified its insurance broker of the loss on August 23, 2002, and that the broker notified Clarendon and Empire on September 17, 2002. Via de la Paz alleges that Kapilow’s advice concerning the contractual limitations period in his e-mail on May 27, 2003, was incorrect, and that the limitations period actually expired in December 2003. It also alleges that the insurers denied the claim because Kapilow failed to provide supporting information and documents, and that the value of its loss was $4,300,317.80. Via de la Paz alleges counts against Kapilow for (1) breach of contract, (2) negligence, (3) negligent misrepresentation, (4) intentional misrepresentation, and (5) constructive fraud.
Kapilow filed a cross-complaint in September 2006 and filed a second amended cross-complaint in August 2007 against Via de la Paz, Shaw, American Commercial Management, Clarendon, and Empire. He alleges that a Via de la Paz director told him that the purported earthquake damage was not present before the earthquake of September 9, 2001, and alleges that that representation was false. He alleges that he is entitled to 35 percent of the value of Via de la Paz’s alleged loss of $4,300,317.80 as a fee for his work on the claim.
Kapilow also alleges in his cross-complaint that Shaw, on behalf of American Commercial Management, Clarendon, and Empire, represented that the contractual limitations period would not expire until one year after the claim was denied. He alleges that she made that representation orally on April 29, 2003, and in May 2003, before the claim was denied. He alleges that Shaw made the same representation in writing on several occasions after the claim denial, both to him and directly to Via de la Paz. Kapilow alleges that Shaw intentionally misled him regarding the limitations period and that he and Via de la Paz justifiably relied on Shaw’s misrepresentations.
Kapilow alleges counts for (1) fraud, against Via de la Paz; (2) negligent misrepresentation, against Via de la Paz; (3) constructive fraud, against Via de la Paz; (4) declaratory relief, against Via de la Paz; (5) fraud, against Clarendon, Empire, American Commercial Management, and Shaw; and (6) negligent misrepresentation, against Clarendon, Empire, American Commercial Management, and Shaw.
4. Summary Judgment
Clarendon, American Commercial Management, and Shaw filed a motion for summary judgment or summary adjudication in October 2007. Empire joined in the motion and also filed its own motion for summary judgment or summary adjudication. The moving parties filed a declaration by Shaw stating that she had assumed that the date that Via de la Paz reported the loss to its broker was the same date that Via de la Paz first discovered the loss, and believed that the limitations period was tolled from that date until the claim was denied.
We augmented the appellate record to include the memorandum of points and authorities and separate statement of undisputed facts filed on October 1, 2007, in support of the motion. (Cal. Rules of Court, rule 8.155(a)(1).)
The moving parties argued that (1) Kapilow was acting as an agent for Via de la Paz, and only Via de la Paz as the principal could maintain an action against them for fraud or misrepresentation; (2) Shaw’s representations regarding the limitations period were statements of her opinion rather than actionable representations of fact; (3) Shaw’s statements were intended for the benefit of Via de la Paz, they were merely conveyed through Kapilow, and there was no intent to induce reliance by Kapilow; (4) the damage was visible on the day of the earthquake, there was no tolling of the limitations period due to delayed discovery, and the limitations period expired on September 9, 2002, before the filing of the complaint, so Kapilow’s alleged reliance on the representations by Shaw could not have resulted in Via de la Paz’s failure to file a timely complaint and could not have caused him any damage; (5) Kapilow did not rely on Shaw’s purported oral representations that the limitations period would expire one year after any claim denial, but instead advised Via de la Paz on May 27, 2003, that the limitations period began to run upon its discovery of the purported earthquake damage; and (6) despite the labeling of the counts for fraud and negligent misrepresentation, Kapilow effectively seeks equitable indemnity from the insurers, the claim administrator, and Shaw for his potential liability to Via de la Paz for the purported value of its insurance claim, but he cannot recover equitable indemnity because the moving parties are not liable to Via de la Paz for any loss. Kapilow opposed the motion.
We augmented the appellate record to include the consolidated memorandum of points and authorities in opposition to the summary judgment motions, separate statement of disputed and undisputed facts, and declarations of Alan Kapilow, Steven Helfand, Marcus Daniel Merchasin, and Stephen Losh, all filed by Kapilow on December 3, 2007. (Cal. Rules of Court, rule 8.155(a)(1).)
The trial court stated in a minute order dated February 5, 2008, that Via de la Paz, as the principal, was the intended recipient of the alleged misrepresentations and that Kapilow, as the agent through whom the alleged misrepresentations were made, had no standing to sue the moving parties for fraud or negligent misrepresentation. Citing Roberts v. Salot (1958) 166 Cal.App.2d 294, the court stated, “where a purported misrepresentation is made through a communication to an agent acting within the course and scope of his agency, any resulting cause of action for fraud is held by the principal, not the agent.” The court stated further that the cross complaint did not adequately allege a tort committed by the moving parties against Kapilow. The court awarded summary judgment in favor of Clarendon, Empire, American Commercial Management, and Shaw. Kapilow timely appealed the judgment.
CONTENTIONS
Kapilow contends (1) he suffered an injury as a result of the alleged misrepresentations, so he has a beneficial interest in the controversy and has standing to sue Clarendon, Empire, American Commercial Management, and Shaw; and (2) the parties moving for summary judgment failed to show that he cannot establish an essential element of his counts for fraud and negligent misrepresentation.
DISCUSSION
1. Standard of Review
Summary judgment is appropriate only if there is no triable issue of material fact and the moving party is entitled to judgment in its favor as a matter of law. (Code Civ. Proc., § 437c, subd. (c).) A defendant (or cross-defendant) moving for summary judgment must show that one or more elements of the plaintiff’s (or cross complainant’s) cause of action cannot be established or that there is a complete defense. (Id., subd. (p)(2).) The defendant can satisfy its burden by presenting evidence that negates an element of the cause of action or evidence that the plaintiff does not possess and cannot reasonably expect to obtain evidence needed to support an element of the cause of action. (Miller v. Department of Corrections (2005) 36 Cal.4th 446, 460.) If the defendant meets this burden, the burden shifts to the plaintiff to set forth “specific facts” showing that a triable issue of material fact exists. (Code Civ. Proc., § 437c, subd. (p)(2).) We review the trial court’s ruling de novo, liberally construe the evidence in favor of the party opposing the motion, and resolve all doubts concerning the evidence in favor of the opposing party. (Miller, supra, at p. 460.) We will affirm a summary judgment if it is correct on any ground that the parties had an adequate opportunity to address in the trial court, regardless of the trial court’s stated reasons. (California School of Culinary Arts v. Lujan (2003) 112 Cal.App.4th 16, 22; see also Code Civ. Proc., § 437c, subd. (m)(2).)
2. Kapilow Cannot Establish the Element of Actual Reliance
Actual reliance is an essential element of a cause of action for fraud or negligent misrepresentation. (Mirkin v. Wasserman (1993) 5 Cal.4th 1082, 1088-1089 & fn. 2.) The plaintiff must show that he or she actually relied on the defendant’s misrepresentation and suffered damages as a result. (In re Tobacco II Cases (2009) 46 Cal.4th 298, 326.) The element of actual reliance here concerns whether the alleged misrepresentations by Shaw caused Kapilow to take some action, or refrain from taking action, as a result of which he suffered an injury. Kapilow alleges in his cross complaint only in general terms that he acted in reliance on Shaw’s alleged oral representations that the contractual limitations period would not begin to run until the claim was denied. He alleges no specific facts as to what actions he, as opposed to Via de la Paz, took or failed to take in reliance on the alleged misrepresentations.
Evidence presented in support of the summary judgment motions indicated that Kapilow did not rely on the alleged misrepresentations. Kapilow’s e-mail to Via de la Paz on May 27, 2003, stated that the limitations period began to run when he first informed Via de la Paz of the purported earthquake damage. It stated further that the limitations period was tolled from the date that the insurers received notice of the claim until they either denied or agreed to pay the claim. Thus, rather than rely on Shaw’s purported representation that the limitations period would not begin to run until the claim was denied, Kapilow advised Via de la Paz that the limitations period already had begun to run but then was tolled. By presenting evidence negating the element of actual reliance, Clarendon, American Commercial Management, Shaw, and Empire satisfied their initial burden as the parties moving for summary judgment, and the burden shifted to Kapilow to “set forth the specific facts showing that a triable issue of material fact exists” (Code Civ. Proc., § 437c, subd. (p)(2)) as to his actual reliance.
Kapilow did not adequately address the element of actual reliance in his opposition to the summary judgment motions. Instead, he argued that the moving parties failed to show that Via de la Paz relied on his e-mail. He argued that, in any event, his e-mail was consistent with the alleged oral representations by Shaw and that “Shaw’s oral and written representations are what everyone relied upon.” Kapilow filed a declaration stating that Shaw expressly told him “prior to and/or upon sending the rejection letter to Via de la Paz” that the limitations period would expire on August 13, 2004. He also stated in his declaration that he, Via de la Paz, and its counsel justifiably relied on Shaw’s representations and that the insurers effectively set their own date for the limitations period to expire.
Kapilow stated in his declaration: “This (including, inter alia, Ms. Shaw’s oral communications to me which I later found out misrepresented or reflected a change in position by the insurance carriers to take unconscionable advantage of Via de la Paz) I, along with Via de la Paz and their counsel, Messrs. Losh, Goldstein and Greifinger, relied upon Ms. Shaw’s ostensible representations in a reasonable manner.”
Kapilow’s conclusory statements that he relied on the alleged representations failed to create a triable issue of material fact as necessary to avoid summary judgment. He was required to set forth “specific facts” controverting the evidence that he formed his own opinion concerning the commencement of the limitations period, advised Via de la Paz accordingly, and did not rely on Shaw’s alleged oral representations in April and May 2003. Contrary to Kapilow’s argument, the statement in his e-mail on May 27, 2003, was inconsistent with the alleged representations by Shaw, as we have stated, and does not show that he acted in reliance on the alleged representations in any manner. Any additional misrepresentations made the following year, after the limitations period undisputedly had expired, could not have caused Via de la Paz, either directly or indirectly through Kapilow, to fail to file a timely complaint and therefore could not support the essential element of actual reliance.
We therefore conclude that the summary judgment was proper on this ground and need not address the other grounds asserted in the motion.
DISPOSITION
The judgment is affirmed. The respondents are entitled to recover their costs on appeal.
We Concur: KLEIN, P. J., KITCHING, J.