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Filed 8/26/15 Wessler v. Mid-Century Ins. Co. CA1/2

NOT TO BE PUBLISHED IN OFFICIAL REPORTS

California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for 

publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication

or ordered published for purposes of rule 8.1115. 

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

FIRST APPELLATE DISTRICT

DIVISION TWO

RICHARD WESSLER et al., 

Plaintiffs and Appellants, 

v.

MID-CENTURY INSURANCE COMPANY,

Defendant and Respondent.

 A142928

 (Contra Costa County 

 Super. Ct. No. MSC1300846) 

Richard Wessler (Richard) and Theresa Wessler (Theresa; collectively, the 

Wesslers) purchased a homeowner’s insurance policy from Mid-Century Insurance 

Company (Mid-Century). The policy included a one-year statute of limitations period for 

any challenge to the insurer’s handling of a claim. The Wesslers’ home was seriously 

damaged by a fire and, more than one year after Mid-Century had denied their claim for 

damage, the Wesslers sued Mid-Century for breach of contract. The Wesslers alleged in 

their pleading that the statute of limitations was tolled while a criminal investigation of 

them was pending. The trial court granted Mid-Century’s motion for summary judgment 

and the Wesslers appeal. We reject the Wesslers’ contention that the statute of 

limitations was suspended during the period of time they were being criminally 

investigated; thus, the statute of limitations bars the Wesslers’ lawsuit against MidCentury. Accordingly, we affirm.
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BACKGROUND

The Wesslers, a married couple, owned property in Danville, California (the 

Danville home) since 2000. Richard, a general contractor, built the home and the

Wesslers lived in the home until 2008. They permitted their friends, Timothy and Agnes 

Shelton (the Sheltons), to live in the home without paying rent. 

On March 22, 2010, Mid-Century executed and delivered to the Wesslers a 

homeowner’s policy (the policy), which was in effect from January 31, 2010, through 

January 31, 2011. The policy covered damage to the Danville home. 

The policy provided that the claimants had various duties after a loss, including 

the obligation to make a list of damaged or destroyed personal property and to attach bills 

and/or records, and to cooperate with Mid-Century’s investigation of the loss. The 

claimant also had the duty to do the following as often as Mid-Century reasonably

required: provide records, documents, and other information requested, including “but 

not limited to banking records, asset, debt and income information, records and 

documents, credit history and other financial records . . . . [;]” submit to examinations 

under oath by Mid-Century and “[s]ubmission to a requested examination(s) under oath is 

a condition precedent to recovery under this policy[;]” and send within 60 days after MidCentury’s request, a signed sworn statement showing, among other things, all information 

requested to investigate the claim.1 

Under the heading, “Suit Against Us,” the policy read: “No suit or other action 

can be brought against us, our agents or our representatives unless there has been full 

compliance with all the terms of this policy, including submission to requested 

 

1 The policy under the heading of “Intentional Acts, Criminal Acts, and Fraud,” 

excluded any coverage “for loss or damage from a criminal act committed by or at the 

direction of any insured if the loss that occurs may be reasonably expected to result from 

such an act, or is the intended result of such an act.” 

Elsewhere, under the heading “Misrepresentation, Concealment or Fraud,” the 

policy stated: “We do not provide coverage for any loss or damage . . . if you or any 

insured has in connection with or related to any insurance provided in this policy 

intentionally caused or arranged for the loss or damage . . . while engaged in committing 

or concealing a felony . . . .” 
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examinations under oath. Suit on or arising out of the . . . [p]roperty [c]overage of this 

policy must be brought within one year after inception of the loss or damage.” 

On January 28, 2011, while the Sheltons were living in the Danville home, a fire 

started in the home’s garage; it spread, and caused substantial damage to the home. The 

day after the fire, the Wesslers filed a claim with Mid-Century.

On February 4, 2011, Mid-Century’s claims adjustor, Craig Perry, inspected the 

Danville home with a fire causation expert and an electrical engineer, Jeffrey Goode. 

Wessler was present but left when Perry told him he had some questions to ask him. The 

fire causation expert and Goode concluded that the fire originated where the electrical 

main service panel and wiring were located in the southwest corner of the garage. Goode 

concluded that “the evidence supports that three improper connectors, most probably 

used to tap power ahead of the meter, provided the ignition source for this fire.” 

On this same date, February 4, 2011, Perry wrote the Wesslers and stated that 

Mid-Century’s investigation supported the conclusion “that three improper [splice] 

connectors, most probably used to tap power ahead of the meter, provided the ignition 

source of this fire.” On this same date, Perry sent two additional letters asking the

Wesslers to complete and sign an “Authorization to Obtain Information” (authorization 

form) and a “Proof of Loss” form. The Wesslers did not respond to either letter. 

Subsequently, on February 10 and February 28, 2011, Perry again sent the Wesslers

letters requesting the completed forms. Perry also asked the Wesslers to agree to be 

interviewed. The Wesslers did not respond. 

The San Ramon Valley Fire Protection District completed an amended incident 

report on March 2, 2011 (fire department report). The fire department report stated that 

the electrical wire and cable insulation were the items that first ignited. The factor 

contributing to the ignition was an electrical failure and malfunction and that a 

contributing factor was the “[m]isuse of material or product[.]” It noted that a

“suppression factor” was an “illegal and clandestine drug operation[.]” 

The fire department report further stated that law enforcement had notified the fire 

fighters at the Danville home “to keep [their] eyes open because [the police] suspected 
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the fire may have been used to cover up a crime.” The fire captain discovered evidence 

of a possible illegal drug growing operation. The fire crew waited until the police 

obtained a search warrant and then assisted with investigating the cause and origin of the 

fire. The fire personnel and law enforcement found “[a] large number of high 

candlepower lights, burned plants, filters, fans, and hydroponics fluid containers . . . . 

The garage was lined with foam insulation . . . .” 

On March 28, 2011, Perry sent the Wesslers a letter notifying them that MidCentury had not received any response to the requests for further information and, 

consequently, it was closing their claim. The letter advised them about the one-year 

contractual limitations period applicable to any lawsuit arising out of the denial.

Counsel for the Wesslers notified Perry that the Wesslers were prepared to give a 

statement. A recorded interview of Richard occurred on April 27, 2011. Richard, who 

had legal representation, asserted his Fifth Amendment privilege whenever a question 

was asked relating to the police investigation, communications with the Sheltons, the 

marijuana growing operation, or the rewiring of the electrical connection. The Danville 

home had a hidden staircase leading to the attic and Richard denied any knowledge of it. 

He refused to sign the authorization form.

On May 3, 2011, Mid-Century wrote the Wesslers asking again for the forms and 

utility bills for the last six months. The letter again advised about the one-year statute of 

limitations. 

In May 2011, Perry received a letter of representation for the Wesslers from 

attorney Ray Rockwell. Mid-Century brought in its counsel, Phaidra M. Garcia of the 

Law Offices of McDowell, Shaw & Colman. 

On June 16, 2011, Garcia sent a letter to Rockwell regarding the Wesslers’ claim. 

The letter confirmed the date for examining the Wesslers under oath. Prior to the 

examination scheduled for July 28, 2011, Garcia requested numerous documents 

including the following: tax forms documenting income from January 1, 2009, until the 

present date; credit card, debit card, and bank statements; and cellular telephone bills. 
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On July 28, 2011, the Wesslers appeared for their examination and refused to 

produce their financial records, bank records, and cell phones. Rockwell warned that the

Wesslers would plead the Fifth Amendment in response to any question related to the 

criminal investigation. Rockwell stated that the Wesslers would cooperate once the 

criminal matter concluded. The Wesslers asserted their Fifth Amendment rights 

throughout their examinations. During the examinations, Garcia informed Rockwell 

about the one-year statute of limitations and he responded, “I’m well aware of the one 

year.” 

On July 29, 2011, Perry sent Rockwell a reminder that Mid-Century still had not 

received either the signed proof of loss or authorization forms. Perry did not receive a 

response and on September 29, 2011, he sent Rockwell a letter denying the Wesslers’ 

claim; Perry explained the denial was due to the Wesslers’ failure to cooperate. Perry 

reminded them of the one-year contractual statute of limitations and provided them with 

an additional 14 days from the date of the letter to submit the requested information. 

Less than one year later, on April 4, 2012, Rockwell sent a letter to Mid-Century’s 

counsel “strongly” suggesting that Mid-Century “advance the funds to secure” the 

Danville home, which was considered a hazard by the Town of Danville. Rockwell 

stated that the Wesslers would be filing a lawsuit regarding their claim. Garcia 

responded on behalf of Mid-Century on April 10, 2012. She reminded Rockwell that the 

Wesslers’ claim had been denied on September 29, 2011, and therefore there would be 

“no coverage for the loss[,] which would include coverage to secure [the Danville 

home].” The letter repeated that the policy specified a one-year statute of limitations for 

filing a lawsuit regarding the handling of this claim. 

A criminal complaint signed on January 10, 2012, and filed on December 17, 

2012, charged Richard and the Sheltons for running a marijuana cultivation operation at 

the Danville home.2 The complaint charged them with three felonies: cultivating 

marijuana (Health & Saf. Code, § 11358), controlling a place where marijuana is 

 

2 Theresa was not charged. 
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cultivated (id., § 11366.5, subd. (a)), and recklessly and unlawfully causing a fire of a 

structure (Pen. Code, § 452, subd. (c)). 

On January 10, 2013, Richard pled no contest to a misdemeanor for controlling a 

place where marijuana is grown (Health & Saf. Code, § 11366.5); the three original 

charges were dismissed. 

On April 18, 2013, the Wesslers filed a complaint in the superior court for breach 

of contract and declaratory relief against Mid-Century based on its denial of their claim 

for the damage to the Danville home from the fire on January 28, 2011. They maintained 

that Mid-Century was obligated to pay their claim because the damage to their Danville 

home was covered and no exclusions applied. They alleged that they did not file their

lawsuit within one year of the date Mid-Century denied their claim at the instruction of 

their counsel “because of the obvious concern that they would have to answer certain 

questions in the discovery process which could have been held against them in the 

criminal proceeding.” They asserted that the statute of limitations should be tolled 

pursuant to the doctrine of equitable tolling until February 2013, when the criminal 

investigation concluded. They sought a declaration that Mid-Century had a duty to 

compensate the Wesslers for the loss resulting from the fire at their Danville home and 

damages for the alleged breach of the contract. 

Mid-Century moved for summary judgment. After a hearing, the trial court filed 

its order on June 27, 2014, granting Mid-Century’s motion for summary judgment. It 

observed that the statute of limitations was triggered when the loss occurred, which was 

January 28, 2011, but the contractual limitations period was equitably tolled until the 

claim was denied on September 29, 2011. The Wesslers filed their action more than 18 

months after their claim had been denied. 

The trial court addressed the Wesslers’ argument that the statute of limitations was 

equitably tolled while the criminal case regarding Richard was pending. The court noted 

that the Wesslers cited no authority to support this argument. The court added: “The 

bigger problem is that Richard Wessler was not acquitted of the charges. It is undisputed 

that Richard Wessler pled no contest to a violation of [Health and Safety Code section 
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11366.5, subdivision (a)], knowingly allowing a premises to be used for storing and 

distributing a controlled substance.” The court stated that the express terms of the policy 

excluded coverage even if the statute of limitations were not tolled. 

The trial court also granted Mid-Century’s summary judgment motion on the 

independent ground that the Wesslers failed to provide necessary information to 

determine if there was coverage. The court elaborated, “Failure or refusal to provide 

documents may result in forfeiture of any claim under the policy, as this requirement has 

been recognized as a condition precedent to filing suit.” 

Judgment was filed on July 28, 2014, and the Wesslers filed a timely notice of 

appeal. 

DISCUSSION

I. Standard of Review

The standard of review of a summary judgment motion in favor of a defendant is 

well settled. We “independently assess the correctness of the trial court’s ruling by 

applying the same legal standard as the trial court in determining whether any triable 

issues of material fact exist, and whether the defendant is entitled to judgment as a matter 

of law.” (Rubin v. United Air Lines, Inc. (2002) 96 Cal.App.4th 364, 372.) “There is a 

triable issue of material fact if, and only if, the evidence would allow a reasonable trier of 

fact to find the underlying fact in favor of the [plaintiff] in accordance with the applicable 

standard of proof.” (Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 850.) The 

trial court must view that evidence, and any reasonable inferences from that evidence, “in 

the light most favorable to” the plaintiff. (Id. at p. 843.) We review the trial court’s 

ruling de novo. (Id. at p. 860.)

II. Statute of Limitations

“The purpose of a statute of limitations is ‘ “to promote justice by preventing 

surprises through the revival of claims that have been allowed to slumber until evidence 

has been lost, memories have faded, and witnesses have disappeared. The theory is that

even if one has a just claim it is unjust not to put the adversary on notice to defend within 

the period of limitation and [that] the right to be free of stale claims in time comes to 
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prevail over the right to prosecute them.” ’ ” (Prudential-LMI Com. Insurance v. 

Superior Court (1990) 51 Cal.3d 674, 684 (Prudential).)

The homeowner’s policy purchased by the Wesslers from Mid-Century plainly 

created a one-year statute of limitations when it provided that any claim or lawsuit 

“arising out of the” property coverage of the policy “must be brought within one year 

after inception of the loss or damage.” Here, the fire damaging the Danville home 

occurred on January 28, 2011, and the Wesslers filed their claim for damage with MidCentury the following day. The trial court correctly applied the holding of Prudential, 

supra, 51 Cal.3d 674 and tolled this contractual limitation period from the time of the fire

until Mid-Century formally denied the Wesslers’ claim in writing (id. at pp. 678, 693), 

which was September 29, 2011. 

Tolling the period from January 29 until September 29, 2011, the statute of 

limitations period expired on September 29, 2012. The Wesslers filed their complaint on 

April 18, 2013, more than six months after the statute of limitations had lapsed.

The Wesslers acknowledge that their pleading was not filed within the statute of 

limitations period but maintain that the trial court should have “forgiven” them “for their 

technical non-compliance with the statute of limitations.” The Wesslers contend that the 

court should have applied a second period of equitable tolling and suspended the statute 

of limitations while the criminal case against them was pending. They maintain that they 

should not have been forced to choose between asserting their Fifth Amendment rights 

and providing Mid-Century with all the requested information. 

Equitable tolling is sparingly applied; it is a judge-made doctrine that suspends or 

extends a statute of limitations otherwise applicable “occasionally and in special 

situations . . . .” (Addison v. State of California (1978) 21 Cal.3d 313, 316 (Addison).) 

Whether the doctrine of equitable tolling should be applied involves a balancing of the 

competing interests of preventing the assertion of stale claims and allowing good faith 

litigants their day in court. (See id. at p. 319.) 

“[T]he effect of equitable tolling is that the limitations period stops running during 

the tolling event, and begins to run again only when the tolling event has concluded. As 
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a consequence, the tolled interval, no matter when it took place, is tacked onto the end of 

the limitations period, thus extending the deadline for suit by the entire length of time 

during which the tolling even previously occurred.” (Lantzy v. Centex Homes (2003) 31 

Cal.4th 363, 370-371, fn. omitted.) Plaintiff bears the burden of proving that the 

equitable tolling doctrine applies. (In re Marriage of Zimmerman (2010) 183 

Cal.App.4th 900, 912.)

The Wesslers do not cite any court that has applied a second period of equitable 

tolling in the insurance context based on a criminal investigation of the claimant. They 

do, however, note that the statute of limitations for breach of contract claims is four years 

(Code Civ. Proc., § 337), and the Legislature provided insurance carriers with special 

treatment by permitting them to create a one-year contractual statute of limitations. 

To the extent the Wesslers are suggesting that equitable tolling is justified because 

ordinary breach of contract claims are governed by a four-year statute of limitations, we 

reject this argument. The one-year statute of limitations in the policy for their Danville 

home satisfies the requirements under Insurance Code section 2071, subdivision (a). 

Under California law, all fire insurance policies must be on a standard form. (Ins. Code, 

§ 2070.) This standard form provides that “[n]o suit or action on this policy for the 

recovery of any claim shall be sustainable in any court of law or equity . . . unless 

commenced within 12 months next after inception of the loss.” (Ins. Code, § 2071, subd. 

(a).) This one-year limitations period on insurance actions has “ ‘long been recognized as 

valid in California.’ ” (Prudential, supra, 51 Cal.3d at p. 683.) Thus, the one-year 

statute of limitations in the policy complied with the law. (See id. at p. 684 [“When a 

clause in an insurance policy is authorized by statute, it is deemed consistent with public 

policy as established by the Legislature”].)

The Wesslers assert that Mid-Century did not suffer prejudice by the delay and 

claim that “Mid-Century cannot argue evidence necessary to its coverage analysis has 

been lost.” The Wesslers ignore that it is their burden to demonstrate that Mid-Century 
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suffered no prejudice; it is not Mid-Century’s burden to show prejudice.

3 To support its 

argument that Mid-Century suffered no prejudice the Wesslers point out that MidCentury propounded no discovery prior to filing its summary judgment motion and 

conclude this showed that Mid-Century needed no further information from the Wesslers. 

This argument is nonsensical. Once Mid-Century rejected the Wesslers’ claim based on 

their failure to cooperate and provide relevant information, it no longer had a need to 

continue to request this information. 

Contrary to the Wesslers’ conclusory argument, tolling the statute of limitations 

for the entire time a claimant is being investigated for committing a crime is clearly 

prejudicial to the insurance company. Criminal investigations can take months or years. 

Indeed, in the present case, the criminal charges against Richard were not filed until 

almost two years after the fire. Thus, the Wesslers are urging this court to adopt a rule 

that permits the claimant to refuse to answer questions regarding the claim or to 

cooperate with the insurance company’s investigation for an indefinite period of time. 

Yet, “ ‘the facts with respect to the amount and circumstances of a loss are almost 

entirely within the sole knowledge of the insured . . . .’ ” (Hickman v. London Assurance 

Corp. (1920) 184 Cal. 524, 529 (Hickman).) The rule advocated by the Wesslers would 

prevent the insurance company from fulfilling its legal obligation to investigate claims 

promptly. (See Abdelhamid v. Fire Ins. Exchange (2010) 182 Cal.App.4th 990, 1007

(Abdelhamid).) Furthermore, tolling in this situation would defeat the entire purpose of 

Insurance Code section 2071, which “is to relieve insurance companies of the burden 

imposed by defending old, stale claims.” (Prudential, supra, 51 Cal.3d at p. 684.)

 

3 The insurer has the burden of showing that it was prejudiced in its investigation 

when it claims the policy is void based on the insured’s failure to submit to an under oath 

examination. (See, e.g., Brizuela v. CalFarm Ins. Co. (2004) 116 Cal.App.4th 578, 591.) 

However, as already noted, the party seeking to have the court apply the equitable 

doctrine has the burden of proof and therefore the Wesslers must demonstrate that MidCentury was not prejudiced. (In re Marriage of Zimmerman, supra, 183 Cal.App.4th at 

p. 912.)
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Abdelhamid and Hickman are distinguishable, according to the Wesslers, because 

these cases involved arson and the present case did not involve arson; rather, the fire was 

an accident. The insurer’s need to investigate to meet its legal obligation occurs in all 

cases; the investigation is not simply to determine whether there was arson. The insurer 

must determine whether the damage is covered, the amount of damage, and whether there 

is any evidence that the claim is fraudulent. (See, e.g., Francis v. Iowa Nat’l. Fire Ins. 

Co. (1931) 112, Cal.App. 565, 571 [purpose of requiring sworn proof of loss within a 

limited time after fire occurs is to protect insurer against fraudulent claims]; Ram v. 

Infinity Select Ins. (N.D. Cal. 2011) 807 F.Supp.2d 843, 857-859 [insurance company 

denied plaintiff’s vehicle theft claim and the insured’s failure to answer material 

questions at examination under oath voided the insurance contract].) 

The Wesslers assert that tolling in the present situation is consistent with the 

principles articulated in Prudential, supra, 51 Cal.3d 674; we disagree. The court in 

Prudential pointed out that equitable tolling was most frequently applied in California in 

cases where the plaintiff first filed a claim before an administrative agency and then filed 

a claim in the court. In such situations, “courts have held the policy underlying the 

statute of limitations—prompt notice to permit complete and adequate defense—has been 

satisfied and that the period should be tolled in equity to preserve the plaintiff’s claim. 

[Citations.] [¶] One commentator has called it ‘unconscionable’ to permit the limitation 

period to run while the insured is pursuing its rights in the claims process.” (Id. at 

p. 690.)

Here, the Wesslers were not pursuing their rights but were refusing to provide 

information relevant to Mid-Century’s investigation of their claim. The Wesslers argue 

that they were forced to choose between cooperating with Mid-Century or asserting their 

Fifth Amendment rights,4 but we reject this claim. As Mid-Century points out in its brief, 

the Wesslers could have filed their lawsuit and then sought a stay or protective order to 

 

4 Mid-Century argues that the Wesslers’ lack of cooperation went beyond 

asserting their Fifth Amendment rights, as they refused to submit a proof of loss form.
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prevent Mid-Century from being able to compel them to disclose incriminating 

information while the criminal action was pending or they could have asserted their Fifth 

Amendment rights in response to discovery. More significantly, our Supreme Court has 

clearly stated that a claimant must comply with an insurance policy’s requirement to 

submit to an examination under oath and is not justified in invoking his or her Fifth 

Amendment right against self-incrimination because of pending criminal charges against

the claimant. (Brizuela v. CalFarm Ins. Co., supra, 116 Cal.App.4th at p. 587, citing 

Hickman, supra, 184 Cal. at p. 534.) Tolling the statute of limitations during a criminal 

investigation of the claimant is contrary to the Supreme Court’s holding in Hickman. 

The rationale for tolling underlying Prudential, supra, 51 Cal.3d 674 does not 

apply here. The court in Prudential emphasized that tolling during the insurance 

company’s investigation of the claim facilitates the effective functioning of the claims 

process by not requiring the insured to sue prior to the completion of the insurance 

company’s investigation and requiring the insurance company to investigate “without 

later invoking a technical rule that often results in an unfair forfeiture of policy

benefits[.]” (Id. at p. 692.) Tolling in this situation furthers the “policy of encouraging 

settlement between insurers and insureds . . . .” (Ibid.) In contrast, the tolling rule 

advocated by the Wesslers would bring the entire process to a halt, and would hamper the 

insurance company’s ability to garner all the relevant information. (See Singh v. Allstate 

Ins. Co. (1998) 63 Cal.App.4th 135, 141-142 [policy reasons for equitable tolling

includes encouraging the insurer’s diligent investigation].)

Finally, this is not a situation where fundamental fairness favors the Wesslers. 

They were repeatedly apprised of the one-year statute of limitations. They had decided 

by April 2012, which was within the statute of limitations period, that they were going to 

pursue legal action against Mid-Century. This is a situation where the claimants were 

dilatory; they waited until after the statute of limitations had expired to file their lawsuit. 

This case does not warrant applying a second period of equitable tolling. 

The statute of limitations bars the Wesslers’ breach of contract claim. The 

Wesslers’ second cause of action for declaratory relief sought a judicial determination of 
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their rights under the policy. Since it was derivative of the breach of contract cause of 

action, the trial court correctly granted summary judgment against this cause of action.

5 

Accordingly, we affirm the trial court’s grant of summary judgment against the Wesslers’ 

complaint.6 

DISPOSITION

The judgment is affirmed. The Wesslers are to pay the costs of appeal

_________________________

Kline, P.J.

We concur:

_________________________

Stewart, J.

_________________________

Miller, J.

 

5 The Wesslers contend that the trial court erred because it ruled that even if the 

statute of limitations were tolled, the Wesslers would not have been covered because the 

policy excluded coverage for loss or damage from a criminal act committed by or at the 

direction of any insured. The Wesslers assert that this statement is incorrect because the 

criminal act exclusion had to be a felony and Richard pled no contest to a misdemeanor. 

We need not consider whether the exclusion in the policy applied to felonies and 

not misdemeanors because the trial court correctly found that the statute of limitations 

barred the Wesslers’ claims. (See fn. 1, ante.) An appellate court will sustain a summary 

judgment if the trial court’s decision is “ ‘ “right upon any theory of the law applicable to 

the case[,] regardless of the considerations which may have moved the trial court to 

its” ’ ” ruling. (See Folberg v. Clara G.R. Kinney Co. (1980) 104 Cal.App.3d 136, 140.) 

6 We need not address Mid-Century’s argument that an independent basis for 

affirming the summary judgment is that the Wesslers materially failed to cooperate in 

Mid-Century’s investigation of their claim, which was a condition precedent.