Source: http://www.cabfinancial.com/index.php?option=com_content&view=article&id=1610:christopher-v-residence-mut-ins-co&catid=137:volume-14-edition-4-cases&Itemid=25
Timestamp: 2013-06-20 09:42:04
Document Index: 195365793

Matched Legal Cases: ['§ 425', '§ 657', '§ 425', '§ 425', '§ 425', '§ 425', '§ 425', '§ 425']

Christopher v. Residence Mut. Ins. Co. | Central Analysis Bureau, Inc. - Know Your Insureds
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Christopher v. Residence Mut. Ins. Co.
Wednesday, 27 April 2011 07:25	Court of Appeal, Second District, Division 7, California.
Robert CHRISTOPHER et al., Plaintiffs and Respondents,
RESIDENCE MUTUAL INSURANCE COMPANY et al., Defendants and Appellants.
No. B223849.
(Los Angeles County Super. Ct. No. BC429770).
Defendants Residence Mutual Insurance Company and Western Mutual Insurance Company appeal from an order denying their anti-SLAPP (Code Civ. Proc., § 425.16) against plaintiffs Robert Christopher and Patricia Freiling. We affirm the order in part and vacate it in part.
A truck speeding downhill on a road in the Hollywood Hills overturned and crashed into the home of plaintiffs Robert Christopher (Christopher) and Patricia Freiling (Freiling) on January 17, 2008. Christopher and Freiling were inside the home at the time. The impact ignited a fire in the home. Although plaintiffs were briefly trapped in the burning home, they eventually escaped through a bedroom window.
At the time, Christopher had a homeowners insurance policy issued by defendants Residence Mutual Insurance Company (Residence Mutual) and Western Mutual Insurance Company (Western Mutual). Christopher's policy included Coverage A—Dwelling, for $165,000. Residence Mutual had reserves under Coverage A of $163,015.07 but claimed to have paid only $138,034.73 to Christopher. Defendants used $6,920 of that amount to pay the structural engineer defendants hired to investigate the damage to the home on their behalf.
The policy included Coverage B—Other Structures, for $11,000. Defendants paid $8,518.84 under Coverage B.
Christopher obtained an estimate for restoration of the dwelling and other structures in the sum of $434,942. This amount far exceeded policy limits under Coverages A and B.
Christopher's policy also included Coverage C—Personal Property, for $55,000. On the day of the accident, defendants' representative presented to Christopher a contract for storage and evaluation of the loss of personal property with Accurate Construction (Accurate). Christopher signed it when the representative told him that he needed to do so immediately. Then Accurate packed the personal property. Accurate charged on a per box basis but packed each box only about 10 percent full. Subsequently, without notice to or consent from Christopher, Accurate had the personal property loss valued by the spouse of defendants' primary adjustor for Christopher's claim.
According to defendants' records, defendants assigned the Christopher claim to Accurate. Accurate's charges totaled $18,966.25 and were paid from Coverage C. In addition, defendants designated the facility for storage of the boxes, but Christopher was required to pay $10,000 for the storage because the applicable benefits under Coverage C had already been depleted by the payment to Accurate.
According to Christopher's calculations, defendants failed to pay him at least an additional $49,522.98 in benefits owed to him.
On October 7, 2008, plaintiffs filed suit against the trucking company owner, Jose Antonio Salmeron, and other third-party tortfeasors they alleged were responsible for the accident (Salmeron action). Plaintiffs sought damages not only for property damage but also personal injuries and emotional distress suffered by Christopher and Freiling.
Christopher v. Salmeron (Super.Ct.L.A.County, 2010, No. BC399524).
On January 21, 2009, Residence Mutual filed a complaint as “plaintiff-in-intervention.” It alleged that Christopher, their insured, suffered property damage and personal injuries in the accident caused by the third-party tortfeasors' negligence and that, as a result, Residence Mutual had “expended the sum of $224,533.57 to date pursuant to the terms of the Insured's homeowners' insurance policy.” The sum expended did not include monies for emotional distress suffered by Christopher, in that his policy did not cover emotional distress damages. Residence Mutual sought the sum expended “plus unknown additional expenditures for property damage,” costs and attorney's fees.
We refer to only Residence Mutual solely because it was the named intervener. The complaint-in-intervention did not mention Western Mutual, but plaintiffs contend that Residence Mutual was acting on behalf of itself and Western Mutual. Plaintiffs named both companies as defendants and alleged that on the day of the accident, they were insured by the two defendants. While defendants maintain that only Residence Mutual was the insurer, the issue had not been resolved in the trial court at the time the court ruled on the anti-SLAPP motion.
In pretrial and trial proceedings in Salmeron, defendants purposely employed litigation tactics aimed at decreasing the amount of any damages ultimately awarded to plaintiffs in order to assure the tortfeasors would have financial resources to satisfy Residence Mutual's prayer for damages.
Defendants admitted they purposely opposed Christopher's claims for damages against the Salmeron tortfeasors. Defendants' anti-SLAPP motion papers included a statement that, because the third-party tortfeasors had “limited liability insurance, ... [t]o have a practical recovery, Residence Mutual ... contest[ed][the] amounts of property damage and the emotional distress claim” made by plaintiffs against the third parties. In another court document, defendants stated that, because they believed there was “a limited amount of money available from the [third-party] defendants ..., it made perfect sense for [defendants] to challenge ... many of Christopher's claimed damages.”
Residence Mutual claimed that it reached a settlement agreement in connection with a pretrial mediation, but the agreement was not signed by Christopher. The unsigned agreement provided for the trucking company tortfeasor to pay Residence Mutual the sum of $200,000 in exchange for Resident Mutual's release and dismissal of its complaint-in-intervention with prejudice. It also provided Residential Mutual would pay Christopher $24,980.34 in exchange for Christopher's release.
Residence Mutual moved on behalf of itself and the trucking company to exclude Christopher's construction expert from testifying regarding the restoration estimate he did for Christopher. On cross-examination after the court denied the motion, Residence Mutual's attorney “vigorously contested the ... expert on the estimate of damages.” Residence Mutual moved to exclude plaintiffs' claims for emotional distress damages resulting from the property damage rather than from any personal injuries.
On January 15, 2010, the Salmeron jury returned a verdict in favor of plaintiffs, finding liability as to all third-party tortfeasors and apportioning fault among them. The jury awarded to Christopher economic damages of $600,000 and noneconomic damages of $280,000; it awarded to Freiling economic damages of $75,000 and noneconomic damages of $280,000. Judgment was entered on February 8, 2010.
The trial court denied defendants' subsequent motion for a new trial. Defendants claimed the awarded noneconomic damages were excessive (Code Civ. Proc., § 657, para. (5)). They also claimed error based upon the court's refusal to modify the verdict form to specify how Residence Mutual would be paid. In the instant appeal, defendants represent that some of their claims are still pending before the Salmeron trial court, in that the court still has not determined how much of the damages for the residence and property will go to Residence Mutual.
On January 13, 2010, plaintiffs filed the instant lawsuit against defendants. In the first cause of action, breach of contract for failure to pay benefits, plaintiffs alleged defendants breached the terms of the homeowners insurance policy by failing to pay the policy limits and by forcing plaintiffs to institute the litigation. The second cause of action alleged defendants breached the implied covenant of good faith and fair dealing by “unreasonably withholding benefits due under the policy, by failing to conduct a fair and objective claims investigation, by intervening in [plaintiffs'] action against third parties and gratuitously seeking to damage [plaintiffs'] claims, by failing to treat Plaintiffs and all other similarly situated insureds consistently, by failing to pay policy benefits, by unreasonably delaying payments and the final resolution of the claim, [ ] by other conduct ...,” and by causing plaintiffs to have to expend attorney's fees and costs “incurred to compel the payment of benefits due under the insurance policy.” The third cause of action alleged that the foregoing conduct by defendants constituted unfair business practices in violation of Business and Professions Code section 17200 et seq.
Shortly after filing a demurrer and a motion to strike portions of the complaint, defendants filed an anti-SLAPP motion, i.e., a special motion to strike plaintiffs' complaint pursuant to Code of Civil Procedure section 425.16 (section 425.16). On March 29, 2010, the trial court sustained the demurrer as to Freiling on all causes of action without leave to amend. The court sustained the demurrer as to Christopher on the third cause of action with leave to amend and overruled the demurrer on the other causes of action.
A SLAPP (strategic lawsuit against public participation) is a lawsuit containing one or more causes of action “against a person arising from any act of that person in furtherance of the person's right of petition or free speech under the United States Constitution or the California Constitution in connection with a public issue.” (§ 425.16, subd. (b)(1); Briggs v. Eden Council for Hope & Opportunity (1999) 19 Cal.4th 1106, 1109, fn. 1.) Section 425.16, the anti-SLAPP statute, authorizes and sets forth requirements for a special motion to strike a SLAPP cause of action. ( Rusheen v. Cohen (2006) 37 Cal.4th 1048, 1055–1056.)
The court did not enter its judgment of dismissal as to Freiling until after ruling on the anti-SLAPP motion. However, the anti-SLAPP motion proceeded only as to Christopher.
Christopher filed his opposition to the anti-SLAPP motion, including his supporting declaration. He also filed the declaration of his Salmeron trial counsel, Pat Harris, with records of defendants' payments under the policy as exhibits.
At the anti-SLAPP motion hearing on April 9, 2009, the trial court gave its tentative ruling denying the motion, which the court ultimately adopted as its final decision. The court ruled that the anti-SLAPP statute did not apply to the first cause of action for breach of contract. The court found that defendants made the required showing that the second and third causes of action for breach of the implied covenant of good faith and fair dealing and unfair business practices arose from defendants' conduct in furtherance of their rights of petition and free speech, in that they were partially based on defendants' conduct as an intervener in Salmeron.
The court denied the motion as to the second and third causes of action, however, on the basis of the court's determination that Christopher made the required showing of a probability of prevailing on the causes of action. In making the determination, the trial court ruled that the litigation privilege under Civil Code section 47, subdivision (b), did not bar the claims in the second and third causes of action. In its written decision, the court stated that Christopher's “claim is based on Defendants' course of conduct to further their own economic interests at the expense of Plaintiff. See White v. Western Title Ins. Co. (1985) 40 Cal.3d 870, 888 ...,” and, as White held, the litigation privilege does not apply to bar the use of a communication in a cause of action “based upon an underlying course of conduct evidenced by the communication.”
According to the trial court, as to the second cause of action for breach of the implied covenant of good faith and fair dealing, Christopher showed that the restoration estimate he obtained far exceeded the policy limits, and defendants had not paid out the policy limits but rather had “low-balled” his claim. In addition, the court found that Christopher showed that defendants reduced the partial benefits they paid by costs for their own structural engineer's investigation and for the packing of plaintiff's personal property by a company to which defendants assigned plaintiff's claim for such services. The court also acknowledged that “Defendants admit that they took an adverse position to the insured by contesting Plaintiff's claims of damages in order to preserve the availability of the third party liability insurance.”
As to the third cause of action based on unfair business practices, the trial court acknowledged that previously, it sustained defendants' demurrer with leave to amend and plaintiff had not yet amended the complaint. The court found that the complaint could be amended to plead a cause of action for, and that Christopher submitted sufficient evidence to establish both unfair and fraudulent business practices.
A. Anti–SLAPP Principles and Standard of Review
On appeal, we review the denial of an anti-SLAPP motion de novo, employing the same two-step process as the trial court. ( Rusheen v. Cohen, supra, 37 Cal.4th at pp. 1055–1056.) In the first step, we determine if defendants made a threshold showing that plaintiff's cause of action arises from acts of defendants which are protected activities as defined in section 425.16. ( Equilon Enterprises v. Consumer Cause, Inc. (2002) 29 Cal.4th 53, 67.) A protected activity includes, inter alia, “any written or oral statement or writing made before ... any ... official proceeding authorized by law” or “made in connection with an issue under consideration or review by ... any ... official proceeding authorized by law.” (§ 425.16, subd. (e).) If defendants have met their burden, we proceed with the second step of the process to determine if plaintiff has demonstrated a probability of prevailing on any claim in the cause of action. (Equilon Enterprises, supra, at p. 67; Mann v. Quality Old Time Service, Inc. (2004) 120 Cal.App.4th 90, 106.) If any such claim has “even minimal merit,” we must affirm the denial of defendants' anti-SLAPP motion as to the cause of action. (Mann, supra, at p. 106.)
The anti-SLAPP statute provides that “[a] cause of action against a person arising from any act of that person in furtherance of the person's right of petition or free speech under the United States Constitution or the California Constitution in connection with a public issue shall be subject to a special motion to strike, unless the court determines that the plaintiff has established that there is a probability that the plaintiff will prevail on the claim.” (§ 425.16, subd. (b)(1).)
In making our determinations, we consider “the pleadings, and supporting and opposing affidavits stating the facts upon which the liability or defense is based.” (§ 425.16, subd. (b)(2); Equilon Enterprises v. Consumer Cause, Inc., supra, 29 Cal.4th at p. 67.) We must accept as true the evidence favorable to plaintiff, and we do not weigh the evidence or determine credibility. ( Blanchard v. DIRECTV, Inc. (2004) 123 Cal.App.4th 903, 918.)
B. Defendants' Anti–SLAPP Motion
Defendants contend that the trial court should have granted their anti-SLAPP motion primarily on two grounds. First, according to defendants, the only reason Christopher brought the instant lawsuit was to chill defendants' right to petition and right of free speech in litigating the Salmeron action. Thus, they claim, the instant action is precisely the type of lawsuit the Legislature intended to thwart by enacting the anti-SLAPP statute, in that it arose from protected activity.
Second, defendants contend Christopher cannot demonstrate a probability of prevailing on his causes of action because their participation in Salmeron was protected by the absolute litigation privilege in Civil Code section 47, subdivision (b), and Christopher is barred from using it as evidence to support his claims.
1. First Cause of Action—Breach of Contract
Defendants contend that the trial court erred in ruling that the first cause of action, breach of contract, did not arise from protected activity and, therefore, was not subject to the anti-SLAPP statute. They argue that all of Christopher's causes of action, including the first cause of action, arose from protected conduct, in that the “gist” of the complaint was that defendants, as an intervener in the Salmeron action, “ ‘sought to damage Plaintiffs' claims against third parties' and to ‘sabotage’ those claims.” Defendants argue that, while Christopher alleged other conduct, that conduct occurred long before their intervention, and if such conduct were the real reason for the instant suit, “[t]here was no reason to wait until January 2010” to file it. Defendants' arguments miss the mark.
Defendants were not required to show that plaintiffs brought the instant action, or any of the three causes of action, primarily to chill defendants' First Amendment rights with respect to their participation in Salmeron. A plaintiff's subjective intent is irrelevant to the determination of whether section 425.16 applies. ( Navellier v. Sletten (2002) 29 Cal.4th 82, 88; Fox Searchlight Pictures, Inc. v. Paladino (2001) 89 Cal.App.4th 294, 305–306.)
Rather, in determining whether a cause of action arises from protected activity, “the critical point is whether the plaintiff's cause of action itself was based on an act in furtherance of the defendant's right of petition or free speech. [Citations.]” ( City of Cotati v. Cashman (2002) 29 Cal.4th 69, 78, italics omitted.) The defendant's act must have been an act in furtherance of the right of petition or free speech. (Ibid.) A cause of action does not “arise from” protected activity simply because the underlying complaint was filed after the defendant engaged in protected activity or even if, arguably, the protected activity triggered the cause of action or the lawsuit as a whole. ( Navellier v. Sletten, supra, 29 Cal.4th at p. 89; City of Cotati, supra, at pp. 76–78.)
To determine the act or acts upon which Christopher's first cause of action was based, we look to the allegations. Christopher alleged that “[d]efendants breached the terms of the contract by failing to fully pay monies due under the contract and by forcing Plaintiffs to institute this litigation.” Thus, defendants' act was failure to pay all the benefits owed under the policy. Failure to pay money due under a contract between private parties bears no reasonable resemblance to an act “in furtherance of [defendants'] right of petition or free speech ... in connection with a public issue.” (§ 425.16, subd. (b)(1).)
Defendants assert that, even if the first cause of action arises in part from non-protected activity, the fact that it also arises in part from protected activity is sufficient to render the cause of action subject to an anti-SLAPP motion. They point out that “[t]he apparently unanimous conclusion of published appellate cases is that ‘where a cause of action alleges both protected and unprotected activity, the cause of action will be subject to section 425.16 unless the protected conduct is “merely incidental” to the unprotected conduct.’ [Citations.]” ( Peregrine Funding, Inc. v. Sheppard Mullin Richter & Hampton LLP (2005) 133 Cal.App.4th 658, 672.)
Defendants' litigation tactics during the intervention may serve as evidence that defendants' failure to pay was in bad faith, but that issue is incidental to whether defendants paid plaintiff the full amount required by the policy. Thus, even if defendants' intervention may be deemed to be a protected activity under section 425.16, its role in the first cause of action, if any, is “ ‘ “merely incidental” to the unprotected conduct.’ “ ( Peregrine Funding, Inc. v. Sheppard Mullin Richter & Hampton LLP, supra, 133 Cal.App.4th at p. 672.) The anti-SLAPP statute thus does not apply to the first cause of action and the trial court properly denied defendants' motion as to that cause of action. (§ 425.16, subd. (b)(1); Peregrine Funding, Inc., supra, at p. 672.)
2. Second Cause of Action—Breach of Implied Covenant of Good Faith and Fair Dealing
The trial court found that defendants met their burden to show that the second cause of action arose from protected activity. With regard to the second step of the anti-SLAPP process, however, defendants contend that the trial court erred in ruling plaintiff had made the requisite showing of a probability of prevailing.
“A covenant of good faith and fair dealing is implied in every insurance contract.” ( White v. Western Title Ins. Co., supra, 40 Cal.3d at p. 885.) The covenant requires the insurer and the insured “to refrain from doing anything to injure the right of the other to receive the benefits of the agreement.” ( Egan v. Mutual of Omaha Ins. Co. (1979) 24 Cal.3d 809, 818.) “[W]hen benefits are due an insured, ‘delayed payment[,] ... inadequate or tardy investigations, oppressive conduct by claims adjusters seeking to reduce the amounts legitimately payable and numerous other tactics may breach the implied covenant because’ they frustrate the insured's right to receive the benefits of the contract in ‘prompt compensation for losses.’ [Citation.]” ( Waller v. Truck Ins. Exchange, Inc. (1995) 11 Cal.4th 1, 36; see, e.g., Silberg v. California Life Ins. Co. (1974) 11 Cal.3d 452, 461–462; Chateau Chamberay Homeowners Assn. v. Associated Internat. Ins. Co. (2001) 90 Cal.App.4th 335, 348–349.)
Defendants mistakenly claim that Christopher made no showing of a breach of the insurance contract, and there can be no liability for bad faith without a breach of contract. When, as in this case, it is undisputed that the insured's claim is for a covered loss, the insured may recover for the insurer's bad faith conduct “whether or not it also constitutes a breach of a consensual contract term.” ( Careau & Co. v. Security Pacific Business Credit, Inc. (1990) 222 Cal.App.3d 1371, 1395.)
Defendants' primary contention, however, is that the litigation privilege bars Christopher's use of evidence of Residence Mutual's trial tactics in Salmeron to meet his burden of demonstrating a probability of prevailing on the second cause of action. Defendants contend the trial court erred in ruling the privilege did not apply. We disagree.
Civil Code section 47 provides that “[a] privileged publication or broadcast is one made: [¶] ... [¶] (b) in any ... (2) judicial proceeding [or] (3) in any other official proceeding authorized by law ...,” subject to certain to specified limitations not relevant here. “The usual formulation is that the [litigation] privilege applies to any communication (1) made in judicial or quasi-judicial proceedings; (2) by litigants or other participants authorized by law; (3) to achieve the objects of the litigation; and (4) that have some connection or logical relation to the action.” ( Silberg v. Anderson (1990) 50 Cal.3d 205, 212.) The principal purpose of the litigation privilege is to afford litigants and witnesses “the utmost freedom of access to the courts without fear of being harassed subsequently by derivative tort actions.” (Id. at p. 213.) The litigation privilege may, in effect, serve as a substantive defense to a plaintiff's evidence of the probability of prevailing as required in the second step of anti-SLAPP analysis. ( Flatley v. Mauro (2006) 39 Cal.4th 299, 323.)
Defendants claim that the trial court mistakenly relied on White v. Western Title Ins. Co., supra, 40 Cal.3d 870 to find that their litigation tactics in Salmeron were evidence of a course of bad faith conduct and, thus, were not protected by the litigation privilege. (Id. at pp. 885, 889.) Defendants assert that, in the subsequent decision in Silberg v. Anderson, supra, 50 Cal.3d 205, the Supreme Court broadened its interpretation of the scope of the litigation privilege to apply to all litigation. According to defendants, “[t]his obviously extends to [a litigant's] argument to defeat or limit another litigant's claims,” as was the case in California Physicians' Service v. Superior Court (1992) 9 Cal.App.4th 1321, 1330 and footnote 7. Defendants are correct in their assertions to an extent, but defendants have not gone far enough in their analysis. In White, the Supreme Court explained that determination of whether the litigation privilege applies requires inquiry beyond whether the questioned action was a communication in the course of a judicial proceeding. The White court drew “a careful distinction between a cause of action based squarely on a privileged communication ... and one based upon an underlying course of conduct evidenced by the communication.” ( White v. Western Title Ins. Co., supra, 40 Cal.3d at p. 888.) According to the court, “[i]t is obvious ... that even if liability cannot be founded upon a judicial communication, it can be proved by such a communication....” (Ibid.) The court further explained that an “entire pattern of conduct” can be sufficient evidence “to permit the jury to find a breach of the covenant of good faith and fair dealing.” (Id. at p. 889.)
The analysis and holding in California Physicians' Service v. Superior Court, supra, 9 Cal.App.4th 1321 do not support the application of the litigation privilege to evidence of defendants' trial tactics. In California Physicians' Service, the plaintiffs used the defendant's initial responsive pleading as the basis for a supplemental complaint in the same action. The court held that the litigation privilege barred the supplemental causes of action. The court distinguished the case from White's holding that the litigation privilege did not apply when the communications at issue were utilized as evidence of the prior course of tortious conduct, rather than used as the basis for a cause of action. The court stated: “The effort here [in California Physicians' Service ] is not to use trial tactics as evidence of prior bad faith, but to mount a new cause of action for severable damages on the theory of an action for bad faith defense.” (Id. at p. 1327.) In the instant case, Christopher is not claiming that defendants' litigation tactics in Salmeron warrant additional, severable damages for bad faith. Rather, the litigation tactics are one more piece of evidence of defendants' bad faith conduct in performing their contractual duty to pay policy benefits to Christopher.
Also contrary to defendants' claim, Silberg v. Anderson, supra, 50 Cal.3d 205 is not inconsistent with White. The Supreme Court stated: “Although originally enacted with reference to defamation [citations], the [litigation] privilege is now held applicable to any communication ... [citations], and all torts except malicious prosecution. [Citations.]” (Id. at p. 212.) The plaintiffs in White advanced a similar theory that liability cannot be based upon a communication in a judicial proceeding, supporting their argument with decisions which had extended the absolute privilege beyond defamation to bar other types of actions. ( White v. Western Title Ins. Co., supra, 40 Cal.3d at pp. 887–888.) The White court acknowledged that the litigation privilege barred a cause of action “based squarely on” a judicial communication. But the court held that the litigation privilege did not bar the plaintiffs' use of the defendant's judicial communications to “show that defendant was not evaluating and seeking to resolve their claim fairly and in good faith.” (Id . at p. 888.)
As defendants note, Silberg disapproved the use of an “interest of justice” standard for determining the litigation privilege did not apply and the cases that had used the standard. ( Silberg v. Anderson, supra, 50 Cal.3d at pp. 212–213.) However, Silberg did not reject or otherwise disapprove the standard applied in White. Silberg did not even cite the White case.
Also defendants point out that, in California Physicians' Service v. Superior Court, supra, 9 Cal.App.4th 1321, the court expressed its “doubt as to the current vitality of White.” (Id. at p. 1328.) Other authority attests, however, to the continuing effectiveness of White. The California Physicians' Service court also acknowledged that, as of September 1992, the “Supreme Court has ... not reexamined White ” and that the “Legislature has apparently recognized the rule established by White, but has not attempted to modify its central principle.” (Id. at p. 1328 & fn. 6.) As recently as 2007, the Supreme Court has acknowledged the “ ‘careful distinction’ “ the court drew in White with respect to the applicability of the litigation privilege. ( Action Apartment Assn., Inc. v. City of Santa Monica (2007) 41 Cal.4th 1232, 1248–1249.)
Defendants point out that the filing of a legal action has been held to be protected by the litigation privilege. ( Action Apartment Assn., Inc. v. City of Santa Monica, supra, 41 Cal.4th at pp. 1248–1249.) They argue that, accordingly, their filing a complaint in intervention is absolutely privileged under Civil Code section 47, subdivision (b), and the privilege applies to all of their participation in the Salmeron litigation. The application of the privilege to the complaint is not the issue here. Rather, the question is whether the litigation privilege bars plaintiff from using as evidence of bad faith the fact that Residence Mutual intentionally used tactics to decrease the amount of damages plaintiffs would recover from the tortfeasors in the Salmeron litigation.
It is undisputed that Residence Mutual had a right to file the complaint. In order to recover subrogated property losses, an insurer may intervene in an insured's lawsuit against third-party tortfeasors. ( Bright v. American Termite Control Co. (1990) 220 Cal.App.3d 1464, 1468.) The purpose of permitting intervention is “ ‘to avoid delay and multiplicity of actions when claims are the same or substantially similar and arise out of the same facts.’ “ (Id. at p. 1469.) Although an intervener is theoretically independent as a separate party, in the context of an insurer's intervention, there is a “mutuality of interests between the plaintiff [insured] and [the insurer as] the plaintiff in intervention vis-à-vis the defendants.” (Id. at p. 1470.) That Residence Mutual purposely employed litigation tactics against the interests of plaintiff is not only inconsistent with the purposes of intervention but also with Residence Mutual's duty of good faith and fair dealing with respect to plaintiff. “The litigation privilege was never meant to spin out from judicial action a party's performance and course of conduct under a contract.” ( Stacy & Witbeck, Inc. v. City and County of San Francisco (1996) 47 Cal.App.4th 1, 8.)
Other than their global argument on the applicability of the litigation privilege, defendants offer only brief conclusory statements to challenge the trial court's ruling that plaintiff showed a probability of prevailing on his second cause of action for breach of the implied covenant of good faith and fair dealing. They offer no citations to supporting authority or to the record in either their opening brief or their reply brief with respect to their additional arguments. When an appellant raises a contention, “but fails to support it with reasoned argument and citations to authority, we treat the point as waived.” ( Badie v. Bank of America (1998) 67 Cal.App.4th 779, 784–785.) Therefore, we treat defendants' additional conclusory contentions as waived.
In any event, we agree with the trial court that Christopher made the requisite showing of probability of prevailing on his second cause of action by presenting evidence of a course of bad faith conduct. Defendants admit they did not pay policy limits, notwithstanding the estimate plaintiff obtained which was well in excess of policy limits. They claimed, in part, that their policy was to withhold some benefits until the insured completed restoration of the property. This claim is similar to the insurer's excuse for delayed payment which was rejected in Silberg. (Silberg v. California Life Ins. Co., supra, 11 Cal.3d at pp. 461–462.) According to Christopher, defendants charged costs of their own, supposedly independent investigation of Christopher's claim, against Christopher's policy benefits and had part of the claim evaluated by a person married to the adjustor for Christopher's claim. Similar conduct was cited as bad faith conduct by an insurer in Chateau Chamberay Homeowners Assn. v. Associated Internat. Ins. Co., supra, 90 Cal.App.4th at pages 348–349.
The fact that defendants took a position and engaged in related litigation tactics for the admitted purpose of decreasing Christopher's recovery from the third-party tortfeasors in Salmeron is simply one more act by defendants that is inconsistent with their duty of good faith and fair dealing to Christopher. “The implied promise [of good faith and fair dealing] requires each contracting party to refrain from doing anything to injure the right of the other to receive the benefits of the agreement. [Citations.]” ( Egan v. Mutual of Omaha Ins. Co., supra, 24 Cal.3d at p. 818.) The insurer “must give at least as much consideration to the [insured's] interests as it does to its own.” (Id. at pp. 818–819; see also Waller v. Truck Insurance Exchange, Inc., supra, 11 Cal.4th at p. 36.) “[T]he contractual relationship between insurer and the insured does not terminate with commencement of litigation,” but rather the insurer's contractual duties to the insured and its obligation to perform them fairly and in good faith remain in effect. ( White v. Western Title Ins. Co., supra, 40 Cal.3d at p. 885.) For example, where an insurer has notice of the insured's intent to pursue the insured's rights against the tortfeasor, the insurer has “a duty of good faith and fair dealing, by virtue of its fiduciary relationship, to do nothing to interfere with those rights,” including to refrain from employing litigation tactics injurious to the insured's rights to recover from the tortfeasor. ( Barney v. Aetna Casualty & Surety Co. (1986) 185 Cal.App.3d 966, 981; see also Rothrock v. Ohio Farmers Ins. Co. (1965) 233 Cal.App.2d 616, 622–623.)
Assuming these facts proffered by Christopher are true, as we must on review of an anti-SLAPP motion, there is a probability that a trier of fact would find that defendants' course of conduct has frustrated Christopher's “right to receive the benefits of the contract in ‘prompt compensation for losses.’ “ ( Waller v. Truck Ins. Exchange, Inc., supra, 11 Cal.4th at p. 36.) Given that Christopher has shown that his claims have at least “minimal merit,” the trial court properly denied the anti-SLAPP motion as to the second cause of action. ( Mann v. Quality Old Time Service, Inc., supra, 120 Cal.App.4th at p. 106.)
3. Third Cause of Action—Unfair Business Practices
Defendants assert that there was no viable third cause of action for the trial court to rule upon, in that the court had previously granted defendants' demurrer to the third cause of action with leave to amend and Christopher had not yet submitted an amended version. We agree with defendants. The trial court had no jurisdiction to act with regard to any third cause of action. Therefore, defendants' anti-SLAPP motion could not properly be either granted or denied as to the third cause of action. The trial court's denial of defendants' anti-SLAPP motion as to the third cause of action must be vacated.
On March 29, 2010, the trial court had sustained defendants' demurrer to plaintiffs' third cause of action, unfair business practices under Business and Professions Code section 17200 et seq., with leave to amend. In its written decision on the anti-SLAPP motion, the trial court noted that fact, as well as the fact that Christopher had not yet amended the complaint, in the court's analysis of Christopher's probability of prevailing on the third cause of action. The trial court denied defendants' anti-SLAPP motion to the ineffective third cause of action on April 9, but Christopher did not file an amended complaint until 10 days later.
The order is affirmed as to the first and second causes of action. The order is vacated as to the third cause of action. Plaintiffs shall recover their costs on appeal.