Embee Inc vs. Safeco Insurance Company of America

Plaintiff is ordered to give notice, including to the LWDA, and to file a proof of service.

113 Embee Inc vs. Safeco Motion for Summary Judgment and/or Adjudication Insurance Company of America Defendant Fireman’s Fund Insurance Company (Fireman’s Fund) moves for summary judgment against the fourth amended complaint of plaintiff 2012-00586683 Embee, Inc. fka Embee Plating (Embee). ROA 1979. The operative pleading alleges two causes of action against defendant: (1) breach of contract; and (2) and breach of the covenant of good faith and fair dealing. Id.

In the alternative, defendant Fireman’s seeks summary adjudication of the following causes or action and/or issues:

(1) First Cause of Action for Breach of Contract; (2) Second Cause of Action for Breach of the Implied Covenant of Good Faith and Fair Dealing; (3) Fireman’s Fund’s Seventh Affirmative Defense - Prohibition Against Voluntary Payments; and (4) Fireman’s Fund has no duty to pay costs incurred pursuant to Embee’s Corrective Action Consent Agreement with the Department of Toxic Substances Control as defense or indemnity costs for the Orange County Water District Action because Embee violated the no-voluntary-payments provision in each of the insurance policies at issue.

Notice of Motion (ROA 2016) 2:6-19.

For the following reasons, defendant’s motion for summary judgment is denied, and defendant’s motion for summary adjudication is denied.

Legal standard

A defendant seeking summary judgment bears its burden of showing that a cause of action has no merit if the defendant shows that one or more elements of the cause of action cannot be established, or that the defendant has a complete defense to the cause of action. Cal. Civ. Proc. Code § 437c(p)(2); Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 850-51.

If a defendant does not meet this initial burden, the plaintiff need not oppose the motion and the motion must be denied. Binder v. Aetna Life Ins. Co.

(1999) 75 Cal.App.4th 832, 840. If the defendant meets this initial burden, the burden shifts to the plaintiff to produce evidence demonstrating the existence of a triable issue of material fact. Cal. Civ. Proc. Code § 437c(p)(2); Aguilar, 25 Cal.4th at 850-51.

A party may move for summary adjudication as to one or more causes of action within an action, one or more affirmative defenses, one or more claims for damages, or one or more issues of duty, if that party contends that the cause of action has no merit or that there is no affirmative defense thereto, or that there is no merit to an affirmative defense as to any cause of action, or both, or that there is no merit to a claim for damages, as specified in Section 3294 of the Civil Code, or that one or more defendants either owed or did not owe a duty to the plaintiff. Cal. Civ. Proc. Code § 437c(f)(1). A motion for summary adjudication shall be granted only if it completely disposes of a cause of action, an affirmative defense, a claim for damages, or an issue of duty. Id.

A motion for summary adjudication “shall proceed in all procedural respects as a motion for summary judgment.” Choochagi v. Barracuda Networks, Inc. (2020) 60 Cal.App.5th 444, 453. “The moving party ‘bears an initial burden of production to make a prima facie showing of the nonexistence of any triable issue of material fact; if [the movant] carries [this] burden of production,’ the burden of production shifts to the opposing party ‘to make a prima facie showing of the existence of a triable issue of material fact.’” Id.

“[I]t is well established that the operative pleading frames the issues for purposes of summary judgment . . . .” Restivo v. City of Petaluma (2025) 111 Cal.App.5th 267, 279. “The pleadings delimit the issues to be considered on a motion for summary judgment. [Citation.] The defendant must present facts to negate each claim as framed by the complaint or establish a defense.” Turner v. State of California (1991) 232 Cal.App.3d 883, 891.

Analysis

As stated above, Fireman’s moves for summary judgment or, in the alternative, summary adjudication, against plaintiff’s fourth amended complaint, which is the operative pleading. Brief (ROA 2010) 2:20-22. The fourth amended complaint alleges:

“6. Fireman’s Fund issued primary general liability policies to Embee for the policy period April 1, 1977 to May 1, 1981, policy numbers MXP 289 44 86, MXP 300 53 45, and MXX 396 63 58 and excess policies XLB 142 10 59 and XLB 145 59 77 for the policy periods April 1, 1980 to April 1, 1982, each with a limit of liability of $1,000,000 per occurrence and $1,000,000 in the aggregate. Each excess policy includes an insuring agreement which obligates Fireman’s Fund to “assume charge of the settlement or defense of any claim or suit . . .to which no primary insurance applies . . .

...

13. Embee submitted certain costs to Fireman’s Fund with respect to costs incurred after May 31, 2017.

14. These costs represent defense costs, or indemnity costs, or both.

14. These costs represent defense costs, or indemnity costs, or both.

15. Fireman’s Fund has refused to pay these defense costs, or indemnity costs, thereby breaching its duty to defend or indemnify the DTSC Proceedings and the OCWD action.

...

18. Fireman’s Fund unreasonably denied coverage for costs of defense, or indemnity, including but not limited to the cost of investigating groundwater and indoor air.

19. Fireman’s Fund failed to conduct a proper investigation.

20. Fireman’s Fund concluded, unreasonably, that all of the costs in question constitute remediation costs, rather than investigative costs, and are not covered for that reason. Assuming that some or all of the costs in question are remediation costs, then Fireman’s owed them under its duty to indemnify. Assuming that some or all of the costs in question are investigation costs, then Fireman’s owed them under the duty to defend.”

ROA 1979.

Defendant contends summary judgment should be granted because plaintiff’s “claim for breach of contract is precluded by Embee’s breach of the no-voluntary-payments provision contained in each of the insurance policies at issue” (Notice (ROA 2016) 2:11-13) and “because Embee is not entitled to coverage under any insurance policy, Embee cannot establish a claim for breach of the implied covenant of good faith and fair dealing” (id. 13-14).

Plaintiff alleges in the fourth amended complaint that “Fireman’s Fund issued primary general liability policies to Embee for the policy period April 1, 1977 to May 1, 1981, policy numbers MXP 289 44 86, MXP 300 53 45, and MXX 396 63 58...” ROA 1979, ¶ 6. Fireman’s motion addresses only one of the three primary general liability policies alleged in the operative pleading. Brief (ROA 2010) 3:9-12; Separate Statement of Material Facts in Support (ROA 2012) UMF Nos. 1-2. Defendant has not presented any evidence or argument pertaining to the existence of “the no-voluntarypayments provision” in Fireman’s primary general liability policies “MXP 300 53 45, and MXX 396 63 58” that were purportedly issued to Embee, as alleged in the fourth amended complaint.

In addition, defendant’s separate statement is deficient as it does not comply with California Rule of Court 3.1350. Defendant’s separate statement, which states it supports “its Motion for Summary Judgment, or in the alternative, Summary Adjudication with respect to Embee’s First Cause of Action for Breach of Contract and FFIC’s Seventh Affirmative Defense” (ROA 2012 at

2:3-5) – lists 38 allegedly undisputed material facts that defendant apparently contends apply equally to each of the two causes of action alleged against it in the fourth amended complaint.

California Rule of Court 3.1350(d) states:

“The Separate Statement of Undisputed Material Facts in support of a motion must separately identify:

“(A) Each cause of action, claim for damages, issue of duty, or affirmative defense that is the subject of the motion; and

“(B) Each supporting material fact claimed to be without dispute with respect to the cause of action, claim for damages, issue of duty, or affirmative defense that is the subject of the motion.”

Cal. R. Ct. 3.1350(d).

In contravention of rule 3.1350(d), defendant’s separate statement does not separately identify “each cause of action . . . that is the subject of the motion,” and “each supporting material fact . . . with respect to the cause of action . . . that is the subject of the motion.” Cal. R. Ct. 3.1350(d). In addition, the materiality of the 38 allegedly undisputed material facts to each of the two causes of action is unclear and unexplained. For example, the court cannot discern the materiality of Undisputed Material Fact Nos. 33 and 34 to the two causes of action on which defendant seeks summary judgment. ROA 2012.

Moreover, “[t]he paragraphs in a separate statement should be limited to facts that address the elements of a cause of action or an affirmative defense.” Beltran v. Hard Rock Hotel Licensing, Inc. (2023) 97 Cal.App.5th 865, 875; see also Cal. R. Ct. 3.1350(d)(2) (“The separate statement should include only material facts and not any facts that are not pertinent to the disposition of the motion.”). Preparation of a proper separate statement is not a pedantic exercise. “‘The separate statement serves two important functions in a summary judgment proceeding: It notifies the parties which material facts are at issue, and it provides a convenient and expeditious vehicle permitting the trial court to hone in on the truly disputed facts.’” Id. A separate statement that lists 38 undifferentiated facts in relation to two different causes of action is neither convenient nor expeditious.

In sum, defendant failed to carry its initial burden on the motion. Defendant did not present any evidence or argument regarding the applicability of the two of the three Fireman’s primary general liability policies alleged in the fourth amended complaint, i.e., policy numbers “MXP 300 53 45, and MXX 396 63 58.” Thus, defendant failed to show one or more elements of each cause of action cannot be established, or that the defendant has a complete defense to each cause of action.

In addition, defendant did not separately identify in its separate statement the causes of action on which it seeks summary judgment and each supporting material fact claimed to be without dispute with respect to each cause of

action. The court thus has no basis on which to conclude that defendant demonstrated that one or more elements of each cause of action cannot be established, or that defendant has a complete defense to each cause of action. Defendant’s motion for summary judgment is denied.

Defendant’s motion for summary adjudication is also denied because the separate statement does not comply with California Rule of Court 3.1350(b), (d) and (h). Cal. R. Ct. 3.1350(b) (“If summary adjudication is sought, whether separately or as an alternative to the motion for summary judgment, the specific cause of action, affirmative defense, claims for damages, or issues of duty must be stated specifically in the notice of motion and be repeated, verbatim, in the separate statement of undisputed material facts.”); see also Schmidlin v.

City of Palo Alto (2007) 157 Cal.App.4th 728, 743-44; Cal. R. Ct. 3.1350(d) (“The Separate Statement of Undisputed Material Facts in support of a motion must separately identify: (A) Each cause of action, claim for damages, issue of duty, or affirmative defense that is the subject of the motion; and (B) Each supporting material fact claimed to be without dispute with respect to the cause of action, claim for damages, issue of duty, or affirmative defense that is the subject of the motion”); Cal.

R. Ct. 3.1350(h) (format of separate statement supporting summary adjudication motion).

Based on defendant’s notice of motion, Fireman’s seeks summary adjudication of the first cause of action for breach of contract, the second cause of action for breach of the implied covenant of good faith and fair dealing, the seventh affirmative defense, and the issue that “Fireman’s Fund has no duty to pay costs incurred pursuant to Embee’s Corrective Action Consent Agreement with the Department of Toxic Substances Control as defense or indemnity costs for the Orange County Water District Action because Embee violated the no-voluntary-payments provision in each of the insurance policies at issue.” Notice of Motion (ROA 2016) at 2:6-19.

As stated above, defendant’s separate statement states it supports “its Motion for Summary Judgment, or in the alternative, Summary Adjudication with respect to Embee’s First Cause of Action for Breach of Contract and FFIC’s Seventh Affirmative Defense” (ROA 2012 at 2:3-5). The separate statement is deficient because the causes of action and/or issues identified in defendant’s notice of motion are not “repeated, verbatim, in the separate statement of undisputed material facts.” The separate statement also lists different issues than those identified in the notice of motion. Compare Notice of Motion (ROA 2016) at 2:6-19 with Separate Statement (ROA 2012) at 2:4-5.

Accordingly, defendant’s motion for summary adjudication of the causes of action and/or issues identified in defendant’s notice of motion is denied.

Defendant’s Request for Judicial Notice (ROA 2014) is denied as the document was not material to the disposition of the motion.

Defendant’s Evidentiary Objections to Plaintiff’s Compendium of Evidence in Opposition (ROA 2041) were not material to the disposition of the motion.

Plaintiff Embee to give notice.