Opinion
NO. C 99-5343 SC
July 19, 2001
ORDER GRANTING DEFENDANT'S MOTION FOR SUMMARY JUDGMENT
The present case is an insurance action in which Plaintiff Conestoga Services Corporation filed suit against its insurer, Executive Risk Indemnity, alleging that Executive Risk failed to defend it in an underlying suit (the "Frontier" action). In an order dated May 11, 2001, the Court found that Executive Risk does not have a duty to defend Conestoga in the Frontier action. The Court granted summary judgment in favor of Executive Risk as to Conestoga's claims for Breach of Contract, Negligence, and Declaratory Relief. Executive Risk now moves the Court for summary judgment as to Conestoga's sole remaining claim of breach of the covenant of good faith and fair dealing. Also before the Court is Conestoga's motion for certification of interlocutory appeal of the Court's May 11, 2001 Summary Judgment Order.
Both Plaintiff and Defendant recognize that under California law, an insured can not maintain a claim of breach of the covenant of good faith and fair dealing where the insurer does not have a duty to defend or indemnify. See Waller v. Truck Ins. Exchange, Inc., 11 Cal.4th, 1, 36 (1995) ("[I]f there is no potential for coverage, and hence, no duty to defend under the terms of the policy, there can be no action for breach of the implied convenant of good faith and fair dealing because the covenant is based on the contractual relationship between the insured and the insurer."); see also; Love v. Fire Ins. Exchange, 221 Cal.App.3d 1136, 1151-53 (1990) ("[A] bad faith claim cannot be maintained unless policy benefits are duo.") Plaintiff also recognizes that granting Defendant's motion for summary judgment will result in entry of final judgment against it and remove the necessity of an interlocutory appeal. Although Plaintiff moves this Court to grant its motion for certification for interlocutory appeal, the Court finds it more appropriate to grant summary judgment and allow Plaintiff to appeal all of its claims in a single appeal.
Accordingly, the Court hereby GRANTS Defendant's Motion for Summary Judgment as to Plaintiff's claim for breach of the covenant of good faith and fair dealing and DENIES Plaintiff's Motion for Certification of Interlocutory Appeal.
JUDGMENT
The present case is an insurance action in which Plaintiff Conestoga Services Corporation filed suit against its insurer, Executive Risk Indemnity, alleging that Executive Risk failed to defend it in an underlying suit. In accordance with the Court's Orders granting Defendant's Motions for Summary Judgment, it is hereby ORDERED, ADJUDGED, and DECREED that:
Judgment shall be entered in this action in favor of Defendant Executive Risk Indemnity Inc. and against Plaintiff Conestoga Services Corp.