 |
 |
to fill out a simple form to connect to Employee Leasing Services in your area.
|
|
|
|
|
Stallion Jewelry11/6/2003
NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS
California Rules of Court, rule 977(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 977(b). This opinion has not been certified for publication or ordered published for purposes of rule 977.
This is an insurance bad faith case in which the trial court granted summary judgment in favor of Certain Underwriters at Lloyds (Lloyds) in a bad faith action brought by appellant Stallion Jewelry, Inc. (Stallion). According to Stallion, the trial court erred because there are triable issues as to whether Lloyds correctly valued and paid Stallion's theft loss, and as to whether Lloyds committed bad faith by unreasonably delaying the payment of benefits. These contentions have merit. Therefore, we reverse and remand.
Stallion's contention that it should have been granted a continuance in order to conduct discovery is moot.
FACTUAL AND PROCEDURAL HISTORY
1. Background.
Lloyds issued Stallion a jeweler's block insurance policy (the policy) to cover, inter alia, theft.
Paragraph 9A of the policy (Paragraph 9A) provided: "[Lloyds] shall not be liable beyond the actual cash value of the property at the time of any loss or damage and the loss or damage shall be ascertained or estimated according to such actual cash value with property deduction for depreciation, however caused, and shall in no event exceed the lowest figure put upon such property in the assured's inventories, stock books, stock papers or lists existing at the time of the loss or damage occurred, nor the cost to repair or replace the same with material of like kind and quality. Any antiquarian or historical value attaching to said property shall be excluded from the estimate of loss or damage."
An endorsement provided that starting March 1, 2001, the policy limits were increased to $930,000 and that "coverage is provided hereunder whilst at MJSA Exhibition in New York to a limit of . . . $1 Million and . . . $700,000 excess of . . . $300,000 to/from the show."
On March 1, 2001, unknown persons posing as armored car personnel stole over $930,000 in insured property. Stallion notified Lloyds of the loss in a timely manner. Lloyds eventually paid only $686,957 even though Stallion was demanding policy limits.
2. The pleading.
Stallion sued Lloyds. In its first amended complaint, Stallion alleged causes of action against Lloyds for breach of contract, bad faith, and violation of Business and Professions Code section 17200.
According to Stallion, Lloyds utilized selective information when valuing Stallion's property in order to minimize the loss. Also, it continually revised its calculations, which resulted in substantial delays in payment. By February 2002, Lloyds had only paid $386,000.
Lloyds committed bad faith by: (1) failing to disclose that the policy provided for actual cash value benefits; (2) failing to adjust the claim properly in accordance with the promised measure of loss; (3) utilizing an overly restrictive interpretation of policy language to impose a "cost of manufacture" valuation on Stallion; (4) unreasonably reducing the benefits by $300,000 on the theory that the property was lost "to/from" an exhibition when Lloyds knew the property was not lost to/from; (5) subjecting Stallion to unreasonable demands for detailed accounting records for calculation of the "cost to manufacture" analysis; (6) subjecting Stallion to demands for multiple audits and accounting procedures; and (7) engaging in a sham adjustment in order to reduce the be
Page 1 2 3 4 5 6 California Employee Leasing Services
Employee Leasing Services
|
| |
to fill out a simple form to connect to Employee Leasing Services in your area.
|
|