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Chaidez v. Progressive Choice Insurance Co.

United States District Court, Ninth Circuit

May 9, 2013

Rich Chaidez, Plaintiff,
v.
Progressive Choice Insurance Company and Does 1-50, Defendants.

STATEMENT OF UNCONTROVERTED FACTS AND CONCLUSIONS OF LAW Re: DEFENDANT'S MOTION FOR SUMMARY JUDGMENT, OR, IN THE ALTERNATIVE, FOR PARTIAL SUMMARY JUDGMENT [14]

RONALD S.W. LEW, Senior District Judge.

After consideration of all the papers and arguments submitted pursuant to Defendant Progressive Choice Insurance Company's ("Defendant") Motion for Summary Judgment, or in the Alternative, for Partial Summary Judgment [14], the Court makes the following findings of fact and conclusions of law.

UNCONTROVERTED FACTS

1. Defendant issued a policy of insurance to Plaintiff Rick Chaidez ("Plaintiff") for the policy period beginning August 4, 2009, and ending February 4, 2010, covering a 2002 Cadillac Escalade ("Vehicle"). Munyer Decl., §§ 1, 2, 4.

2. The policy issued to Plaintiff included a "Fraud or Misrepresentation" provision, which stated that "[Defendant] may deny coverage for an accident or loss if you or a person seeking coverage has concealed or misrepresented any material fact or circumstance, or engaged in fraudulent conduct, in connection with the presentation or settlement of a claim." Id . §§ 4, 5, & Ex. B.

3. Plaintiff presented a claim to Defendant on or about September 23, 2009, in which Plaintiff claimed that the Vehicle was stolen. Id. at § 6.

4. Defendant's investigation of Plaintiff's claim, which took place from September 2009 through March 2010, included, inter alia, taking recorded and in-person statements from both Plaintiff and his cousin; reviewing documents and other supporting evidence provided by Plaintiff; conducting outside research as to the Vehicle's value and title and Plaintiff's credit; referring Plaintiff's claim to Progressive's Special Investigations Unit; interviewing the Vehicle's prior owner; and hiring outside counsel, Marvin Straus, to conduct an examination under oath with Plaintiff. Id . §§ 6-49; Azrael Decl. Ex. C ("Claim File").

5. During the claim investigation, Plaintiff made multiple inconsistent representations to Defendant regarding the Vehicle, such as when and where he purchased it and for how much. See generally Claim File.

6. On March 3, 2010, Mr. Straus sent Progressive Claims Representative Lindsey Munyer a letter recommending that Defendant deny Plaintiff's claim because Plaintiff had "misrepresented material facts during the presentation of the claim." Brown Decl., Ex. 2, p. 6.

7. Ms. Munyer called Plaintiff on March 16, 2010, and informed him that Defendant was denying his claim. Munyer Decl. § 46.

8. Ms. Munyer also sent Plaintiff a letter on March 25, 2010, explaining that Defendant was denying Plaintiff's claim because it appeared that Plaintiff had provided Defendant with an altered version of the Vehicle's original bill of sale and "knowingly misrepresented material facts associated with [his claim of] loss, " including the date that he purchased the Vehicle, the amount he paid for it, the condition of the Vehicle at the time of loss, and the prior loss history of Plaintiff's household. Id .; Claim File, p. 1026.

CONCLUSIONS OF LAW

1. In order to establish a breach of the implied covenant of good faith and fair dealing in the insurance context, a plaintiff must show that: "(1) benefits due under the policy [were] withheld; and (2) the reason for withholding benefits [was] unreasonable or without proper cause." Love v. Fire Ins. Exch. , 221 Cal.App.3d 1136, 1151 (1990).

2. "While the reasonableness of an insurer's claims-handling conduct is ordinarily a question of fact, it becomes a question of law where the evidence is undisputed and only one reasonable inference can be drawn from the evidence." Chateau Chamberay Homeowners ...


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