*1 Dist., 1984.] Div. One. June B001225. Second [No. etc., WILLIAMS, Personal Representative, and as Individually
PHYLLIS Plaintiff and Appellant, al., et
TRANSPORT INDEMNITY COMPANY
Defendants Respondents.
Counsel and Plaintiff and
Hurley, Grassini & Wrinkle Roland Wrinkle for Appellant. Foxx, Canter, Flory Dubrow & Dale B. Goldfarb Mark W. Harrington, Defendants and Respondents. Opinion
SPENCER, P. J.
Introduction Plaintiff Phyllis Williams in her individual appeals and as the capacity personal representative husband, the estate of her deceased Jackson Wil- liams, from a summary judgment granted in favor of defendants Transport Indemnity Company Tod Uresse.
Statement of Facts *4 4, On 1979, August the automobile driven husband by plaintiff’s was struck from the rear aby Co., truck owned by Lads Trucking insured of defendant Transport collision, Indemnity As a result of the Company. Mr. Williams sustained and internal orthopedic injuries.
Mr. Williams made insurer, a claim the defendant after which defendant paid that of the portion claim to Mr. relating Williams’ property However, damage. defendant did not offer to settle Mr. Williams’ personal claim; fact, injury in after learning Mr. Williams was from suffering cancer condition, and a heart defendant ceased related negotiations to the personal injury claim.
On 5, 1980, January that Mr. upon learning Williams was about to be for hospitalized his conditions, preexisting as well as his accident-related injuries, defendant resumed $2,000 contact with Mr. Williams by offering in settlement of Mr. Williams’ entire claim. The offer personal injury was made three days to Mr. prior Williams’ on a hospitalization, purportedly “take it basis; or leave it” the amount offered was than substantially less Mr. Williams’ accident-related medical Mr. Williams expenses. rejected Thereafter, offer. 13, 1980, on January Mr. Williams died while hospital- ized. death,
Prior to his Mr. Williams never initiated action to estab- any legal lish the insured; liability defendant’s neither did his estate initiate any such action after his death. Plaintiff suit in the instant brought proceeding, defendant’s alleging 790.03, violation of Insurance Code section (h), on December statute following expiration one-year of limitations period (Code applicable actions. personal injury negligence Proc., Civ. (3).) subd. Plaintiff made no claim defendant other than by the instant bringing action. 27, 1981,
Plaintiff’s first amended filed defend- complaint, April alleges ant in unfair claims settlement Mr. Williams engaged practices by offering $2,000, situation,” pittance take of his at a advantage “desperate clear, time when the defendant’s insured was defendant’s insured cited for excessive and defective brakes fol- speed the accident which lowing injured Mr. Williams. The first amended com- further plaint alleges defendant’s emotion- negligently inflicting al distress on on plaintiff defendant knew or should have known ground such a bad faith settlement offer would cause emotional pain suffering.
Contentions I Plaintiff contends the trial court erred in summary granting judgment, that the initiation of a action which legal results a final determination of the insured’s liability is not a condition to the maintenance of an precedent the insurer for violation of Insurance Code section (h), under the facts of this case.
II *5 Plaintiff further contends the trial court erred in granting summary judg- ment her individual for the reasons: capacity, following
A. Plaintiff is a to the cause of action proper party alleging defendant’s violation of 790.03, (h); Insurance Code section subdivision and
B. Plaintiff’s cause of action for the infliction emotional dis- negligent tress is properly brought, that she was a foreseeable victim of defendant’s conduct to whom defendant owed a of care. duty
III Finally, plaintiff asserts the trial court erred in granting summary judg- ment on action, the first cause of in that Mr. Williams suffered special 790.03, from damages defendant’s violation of Insurance Code section sub- (h), division which survive Mr. Williams’ death.
Discussion we note Preliminarily, summary that the a motion purpose is “to judgment and penetrate evasive through language adept pleading 958 (Chern Bank
ascertain the existence or absence of triable issues.” 110, 1310].) (1976) America 544 P.2d Cal.3d Cal.Rptr. [127 The by examining “supporting] court resolves of triable issues question admissions, affidavits, declarations, interro- . . . answers to opposing] be taken may and matters of which notice . . . gatories, judicial depositions evidence, Proc., (Code Civ. . . . set forth admissible ...” [which] 437c.)
I trial court erred in granting summary judg Plaintiff contends the ment, in a in that the of a action which results final deter initiation legal mination of the not a condition to the main insured’s is precedent of Insurance Code tenance of an action the insurer for violation 790.03, (h), of this case. We cannot section under the facts agree. 880, 884 Court Superior Globe Ins. Co. v. [153 claimant sue an 592 P.2d held that a third party
Cal.Rptr. 329] Insurance Code section insurer for the violation of the duty imposed by (h) injured after the action between only that the true the insured has been “concluded.” Plaintiff thrust argues third from both suing Globe decision is to bar the injured suit, rather than to that the require the insurer and the insured in the same a condition insured’s established as independently precedent novel; it was rejected the insurer. The is not suing argument persuasively (1982) 128 in Nationwide Ins. Co. v. Court 464], noted, not limited to the As Nationwide Globe’s reasoning *6 the insured inherent in the trial of actions joint against danger prejudice insurer; defense of the decision reasoned that the and the integral part and dam- aimed at the insurer discovery the insured be hindered might by the the conclusion of the action against best be determined after ages might concluded, the Nationwide “In view of its reasoning, insured. therefore of the insured is first liability court’s in Globe ‘until the language Royal third claim- determined’ and ‘after the conclusion of the action the a final determi- ant the insured’ could have had reference to only against ” 714.) conclusion, (128 at p. nation and a final judgment. Cal.App.3d (1983) 142 Inc. Companies, v. Fireman’s Fund Ins. Rodriguez of the “con the concept expanded Cal.App.3d 705] encom a final to judgment clusion” of the action the insured against beyond is admitted expressly the where the of the insured liability circumstance pass (Code of an offer action is “the statutory acceptance and the terminated Proc., 998) injured thereafter or an a entered by judgment Civ. followed that reasoned Rodriguez motion to with . . . .” dismiss plaintiff’s prejudice circum- “concluded” in these the was sufficiently the action insured of an action stances, on a settlement in that a with based prejudice dismissal However, (Id., 55.) Rodriguez bar to as a new action. at any p. operated noting, the insured be admitted that of the also liability expressly, required of either of liability a settlement will not act as an admission “Generally, claim from or the with to other any arising the insured insurer respect Hence, Rod- (Ibid.) thrust of accident or event. clear same [Citations.]” must be well as that insured liability Nationwide—is riguez—as of the for its violation determined before the insurer be sued finally Moreover, (h). by Insurance Code section subdivision duty imposed Court, was the intent of Globe Ins. Co. obviously Royal Superior this and to both reference to Globe’s rationale supra, an insurer’s flows from the fact to settle a third claim obligation (See Nation- contractual from insurer. insured’s indemnification right 711, 715.) wide Ins. Co. v. not the com- Plaintiff Globe does nevertheless argues require to the mencement and final of an action the insured prior conclusion bar, in suit insurer facts of initiation a under the the case against.the bars of the limitations future period effectively any as lapse insured a final or dismissal with prejudice as does judgment holding a settlement Globe’s following motivating concerns However, have suit. the latter no the instant consequently applicability does not from the former. premise follow necessarily logically Code “unfair methods of competition Insurance section 790.03 defines and unfair and or in the business of insurance.” acts deceptive practices (h) The definition provides pertinent part: contained indicate as to “Knowingly frequency with such committing performing business unfair claims settlement any following general practice . . . . faith effectuate practices: prompt, Not attempting good [t] fair, rea- has become settlements of claims in which equitable alleges clear.” first amended sonably complaint Inasmuch (h)(5), that the position violation takes *7 issue; whether not instant action is of the insured is in the in the only issue fair a defendants failed to in faith to effectuate good prompt attempt rea- become liability settlement of the claim at a when had decedent’s time whether, to defend- However, clear. of from facts known sonably the issue de- ants, be had a certain time cannot liability become clear at in a vacuum. cided
960 nature, is, an indem
It contract by is fundamental that an insurance contract; until the the insurer against no enforceable claim accrues nity Code, (See, in Ins. e.g., insured’s is fact established. liability Cadillac, Ins. Co. (b)(2); subd. Mathews Inc. v. Phoenix of Hartford Therefore, well 267].) however Cal.App.3d become rea a time when had liability isolated facts seem to indicate may fact, insurer, in actual liability clear to the if the insured had no sonably claim. As to settle a third party insurer can have breached no duty in action any alleging the essential inquiry consequence, preliminary (h)(5) violation of Code section insurer’s Insurance claim in for the third actuality must be whether the insured was liable ant’s injury. has never been determined
It
uncontroverted that the insured’s liability
is
no facts in the record
suggest
in a
and there are
legal proceeding
Plaintilf inti-
liability.
admitted
either the insured or
insurer expressly
of the decedent’s property damage
mates that defendants’
prompt
noted,
but as
liability,
be
an admission of the insured’s
claim
deemed
may
ante,
with
liability
does not act as an admission of
respect
a settlement
Fireman’s
incident.
v.
(Rodriguez
other claim
from the same
any
arising
Inc.,
Hence,
46, 55.)
Ins. Companies,
supra,
Fund
an ad-
insured’s
Absent such
liability.
record contains no admission
of the insured
liability
liability,
mission or a
determination
legal
Globe Ins. Co.
by Royal
and the concerns addressed
remains
issue
fundamental
The most
vitality.
The that “unless court concern expressed determined, the defense first until the of the insured is postponed initiated discovery of the insured seriously hampered 892.) Concededly, (23 Cal.3d at p. claimant the insurer.” injured the statute now is barred the insured inasmuch as any otherwise, the limitation, seriously there is no danger hampering, However, Globe also of the insured in the instant situation. defense *8 of the insurer’s as a result the by injured party suffered “damages noted the con- after be determined (h)(5) best . . . violation of subdivision[ ] {Ibid.) the insured.” claimant of the action the third by clusion of the action The conclusion the view is obvious. The reason for court’s the in- the extent of assessing means of the some insured provides violation the insurer’s and, hence, effect of the liability damaging sured’s of its statutory duty. in assessing assistance of similar no background
The instant case provides matter Indeed, of the instant the posture effect of the conduct. insurer’s (1980) Ins. Co. Middlesex Mutual in Doser v. from that criticized differs Doser, In only degree. 101 Cal.App.3d 115] death, trial the but before for wrongful a third by insured was sued claim in the amount defendant agreed compromise and insured defendant release, for which the $980,000 in return for a general he have might and causes of action all claims assign agreed In $100,000 rejecting to the plaintiff. insurance policy insurer on a re met the of the action dismissal argument subsequent supra, Globe Ins. Co. v. quirement with the fact of here not only “We are concerned the court noted: thereof established, of the amount certainty but the being clearly damages . case the facts of . . ever considered jury well .... No or judge as [t] could be which a judgment verdict on with and came up appropriate in which a represen ever reached was damages based. No agreement 892.) (101 Cal.App.3d p. of the insurance company participated.” tative While Doser limiting at bar. of affairs in the case This is the state precisely Inc., facts, Companies, Fund Ins. v. Fireman’s Rodriguez to its that a statutory compro its holding 46 was careful to predicate on Globe with met requirements mise dismissal prejudice the insurer’s express (1) alleged of two factors: The complaint the presence was a compro the settlement admissions of insured’s in that analysis Implicit the insurer and the injured party. mise between a degree removed those circumstances that a under recognition insurer’s con from the of damages the amount uncertainty calculating matter The present liability. the insured’s absolutely duct and established either issue. whatsoever on certainty no degree provides “con- action is of when an that, in extending concept We further note accom- to compromise offer statutory to a in the Globe sense cluded” is fol- of which the acceptance of liability, admissions panied by express with a dismissal of the insured of a in favor lowed entry judgment abuse with the great “possibility concern Rodriguez expressed prejudice, unfair practices, entice a settlement who might insurance companies one should gain No of that settlement. the cloak then seek to hide behind *9 962 (142 56.)
an No such from one’s own advantage p. wrong.” circumstances, where there has been of abuse exists in the instant danger no settlement. The in circumstances is clear—to use these plaintiff’s remedy insurer, and al- insured establish then to liability, proceed against 790.03, (h). subdivision the violation of Insurance Code section leging Plaintiff that a the insured’s argues liability impos- suit establish or of Probate sible after Mr. Williams’ death virtue Code impracticable section 573. Section 573 limits those which decedent’s damages personal recover, of “for recovery damages pain, representative barring include those for emo- sought which suffering disfigurement,” damages 910, (Neal (1978) 21 Cal.3d Exchange tional distress. v. Farmers Insurance words, 980].) 3 In other section 573 fn. 582 P.2d [148 incurred damages limits a to the representative recovery special personal However, fails to rec- argument to the decedent’s demise. prior that a on a is injury brought theory negligence ognize personal Indeed, damages. plaintiff as well as comprised special damages general as medical the decedent sustained such alleges special damages expenses 560, 570, 154]) (Wilcox (1945) 573 P.2d and Sway 69 Cal.App.2d [160 (1899) (see Co. 124 Ry. the loss Lombardi v. St. earnings California 66]). Cal. P. an action insured establish Clearly, for these remained both damages possible practicable—partic- were view of that medical consid- ularly plaintiff’s position expenses $2,000. than the insurer’s offer erably greater sum, (1) In we hold: Globe Ins. Co. v. the final determi-
Cal.3d 880 has been requiring interpreted to the maintenance nation of an insured’s as a condition precedent Code section of an action an for the violation of Insurance insurer 790.03, case no factual cir- (h)(5), subdivision the instant presents to the cumstances which raise considerations favoring exception policy deter- never obtained a final Inasmuch as foregoing requirement. mination of in her representative capacity, the insured’s liability, plaintiff, defendants for the violation In- failed to state a cause of action against 790.03, (h)(5). It follows that necessarily surance Code section hence, theory; fact to that relating there were no triable issues of material in her the trial court summary judgment against plaintiff, properly granted of action. on the first cause representative capacity, II summary judg- court erred granting Plaintiff further contends the trial for the reasons: following ment individual her against plaintiff capacity, defendant’s alleging of action to the cause A. Plaintiff is a proper party (h); and Code violation of Insurance section *10 dis- of emotional infliction for the negligent B. Plaintiff’s cause of action of defendant’s victim in that was a foreseeable tress is she brought, properly We disagree. a of care. duty to whom defendant owed conduct 790.03, (h) Section Subdivision Violation Insurance Code the insurer action against to maintain an Plaintiff’s as an individual right 790.03, sub in violation of section for bad faith claims settlement practices her to owed to duty of a (h)(5) division is dependent upon presence an insured duties owed faith of a claim. The settlement attempt good from statutes imposing flow either from the contract itself or may insurance in faith However, good to duty attempt such duties. the contractual the contractual claim, to settle a in the contract lawby part implied the insured intended to benefit covenant of faith and fair is good dealing, alone; Allstate (Murphy benefit a third claimant. there is no intent to party 424, 584].) 553 P.2d (1976) Ins. Co. 17 Cal.3d 941 [132 Hence, any duty in of the rights, the absence of an insured’s assignment noninsured, claim, to a must faith of a owed effectuate the good to the insur is not a party be It is statutorily imposed. undisputed plaintiff case, of an and there is no question ance contract at issue in the instant assignment. intended to 790.03 is (h) pro
Subdivision of Insurance Code section unfair settlement practices. Specifi tect both insureds and claimants from not to attempt an unfair (h)(5) practice subdivision that it is cally, provides in which is a claim faith the and fair settlement of good prompt clear, third claimants its thereby extending protection supra, as well as Co. v. {Royal insureds. Globe Ins. insurer words, (h)(5) on the 888.) Cal.3d In imposes other to effectuate faith good owed to third claimants to duty attempt However, herself claim. just plaintiff fair settlement of prompt suit; only claim the instant filing made no the insurer prior decedent made such a claim.
Nevertheless, Group Insurance on Delos v. Farmers relies a nonclaim- for the proposition 93 Cal.App.3d Cal.Rptr. 843] emotional dis- his or her ant maintain an action to recover for spouse claim- tress, toward the bad faith conduct that the of the insurer’s impact Delos does say is foreseeable. clearly ant on the nonclaimant spouse spouse the nonclaimant that, spouse on the fact but the court its predicated holding insurer owed a duty. in that case also was a named insured to whom the is owed duty Delos not does stand for proposition independent status, noninsured, In the either as any to a nonclaimant absence spouse. Code claimant, (h)(5) of Insurance an insured or as a which subdivision benefit, as it may appear, plaintiff section 790.03 is intended to as harsh for an insurer’s to recover standing must be deemed an intermeddler without Co., (Cf. Ins. violation of the statute. v. Allstate Murphy In Moreover, for the violation of 944.)1 individual action (h)(5), to the same subject surance Code is section decedent; condition the action on behalf brought precedent governing i.e., to com determined finally prior of the insured must *11 there has been no final the insurer. Inasmuch as mencement of a suit against cause of action individual liability, determination of insured’s with in her brought representative capacity. must fail along Emotional Distress Negligent Infliction of (1980) 27 Cal.3d Foundation Hospital on Molien v. Kaiser
Relying 518], argues 616 P.2d 16 A.L.R.4th plaintiff distress, in that infliction of emotional she recover for the may negligent conduct as was the much a ‘victim’ of the she is as “just [defendant’s] brief, 18.) Molien in Molien.'” opening p. permitted husband (Appellant’s an action medical to maintain of a diagnosed patient the spouse negligently the erroneous diagnosis due to the direct to him from injury in his own right to com- which the instructed patient of syphillis, diagnosing physician 923.) First, of the in- (27 virtue to her Cal.3d p. municate spouse. so he her of the spouse diagnosis to the that she inform patient struction intended conduct was clearly be tested for the physician’s could syphillis, victim. his status as a foreseeable thereby confirming to affect the spouse, noted, transmitted Second, normally “Because the disease is as the court relations, that both husband it is rational to anticipate sexual only by when confronted and hostility wife would anxiety, suspicion, experience medical evidence believe was reliable with what had reason to they every {Ibid.) of a noxious infidelity.” particularly to those case are not analogous While facts in the instant alleged Molien, her hus- Plaintiff sensitivity. alleges well be of a similar they may he disease, of which a result and heart as band was from cancer suffering her right to sue in has a argument that she 1Plaintiff also tenders the somewhat novel community property damages are considered capacity, personal injury in that individual division of (c). deals with the Section 4800 under Civil Code section separation of marriage legal or the of the community property in the event of dissolution Moreover, (c) defines in the instant case. parties—a present circumstance not or to be re money . received “all . . “community personal injury damages” as property equally absent. a circumstance judgment of a .... ceived ... satisfaction about was to enter the be final hospital for what was to his illness. likely She further alleges defendants knew these facts and took advantage decedent’s to offer desperate make a sub- plight nonnegotiable stantially less than the decedent’s actual Conced- out-of-pocket expenses. defendants’ edly, conduct not have been intended affect plaintiff the same sense instructions were intended to affect hus- physician’s however, band given the nature plaintiff’s allegations—sug- Molien\ a gesting highly emotional well as extreme charged as setting physical psychological all of which known defendants—we are vulnerability, was unwilling say a matter of law that victim not foreseeable of defendants’ conduct. In the it is entirely circumstances alleged, possible is plaintiff within the class of Molien foreseeable victim to whom extends action; least, cause at the the matter a triable issue material presents fact.
However, the not conclusion is of matter. foregoing dispositive Plaintiff’s to maintain an right negligent action for infliction of emotional distress necessarily must on the existence of a of care predicated duty and its breach. Inasmuch as defendants no owed established independently *12 to duty plaintiff, duty must arise as a foreseeable consequence owed to the duty decedent. The sole of defendants’ of source care to duty the decedent (h)(5) is subdivision of Insurance Code section 790.03. Any action founded upon (h)(5) a breach of the of protections subdivision must a preceded final of determination of insured—no less when, here, so as reliance on the statute is indirect rather than direct. As before, we have noted duty to settle a third claim faith does good not arise unless insured is liable. Absent essential final deter prior mination of the insured’s cause of action for the liability, plaintiff’s negli gent infliction of emotional distress must be barred in concert with the first cause of action.
Ill In view of our an is barred from holding maintaining as decedent’s for defendants’ violation of Insurance personal representative 790.03, Code section (h)(5), subdivision final assertion—that the conduct, decedent suffered as a result of defendants’ which special damages damages survive his death—is not for ripe consideration.
The judgment is affirmed.
Dunnum, J.,* concurred.
*Assigned by Chairperson of the Judicial Council. and Dissenting. in the
DALSIMER, J.J., majority concur Concurring I Williams Phyllis insofar as it affirms the opinion summary judgment against dissent from (Mrs. Williams) in her I respectfully individual but capacity, as Mrs. Williams the per- affirmance of the summary judgment husband, Wil- Jackson sonal of the estate of her deceased representative liams. (h)(5) unfair practices
The of section 790.03 purpose (§ act is that insurance com- Insurance Code 790 et to seq.) require once lia- fair settlements faith panies attempt good negotiate prompt, has become bility reasonably clear. Williams as per-
Defendants’ motion for Mrs. summary judgment against have been estate Jackson Williams should sonal representative as as the insurer received denied. became clear soon Liability reasonably rear- the decedent was stating and evaluated a of the accident copy report ex- with brakes at an ended insured who was defective driving clear, defendants reasonably become cessive had speed. Although did not fair decedent’s personal to effectuate attempt prompt, for made decedent defendants claim. The settlement offer injury only less than decedent’s decedent’s claim was for amount personal injury before decedent’s death This offer was made special just days damages. a time when medical treatment. money decedent needed pay urgently clear” used The “in which become liability has phrase construed (h)(5), recently Insurance Code section *13 (1983) 148 Ins. Co. Jackson v. State Farm Mutual Auto. the that insurer 474], In that case the alleged Cal.Rptr. complaint $900 $25 car valued at between offered of a claim for loss of a settlement that rea- $1,200 revealed the at a time when the insurer’s investigation the amount of settlement sonable value of the car exceeded the substantially the that offer. Division Four of court held that the pleading this had $25 the insurer completed insurer offered at a time when it that to apprise sufficient investigation, discovery, analysis necessary was exceeded that sum the value of claim greatly reasonable the plaintiff’s faith settlement good sufficient to that did not attempt the insurer allege reasonably at had from had become liability a time when it facts which the of (Id., 1186.) Four’s construction clear. at I believe that Division p. To hold is correct. “in become clear” which has phrase liability is rea- before an action the insured must be concluded that against Code section the of Insurance clear would defeat sonably very purpose v. (Also Superior Ins. Co. (h)(5). Royal see Globe 842, 329].) P.2d 880, Court 23 Cal.3d 888-891 [153 The of Globe for purpose judicial by was enforcement provide (Act). third of party claimants the mandate of the Unfair Practices Act Court, (Royal 880, 888.) Globe Ins. v. Superior Co. 23 Cal.3d supra, In Globe third the claimant sued the insured for party had personal injuries and the for of Act in the Under insurer violation the same lawsuit. those court circumstances the held that the third claimant’s lawsuit party against the insurer could not until the the insured was brought Court, first determined. Globe Co. 23 Cal.3d (Royal supra, Ins. v. Superior 880, A 892.) that, reason for unless the trial primary holding against the insurer was until the of the postponed conclusion lawsuit against insured, the “the defense of the insured bemay seriously by hampered (Id., discovery initiated the by claimant the injured against insurer.” 892.) p. Since here no action was the third claimant brought by injured party or his estate (Code against the insureds within the limitations Civ. period Proc., (3)), subd. rationale has no There exists no application. insureds, problem defense since the hampering statutory period an action filing the insureds had before this action was against expired commenced.
Two additional reasons were policy by recited Globe court on question of the lawsuit timing the claimant the insurer. against First, the court noted that a trial joint insured and insurer would violate Evidence Code section which that evidence insur- provides ance is inadmissible to prove negligence (Royal Globe Ins. wrongdoing. Court, Because, Co. v. Superior 891.) due to limitations, expiration statute of the estate cannot an action bring insureds, this reason no policy also has to the estate’s application right to pursue the remedy Globe. recognized by Royal
Second, the Royal Globe in- court stated that suffered “damages jured a result of the (h)(5) insurer’s violation . . . subdivision^ may best be determined after the of the action the third conclusion claimant (Royal insured.” Globe Ins. Co. *14 880, 892, 23
supra, Cal.3d A that italics inference of supplied.) strong statement is that of the suffered as a result damages by injured party the such violation may also be determined in the absence of an action the by third claimant no now be party against the insured. Since action insureds, the to a brought against delay no reason exists determina- policy tion of the as a de- damages suffered the third claimant result of by party fendants’ tortious Globe by Royal conduct. None of the reasons mentioned for the fore- deferring justifies action the insurer or even against requires such action closing under the present circumstances.
968 intention to any preclude the Globe decision indicates
Nothing for from an insurer violation estate a third claimant party suing 790.03, lim- (h)(5), after the statute of Insurance Code section While itations has run on the of action the insured. claimant’s causes Casualty court in Carr v. contrary Progressive view was expressed 835], (1984) Co. 881 that case is distin- Cal.Rptr. Cal.App.3d [199 had initiated a lawsuit because there the third claimant guishable his lifetime, entered after the insured his and was during judgment Thus, with issue now before death. the Carr court was not confronted this court. no defendants arose
In our case the of action against decedent’s cause duty fairly, later than 1980. breached their to January promptly, Defendants his him than and settle decedent’s claim when offered less they equitably and knew of injuries medical well his severe specials although they personal clear. terminal condition had become nature, 790.03, be liberally construed. being Section remedial in should (See 468, 480 (1967) Tammen San v. County Diego [58 249, 753].) Globe 426 P.2d This was recognized by Cal.Rptr. as to indicate a court in its that “with such frequency holding phrase Code, (h)) does not (Ins. subd. general apply business practice” to an Globe Ins. (Royal the insurer a third claimant. 891; Fire- Co. v. Rodriguez Cal.3d cf. 46, 53 Fund Companies, man’s Ins. Inc. 705].) action under Extension of the Globe limitation to foreclose an engage circumstances in this would insurers encourage case pleaded negotiate good of conduct calculated refusal to very type alleged—the faith it The insurer is well once is learned that the claimant is ill. gravely “When a aware of Code which person Probate section provides recoverable cause of action dies before having judgment, damages as the the executor or are limited to such loss or damage administrator . not include decedent or to his death . . and shall sustained incurred prior that de- alleges damages pain, suffering disfigurement.” Appellant fendants, knowing fatal of decedent’s illness nature knowing hospitalization, impending it was not that decedent would survive his likely decedent’s condition intent take full advantage manifested their effect Knowing actual of the claim. avoid settlement value paying any avoid paying section defendants intended to Probate Code which amount for and offered amount general decedent’s damages It was full of the case. even less than the medical as a specials *15 Code the of Probate also because of death and effect decedent’s impending section that defendants were unconcerned with lia- quite any potential to decedent for bility emotional distress caused their con- by reprehensible duct in (h)(5). Insurance Code I violating section cannot that believe the limitation of Globe to was intended an action preclude the against insurer for violation the under of Act such circum- outrageous stances as are here of be The limitation Globe should not alleged. extended an when, to bar action the insurer due to the death of the against third claimant before the the party of limitations expiration period, general damages caused the accident from could not be recovered the insured. A new cause of action the arose in favor of third claimant when party defendants breached their of action survived duty, and cause statutory the decedent’s death.
This is not a case in a healthy which third claimant is to party attempting sue the insurer under the Act after allowed the limitations for having period an bringing action the against Only insured to five months of the expire. limitations period had when expired decedent died. Since decedent was in extremely health and the the poor of limitations was not expiration period imminent, there was no reason to for decedent commence an action against the died, insureds. After decedent his estate could sue for the amount only Code, decedent’s (Prob. 573.) would have special damages. It not been economically feasible the to for estate file a the insureds complaint against in court in municipal view of the costs of in relation such to the litigation small amount of the probable recovery. insureds’ Although action, would have been determined in an such it not for the necessary estate commence an action a clear the insureds because case existed view the accident described ante at 966. report page These circumstances to the usual situation present compelling exception in which “damages suffered injured as a result the insurer’s violation of (h)(5) . be . . best determined after con- [] clusion of the action the third claimant insured.” {Royal Globe Ins. 892.) Co. v. Superior Where there no exists economic incentive estate first sue the insureds and where damages such an action would limited the decedent’s be spe- cials, an action against the should before the estate insureds not required may sue insurer and its Act in claims for violation adjuster manner alleged this case. An rationale Globe underlying limitation is to the insured from inflated protect prejudiced by jury’s being determination of the learning amount of damages jury’s general upon Where, here, that the defendant has the maximum damages insurance. that could been have obtained in the insureds was limited to the decedent’s not specials, rationale does apply. *16 as representative Williams Phyllis
I would reverse the judgment against Jackson Williams. of the estate of was denied Court Supreme for a hearing petition
Appellant’s J., should Bird, petition C. was of the opinion 1984. August granted.