Opinion
NOT TO BE PUBLISHED
APPEAL from a judgment of the Superior Court of Los Angeles County No. BC 265308. Emilie H. Elias, Judge.
Zelig & Associates and Steven L. Zelig for Plaintiff and Appellant.
Selvin Wraith Halman, Gary R. Selvin and Jill S. Picone for Defendant and Respondent.
ROTHSCHILD, J.
Lake Avenue Church appeals from the judgment entered in favor of Atlantic Mutual Insurance Company on the church’s complaint for breach of contract, bad faith, fraud, and negligent misrepresentation. The church’s claim arises from damage allegedly caused by the Northridge earthquake. The trial court determined that the church’s earthquake coverage was limited to the church’s organ, which the church conceded was not damaged. We agree and affirm.
BACKGROUND
When the Northridge earthquake struck on January 17, 1994, the church was the named insured on a policy issued by Atlantic Mutual. The policy provided several types of coverage, including commercial general liability and business automobile coverage, but only the commercial real and personal property coverage is at issue here.
On a page of the policy entitled “Other Commercial Property Coverage Declarations[,]” there is an entry that reads “Earthquake[,] see CP 10 40 10 90[.]” Form CP 10 40 10 90 is entitled “Causes of Loss—Earthquake Form[,]” and it describes the covered causes of loss, exclusions, limitations, and deductible for the earthquake coverage. The form does not purport to identify the property to which the coverage applies.
In these and subsequent quotations from the policy, all block capitals have been omitted.
On a page of the policy entitled “Policy Change[,]” under the subheading “Continued Forms Applicable to the Property Declarations[,]” there is an entry that reads “AIC 06 10 90[,] Causes of Loss Form A[,]” and another entry that reads “AIL 03 07 86 #03[,] Earthquake[.]” The next page of the policy is headed “Endorsement 3” and states “Earthquake Coverage Is Applicable to the Church Organ Only. 10% Deductible Applies[.]” Causes of Loss Form A states that Atlantic Mutual “will not pay for loss or damage caused directly or indirectly by . . . earth movement (other than sinkhole collapse), such as an earthquake . . . .”
On December 31, 2001, the church filed suit against Atlantic Mutual for breach of contract, bad faith, fraud, and negligent misrepresentation. The complaint also named numerous other plaintiffs and numerous other defendant insurers. The allegations of the complaint provide no factual detail concerning either the scope of the church’s claim or Atlantic Mutual’s alleged misconduct.
On August 20, 2002, Atlantic Mutual answered with a general denial. At the same time, Atlantic Mutual proceeded to investigate and adjust the claim under a general reservation of rights. By letter dated October 23, 2003, Atlantic Mutual denied the church’s claim on the ground that the earthquake coverage applied only to the church’s organ, which was not damaged in the earthquake.
On February 6, 2006, Atlantic Mutual filed a motion “to resolve legal issues of coverage.” Atlantic Mutual again argued that the policy’s earthquake coverage was limited to the organ, which was not damaged in the Northridge earthquake. According to Atlantic Mutual, earthquake coverage is expressly excluded from the general property coverage under the policy, but Endorsement 3 provides earthquake coverage for the organ. In support of its motion, Atlantic Mutual relied on not only the express language of the policy but also the insurance proposal that the church received from its insurance broker. On the page entitled “Property[,]” under the subheading “Causes of Loss[,]” the proposal states “Special Form, Excluding Earthquake & Flood[.]” On a different page entitled “Value Added Coverages[,]” under the subheading “Organs[,]” the proposal states “Included with special endorsement for Earthquake $250,000 with 10% deductible[.]”
At the hearing on the motion, the trial court stated that the parties could “consider this a summary judgment” because “there were no controverted facts.” No party objected, and on appeal the church does not complain of any procedural defects in the motion.
In opposition, the church did not contend that the organ was in fact damaged. Rather, the church opposed the motion on the grounds that the policy was confusingly worded and assembled, that it was consequently ambiguous, and that a reasonable insured could easily be led to believe that the policy provided earthquake coverage for all of the church’s buildings. The church did not, however, introduce any evidence that any church personnel in fact believed that the policy provided such coverage. The church also argued that by investigating the claim for over one year before denying coverage, Atlantic Mutual waived, forfeited, and was estopped to assert any right to deny that the church’s claim was covered. In support of its waiver, forfeiture, and estoppel arguments, the church also introduced the declaration of its business manager, who stated that in December 2002, an unidentified representative of Atlantic Mutual “stated that Atlantic Mutual would be making an offer to settle the claim and would do so in the immediate future.”
The trial court granted Atlantic Mutual’s motion and entered judgment against the church. The church timely appealed.
STANDARD OF REVIEW
We review the trial court’s ruling on a motion for summary judgment de novo. (Buss v. Superior Court (1997) 16 Cal.4th 35, 60.) We review the trial court’s conclusions of law de novo. (Crocker National Bank v. City and County of San Francisco (1989) 49 Cal.3d 881, 888.) “[I]nterpretation of an insurance policy is a question of law. [Citation.]” (Waller v. Truck Ins. Exchange, Inc. (1995) 11 Cal.4th 1, 18.)
DISCUSSION
We agree with the trial court’s interpretation of the insurance policy. The policy provides commercial real property coverage for the buildings identified in the policy, but the causes of loss form defining the scope of that coverage expressly excludes earthquakes from the covered causes of loss. That is, the property coverage for the church’s buildings did not include earthquake coverage. By separate endorsement, the policy does, however, provide earthquake coverage for the organ alone. The limitation to the organ is as clear and explicit as could reasonably be demanded: “Earthquake coverage is applicable to the church organ only.”
Because the church does not dispute that the organ sustained no earthquake damage, the church’s complaint fails to allege a covered claim. The trial court therefore properly granted summary judgment in favor of Atlantic Mutual.
The church argues that the language and layout of the policy are sufficiently confusing that an insured could have reasonably believed that the earthquake coverage applied to all of the church’s buildings. We disagree. The causes of loss form states that the property coverage does not include earthquake coverage. The endorsement for earthquake coverage limits the earthquake coverage to the organ. No reasonable insured would have believed that the earthquake coverage applied to all of the buildings. And we find it noteworthy that the church did not introduce any evidence that any of its personnel in fact believed that the earthquake coverage was not limited to the organ.
The church also argues that the earthquake coverage must apply (or that a reasonable insured could believe it applied) to more than the organ because the part of the policy entitled “Causes of Loss—Earthquake Form” refers to things like “‘finished stock’” and “radio or television antennas, including their lead-in wiring, masts or towers[,]” which have nothing to do with the church’s organ. The argument fails. The form states how such structures (e.g., radio or television antennas) will be treated under the policy if they are present at the insured property. If they are not present, no reasonable insured would take that as a sign that the coverage must apply to some other property that does have an antenna. The form does not purport to identify the property to which the earthquake coverage applies, and no reasonable insured would think it does.
The church argues that because (1) Atlantic Mutual investigated the claim for over one year before denying coverage, and (2) in December 2002, a representative of Atlantic Mutual allegedly said that Atlantic Mutual would soon be making an offer to settle the church’s claim, Atlantic Mutual has waived, forfeited, and is estopped to assert any right to deny that the church’s claim was covered. The linchpin of the church’s arguments is its claim that “[t]he record herein does not reflect any attempt by Atlantic [Mutual] . . . to reserve its right to claim that there was no coverage for the buildings or structures within the [church] complex.” That claim is incorrect, so the arguments fail. Atlantic Mutual investigated and adjusted the church’s claim under an express reservation of rights, which Atlantic Mutual repeatedly reasserted both before and after December 2002. Atlantic Mutual’s general reservation of its rights under the policy means that the church’s waiver, forfeiture, and estoppel arguments cannot succeed. (See, e.g., Blue Ridge Ins. Co. v. Jacobsen (2001) 25 Cal.4th 489, 497-498.)
DISPOSITION
The judgment is affirmed. Respondent shall recover its costs of appeal.
We concur: MALLANO, Acting P. J., VOGEL, J.