LEADING INSURANCE GROUP INSURANCE CO. VS RENKA PROP, LLC

Tentative Rulings

Case Number: SC124919    Hearing Date: August 20, 2020    Dept: N

TENTATIVE RULING

Plaintiffs Leading Insurance Group Insurance Co., Ltd. (U.S. Branch) dba Leading Insurance Company (U.S. Branch), Leading Insurance Services, Inc., and Kookmin Best Insurance’s Motion for Attorneys’ Fees in the Amount of $143,434.00 is GRANTED.

Plaintiffs Leading Insurance Group Insurance Co., Ltd. (U.S. Branch) dba Leading Insurance Company (U.S. Branch), Leading Insurance Services, Inc., and Kookmin Best Insurance to give notice.

REASONING

Code of Civil Procedure section 2033.420, subdivision (a), provides:

If a party fails to admit the genuineness of any document or the truth of any matter when requested to do so under this chapter, and if the party requesting that admission thereafter proves the genuineness of that document or the truth of that matter, the party requesting the admission may move the court for an order requiring the party to whom the request was directed to pay the reasonable expenses incurred in making that proof, including reasonable attorney’s fees.

Pursuant to subdivision (b) of that section, “[t]he court shall make this order unless it finds any of the following:”

(1) An objection to the request was sustained or a response to it was waived under Section 2033.290.

(2) The admission sought was of no substantial importance.

(3) The party failing to make the admission had reasonable ground to believe that that party would prevail on the matter.

(4) There was other good reason for the failure to admit.

(Code Civ. Proc., § 2033.420, subd. (b).)

Plaintiffs Leading Insurance Group Insurance Co., Ltd. (U.S. Branch) dba Leading Insurance Company (U.S. Branch), Leading Insurance Services, Inc., and Kookmin Best Insurance (“Plaintiffs”) move the Court for an award of attorneys’ fees based on Defendants Renka Prop, LLC, Xelan Prop 1, LLC, Anna Kihagi, and Julie Mwangi (“Defendants”)’s failure to admit that Plaintiffs’ insurance policies did not provide insurance coverage for an action filed by non-tenant governmental entities. Plaintiffs proved at trial there was no coverage for that action, so they argue they are entitled to an award of attorneys’ fees in the amount of $143,434.00 to cover costs incurred in proving that Plaintiffs’ policies did not provide coverage. 

As an initial matter, the Court notes Defendants did not file an opposition. While the moving party generally bears the initial burden of proof on its motion, and lack of opposition will not automatically entitle the moving party to prevail on its motion, a party’s failure to file an opposition can be considered a concession that the motion is meritorious. (See Sexton v. Superior Court (1997) 58 Cal.App.4th 1403, 1410.)

On February 27, 2020, judgment was entered in favor of Plaintiffs and against Defendants with the following findings: (1) Plaintiffs had no duty under the LIG Policies to defend Defendants in the underlying action, (2) Plaintiffs had no duty under the LIG Policies to pay any settlement or judgment or any other award entered in the underlying action, (3) there is no insurance coverage under the LIG Policies for any aspect of the underlying action, (4) Plaintiffs were to recover the amount of $792,923.12, which they expended in defending Defendants in the underlying action, and (5) Plaintiffs were to recover prejudgment interest in the amount of $230,143.00.

Plaintiffs point to Defendants’ failure to make the following admissions:

(1) Plaintiffs asked Defendants to admit that the claim for violations of Administrative Code section 37.10B, subdivision (a), brought by the plaintiffs in the underlying action was not covered under the policies issued to Defendants by Plaintiffs.

(2) Plaintiffs asked Defendants to admit that the claim for violations of Health and Safety Code sections 17920 to 17980.9 brought by the plaintiffs in the underlying action was not covered under the policies issued to Defendants by Plaintiffs.

(3) Plaintiffs asked Defendants to admit that the claim for violations of Civil Code sections 3749 and 3480 brought by the plaintiffs in the underlying action was not covered under the policies issued to Defendants by Plaintiffs.

(4) Plaintiffs asked Defendants to admit that the claim for violations of Code of Civil Procedure section 731 brought by the plaintiffs in the underlying action was not covered under the policies issued to Defendants by Plaintiffs.

(5) Plaintiffs asked Defendants to admit that the claim for violations of Business and Professions Code sections 17200 to 17210 brought by the plaintiffs in the underlying action was not covered under the policies issued to Defendants by Plaintiffs.

Plaintiffs argue when the requests were denied on August 2, 2018, the San Francisco Superior Court had already issued its Statement of Decision and judgment finding intentional conduct and bad faith by Defendants in the underlying action and imposing civil penalties.

Bullock v. Maryland Casualty Co. (2001) 85 Cal.App.4th 1435, 1448 to 1149, and Insurance Code sections 533 and 533.5, subdivision (a), state, respectively, that “[a]n insurer is not liable for a loss caused by the wilful act of the insured,” and “[n]o policy of insurance shall provide, or be construed to provide, any coverage or indemnity for the payment of any fine, penalty, or restitution in any criminal action or proceeding or in any action or proceeding” brought by a public entity. Indeed, there was no justification for denying Plaintiffs’ requests for admission that the insurance policies did not cover the claims in the underlying action, and thus, Plaintiffs are entitled to an award of attorneys’ fees.

Plaintiffs ask for an award of attorneys’ fees in the amount of $143,434, which represents 740.4 attorney hours preparing this action for trial at the rate of $180 per hour, and 128.6 paralegal hours preparing this action for trial at the rate of $80 per hour. The Court finds this to be a reasonable amount of time to prepare this action for trial at a reasonable rate, and such costs were incurred because of Defendants’ unreasonable failure to admit that their conduct was not covered by the insurance policies in the underlying action. 

Accordingly, Plaintiffs Leading Insurance Group Insurance Co., Ltd. (U.S. Branch) dba Leading Insurance Company (U.S. Branch), Leading Insurance Services, Inc., and Kookmin Best Insurance’s Motion for Attorneys’ Fees in the Amount of $143,434.00 is GRANTED.