Admiral Ins. Co. v. Superior Court, D072267

Perfect Match, a surrogate/egg-donor matching service, received three June 2012 letters from counsel for Monica Ghersi and Carlos Arango (and their infant) notifying an intent to sue for negligence/medical negligence related to the child's retinoblastoma.
Perfect Match consulted its broker and decided not to notify its then-current insurer; when applying to Admiral in October 2012 it answered "No" to whether it was aware of anything that might result in a malpractice claim and did not disclose the letters.
Admiral issued a claims-made professional liability policy effective December 5, 2012–December 5, 2013 that covered damages caused by a "professional incident" only if, prior to the policy inception, no insured "knew, nor could have reasonably foreseen, that the professional incident might result in a claim."
Ghersi and Arango filed suit; the complaint was served in March 2013. Admiral declined defense and indemnity, citing the prior-knowledge exclusion and application misrepresentations.
Perfect Match sued Admiral for breach of contract and bad faith; Admiral moved for summary judgment. The trial court denied the motion, finding triable issues based on the application form being aimed at health‑care entities and possible ambiguity.
The Court of Appeal granted the writ, holding the undisputed facts established the prior‑notice exclusion precluded coverage and ordering the trial court to grant Admiral summary judgment.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Does the policy's prior‑notice exclusion bar coverage for the Ghersi/Arango claim?	Perfect Match: exclusion must be read in context with the application; as a non‑healthcare business it could truthfully deny awareness of a malpractice claim, so coverage is possible.	Admiral: counsel's June 2012 letters gave notice that a claim "might" be made; the exclusion unambiguously bars coverage for claims the insured knew or reasonably could foresee before inception.	Held: Exclusion unambiguously applies; undisputed letters show Perfect Match knew or could reasonably foresee a claim, so no coverage.
Did the allegedly ill‑fitting application create triable issues defeating summary judgment?	Perfect Match: application form was designed for medical providers; answering "No" was not untruthful and creates factual dispute about reliance/misrepresentation.	Admiral: even assuming application ambiguity, the policy language controls and independently defeats coverage via the prior‑notice clause.	Held: Application ambiguity is largely immaterial; policy language governs and admits no coverage under the undisputed facts.

Parsons v. Bristol Development Co., 62 Cal.2d 861 (contract interpretation is a question of law when extrinsic evidence is not in conflict)
Maryland Casualty Co. v. Nationwide Ins. Co., 65 Cal.App.4th 21 (courts decide meaning of insurance contracts when foundational facts are undisputed)
Medical Operations Management, Inc. v. National Health Laboratories, Inc., 176 Cal.App.3d 886 (distinguishing dispute over inferences from conflict in foundational evidence)
Producers Dairy Delivery Co. v. Sentry Ins. Co., 41 Cal.3d 903 (contract construed in context of the instrument and surrounding circumstances)
Pacific Gas & E. Co. v. G. W. Thomas Drayage etc. Co., 69 Cal.2d 33 (contract language must be given the meaning to which it is reasonably susceptible)
Phoenix Ins. Co. v. Sukut Construction Co., 136 Cal.App.3d 673 (prior notice to insured can preclude coverage under policy language requiring lack of prior knowledge)