Case Name: PROVIDENT LIFE AND ACCIDENT INSURANCE COMPANY, a corporation, Plaintiff-Appellee, v. Ravindra R. CHANDRASENA, a.k.a., Randy Chandrasena, Defendant-Appellee
Court: United States Court of Appeals for the Ninth Circuit
Jurisdiction: United States
Decision Date: 2001-11-28
Citations: 23 F. App'x 745
Docket Number: No. 99-56513; D.C. No. CV-98-3138-NM (Mcx)
Parties: PROVIDENT LIFE AND ACCIDENT INSURANCE COMPANY, a corporation, Plaintiff-Appellee, v. Ravindra R. CHANDRASENA, a.k.a., Randy Chandrasena, Defendant-Appellee.
Judges: 
Reporter: West's Federal Appendix
Volume: 23
Pages: 745–747

Head Matter:
PROVIDENT LIFE AND ACCIDENT INSURANCE COMPANY, a corporation, Plaintiff-Appellee, v. Ravindra R. CHANDRASENA, a.k.a., Randy Chandrasena, Defendant-Appellee.
No. 99-56513.
D.C. No. CV-98-3138-NM (Mcx).
United States Court of Appeals, Ninth Circuit.
Argued and Submitted Nov. 9, 2001.
Decided Nov. 28, 2001.
Silverman, Circuit Judge, filed dissenting opinion.
Before PREGERSON, REINHARDT and SILVERMAN, Circuit Judges.

Opinion:
MEMORANDUM
Chandrasena appeals the district court's grant of summary judgment rescinding his Provident Life insurance policies on the ground that he fraudulently misrepresented his income on his insurance application. There is a genuine issue of material fact with respect to the following: (1) whether Chandrasena had the requisite fraudulent intent and (2) whether Provident Life justifiably relied upon Chandrasena's misstatements with respect to his income.
In order to prevail in its action, Provident Life is required to show that Chandrasena's misstatements were made with knowledge and with intent to defraud. Fraker v. Sentry Life Ins. Co., 19 Cal.App.4th 276, 23 Cal.Rptr.2d 372, 377 (1993); Witkin, Summary of California Law § 676 (9th ed.1988). Intent is ordinarily a highly fact-intensive question. Here, there are several pieces of evidence that would indicate that Chandrasena's misstatements were not made with fraudulent intent. For example, neither the application form Chandrasena was asked to till out nor the insurance broker who was assisting Chandrasena made any reference to the particular business expense or class of expenses Provident Life claims he was to have deducted from his reported income. Drawing all inferences in Chandrasena's favor, a genuine issue of material fact exists as to whether he knowingly misstated his income with the intent to defraud Provident Life.
Under California law, the right of insurers to reasonably rely on the representations of an insured is waived when an insurer fails to investigate facts that are "distinctly implied" from other facts. Cohen v. Penn Mutual Life Ins. Co., 48 Cal.2d 720, 312 P.2d 241, 245 (1957). Provident Life was alerted to a possible significant discrepancy with respect to Chandrasena's income when it received the report it had solicited from an outside entity, because the report listed Chandrasena's income as far less than he had reported. Provident Life's subsequent action, or lack of action, raises a genuine issue of material fact as to whether it waived its right to reasonably rely on Chandrasena's representations.
REVERSED and REMANDED for further proceedings consistent with this disposition.
This disposition is not appropriate for publication and may not be cited to or by the courts of this circuit except as may be provided by 9th Cir. R. 36-3.