Court Opinion

ID: 9750220
Source: CourtListenerOpinion
Date Created: 2023-08-28 14:37:06.90823+00
Date Added: 2024-06-11T07:26:04.683254
License: Public Domain

*291SPENCER, P. J., Concurring and Dissenting.
I concur in the affirmance of the judgment. However, I respectfully dissent from the majority’s reasoning and would affirm on a different basis.
Insurance Code section 11580, subdivision (b)(2) (hereinafter section 11580(b)(2)), provides a liability insurance policy may not be issued unless it contains “[a] provision that whenever judgment is secured against the insured ... in an action based upon bodily injury, death, or property damage, then an action may be brought against the insurer on the policy and subject to its terms and limitations, by such judgment creditor to recover on the judgment.” Defendant argues “judgment,” as used in the section, means a final judgment, one upheld after any appeals in the case, rather than a judgment entered by the trial court but subject to any pending appeals.
In the construction of statutes, the primary goal of the court is to ascertain and give effect to the intent of the Legislature. (Code Civ. Proc., § 1859; Kimmel v. Goland (1990) 51 Cal.3d 202, 208 [271 Cal.Rptr. 191, 793 P.2d 524].) The court looks first to the language of the statute; if clear and unambiguous, the court will give effect to its plain meaning. (51 Cal.3d at pp. 208-209; see also Rojo v. Kliger (1990) 52 Cal.3d 65, 73 [276 Cal.Rptr. 130, 801 P.2d 373].) Additionally, in construing a statute the role of the court “is simply to ascertain and declare what is in terms or in substance contained therein, not to insert what has been omitted, or to omit what has been inserted; and where there are several provisions or particulars, such a construction is, if possible, to be adopted as will give effect to all.” (Code Civ. Proc., § 1858; see People v. White (1954) 122 Cal.App.2d 551, 554 [265 P.2d 115].)
Where the court must construe the statute, it “ ‘turns first to the words themselves for the answer.’ [Citation.]” (Moyer v. Workmen’s Comp. Appeals Bd. (1973) 10 Cal.3d 222, 230 [110 Cal.Rptr. 144, 514 P.2d 1224].) The words used should be given their usual, ordinary meanings and, if possible, each word and phrase should be given significance. (Ibid.) The words used “must be construed in context, and statutes must be harmonized, both internally and with each other, to the extent possible.” (California Mfrs. Assn. v. Public Utilities Com. (1979) 24 Cal.3d 836, 844 [157 Cal.Rptr. 676, 598 P.2d 836].) Thus, where a word or phrase has been given a particular meaning in one part of the law, it should be given the same meaning in other parts of the law. (Stillwell v. State Bar (1946) 29 Cal.2d 119, 123 [173 P.2d *292313]; City of Sacramento v. State of California (1984) 156 Cal.App.3d 182, 197 [203 Cal.Rptr. 258].)
This court previously construed the word “judgment” as used in Code of Civil Procedure section 877. In Southern Cal. White Trucks v. Teresinski (1987) 190 Cal.App.3d 1393, 1405 [236 Cal.Rptr. 159], this court stated: “While ‘judgment’ is defined by [Code of Civil Procedure] section 577 as ‘the final determination of the rights of the parties in an action or proceeding,’ the term is ‘meaningless unless qualified by context, i.e., a judgment may be final, but modifiable at the trial level, or final for the purpose of appeal.’ [Citation.] The finality of the judgment is determined by the circumstances present at the time it is entered; it is not determined on the basis of hindsight after further proceedings have established it did or did not provide the proper relief to the parties. [Citation.] Thus, the judgment of the trial court is a ‘judgment’ within the meaning of section 577 [citation]; the possibility of further challenge does not render it any less a ‘judgment.’ ”
A like construction of “judgment” in section 11580(b)(2) to mean trial court judgment would be both internally consistent and consistent with other parts of the law. (Stillwell v. State Bar, supra, 29 Cal.2d at p. 123; City of Sacramento v. State of California, supra, 156 Cal.App.3d at p. 197.) Section 11580(b)(2) provides “that whenever judgment is secured . . . , then an action may be brought against the insurer on the policy ... by such judgment creditor to recover on the judgment.” There is no provision for delaying the action pending appeal of the judgment.
Similarly, pursuant to the Enforcement of Judgments Law (Code Civ. Proc., § 680.010 et seq.), a “ ‘[j]udgment’ means a judgment. . . entered in a court of this state.” (Id., § 680.230.) A “ ‘judgment creditor’ means the person in whose favor a judgment is rendered or, if there is an assignee of record, means the assignee of record.” (Id., § 680.240.) “Except as otherwise provided by statute or in the judgment, a judgment is enforceable . . . upon entry.” (Id., § 683.010.) The Code of Civil Procedure further provides a money judgment entered by the trial court is enforceable even if an appeal is pending, “unless an undertaking is given.” (Id., § 917.1, subd. (a).)
Thus, the general law is that a judgment entered in the trial court is enforceable upon its entry by the judgment creditor, although enforcement may be stayed by the giving of an undertaking. If “judgment” in section 11580(b)(2) is construed to mean a judgment in the trial court, the section provides, consistent with the general law, the judgment is enforceable upon its entry.
Defendant relies on several cases to support its claim “judgment” as used in section 11580(b)(2) means a final judgment following any appeals. The *293majority also cites these cases to support this proposition. In my view, all are inapposite.
Defendant quotes Mathews Cadillac, Inc. v. Phoenix of Hartford Ins. Co. (1979) 90 Cal.App.3d 393, 397 [153 Cal.Rptr. 267] for the proposition: “Where the terms of the indemnity contract, or law of the state, require a judgment against the bankrupt (indemnitee) before direct action against the insurer, no liability accrues as an enforceable claim against the insurer until recovery of a final judgment against the bankrupt. [Citations.]” In Mathews, dismissal of the action against defendant insurer was upheld, but not because an appeal was pending against the bankrupt insured. It was upheld because no judgment was ever entered against the insured. (Id. at pp. 395, 399.)
Defendant also quotes Fireman’s Fund Ins. Co. v. City of Turlock (1985) 170 Cal.App.3d 988, 1004 [216 Cal.Rptr. 796], which states: “Until such time as a final judgment was entered in favor of City and against Watson, no cause of action could be maintained by City against [the insurer] on the policy [pursuant to section 11580(b)(2)], [Citations.] Here, City is attempting to reach Watson’s insurance policy without having first secured a final judgment against Watson. That it cannot do.” As in Mathews, no judgment, in fact, had been entered against the insured, Watson; “[i]ndeed, the record fails to indicate that City has even made a claim against Watson . . . .” (Ibid.)
Laguna Pub. Co. v. Employers Reinsurance Corp. (D.C.Cal. 1985) 617 F.Supp. 271 similarly uses the term “final judgment,” but in that case, too, there was no judgment at all entered against the insured, in that it had been set aside. (At p. 272.) Chamberlin v. City of Los Angeles (1949) 92 Cal.App.2d 330 [206 P.2d 661] also uses the term “final judgment” but involves an action brought against the insured and insurer simultaneously; having not first obtained a judgment against the insured, plaintiff could not maintain an action against the insurer. (At pp. 332-333.)
In Malmgren v. Southwestern Auto. Ins. Co. (1932) 126 Cal.App. 135 [14 P.2d 351], the court noted plaintiff’s “right of action, if any, against [the insurer] for the principal sum of the judgment and costs arose as soon as the judgment became final.” (At p. 139.) It also noted no appeal was taken from the judgment against the insured, and the judgment thereafter became final. (Id. at p. 138.) The case did not discuss the effect an appeal would have had on plaintiffs ability to bring an action against the insurer.
In short, none of the foregoing cases cited by defendant and the majority opinion holds or supports the proposition that an action pursuant to section *29411580(b)(2) may not be brought until a trial court judgment has been made final by the resolution of any appeals taken therefrom. In these cases, there was no judgment at all, or a judgment and no appeal, not a judgment which was the subject of a pending appeal.
The majority also relies on Woolett v. American Employers Ins. Co. (1978) 77 Cal.App.3d 619 [143 Cal.Rptr. 799] and 2 California Liability Insurance Practice (Cont.Ed.Bar 1992) section 27.10 for the proposition section 11580(b)(2) requires a “final” judgment, one which has been made final by the determination of an appeal or the expiration of the time in which an appeal may be taken. Woolett simply held a cause of action under section 11580(b)(2) accrued after the time in which the underlying judgment could have been—but was not—appealed from expired. (77 Cal.App.3d at p. 624.) It did not discuss the effect of a pending appeal on the accrual of a cause of action under section 11580(b)(2). In reaching this holding, Woolett reiterated the familiar principle that a cause of action under section 11580(b)(2) does not accrue until a “final judgment” has been entered against the insured in the underlying action. (Ibid.) In this it relied on Zander v. Texaco, Inc. (1968) 259 Cal.App.2d 793, 807 [66 Cal.Rptr. 561], which stated the same principle but, again, did not involve an appeal from the underlying judgment or address the question whether an action under section 11580(b)(2) could be brought while such an appeal was pending. 2 California Liability Insurance Practice relies on Woolett and Zander to support its conclusion a section 11580(b)(2) action cannot be brought until an appeal from the underlying action is concluded, but they do not support this conclusion.
The majority also cites Code of Civil Procedure section 1049, which provides “[a]n action is deemed to be pending from the time of its commencement until its final determination upon appeal, or until the time for appeal has passed, unless the judgment is sooner satisfied.” That an action may be pending on appeal, however, does not mean the judgment cannot be enforced. As previously mentioned, Code of Civil Procedure section 683.010 provides a judgment is enforceable upon entry and section 917.1, subdivision (a), provides it is enforceable upon entry, even if an appeal is pending, unless an undertaking is given. Thus, Code of Civil Procedure section 1049 provides no support for the majority’s cause.
Caminetti v. Guaranty Union Life Ins. Co. (1943) 22 Cal.2d 759, 766 [141 P.2d 423] notes that “appeals do not automatically stay enforcement of [an] order. But they do suspend the force of the order as a conclusive determination of the rights of the parties. [Citation.] This is so, since finality is not accorded a judgment until affirmance in the event of an appeal.” However, as noted in Southern Cal. White Trucks v. Teresinski, supra, 190 Cal.App.3d *295at page 1405, finality is a fluid concept. A judgment may be final for purposes of appeal, yet not final in the sense of a “conclusive determination of the rights of the parties” (Caminetti, supra, at p. 766), until the appeal has been resolved. In any event, as Caminetti notes, a judgment which has been appealed nonetheless may be enforced; section 11580(b)(2) deals with enforcement of a judgment.
In Caminetti, the question was whether the reviewing court could grant a writ of supersedeas to stay the force and effect of a trial court order approving a rehabilitation and reinsurance agreement relating to several insurance companies which had been seized by the insurance commissioner. (Caminetti v. Guaranty Union Life Ins. Co., supra, 22 Cal.2d at p. 763.) The court noted the order was self-executing, requiring no court process to give it effect. (Ibid.) Since a writ of supersedeas acts only on trial court proceedings to enforce a judgment, rather than on the parties, it could not be issued to prevent the insurance commissioner from acting on the order. (Id. at pp. 763, 766.) Thus, the appeal from the order did not prevent its enforcement, and Caminetti does not support a conclusion enforcement must wait until the appeal has been resolved.
In Jennings v. Ward (1931) 114 Cal.App. 536 [300 P. 129], on which the majority relies, the court held an action against the insurer could not be brought during the pendency of an appeal from the underlying judgment but had to be brought after a “final judgment” following appeal. (At p. 537.) However, Jennings was based on the language of the particular insurance policy, not on the later-enacted section 11580(b)(2). (114 Cal.App. at p. 538.) That policy provided an action could not be brought against the insurer “ ‘unless brought after the amount of such claim or loss shall have been fixed and rendered certain ... by final judgment against the Assured ....’” (Id. at p. 537.) The court’s reasoning was that, since a judgment is not final while an appeal is pending, the amount of the claim or loss could not be fixed and rendered certain by final judgment until after the appeal was decided. (Ibid.)
As previously discussed, while a trial court judgment is not final for all purposes while an appeal is pending, as a general rule it is final for enforcement purposes. The amount of liability is fixed and certain when the judgment is entered, although it is subject to further challenge. (Southern Cal. White Trucks v. Teresinski, supra, 190 Cal.App.3d at p. 1405.) Had the Legislature when it enacted section 11580(b)(2) wanted to provide, as in Jennings, that an action could not be brought under the section until the judgment was final for all purposes following the resolution of any appeal, it could have done so. It must be presumed the Legislature was aware of Jennings when it enacted section 11580(b)(2) and, had it wanted the section *296to have the same effect as Jennings, would have used similar language in the section. (Bailey v. Superior Court (1977) 19 Cal.3d 970, 977-978, fn. 10 [140 Cal.Rptr. 669, 568 P.2d 394].) This court should not insert such a provision if the Legislature did not see fit to do so. (Code Civ. Proc., § 1858.)
I am not unaware of the possibility noted by the majority that an underlying judgment may be reversed after an insurer has paid the judgment pursuant to a section 11580(b)(2) lawsuit, requiring the insurer to attempt to get its money back from the claimant. But this possibility exists in any case in which the winning party executes on a judgment while an appeal is pending where there is no stay of execution. In any event, the Legislature apparently has determined the right of injured claimants to collect their money upon receiving judgments in their favor rather than waiting until all appeals have been exhausted outweighs the inconvenience insurers may face if the judgments later should be reversed. We are bound to interpret section 11580(b)(2) according to the intent of the Legislature as expressed in the statute. (Code Civ. Proc., §§ 1858, 1859; Kimmel v. Goland, supra, 51 Cal.3d at p. 208.)
Again as the majority notes, this court has stated that, inasmuch as an insurance contract is by nature an indemnity contract, “no enforceable claim accrues against the insurer until the insured’s liability is . . . established.” (Williams v. Transport Indemnity Co. (1984) 157 Cal.App.3d 953, 960 [203 Cal.Rptr. 868].) This statement was made in connection with the determination as to when a new cause of action against an insurer for bad faith under Insurance Code section 790.03 accrued. The accrual of the new cause of action required a final determination of liability on the part of the insured in the underlying action which could be given res judicata effect in the new lawsuit, so the insurer would be collaterally estopped to relitigate the issue. (Nationwide Ins. Co. v. Superior Court (1982) 128 Cal.App.3d 711, 715 [180 Cal.Rptr. 464].) This, in turn, required a judgment made final for res judicata purposes by the conclusion of any appeals. (7 Witkin, Cal. Procedure (3d ed. 1985) Judgment, § 212, pp. 649-650.)
An action brought under section 11580(b)(2) is for the enforcement of the underlying judgment; it does not involve the accrual of a separate cause of action. Res judicata is not an issue; the insurer is not permitted to relitigate the issue of the insured’s liability to the claimant. The insurer’s only defenses are those it has against the insured. (See, e.g., Billington v. Interinsurance Exchange (1969) 71 Cal.2d 728, 736-738 [79 Cal.Rptr. 326, 456 P.2d 982]; see also Clemmer v. Hartford Insurance Co. (1978) 22 Cal.3d 865, 876 [151 Cal.Rptr. 285, 587 P.2d 1098].) Therefore, the principles enunciated in Williams and Nationwide are inapplicable here; an action under *297section 11580(b)(2) is entirely different from one under Insurance Code section 790.03.
For the reasons stated, I would hold an action under section 11580(b)(2) may be brought once a judgment has been entered and become final in the trial court, without reference to whether an appeal is pending. Accordingly, this action was not prematurely filed and tried. (Southern Cal. White Trucks v. Teresinski, supra, 190 Cal.App.3d at p. 1405; cf. Code Civ. Proc., § 683.010.)
A petition for a rehearing was denied May 18, 1993.