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Durbin v. Hartford Life Insurance Co.

United States District Court, S.D. California

August 11, 2014

HARTFORD LIFE INSURANCE COMPANY; and DOES 1 through 10, Defendants.


ROGER T. BENITEZ, District Judge.

Before the Court is a Motion for Summary Judgment or Partial Summary Judgment filed by Defendant Hartford Life Insurance Company's ("Hartford"). (Docket No. 30.) For the reasons stated below, the Motion is GRANTED.


Except where otherwise noted, the following facts are undisputed. In 1988, Plaintiff Dorothy Durbin purchased a single-premium adjustable life insurance policy ("the Policy") from Pacific Standard Life Insurance Company ("Pacific Standard"). (Pl.'s Opp'n to Mot. for Summ. J. ("Pl.'s Opp'n") 2; Def.'s Mot. for Summ. J. ("Def.'s Mot.") 1.) The Policy issued for a one-time payment of $100, 000 and had a face value of $326, 000. (Pl.'s Opp'n 2, Craig Miller Decl. ("Miller Decl.") ¶ 2, Ex. 1; Def.'s Mot. 2.) The Policy was purchased through a relative, Gary Jenkins. (Pl.'s Opp'n 2; Def.'s Mot. 2-3.) Hartford assumed Pacific Standard's contractual obligations under the Policy on May 11, 1994. (Notice of Removal, Ex. A [Compl.], Ex. B ("Certificate of Assumption").)

The Policy's terms allow Durbin to borrow funds against it, using the Policy as collateral. (Miller Decl. ¶ 2, Ex. 1; Def.'s Mot. 3.) On October 3, 1990 and April 28, 1992, Pacific Standard issued loans against the Policy ("Loan 1" and "Loan 2"). (Pl.'s Opp'n 2; Def.'s Mot. 3.) Loan 1 and Loan 2 were in the principal amounts of $9, 274.17 and $8, 894.00, respectively. (Pl.'s Opp'n 2; Def.'s Mot. 3.) Hartford issued a third loan ("Loan 3") in the amount of $30, 000.00 on October 13, 1997. (Pl.'s Opp'n 2; Def.'s Mot. 3.)

Information about the loans was sent to Durbin at her residence. Durbin recalled receiving the checks for Loans 1 and 2 and sending them to Jenkins. (Miller Decl., Ex. 9 [Dorothy Durbin's July 28, 2011 Statement].)[1] Annual statements reflecting the outstanding loan balances were sent to Durbin's home from 1995-1997, 2002-2004, and 2008-2012. (Def.'s Mot., Kari Clasen Decl. ("Clasen Decl."), ¶¶ 4-5, Ex. A.) Additionally, loan payment notices which stated the amount of interest due on the loans were sent to Durbin at her home in at least 1997, 2003, and 2005. ( Id. at ¶¶ 6-7, Ex. B.)[2] In addition, Durbin's son, Richard Durbin, testified that Durbin was upset about loan payment notices she received sometime before 2007 because she did not generally borrow money. (Def.'s Mot., Michael Barnes Decl. ("Barnes Decl.") ¶ 2, Ex. A at 19-25, 39-40.)

In early 2009, Durbin learned that Jenkins had been arrested and charged with defrauding an elderly couple. (Pl.'s Opp'n 3; Def.'s Mot. 5.) Upon review of her life insurance statements from Hartford, Durbin took note of the three loans against the Policy. (Pl.'s Opp'n 3; Def.'s Mot. 5.) On May 7, 2009, Durbin notified Hartford by phone that she thought Jenkins took her money through the loans. (Miller Decl., Ex. 4.)

Hartford conducted an investigation. (Pl.'s Opp'n 3-8; Def.'s Mot. 6.) Hartford assigned the case to Brian Erickson in its Investigations Unit. (Pl.'s Opp'n 3; Def.'s Mot. 6.) Erickson interviewed Durbin, Jenkins, Jenkins' wife, and Jenkins' former assistant. (Def.'s Mot. 6; Pl.'s Opp'n 4-7.) Based on his investigation, Erickson opined that there was credible evidence to support Durbin's claim that she did not request or receive the proceeds of the loans, and that he thought that "Durbin most likely did not" receive the loans. (Miller Decl. ¶ 8, Ex. 7.) He also indicated he was unable to determine who did receive the loan proceeds. ( Id. ) The facts concerning Erickson's investigation and his opinions are undisputed. It is the significance of his opinions that the parties dispute.

On July 28, 2011, Durbin asked Hartford to put "my policy back to what it was before the loans were taken." (Miller Decl., Ex. 8.) On October 28, 2011, Hartford offered to pay off Loan 3, which at that time, including interest, totaled $79, 026.78, in exchange for a release of liability with regard to all three loans. ( Id., Ex. 10.) Following multiple extensions of the deadline to accept the offer, the offer was withdrawn on June 29, 2012. ( Id. Ex. 15.)

On November 13, 2012, Durbin filed suit in San Diego County Superior Court against Hartford. (Notice of Removal, Ex. A [Compl.].) The complaint alleges: (1) breach of contract, (2) breach of the implied covenant of good faith and fair dealing, and (3) financial elder abuse. ( Id. ) Hartford removed the action to this Court on January 9, 2013. ( Id. ) Hartford subsequently joined Jenkins as a third-party defendant. (Docket No. 14).


Summary judgment is appropriate when "there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." FED. R. CIV. P. 56(a); see also Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247-48 (1986). In considering a summary judgment motion, a court examines the evidence in the light most favorable to the non-moving party. United States v. Diebold, Inc., 369 U.S. 654, 655 (1962).

A moving party bears the initial burden of showing there are no genuine issues of material fact. Horphag Research Ltd. v. Garcia, 475 F.3d 1029, 1035 (9th Cir. 2007) (citing T.W. Elec. Serv., Inc. v. Pac. Elec. Contractors Ass'n, 809 F.2d 626, 630 (9th Cir. 1987)). The moving party can do so by negating an essential element of the non-moving party's case, or by showing that the non-moving party failed to make a showing sufficient to establish an element essential to that party's case, and on which the party will bear the burden of proof at trial. Celotex Corp. v. Catrett, 477 U.S. 317, 331 (1986). The burden then shifts to the non-moving party to show that there is a genuine issue for trial. Horphag Research Ltd., 475 F.3d at 1035.

"Only disputes over facts that might affect the outcome of the suit under the governing law will properly preclude the entry of summary judgment. Factual disputes that are irrelevant or unnecessary will not be counted." Anderson, 477 U.S. at 248. As a general rule, the "mere existence of a scintilla of evidence" will be insufficient to raise a genuine issue of material fact; there must be evidence on which the jury could reasonably find for the non-moving party. Id. at 252. "Summary judgment procedure is properly regarded not as a disfavored procedural shortcut, but rather as an integral part of the Federal Rules as a whole, which are designed to secure the just, speedy and inexpensive determination of every action.'" Celotex Corp., 477 U.S. at 327 (quoting FED. R. CIV. P. 1).


As noted above, the facts of this case are largely undisputed and the few facts that are in dispute are not material. The real dispute in this case, and the issue this Court must resolve, is when Durbin's claims accrued. In moving for summary judgment, Hartford argues that Durbin's claims are barred by the applicable statutes of limitation because her claims are based on loans issued in 1990, 1992, and 1997, and Durbin did not file this action until 2012. Durbin argues that her claims are not based on the issuance of the loans, but rather on Hartford's refusal, in 2011-2012, to repay the loans.

As discussed in more detail below, the Court finds Durbin's claims are barred by the statutes of limitation. Despite Durbin's efforts to characterize her claims as arising in 2011-2012, her claims arose when each of the allegedly unauthorized loans was issued.[3] Hartford's offer to repay only the third loan and ...

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