33 Cal. App. 5th 960
Cal. Ct. App. 5th2019Background
- Linda and Alan Liker were insured under a Farmers primary auto policy (UM/UIM limits $250,000) and Alan had an umbrella/excess Truck policy (UM/UIM endorsement up to $1M); the Truck endorsement made coverage "payable to you and any other insured under this policy" and listed insureds as those living in the named insured's household.
- Linda Liker was killed by an uninsured motorist; her daughter Melissa Komorsky (from a prior marriage) and Linda's other daughter Sherri Fogelman (intervenor) each claimed UM benefits; neither daughter lived in the Likers' household.
- Trial court found Komorsky and Fogelman were entitled to UM benefits under the Farmers primary policy as heirs under Ins. Code §11580.2(a)(1), but not under the Truck umbrella policy because the statute excludes umbrella/excess policies and the Truck endorsement only paid benefits to persons defined as "insureds" under that policy.
- Komorsky moved for leave to file a second amended complaint to add estoppel and reformation causes of action against Truck (and Farmers Group, Inc.); the trial court denied leave as the proposed amendments could not establish relief as a matter of law.
- Farmers interpleaded the Farmers policy limits; Farmers and Truck later moved for judgment on the pleadings, which the court granted based on the coverage ruling and prior denial of amendment; judgment for insurers affirmed on appeal.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether §11580.2(a)(1) requires UM coverage under Truck umbrella policy | Komorsky: statute should apply when an umbrella policy contains a UM endorsement that "follows form," so heirs should receive UM benefits under Truck | Farmers/Truck: §11580.2(a)(1) expressly excludes policies providing only excess or umbrella coverage; Truck endorsement limits payment to persons defined as "insureds" under the Truck policy | Held: §11580.2(a)(1) does not apply to umbrella/excess policies; Truck endorsement’s plain terms limit payable beneficiaries to insureds (Komorsky not an insured), so no coverage under Truck |
| Whether leave to amend to add estoppel claim should be allowed | Komorsky: Truck’s conduct (investigating claim, agreeing to arbitrate, not denying coverage) induced reliance that Truck covered heirs | Farmers/Truck: coverage cannot be created by estoppel where policy does not provide coverage to the claimant; no defense was undertaken for Komorsky | Held: Denied—plaintiff cannot create coverage by estoppel where she is not an insured and insurers did not defend her; amendment would fail as a matter of law |
| Whether leave to amend to add reformation claim should be allowed | Komorsky: Truck intended heirs to be insured; policy should be reformed to reflect that mutual intent or known unilateral mistake | Farmers/Truck: no facts showing mutual mistake or that the Likers intended heirs to be insured; reformation requires clear facts of mistake or knowledge by other party | Held: Denied—proposed complaint lacked facts showing mutual mistake or that other contracting party knew/suspected a unilateral mistake |
| Whether Farmers Group, Inc. is a proper defendant | Komorsky: Farmers Group controls Farmers and Truck and so is proper defendant | Farmers/Truck: No liability; moreover, pleadings and stipulation identify Farmers and Truck as the insuring entities | Held: Issue moot given other rulings; trial court properly dismissed claims against corporate parent |
Key Cases Cited
- Haering v. Topa Ins. Co., 244 Cal.App.4th 725 (discussing §11580.2 and exclusion for excess/umbrella policies)
- Foster-Gardner, Inc. v. Natl. Union Fire Ins. Co., 18 Cal.4th 857 (plain policy language governs interpretation)
- Schwartz v. State Farm Fire & Cas. Co., 88 Cal.App.4th 1329 (duty of excess insurer to avoid favoring insureds when competing claims threaten limits)
- Dollinger DeAnza Assocs. v. Chicago Title Ins. Co., 199 Cal.App.4th 1132 (coverage cannot be created by estoppel where policy does not provide it)
- Advanced Network, Inc. v. Peerless Ins. Co., 190 Cal.App.4th 1054 (doctrine that estoppel/waiver cannot extend coverage to risks not covered)
- Miller v. Elite Ins. Co., 100 Cal.App.3d 739 (exception for estoppel where insurer defends without reserving rights)