Opinion
NOT TO BE PUBLISHED
Contra Costa County Super. Ct. No. C03-02787
McGuiness, P.J.
Plaintiff Valerie Taybron appeals from a judgment dismissing her complaint against defendant Allstate Insurance Company. She correctly argues that the trial court erred in granting Allstate’s motion for summary judgment dismissing her causes of action for breach of contract and breach of the implied covenant of good faith and fair dealing. Accordingly, we reverse the judgment, direct modification of the order granting summary judgment, and remand the matter for further proceedings.
The judgment under review does not resolve Taybron’s causes of actions against defendants Roofing Doctor and Donun Chan. However, she may appeal from the judgment that is final as to her claims against Allstate. (Desaigoudar v. Meyercord (2003) 108 Cal.App.4th 173, 182, fn. 2; Wells Fargo Bank v. California Ins. Guarantee Assn. (1995) 38 Cal.App.4th 936, 941-942, fn. 5.)
FACTUAL AND PROCEDURAL BACKGROUND
In early November 2002, a winter storm allegedly caused damage to the garage roof of Taybron’s property. The damaged roof allowed water to intrude into the garage, where Taybron had stored certain personal property. Taybron submitted to her insurer, Allstate, a claim pertaining to the damaged structure and personal property. Allstate authorized the repair of the roof. Although Taybron submitted an inventory of the damaged items stored in the garage, an issue arose as to whether Taybron’s policy covered that loss. Allstate ultimately concluded that coverage existed for the damaged personal property up to $50,000. Because mold had apparently grown as a result of the water intrusion, Allstate hired a hygienist and a remediation company to inspect and inventory plaintiff’s damaged property.
In or about the first week in February 2003, the inspection and inventory was completed. After Allstate received an estimate from the remediation service, it offered to pay the policy’s personal property limit by sending a $50,000 check to Taybron to settle her claim on or about February 14, 2003. Taybron returned the check. In a letter dated April 7, 2003, Allstate told Taybron that it remained prepared to reissue the $50,000 check “in full settlement” of her claim, but Taybron rejected the offer.
Taybron filed this action on November 6, 2003. Taybron alleged that Allstate had breached its obligations under the policy and breached the implied covenant of good faith and fair dealing by failing, among other things, to conduct a prompt, full and complete investigation of the loss and to pay benefits in a timely manner. She claimed that as result of Allstate’s delay in investigating her claim and paying benefits, her personal property and the garage structure began to grow mold and mildew thereby destroying her property and creating a hazardous living environment in her home. Taybron also alleged that Allstate’s remediation service representatives indicated that had they been called within a reasonable time after the initial loss was reported they could have saved and restored the property for an amount within her policy limits.
Allstate moved for summary judgment seeking dismissal of the causes of action for breach of contract and breach of the implied covenant of good faith and fair dealing, which was opposed by Taybron. The trial court granted the motion after concluding that there were no triable issues of material fact regarding Allstate’s breach of a policy term or “any ‘delay’ causing [Taybron] harm.” The court entered a judgment dismissing the complaint against Allstate. Taybron filed a timely notice of appeal from the judgment.
Plaintiff also alleged causes of action against Allstate for violation of Business and Profession Code Section 17200, fraud and negligent misrepresentation, violation of the Unruh Civil Rights Act (Civ. Code § 51 et seq.), and negligence. However, in response to Allstate’s motion, Taybron conceded that those causes of action were not sustainable and that dismissal was appropriate. Taybron raises no issue regarding those causes of action.
At the suggestion of the trial court, Allstate unilaterally and voluntarily dismissed its cross-complaint without prejudice so that an appealable final judgment could be entered. Because Allstate is the respondent on this appeal, its dismissal of its cross-complaint without prejudice “does not make the judgment any less appealable.” (Vedanta Society of So. California v. California Quartet, Ltd. (2000) 84 Cal.App.4th 517, 525, fn. 8.)
DISCUSSION
Because Allstate was granted summary judgment in its favor, we review the record de novo. As the moving party, Allstate “bears the burden of persuasion that there is no triable issue of material fact and that [it] is entitled to judgment as a matter of law.” (Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 850, fn. omitted (Aguilar).) “A defendant moving for summary judgment must ‘ “show[] that one or more elements of the cause of action . . . cannot be established” by the plaintiff.’ [Citation.] A defendant meets its burden by presenting affirmative evidence that negates an essential element of plaintiff’s claim. [Citation.] Alternatively, a defendant meets its burden by submitting evidence ‘that the plaintiff does not possess, and cannot reasonably obtain, needed evidence’ supporting an essential element of its claim. [Citation.]” (Oakland Raiders v. National Football League (2005) 131 Cal.App.4th 621, 629.) “We need not defer to the trial court and are not bound by the reasons in its summary judgment ruling; we review the ruling of the trial court, not its rationale. [Citation.]” (Id. at p. 630.)
Consequently, we need not address Taybron’s arguments challenging the terse nature of the trial court’s decision.
The drastic remedy of summary judgment was sought on very narrow grounds. Allstate argued that the breach of contract cause of action was precluded because it had offered to pay the policy’s personal property contents limit of $50,000 within days of receiving the remediation estimate, and on a second occasion, but Taybron had rejected the offers. As to the breach of an implied covenant of good faith and fair dealing, Allstate argued that (a) in the absence of a breach of contract there could be no breach of the implied covenant of good faith and fair dealing, and (b) Taybron could not, as a matter of law, establish that Allstate’s alleged bad faith conduct caused her damages or had any impact on the claim’s outcome because she admitted at her deposition that she would not have accepted the $50,000 check even if it had been offered within one week of the submission of the claim. We conclude Allstate did not establish its entitlement to summary judgment.
In support of its motion for summary judgment, Allstate conceded that it was not seeking summary adjudication pertaining to whether it had unreasonably delayed the resolution of Taybron’s claim.
Allstate cannot defeat the causes of action for breach of contract and breach of the implied covenant of good faith and fair dealing merely because it ultimately offered to pay the purported personal property policy limit of $50,000 several months after the loss was filed. While an insurer may correct an initial failure to perform under its contract of insurance and will not be liable for damages that an insured incurs thereafter, “we decline to hold that all liability and damages for a breach of duty may be cured by a subsequent offer of settlement.” (Schlauch v. Hartford Accident & Indemnity Co. (1983) 146 Cal.App.3d 926, 935-936.) Similarly, “an ‘ultimate tender of benefits . . . does not defeat [a cause] of action for insurance bad faith. . . . Rather, it merely mitigates damages.’ [Citation.]” (McCormick v. Sentinel Life Ins. Co. (1984) 153 Cal.App.3d 1030, 1051.)
Allstate’s argument that Taybron’s bad faith claim cannot exist in the absence of a breach of contract is based on case law holding that an insured’s bad faith claim is not separately actionable unless there is coverage and policy benefits are due to the insured. (Waller v. Truck Ins. Exchange, Inc. (1995) 11 Cal.4th 1, 36; Love v. Fire Ins. Exchange (1990) 221 Cal.App.3d 1136, 1153.) However, Allstate does not dispute that Taybron’s loss was covered under the policy and that policy benefits were due to be paid to Taybron. At issue here is Allstate’s “duty not to withhold unreasonably payments due under a policy. . . . That responsibility is not the requirement mandated by the terms of the policy itself—to defend, settle, or pay. It is the obligation, deemed to be imposed by the law, under which the insurer must act fairly and in good faith in discharging its contractual responsibilities. Where in so doing, it fails to deal fairly and in good faith with its insured by refusing, without proper cause, to compensate its insured for a loss covered by the policy, such conduct may give rise to a cause of action in tort for breach of an implied covenant of good faith and fair dealing.” (Gruenberg v. Aetna Ins. Co. (1973) 9 Cal.3d 566, 573-574.)
“[I]n a case like the one before us, there may be some unavoidable intertwining or overlap of the contract and bad faith issues . . . .” (Jordan v. Allstate Ins. Co. (2007) 148 Cal.App.4th 1062, 1079-1080, fn. omitted.) “For example, the contract issues might involve such matters as (1) the proper construction and interpretation of relevant policy provisions, (2) the existence of coverage under the policy, (3) the amount of property damage sustained by [Taybron] and (4) Allstate’s failure to timely pay promised benefits. It is true, however, that some or all of these issues might also be relevant to the claim of bad faith.” (Id. at p. 1080, fn. 12). Taybron’s breach of contract cause of action, if proven, will entitle her to recover any unpaid policy benefits found to be due to her. If Taybron also establishes a breach of the implied covenant of good faith and fair dealing, “then she may be entitled to recover, in addition to any unpaid policy benefits found to be due to her, certain extracontractual tort remedies according to proof.” (Id. at p. 1079.)
We also conclude that Allstate did not present evidence showing that Taybron cannot and could not possibly establish that any delay in processing her claim caused her compensable damages. Allstate relies only on Taybron’s response to a question at her deposition—that she would have rejected Allstate’s $50,000 check even if Allstate had sent it to her within a week of reporting her loss. However, Allstate ignores that at issue here is its conduct in handling Taybron’s loss claim, not Taybron’s conduct. The nature of the deposition question and Taybron’s answer does not rise to the level of such evidence that persuades us that Taybron cannot establish that Allstate’s conduct caused her to suffer compensable damages. (See Aguilar, supra, 25 Cal.4th at p. 854.) Citing to Taybron’s memorandum of points and authorities in opposition to its motion, Allstate argues Taybron admitted that any attempt to establish that Allstate caused her to suffer damages would be “ ‘hypothetical’ ” and “ ‘fiction[al].’ ” However, Allstate misreads Taybron’s argument, taking the words hypothetical and fictional out of context. Taybron correctly argued that her ability to establish that Allstate’s conduct caused her compensable damages was not precluded by her response to “a hypothetical” question regarding a “fictional scenario[]” that never occurred, namely, an offer by Allstate to pay $50,000 within one week of the filing of the claim. Whether Taybron would have accepted $50,000 within one week of submitting her loss to Allstate cannot be the basis for a conclusion that, as a matter of law, Allstate should be relieved of liability for damages resulting from its conduct during the processing of the claim. Because Allstate failed to meet its initial burden of presenting evidence sufficient to make a prima facie showing that a triable issue of fact did not exist regarding causation (Aguilar, supra, 25 Cal.4th at p. 850), the burden of producing evidence never shifted to Taybron to establish a triable issue of fact regarding causation. Consequently, we do not need to address the sufficiency of Taybron’s opposing evidence.
Our determination should not be read as expressing an opinion about the ultimate merits of the matter. We conclude only that Allstate failed to show Taybron should be barred as a matter of law from pursuing her causes of action for breach of contract and breach of the implied covenant of good faith and fair dealing.
Taybron requests that we take judicial notice of certain documents filed in a pending related federal lawsuit filed by her against Allstate. Allstate opposes the request. By order filed on May 14, 2007, we deferred consideration of the request to this time. Because these documents are not necessary to resolve the issues before us, we deny the request for judicial notice as moot.
DISPOSITION
The judgment in favor of Allstate Insurance Company is reversed. On remand the trial court should modify its order granting summary judgment in favor of Allstate Insurance Company by adding a provision that Allstate’s motion for summary judgment is denied as to the causes of action for breach of contract and breach of the implied covenant of good faith and fair dealing. Plaintiff is awarded costs on this appeal.
We concur: Parrilli, J., Pollak, J.
Additionally, Allstate requests that we clarify the trial court’s ruling pertaining to plaintiff’s request for punitive damages. Although Allstate sought summary adjudication dismissing Taybron’s request for punitive damages, which was not opposed, the trial court did not rule on that request. Taybron raises no issue regarding her request for punitive damages. Because we are remanding the matter, the trial court will have the opportunity to enunciate its ruling pertaining to Allstate’s challenge to Taybron’s request for punitive damages.