Court Opinion

ID: 4310724
Source: CourtListenerOpinion
Date Created: 2018-09-07 19:01:56.76829+00
Date Added: 2024-06-11T14:44:16.344824
License: Public Domain

Filed 9/7/18
                             CERTIFIED FOR PUBLICATION

               IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

                                SIXTH APPELLATE DISTRICT

MANNY VILLANUEVA et al.                               H041870, H042504
                                                     (Santa Clara County
        Plaintiffs and Appellants,                    Super. Ct. No. 1-10-CV173356)

        v.

FIDELITY NATIONAL TITLE
COMPANY,

        Defendant and Appellant.

        In their first appeal (case No. H041870), both plaintiff Manny Villanueva,
individually and as class representative, and defendant Fidelity National Title Company
(Fidelity) appeal from a judgment following a bench trial in this class action lawsuit
alleging violations of the Unfair Competition Law (UCL) (Bus. & Prof. Code, §§ 17200
et seq.). Villanueva and the class (jointly Plaintiffs) allege Fidelity, an underwritten title
company that handled Plaintiffs’ escrow accounts, engaged in unlawful conduct under the
UCL when it charged overnight mail delivery fees, courier fees, and document
preparation or “draw deed” fees that were not listed in its schedule of rates filed with the
Department of Insurance in violation of Insurance Code provisions governing the
business of title insurance (Ins. Code, §§ 12401–12410.10, 12414.27).1 Fidelity argues,
among other things, that this lawsuit is barred by the statutory immunity in
section 12414.26 for matters related to ratemaking. The trial court rejected Fidelity’s
immunity claim based on section 12414.26. It found that Fidelity’s charges for overnight

        1
             All undesignated statutory references are to the Insurance Code.
mail and courier services and some of the draw deed fees were unlawful because they
were not included in Fidelity’s rate schedules. The court granted Plaintiffs injunctive
relief under the UCL, but denied their restitution claims.
       On appeal, Plaintiffs contend the trial court erred in failing to award them
restitution under the UCL and by granting judgment on the pleadings on their breach of
fiduciary duty claim. In its appeal, Fidelity argues the trial court lacked subject matter
jurisdiction over this action because section 12414.26 confers exclusive original
jurisdiction over ratemaking on the Insurance Commissioner and this case involves
ratemaking. Plaintiffs respond that Fidelity waived its immunity defense by limiting it to
certain claims below. Fidelity also argues the named class representative lacked
standing. Fidelity contends that under the statutory scheme it was required to file rates
only for services it provided and not for services provided by third parties. It argues
other allegedly unlawful charges were authorized by the Insurance Code and the trial
court erred by enjoining past acts that are not likely to be repeated.
       We will conclude Fidelity’s immunity defense (§ 12414.26) is not subject to the
forfeiture doctrine because it implicates the court’s subject matter jurisdiction. We will
also hold that this civil action is barred by the immunity in section 12414.26 and is
subject to the exclusive original jurisdiction of the Insurance Commissioner because it
challenges Fidelity’s ratemaking-related activity. We will therefore reverse the
judgment.
       In their second appeal (case No. H042504), Plaintiffs challenge the trial court’s
post-judgment order denying their motion for attorney fees under the private attorney
general attorney fees doctrine (Code Civ. Proc., § 1021.5). In that same appeal, Fidelity
challenges the trial court’s order awarding costs to Plaintiffs and granting Plaintiffs’
motion to tax Fidelity’s costs.
       Since we conclude this civil action is barred by statutory immunity (§ 12414.26),
Plaintiffs are no longer the prevailing party and are therefore not entitled to an award of

                                              2
attorney fees. We will therefore affirm the trial court’s order denying Plaintiffs’ motion
for attorney fees. In light of our conclusion on the merits, we will also reverse the trial
court’s order awarding Plaintiffs their costs, direct the court to enter a new order
awarding costs to Fidelity, and remand to the trial court to determine the amount of the
costs award.

                            FACTS AND PROCEDURAL HISTORY

   I. State Regulation of Title Insurance; Fidelity’s Role

       The California Insurance Commissioner has general regulatory authority over the
business of title insurance. (Ins. Code, § 12340 et seq.; Cal. Code Regs., tit. 10,
§§ 2355.1-2355.5.) The “[b]usiness of title insurance,” as defined in the Insurance Code,
includes in relevant part: “The performance by a title insurer, an underwritten title
company or a controlled escrow company of any service in conjunction with the issuance
or contemplated issuance of a title policy including but not limited to the handling of any
escrow, settlement or closing in connection therewith; or the doing of or proposing to do
any business, which is in substance the equivalent of any of the above.) (§ 12340.3,
subd. (c); italics added.) The Insurance Code also defines “ ‘[t]itle insurer,’ ”
“ ‘underwritten title company,’ ” and “ ‘[c]ontrolled escrow company.’ ” (§§ 12340.4,
12340.5, 12340.6.) We will discuss the statutory regulatory scheme in greater detail in
the “Discussion” portion of this opinion. Because the State of California regulates the
business of title insurance, California title insurers are subject to very little regulation by
the federal government. (Greenwald & Asimow, Cal. Practice Guide: Real Property
Transactions (The Rutter Group 2017) ¶¶ 3:61, pp. 3-17 to 3-18 (Greenwald), citing 15
USC App. §§ 1011-1015 [McCarran-Ferguson Insurance Regulation Act] & Commander
Leasing Co. v. Transamerica Title Ins. Co. (10th Cir. 1973) 477 F.2d 77, 83, 89 [title

                                               3
insurance companies are exempt from federal anti-trust laws when their business is
regulated by the state where the alleged violation occurred].)
       Fidelity is a subsidiary of Fidelity National Financial (FNF), which operates
Fidelity and its other subsidiaries through the Fidelity National Title Group (FNTG).
Fidelity has been licensed by the California Department of Insurance (DOI) to transact
business as an underwritten title company since at least January 1996 in 21 California
counties. Prior to that, beginning in November 1978, it was licensed as an underwritten
title company to do business in Los Angeles County. The Insurance Code defines an
underwritten title company as “any corporation engaged in the business of preparing title
searches, title examinations, title reports, certificates or abstracts of title upon the basis of
which a title insurer writes title policies.” (§ 12340.5.) Fidelity is underwritten by
Fidelity National Title Insurance Company (sometimes FNTIC).
       The Insurance Code requires title insurers, underwritten title companies, and
controlled escrow companies to file their “schedules of rates, all regularly issued forms of
title policies to which such rates apply, and every modification thereof which [they]
propose[] to use in this state” with the Insurance Commissioner and to “establish basic
classifications of coverages and services to be used as the basis for determining rates.”
(§§ 12401.1, 12401.2.) In this litigation, Villanueva alleges—on behalf of himself and a
class of similarly situated persons—that Fidelity violated the Insurance Code when it
charged for certain services that were not listed on its schedule of rates filed with the
Insurance Commissioner.

   II. Facts Regarding the Named Plaintiff’s Escrow

       The named plaintiff is Manny Villanueva. In 2006, Villanueva and his wife Sonia
Villanueva refinanced the mortgage on their home in Santa Clara County. The refinance
loan was arranged by mortgage broker UMG Mortgage. UMG Mortgage arranged for
FNTIC to provided title insurance and for Fidelity to provide escrow services. Sonia

                                                4
Villanueva was the sole borrower. She is not a party to this action. Although
Mr. Villanueva was not a party to the loan agreement, he did sign the escrow instructions.
(Hereafter, we shall refer to Manny Villanueva using the singular “Villanueva,” to Sonia
Villanueva by her complete name, to Manny and Sonia Villanueva jointly as “the
Villanuevas.”)
       Among other things, the refinance transaction involved: (1) obtaining a new loan
from First Federal Bank of California (First Federal); (2) paying off a first mortgage with
Countrywide Home Loans, (3) paying off a second mortgage with Chase Home Finance,
and (4) paying various fees, which left (5) a balance of $116,238.69 that was paid to the
Villanuevas.
       The Villanuevas incurred several expenses in connection with refinancing their
mortgage, including payments to the new lender (First Federal), the mortgage broker, the
homeowners’ insurance carrier, the title insurer (FNTIC), escrow fees to Fidelity, and
other fees. Fidelity charged the Villanuevas a base rate of $250 to handle their escrow.
In addition to the base rate, Fidelity charged certain fees that are the subjects of this
lawsuit, including a document preparation fee ($75), a “Draw Deed” fee ($50), an
overnight delivery fee ($11.20), and a courier fee ($15).2 Fidelity also charged other fees
that are not at issue in this case. In addition, Fidelity gave the Villanuevas a $20 discount
on escrow fees pursuant to the terms of a 2002 stipulated judgment in People v. Fidelity
National Title Insurance Co., Sacramento County Superior Court Case No. 99AS02793.3

       2
         Fidelity charged both a $75 document preparation fee and a $50 “Draw
Deed” fee to prepare a single grant deed. This was apparently due to human error
that was discovered during the litigation. Fidelity offered to refund the overcharge
plus interest. Plaintiffs do not allege any unlawful business practices based on
double charging for services.
       3
          In People v. Fidelity National Title Insurance Co., the California Attorney
General and others sued Fidelity and other companies in the business of title insurance
for alleged violations of the Unclaimed Property Act and the UCL occurring between
May 1995 and October 2002. The alleged illegal conduct included, among other things,

                                               5
       This litigation concerns the legality of amounts paid for delivery services and the
“draw deed” fee. In their escrow instructions, the Villanuevas “authorize[d] and
instruct[ed] [Fidelity] to charge each party to the escrow for their respective Federal
Express, special mail handling/courier and/or incoming/outgoing wire transfer fees” and
to “select special mail/delivery or courier service to be used.” In the estimated closing
statement, which was part of the escrow instructions, Fidelity estimated the escrow
charges would include $30 for overnight delivery and $30 for “Outside Courier/Special
Messenger.”
       The Villanuevas’ escrow closed on May 31, 2006. Fidelity arranged for three
deliveries to be made while the transaction was in escrow. The first delivery was via
overnight mail by California Overnight from the Fidelity office in Milpitas to First
Federal Bank in Los Angeles on May 23, 2006 (eight days before close of escrow). The
Villanuevas’ final escrow closing statement on the HUD-1 form4 dated May 31, 2016,

charging improper fees for services the defendants never intended to perform and
charging fees that greatly exceeded the actual cost of the service, including fees for
delivery services.
        The terms of the stipulated judgment included an injunction permanently enjoining
the defendants from, among other things, “[b]illing or collecting from title insurance or
escrow customers an amount that exceeds the actual cost to defendants of services
provided by third parties in connection with defendants’ performance of escrow and title
services, such as overnight mail, courier, and notary services, unless (1) such practice is
permitted by state and federal law and (2) defendants clearly and conspicuously disclose
that they have marked-up [sic] the third party charge.” The stipulated judgment also
provided for restitution, including cash payments to former customers and up to
$26 million in the form of $20 discounts on future transactions to certain eligible
customers.
        4
          The federal Real Estate Settlement Procedures Act of 1974 (RESPA) (12 U.S.C.
§ 2601 et seq.) and Regulation X to the Real Estate Settlement Procedures Act (24 C.F.R.
§ 3500.1 et seq. (1999)) (Regulation X) “regulate[] the settlement process for certain
residential real estate loan transactions throughout the nation that involve federally
related mortgage loans. RESPA and Regulation X require certain disclosures be made to
borrowers by lenders both at the time of application for a loan and at the time of closing
of the loan, including disclosure of charges that the borrower will have to pay for

                                             6
lists a fee of $11.20 for this delivery. Five days after closing, California Overnight billed
Fidelity $4.60 for this delivery.
       The second delivery was via overnight mail by Federal Express (FedEx) from the
Fidelity office in Milpitas, California to Chase Home Finance in Columbus, Ohio on
May 31, 2006 (at close of escrow). FedEx charged Fidelity a “[c]ourtesy [r]ate” of $5.75
for this delivery. Fidelity did not include a separate charge for the FedEx delivery on the
Villanuevas’ final escrow closing statement on the HUD-1 form.
       The third delivery was made by First Courier (also referred to as Tri-Valley
Courier) from the Fidelity office in Milpitas to mortgage broker UMG Mortgage in
Milpitas at close of escrow on May 31, 2006. First Courier charged $15 for this delivery.
It was listed as $15 for “Outside courier/Special Messenger” on the Villanuevas’ final
escrow closing statement.

   III.   Fidelity’s Rate Filings

       The evidence at trial included several the rate manuals (also described as “rate
schedules” or “rate filings”) that Fidelity filed with the DOI with effective dates between
May 2006 and August 2013. The schedule of rates governing the Villanuevas’
transaction is set forth in Fidelity’s rate manual entitled “Escrow Fees and Charges for
the State of California,” effective May 22, 2006. The escrow rate tables in the rate
manual are organized by counties. According to the manual, “[f]or escrows involving the
refinancing of an existing deed of trust on a one-to-four [sic] family residence,” in Santa
Clara County, the charge shall be $250 on transactions up to and including $1 million.

settlement services such as credit reports, appraisal fees, recording fees, wire transfer
fees, and other loan related services.” (Washington Mutual Bank v. Superior Court
(1999) 75 Cal. App. 4th 773, 776.) RESPA requires lenders throughout the nation to use a
standard uniform settlement statement form at the time of settlement, or closing, which is
known as the “HUD-1 form.” (Id. at p. 776, 779.)

                                              7
The schedule provided that “[f]or the purpose of this section only, ‘Refinance Escrow
Services’ shall include the following services: (a) ordering demands and making payoffs
on up to two (2) previous loans by either check or wire transfer; (b) disburse balance of
proceeds, by either check or wire transfer, to up to 4 payees; and (c) company-performed
in office document signing of one set of loan documents; and (d) standard in-house
courier services. Refinance Escrow services do not include notary fees, . . . recording
fees, transfer tax or other governmental fees or charges.” The schedule also lists nine
“Refinance Related Services,” which are described as charges “[i]n excess of escrow
services included in the above[-]referenced paragraphs” The nine services listed include
“Document Preparation” at $75 per document, but not delivery or courier services by
outside vendors like FedEx, California Overnight, or First Courier. The Villanuevas did
not review Fidelity’s rate manual at any time during the escrow process. Villanueva
alleges in the operative complaint, on information and belief, “that no individual
consumer has ever visited the [DOI] archive to check the . . . escrow rate prior to the
close of their real estate transaction. Instead, like Plaintiff they would trust title and
escrow professionals to charge them the correct rates.”

   IV. Pretrial Procedural History

       Villanueva’s class action complaint alleges Fidelity engaged in unlawful conduct
by charging him and others for delivery services and draw deed fees that were not listed
on Fidelity’s rate filings with the Insurance Commissioner. Villanueva’s original
complaint, filed in May 2010, contained causes of action for violations of the Unfair
Competitor Law (UCL) (Bus. & Prof. Code, § 17200 et seq.), fraud, negligent
misrepresentation, negligence, unjust enrichment, money had and received, and breach of
fiduciary duty. It also contained a prayer for punitive damages. The named defendants
included Fidelity (the escrow company), FNTIC (the title insurer), and Fidelity National
Title Company of California (FNTC-CA) (hereafter jointly “Defendants”).

                                               8
       Defendants filed demurrers to the original and the first amended complaints. The
papers in support of and opposing both demurrers, as well as the orders on the demurrers,
are not in the record. According to the statement of decision after trial, the trial court
sustained the demurrers to the causes of action for fraud, negligence, and negligent
misrepresentation in the original complaint with leave to amend. Villanueva elected not
to amend his cause of action for negligence and did not include that claim in his first
amended complaint. As for the demurrer to the first amended complaint, the trial court
sustained the demurrers to the causes of action for fraud and negligent misrepresentation
with leave to amend and overruled the demurrers to the other causes of action.
Villanueva elected not to amend the complaint.
       Defendants filed their answer in December 2011. In 2012, Villanueva dismissed
the action without prejudice as to FNTC-CA and FNTIC, which left Fidelity as the only
named defendant.
       In February 2013, the Court certified a class of “ ‘[a]ll persons for whom [Fidelity]
performed residential escrow services in a transaction that occurred in California, and
who were charged for courier, overnight, messenger, or other delivery services and/or
draw deed fees in connection with that transaction, during the period May 28, 2006
through September 30, 2012.’ ” For ease of reference, we shall sometimes refer to the
overnight mail, messenger, courier, and other delivery services jointly as “delivery
services.”
       In July 2013, the court granted Fidelity’s motion for summary adjudication of the
punitive damages claim, but denied summary adjudication of other issues and denied
summary judgment. Plaintiffs do not challenge that order on appeal.
       In September 2013, Fidelity filed a motion for judgment on the pleadings
challenging Plaintiffs’ common law claims for unjust enrichment, money had and
received, and breach of fiduciary duty, but not the UCL claim. The trial court granted the
motion with leave to amend. Plaintiffs elected not to amend their complaint. On appeal,

                                              9
Plaintiffs challenge the trial court’s order granting judgment on the pleadings on the
breach of fiduciary duty claim only.
       In February 2014, the court denied Fidelity’s separate motion for judgment on the
pleadings on the UCL claim. When the case went to trial, the only remaining cause of
action was the UCL claim (Bus. & Prof. Code, § 17200 et seq.). The court conducted a
bench trial in the complex litigation department over 16 days in April, May, and
June 2014.

   V. Evidence Presented and Theories of Liability Argued at Trial

       At trial, Plaintiffs argued two alternate theories of liability related to alleged
unlawful charges for delivery services. They sought injunctive relief and requested
approximately $13.1 million in restitution for third party delivery services. Plaintiffs also
alleged Fidelity’s “ ‘draw deed’ ” fees were unlawful and sought approximately $10.7 in
restitution for the draw deed fees.5 A subset of the class sought $1.8 million in restitution
for draw deed fees on an alternative theory of liability.

       A. Delivery Theory No. 1

       Plaintiffs’ Delivery Theory No. 1—which the trial court and the parties also
described as the “ ‘unfiled rate’ claim”—posited that the charges for delivery services
provided by third parties were unlawful because Fidelity was required to file its rates for
third party delivery services with the DOI and those rates were not included in Fidelity’s
rate filings. Fidelity contended the Insurance Code does not require it to file rates for
“[p]ass [t]hrough” delivery fees that it collects from its customers and passes through to
third party delivery service providers. Fidelity argued that the Insurance Code requires it

       5
         Plaintiffs sought the following amounts in restitution in their closing argument:
“For delivery fees, $13,115,370 without interest. $17,914,082 with interest. For draw
deed fees: $10,670,982 without interest. $14,176,895 with interest.”

                                              10
to file rates only for services “it performs” (§ 12340.7) and that it was not required to file
rates for delivery services performed by others.
       Plaintiffs disputed Fidelity’s characterization of the delivery fees as “[p]ass-
[t]hroughs” based on agreements between certain delivery services and a Fidelity affiliate
under which “escrow customers receive[d] discounted delivery rates” and the delivery
companies paid the Fidelity affiliate “marketing fees.” They argued that the Insurance
Code required Fidelity to include a statement in its rate filings (for example “as charged
by vendor”) that would provide notice that such fees would be collected.

       B. Delivery Theory No. 2

       Alternatively, Plaintiffs’ Delivery Theory No. 2—also described as the “ ‘double
charge’ claim”—asserted that the charges for delivery services were unlawful because
they were part of the services included in Fidelity’s base rate—which the parties also
refer to as a “bundled rate”—and that by charging both the base rate and separate fees for
delivery, Fidelity billed its customers twice for the same service. Fidelity disagreed with
Plaintiffs’ interpretation of the language in its rate filings that Plaintiffs relied on as the
basis for Delivery Theory No. 2.

       C. Draw Deed Theory

       A subset of plaintiffs—which the trial court referred to as the “ ‘Draw Deed
Plaintiffs’ ”—argued that Fidelity could not charge its filed rate for “ ‘document
preparation’ ” for preparing a deed if the customers’ HUD-1 closing statement described
the service as “ ‘draw deed’ ” instead of “ ‘document preparation.’ ” Plaintiffs sought
restitution of approximately $10.7 million under this theory. We shall hereafter refer to
this claim as the General Draw Deed Theory.
       Plaintiffs asserted an alternative theory of liability with regard to a subset of the
Draw Deed Plaintiffs whose escrows involved real estate sale transactions (as opposed to

                                               11
refinance transactions) between May 28, 2006 and February 2, 2008—which the trial
court referred to as the “ ‘Gap Period Plaintiffs.’ ” The Gap Period Plaintiffs contended
that Fidelity’s rate filings during that period did not include a rate for “ ‘document
preparation’ ” for real estate sales transactions. They argued that Fidelity’s failure to
have filed a rate for document preparation for sales transactions made their charges for
drawing a deed unlawful even if Fidelity’s filed rate for “ ‘document preparation’ ”
authorized draw deed charges in other instances. The Gap Period Plaintiffs sought
approximately $1.8 million in restitution.6

   VI. Motion for Nonsuit; Statement of Decision

       After Plaintiffs’ opening statement, Fidelity made three motions for nonsuit, one
of which was based on its statutory immunity defense (§ 12414.26). The trial court
denied each of the motions.
       The court issued its final statement of decision in November 2014. The court
concluded that the delivery services were made in connection with Fidelity’s handling of
the class members’ escrows. It found that delivery of escrow funds and documents was a
“necessary” and “integral” part of an escrow holder’s function, even if accomplished by
using third party delivery services. The court reasoned that the delivery fees were
expenses Fidelity incurred to carry out “a core part of” its function as escrow holder, that
Fidelity—and not the class members—contracted with the delivery companies and was
obligated to pay them, that the delivery fees were not “ ‘pass-through’ ” charges and were
therefore charges by Fidelity. Construing section 12414.27, the court found the statute
was not ambiguous and that its plain language broadly prohibits Fidelity from charging
for any service that does not match its rate filings, including delivery services. The court

       6
          For the Gap Period, Plaintiffs sought draw deed fees of $1,800,973 without
interest and $2,696,986 with interest.

                                              12
held that the legislative history of the statutory scheme, the purpose of the statutory
scheme, and the DOI’s interpretation of the statute all supported its conclusions.
        On Plaintiffs’ Delivery Theory No. 1, the court found that Fidelity violated
section 12414.27 by charging for delivery services because its rate filings did not include
a rate for such service or a general statement that the rate would be that charged by a third
party delivery service. In light of its conclusion, the court did not reach the merits of
Delivery Theory No. 2.
       Regarding the General Draw Deed Theory, the court rejected Plaintiffs’ assertion
that drawing a deed was different from document preparation. The court found that
statistical evidence presented at trial substantiated Fidelity’s testimony that its regular
practice was to charge the document preparation rate, regardless of whether the service
was labelled as “ ‘document preparation’ ” or “ ‘draw deed’ ” on the HUD-1 form. The
court found that Fidelity’s rate filings during the Gap Period (May 28, 2006, to
February 2, 2008) “for sale/resale transactions (as contrasted with refinance transactions)
did not include a rate for either . . . drawing a deed or document preparation” and that
during that time, “Fidelity charged $1,800,973 in draw deed fees. [(Fns. omitted.)]”
The court rejected Fidelity’s assertion that those fees were “unusual services” within the
meaning of section 12401.8. The court held “that charging for drawing a deed was
unlawful during the Gap Period,” but that Fidelity “did not violate the law by charging
for the service of drawing a deed outside the Gap Period.”
       The court found that in the Villanuevas’ transaction, “due to human error, Fidelity
inadvertently listed two charges for preparing the Grant Deed, instead of one, and at
different rates”—the $75 document preparation fee and the $50 draw deed fee. The court
noted that “Fidelity sought to refund the mistaken second charge per company policy
[(fn. omitted.)]” and found “no evidence that such an individualized error occurred in any
other class transaction.” It found that charging $50 for document preparation in the
Villanuevas’ case, when the filed rate was $75, was “atypical of the class.”

                                              13
       The court also rejected Fidelity’s statutory immunity claim under section 12414.26
and found that the statute did not immunize Fidelity from suit based on its unlawful
charges.
       With regard to remedies, the court found that although Plaintiffs had established
legal violations by Fidelity, they had failed to prove they were entitled to restitution. The
court reasoned that Plaintiffs “received the benefit of their bargain” and noted they did
not contend that the services were unwarranted, “unsatisfactory, or unfairly priced, and
all of the services and rates were disclosed up-front and agreed to by Plaintiffs.” The
court concluded that (1) Plaintiffs benefitted from Fidelity’s preparation of deeds and its
negotiation of low third party delivery service fees that were lower than those charged by
other escrow holders; (2) the fees were disclosed to and approved by Plaintiffs in their
estimated closing statements; (3) Plaintiffs failed to show economic injury as a result of
omissions from rate manuals they neither reviewed nor relied on; and (4) awarding
restitution would “put Plaintiffs in a better position than they expected to receive.”
       Although it denied restitution, the court concluded that Plaintiffs were entitled to
injunctive relief. While Fidelity’s most recent rate filings included rates for delivery
services, the court found it was “appropriate to enjoin Fidelity from charging for the
service of delivery unless its rate filing includes the charge or a statement that the rate
will be the amount charged by the third party vendors for delivery fees.”

   VII.    Motions for Attorney Fees and Costs

       In January 2015, Plaintiffs filed a motion for attorney fees under Code of Civil
Procedure section 1021.5, which codifies the private attorney general attorney fee
doctrine. (Conservatorship of Whitley (2010) 50 Cal. 4th 1206, 1217-1218.) Plaintiff

                                              14
sought $9,439,929 in attorney fees based on the work of nine lawyers in two different law
firms.7
          Code of Civil Procedure section 1021.5 provides in relevant part: “Upon motion,
a court may award attorneys’ fees to a successful party against one or more opposing
parties in any action which has resulted in the enforcement of an important right affecting
the public interest if: (a) a significant benefit, whether pecuniary or nonpecuniary, has
been conferred on the general public or a large class of persons, (b) the necessity and
financial burden of private enforcement, . . . , are such as to make the award appropriate,
and (c) such fees should not in the interest of justice be paid out of the recovery, if any.”
The trial court concluded that Plaintiffs were not entitled to attorney fees under Code of
Civil Procedure section 1021.5. The court reasoned that although the litigation involved
an important right affecting the public interest, Plaintiffs had not met their burden of
establishing the significant benefit element or that private enforcement was necessary or
that the necessity and financial burden of private enforcement were such as to make the
award appropriate. Thus, the court denied Plaintiffs’ motion for attorney fees.
          In December 2014, both sides filed a memorandum of costs. Plaintiffs sought
$393,862.19 in costs and Fidelity claimed $197,839.41 in costs. Both parties filed
motions to tax the other side’s costs. The trial court concluded that since the only relief
Plaintiffs obtained was an injunction and they had not obtained any monetary relief, it
had discretion under Code of Civil Procedure section 1032, subdivision (a)(4) to
determine which party was the prevailing party, whether costs should be awarded, and in
what amount. The court concluded that Plaintiffs were the prevailing party and awarded

          7
          The attorneys billed at different rates ranging from $395 per hour to $800 per
hour depending on their experience. (After applying reductions and a multiplier, and
based on 11,284.65 hours billed, Plaintiffs’ attorney fees claim yields an average hourly
rate of $836.53 per hour.)

                                              15
them the entire amount claimed as costs. Consequently, the court denied Fidelity’s
motion to tax Plaintiff’s costs and granted Plaintiffs’ motion to tax Fidelity’s costs.

                                   PARTIES’ CONTENTIONS

       Both sides appeal the judgment and the post-judgment order denying Plaintiffs’
motion for attorney fees and awarding costs to Plaintiffs. In their appeal on the merits,
Plaintiffs do not challenge the trial court’s ruling on Delivery Theory No. 2 or its ruling
regarding the Draw Deed charges outside the Gap Period. Only the rulings on Delivery
Theory No. 1 and the Draw Deed claims of the Gap Period Plaintiffs are at issue here.
Plaintiff contend the trial court erred in failing to award them restitution under the UCL
and by granting judgment on the pleadings on their breach of fiduciary duty claim. They
argue that if this court reverses as to restitution, the case should be remanded to the trial
court on the question of attorney fees.
       In its appeal on the merits, Fidelity argues that the judgment must be reversed
because the trial court lacked subject matter jurisdiction for two independent reasons.
First, Fidelity contends it was immune from suit under section 12414.26, which it argues
consigns all issues regarding filed rates to the discretion of the Insurance Commissioner
and prohibits courts from second-guessing Fidelity’s filed rates. Second, Fidelity
contends Villanueva, the named class representative, lacked standing because he was not
the borrower and paid no fees related to his wife’s loan transaction.
       Fidelity contends that even if the court had jurisdiction over the subject matter of
the action, the judgment on Delivery Theory No. 1 must be reversed because the trial
court misinterpreted and misapplied section 12414.27. Fidelity argues section 12414.27
required it to file rates for services it provided and did not require it to file rates for
delivery services provided by third parties. Fidelity contends the judgment on the claims
of the Gap Period Plaintiffs must be reversed because the charges were authorized as

                                               16
excess charges by section 12401.8. It also asserts the trial court erred by enjoining past
acts that are not likely to be repeated.
       As for the postjudgment order on attorney fees and costs, Plaintiffs appeal the trial
court’s order denying their motion for attorney fees. Fidelity challenges the court’s order
awarding costs to Plaintiff and granting Plaintiffs’ motion to tax Fidelity’s costs.

                                             17
                                       DISCUSSION8

   I. Brief Introduction to Statutory Scheme Governing Title Insurance

       The statutory scheme at issue in this appeal is found in division 2 of the Insurance
Code, which is entitled “Classes of Insurance.” We are concerned with part 6 of
division 2, which governs “Insurance Covering Land.” Part 6 is divided into three
chapters. Chapter 1 of part 6 contains the provisions regarding “Title Insurance.”

       8
          In reviewing this appeal, we noted two deficiencies in the parties’ briefs
regarding citations to the record. First, they neglected to support each and every
statement in their briefs concerning matters in the appellate record, whether factual or
procedural, with a citation to the record. (Cal. Rules of Court, rule 8.204(a)(1)(C); Myers
v. Trendwest Resorts, Inc. (2009) 178 Cal. App. 4th 735, 745 (Myers); City of Lincoln v.
Barringer (2002) 102 Cal. App. 4th 1211, 1239 (Barringer) [record citations in statement
of facts do not cure failure to include record citations in argument portion of brief].) This
allows the reviewing court to locate relevant portions of the record expeditiously.
(Myers, at p. 745.) It is especially important in a case such as this that has a very large
record (over 3,250 pages of appendices and 2,096 pages of reporter’s transcript in case
No. H041870 alone). When a brief fails to refer to the record in connection with the
points raised on appeal, the appellate court may treat those points as having been waived,
(Barringer, supra, 102 Cal.App.4th at p. 1239; Dietz v. Meisenheimer & Herron (2009)
177 Cal. App. 4th 771, 799-801), ignore unsupported contentions, (Dominguez v.
Financial Indemnity Co. (2010) 183 Cal. App. 4th 388, 392, fn. 2), or strike portions of the
brief entirely (Ojavan Investors, Inc. v. California Coastal Com. (1997) 54
Cal. App. 4th 373, 391).
        Second, Plaintiffs argue substantial evidence supports the trial court’s implied
finding that Fidelity’s charges were not made in accordance with its rate filings. Rather
than cite the evidence that supports the finding, Plaintiffs cite the court’s statement of
decision, which contains the court’s findings. The statement of decision is not evidence.
(See Jackson v. County of Los Angeles (1997) 60 Cal. App. 4th 171, 178, fn.4 [citation to
the separate statement, rather than the evidence, in a summary judgment appeal is
inadequate; a separate statement is not evidence; assertions of fact in appellate briefs
“should be followed by a citation to the page(s) of the record containing the supporting
evidence”].)
        We shall ignore statements in the briefs that are unsupported by appropriate record
citations or that improperly cite the statement of decision. Since we decide this case
based on questions of law and statutory interpretation, these deficiencies in the briefs are
not dispositive.

                                             18
Chapter 1, is divided into 16 articles. Although we will discuss the entire statutory
scheme, we are concerned primarily with statutes in five of those articles: (1) article 1,
which contains pertinent definitions (§§ 12340 to 12342); (2) article 5.5, which is entitled
“Rate Filing and Regulation” (§§ 12401 to 12401.10); (3) article 5.7, which is entitled
“Advisory Organizations” (§§ 12402 to 12402.2); (4) article 6.7, entitled “Hearings,
Procedure, and Judicial Review” (§§ 12414.13 to 12414.19); and (5) article 6.9, entitled
“Examinations, Penalties, and Miscellaneous” (§§ 12414.20 to 12414.31). (Stats. 1973,
ch. 1130, pp. 2300, 2307, 2309, 2311, 2313.) For ease of reference, we shall refer to
chapter 1 of part 6 of division 2 of the Insurance Code, the statutory scheme governing
title insurance, as “Chapter 1” or “Chapter 1 (Title Insurance).”
       Chapter 1 refers to three types of regulated entities in the business of title
insurance: title insurers, underwritten title companies, and controlled escrow companies;
(See e.g., §§ 12340.7, 12401.1, 12401.2, 12401.3, subd. (c), 12401.7, 12414.27; see also
§§ 12340.4 to 12340.6 [defining “title insurer,” “underwritten title company,” and
“ ‘[c]ontrolled escrow company’ ”].) We will refer to all three types of entities jointly as
“regulated title entities.” Since Fidelity is an underwritten title company and for ease of
reference, we will sometimes delete references to title insurers, controlled escrow
companies, and advisory organizations, as well as insurance coverages provided by title
insurers when describing the Insurance Code sections at issue.

   II. General Principles Under the Unfair Competition Law

       “The UCL prohibits, and provides civil remedies for, unfair competition, which it
defines as ‘any unlawful, unfair or fraudulent business act or practice.’ ([Bus. & Prof.
Code,] § 17200.) Its purpose ‘is to protect both consumers and competitors by promoting
fair competition in commercial markets for goods and services.’ (Kasky v. Nike, Inc.
(2002) 27 Cal. 4th 939, 949, . . . .) In service of that purpose, the Legislature framed the
UCL’s substantive provisions in ‘ “broad, sweeping language” ’ [citations] and provided

                                              19
‘courts with broad equitable powers to remedy violations’ [citation].” (Kwikset Corp. v.
Superior Court (2011) 51 Cal. 4th 310, 320, citing Cel-Tech Communications, Inc. v. Los
Angeles Cellular Telephone Co. (1999) 20 Cal. 4th 163, 181 (Cel-Tech) and Bank of the
West v. Superior Court (1992) 2 Cal. 4th 1254, 1266 [“The Legislature intended this
‘sweeping language’ to include ‘ “anything that can properly be called a business practice
and that at the same time is forbidden by law.” ’ ”].) The UCL “governs ‘anti-
competitive business practices’ as well as injuries to consumers, and has as a major
purpose ‘the preservation of fair business competition.’ ” (Cel-Tech, at p. 180.)
       Because Business and Professions Code section 17200 is written in the
disjunctive, it establishes three types of unfair competition: acts or practices that are
(1) unlawful, or (2) unfair, or (3) fraudulent. (Cel-Tech, supra, 20 Cal.4th at p. 180.)
“ ‘ “In other words, a practice is prohibited as ‘unfair’ or ‘deceptive’ even if not
‘unlawful’ and vice versa.” ’ ” (Ibid.) Plaintiffs pleaded their UCL claim “under the
unlawful prong of the statute on behalf of approximately half a million people.”
       As we have noted, “ ‘[u]nlawful business activity’ proscribed under [Business and
Professions Code] section 17200 includes ‘ “anything that can properly be called a
business practice and that at the same time is forbidden by law.” ’ [Citation.] . . . ‘[In]
essence, an action based on Business and Professions Code section 17200 to redress an
unlawful business practice “borrows” violations of other laws and treats these violations,
when committed pursuant to business activity, as unlawful practices independently
actionable under [Business and Professions Code] section 17200 et seq. and subject to the
distinct remedies provided thereunder.’ ” (Farmers Ins. Exchange v. Superior Court
(1998) 2 Cal. 4th 377, 383.) The UCL claim in this case is based on alleged violations of
the Insurance Code provisions governing the business of title insurance.
       In evaluating Plaintiffs’ UCL claims, we review questions of law and statutory
interpretation de novo. (People ex rel. Lockyer v. Shamrock Foods Co. (2000) 24 Cal. 4th
415, 432.) We review the trial court’s resolution of disputed factual issues “for

                                              20
substantial evidence, viewing the record in the light most favorable to the ruling.”.
(People ex rel. Lockyer v. Fremont Life Ins. Co. (2002) 104 Cal. App. 4th 508, 514.)
          We begin with the jurisdictional questions raised by Fidelity’s appeal, including
the application of statutory immunity.

   III.       Fidelity’s Appeal in Case No. H041870: Statutory Immunity

          Section 12414.26 provides: “No act done, action taken, or agreement made
pursuant to the authority conferred by Article 5.5 . . . of this chapter shall constitute a
violation of or grounds for prosecution or civil proceedings under any other law of this
state heretofore or hereafter enacted which does not specifically refer to insurance.”
Fidelity contends it is immune from suit under section 12414.26 and that the Insurance
Commissioner has exclusive original jurisdiction over all matters related to the making,
filing, and use of its rates. It argues this statutory immunity is broad and bars the entire
action.
          Plaintiffs contend Fidelity has forfeited its immunity defense by limiting it to
Delivery Theory No. 2 and the General Draw Deed claims in the trial court. On the
merits of the immunity issue, Plaintiffs argue both the plain language of section 12414.26
and case law defeats Fidelity’s immunity argument. They contend the statutory
immunity does not extend to Fidelity’s conduct of charging for services that were not
included in its rate filings and that this action is not related to ratemaking activity.

          A. Background

          The trial court first addressed the immunity question in its ruling on Fidelity’s
motion for nonsuit following Plaintiffs’ opening statement. The court’s tentative ruling
on the motion for nonsuit, which it later adopted, stated: “Article 5.5 pertains to ‘Rate
Filing and Regulation.’ Acts done or taken pursuant to the authority conferred by Article
5.5 include filing a schedule of rates with the commissioner (§ 12401.1), establishing

                                                21
basic classifications of coverages and services to be used as the basis for determining
rates (§ 12401.2), making and using rates subject to rate standards that require rates not to
be excessive, inadequate or unfairly discriminatory (§ 12401.3), and exchanging
information and experience data with insurance supervisory officials (§ 12401.4).” The
trial court limited its immunity analysis to Delivery Theory No. 2 and the Draw Deed
Theory. It reasoned that the conduct at issue under these theories was “charging of
unauthorized fees” and since the charges were not in the rate filings, Fidelity obtained no
authority from article 5.5 to charge those fees, and immunity did not apply. “Here
Plaintiff does not challenge [Fidelity’s] collection of fees ‘consistent with an approved
rate’; rather . . . fees beyond the approved rates.”
       In its statement of decision, the trial court wrote: “[S]ection 12414.26 does not
immunize Fidelity from suit for its unlawful charges. Section 12414.26 confers
immunity for an ‘act done, action taken, or agreement made pursuant to the authority
conferred by Article 5.5 . . . .’ Section 12414.26 does not apply because Article 5.5 did
not authorize the unlawful charges. Nothing in Article 5.5 authorizes the charges for a
service other than in accordance with the rate filings.”

       B. Waiver/Forfeiture

       Plaintiffs contend Fidelity waived its immunity defense with regard to Delivery
Theory No. 1 because Fidelity’s motion for nonsuit expressly limited its immunity
defense to Delivery Theory No. 2 and the Draw Deed claims. Generally, trial court error
is waived by implication or deemed forfeited when the appellant fails to bring the alleged
error to the trial court’s attention by timely motion or objection. (Doers v. Golden Gate
Bridge, Highway & Transportation Dist. (1979) 23 Cal. 3d 180, 184-185, fn. 1; In re
Marriage of Falcone & Fyke (2008) 164 Cal. App. 4th 814, 826.)
       Fidelity responds that it did not forfeit its immunity defense as to any of Plaintiffs’
theories of liability. It argues that although its written motion for nonsuit briefed the

                                              22
immunity defense as to only Delivery Theory No. 2 and the Draw Deed claims, at the
oral argument on the motion, Fidelity’s counsel argued that immunity applied to all of
Plaintiffs’ claims. Alternatively, Fidelity argues that since the immunity affects the trial
court’s subject matter jurisdiction, the issue has not been waived or forfeited. We shall
not address Fidelity’s first point because its second point resolves the forfeiture question.
         In the absence of subject matter jurisdiction, a court has no power to hear or
determine a case. (Varian Medical Systems, Inc. v. Delfino (2005) 35 Cal. 4th 180, 196.)
The existence of subject matter jurisdiction is a question of law, which we review de
novo. (Robbins v. Foothill Nissan (1994) 22 Cal. App. 4th 1769, 1774.) Issues affecting
the trial court’s subject matter jurisdiction are never forfeited and can be asserted for the
first time on appeal, at any stage of the appellate process. (Consolidated Theatres, Inc. v.
Theatrical Stage Employees Union, Local 16 (1968) 69 Cal. 2d 713, 721 (Consolidated
Theatres) [whether action arising out of labor dispute was within exclusive jurisdiction of
NLRB]; San Joaquin County Human Services Agency v. Marcus W. (2010) 185
Cal. App. 4th 182, 187-188 [“lack of fundamental jurisdiction is not subject to the
forfeiture doctrine”]; In re Marriage of Oddino (1997) 16 Cal. 4th 67, 73 [issue of subject
matter jurisdiction raised for first time in petition for review “must be addressed”].)
         The questions whether the immunity in section 12414.26 bars this civil action and
whether the case is subject to the exclusive original jurisdiction of the Insurance
Commissioner are analogous to the issue presented in Consolidated Theatres, supra, 69
Cal. 2d 713. Since this question implicates the court’s subject matter jurisdiction, it may
be raised at any time, even for the first time on appeal. We therefore conclude Fidelity
has not forfeited its claims on appeal regarding its immunity defense. In light of our
conclusion, we shall not address the question whether the argument below preserved the
issue.

                                              23
       C. Standard of Review

       Whether this action is barred by the statutory immunity in section 12414.26 and
the interpretation of the statutory scheme in Chapter 1 (Title Insurance) is a question of
law, which we review de novo. (People ex rel. Lockyer v. Shamrock Foods Co., supra,
24 Cal.4th at p. 432.) Application of the interpreted statute to undisputed facts is also a
question of law subject to our independent review. (International Engine Parts, Inc. v.
Fedderson & Co. (1995) 9 Cal. 4th 606, 611.)

       D. Rules of Statutory Construction

       “In construing a statute, our fundamental task is to ascertain the Legislature’s
intent so as to effectuate the purpose of the statute. [Citation.] We begin with the
language of the statute, giving the words their usual and ordinary meaning. [Citation.]
The language must be construed ‘in the context of the statute as a whole and the overall
statutory scheme, and we give “significance to every word, phrase, sentence, and part of
an act in pursuance of the legislative purpose.” ’ [Citation.] In other words, ‘ “we do not
construe statutes in isolation, but rather read every statute ‘with reference to the entire
scheme of law of which it is part so that the whole may be harmonized and retain
effectiveness.’ [Citation.]” ’ [Citation.] If the statutory terms are ambiguous, we may
examine extrinsic sources, including the ostensible objects to be achieved and the
legislative history. [Citation.] In such circumstances, we choose the construction that
comports most closely with the Legislature’s apparent intent, endeavoring to promote
rather than defeat the statute’s general purpose, and avoiding a construction that would
lead to absurd consequences. [Citation.]” (Smith v. Superior Court (2006) 39 Cal. 4th 77,
83 (Smith).)

                                              24
       E. Statutory Scheme Governing Regulated Title Entities

       The California Supreme Court has observed that “in some instances, an action
may not lie under the UCL because another statutory scheme provides the exclusive
means for resolving disputes.” (Loeffler v. Target Corp. (2014) 58 Cal. 4th 1081, 1126
(Loeffler).) As examples of such statutory schemes, the Loeffler court cited the exclusive
remedy provision of the workers’ compensation law and two statutory schemes in the
Insurance Code involving insolvent insurers and casualty insurance rates. (Id. at pp.
1126-1127, citing Charles J. Vacanti, M.D., Inc. v. State Comp. Ins. Fund (2001) 24
Cal. 4th 800, 811–812 [workers compensation exclusive remedy, Lab. Code §§ 3201 et
seq.] and State of California v. Altus Finance (2005) 36 Cal. 4th 1284, 1291 (Altus)
[restitution remedy under UCL barred by § 1037 in cases involving insolvent insurers]
and MacKay v. Superior Court (2010) 188 Cal. App. 4th 1427, 1434, 1441–1443
(MacKay) [immunity under § 1860.1; statutory administrative process is exclusive means
of challenging auto insurance rates that the DOI has approved].) Citing Altus, the
Supreme Court explained that section 1037 gives the Insurance Commissioner exclusive
authority to bring a civil action when an insurer is insolvent and held that “the Attorney
General may not bring a UCL action for restitution that ‘trespasses directly on the core
function of the [Insurance] Commissioner.’ ” (Loeffler, at pp. 1126-1127.) Citing
MacKay, the court stated that “a UCL action will not lie to challenge an insurance rate
previously approved by the [Department] of Insurance.” (Ibid.) The question presented
here is whether the statutory immunity in Chapter 1 (§ 12414.26) bars this action
challenging the use rates for which there have been no rate filings; rates that have neither
been approved nor accepted by the Insurance Commissioner.
       Fidelity argues the section 12414.26 immunity is broad and that a “review of
Article 5.5 shows that it encompasses all conduct Fidelity performs in conducting the

                                             25
business of title insurance,” including “the making and use of the rate filings and the
agreements to pay fees” (italics added). Fidelity interprets the immunity too broadly.
       The Insurance Code contains a comprehensive scheme for the regulation and
enforcement of entities and persons engaged in the business of title insurance. (See
summary at 12 Witkin, Summary of Cal. Law (11th ed. 2107) Real Property, § 367, pp.
423-424.) Excluding the definitions in article 1, Chapter 1 (Title Insurance) is divided
into 15 articles that regulate various aspects of the business of title insurance. Under
Chapter 1, title insurers must maintain financial stability (§§ 12350 to 12388 [arts. 2, 3,
and 3.5]) and underwritten title companies must furnish quarterly financial statements to
the Insurance Commissioner (§ 12389.4 [art. 3.7]). Rates and commissions are regulated
for all regulated title entities (§§ 12401 et seq. [art. 5.5 “Rate Filing and Regulation] and
§§ 12404 et seq. [art. 6 “Rebates and Commissions”]) and rebates and discounts are
prohibited (§ 12405). Rate schedules must be filed with the Insurance Commissioner,
posted in the regulated title entity’s place of business, and made available to the public
(§ 12401.9 [art. 5.5]). Under article 6 of Chapter 1, regulated title entities are subject to
the disciplinary authority of the Insurance Commissioner with regard to rebates and
commissions (§§ 12410, 12411). The statutory scheme also regulates advisory
organizations9 (§ 12402 et seq. [art. 5.7]) and marketing representatives who work for
regulated title entities (§ 12418 et seq. [art. 8]), as well as the deposit or collection of

       9
          An “ ‘[a]dvisory organization’ ” is a “person or entity (other than a title insurer,
underwritten title company, or controlled escrow company) which recommends or
prepares policy forms or endorsements, or procedural manuals (but not including the
making of rates, rating plans, or rating systems), or which collects and furnishes to its
members or insurance supervisory officials loss and expense statistics or other statistical
information and data relating to the business of title insurance and who otherwise acts in
an advisory, as distinguished from a ratemaking, capacity. No duly authorized attorney at
law acting in the usual course of his profession nor any entity engaging in the above
activity on a nationwide basis shall be deemed to be an advisory organization.”
(§ 12340.8.)

                                               26
items connected with an escrow, the disbursement of funds from escrow accounts, and
interest on escrow fund deposits (§§ 12413.1, 12413.2, and 12413.5 [art. 6]). It requires
regulated title entities to submit business plans (§§ 12396 et seq. [art. 4.5]) and to pay
annual renewal fees (§§ 12415 et seq. [art. 7]) to cover the costs of administering and
enforcing the statutory scheme.
       Although the statutory scheme regulates a broad range of activity in the business
of title insurance, the section 12414.26 immunity by its own terms is expressly limited to
“ ‘act[s] done, action[s] taken, or agreement[s] made pursuant to the authority conferred
by Article 5.5 . . . or Article 5.7 . . . of’ ” Chapter 1. “Article 5.5 applies only to rate
regulation, article 5.7 only to advisory organizations which supply data related to rate
making.” (Quelimane Co. v. Stewart Title Guaranty Co. (1998) 19 Cal. 4th 26, 44-45, fn.
omitted (Quelimane).) As our summary in the previous paragraph illustrates, Chapter 1
regulates several aspects of the business of title insurance that are unrelated to rate
making and advisory organizations. We therefore reject the assertion that immunity
applies to “all conduct Fidelity performs in conducting the business of tile insurance.”

       F. The Authority Conferred by Article 5.5

       As we have noted, section 12414.26 provides: “No act done, action taken, or
agreement made pursuant to the authority conferred by Article 5.5 . . . of this chapter
shall constitute a violation of or grounds for . . . civil proceedings . . . .” In determining
the scope of the section 12414.26 immunity, we next examine what is meant by “the
authority conferred by Article 5.5.” Since this case involves the rate filings of an
underwritten title company and not an advisory organization, we are not concerned with
the scope of article 5.7 (§§ 12402-12402.2), which concerns advisory organizations.
       When enacted, article 5.5 of Chapter 1 was expressly entitled “Rate Filing and
Regulation.” (Stats. 1973, ch. 1130, p. 2307.) The purpose of article 5.5 “is to promote
the public welfare by regulating rates for the business of title insurance as herein

                                               27
provided to the end that they shall not be excessive, inadequate or unfairly
discriminatory.” (§ 12401.) The provisions of article 5.5 (§§ 12401 to 12401.10) require
regulated title entities to establish “basic classifications of coverages and services to be
used as the basis for determining rates” (§ 12401.2) and to file their “schedules of
rates . . . and every modification thereof” that they propose to use in California with the
Insurance Commissioner (§ 12401.1).
       Section 12401.1 provides in relevant part: “Every . . . underwritten title
company . . . shall file with the commissioner its schedules of rates, . . . and every
modification thereof which it proposes to use in this state. . . . Every filing shall set forth
its effective date, which shall be not earlier than the 30th day following its receipt by the
commissioner, and shall indicate the character and extent of the coverages and services
contemplated.”
       Section 12401.3 contains detailed standards that “apply to the making and use of
rates” under article 5.5. It repeats the purpose of the statutory scheme that “[r]ates shall
not be excessive or inadequate, . . . nor shall they be unfairly discriminatory” and, among
other things, defines when a rate is “excessive” or “inadequate.” (§ 12401.3, subd. (a).)
Section 12401.4 permits the exchange of information between the commissioner, persons
and entities in the business of title insurance, and advisory organizations “to further
uniform administration of rate regulatory laws.” Section 12401.7 provides in pertinent
part: “No [regulated title entity] shall use any rate in the business of title insurance prior
to its effective date . . . .” Sections 12401.71 and 12401.8 set forth exceptions to
section12401.7. Section 12401.71 permits regulated title entities to “use a new rate prior
to 30 days after filing” if it results in a rate reduction and meets other requirements.

                                              28
Section 12401.8 specifies the circumstances under which rates “in excess of those set
forth in a rate filing which has become effective” may be used.10
       Unlike other types of insurance, title insurance rates need not be approved by the
insurance commissioner prior to their use. (See §§ 1861.01, subd. (c) [“insurance
rates . . . must be approved by the commissioner prior to their use.”], 1851 [the provisions
regarding rate approval “shall apply to all insurance on risks or on operations in this state,
except: [seven classes of insurance, including] “(d) Title insurance.”].)
       Dwayne Buggage, who was an analyst in the DOI’s rate filing bureau for more
than 20 years, testified at trial. He explained that in regulating the business of title
insurance, the DOI accepts regulated title entities’ filed rates, but does not approve them.
As an analyst, he reviews the filings “to make sure that they make sense at least to
[him].” He looks for ambiguity in the rates, “to see if there’s more than one rate set for
one risk” and to “make sure that . . . the rates are not excessive or inadequate or
discriminatory,” which is consistent with the purposes of article 5.5. After he completes
his review and analysis, the rate filings are reviewed by his bureau chief. Rate filings
may be accepted or rejected by the DOI or withdrawn by the filer. If rejected, it is
usually because the filing is incomplete. If Buggage rejects a rate filing, he sends a letter
to the filer explaining the deficiency. The filer will either (1) address the deficiency and
resubmit the rate schedule or (2) request a hearing before an administrative law judge to
contest the DOI’s decision.

       10
            Section 12401.8 provides in relevant part that charges in excess of those set
forth in the rate filing may be made when the regulated title entity includes a statement in
its rate filing that “such charges may be made in the event . . . unusual services are
performed.” It also requires that the charges be “reasonably commensurate with . . . the
costs of the services performed” and that “each person or entity obligated to pay such
charges consents thereto in writing in advance.” (§ 12401.8.)

                                              29
       G. Case Law Interpreting Section 12414.26 and Analogous Immunity
          Statutes

       We turn next to the case law interpreting section 12414.26 and two analogous
immunity provisions in the Insurance Code.
       The only published California case that discusses the immunity in section
12414.26 is Quelimane, supra, 19 Cal. 4th 26. In Quelimane, the Supreme Court
considered whether Insurance Code provisions governing title insurance barred a civil
action, including claims under the UCL, by plaintiffs (landowners) who alleged they had
been harmed by a conspiracy among title insurers to refuse to sell title insurance on real
property in El Dorado County with a tax sale in the chain of title. (Id. at pp. 33, 43,
48-49.) The defendants in Quelimane, three title insurers, argued they were not subject to
the UCL based on the immunity in section 12414.26 and the language of
section 12414.29. (Id. at pp. 44-45, fn. omitted.) The court held “[t]he scope of these
sections is expressly limited to articles 5.5 and 5.7 of [the chapter that] governs title
insurance. Article 5.5 applies only to rate regulation, article 5.7 only to advisory
organizations which supply data related to ratemaking.” (Id. at pp. 44-45.) The court
rejected the insurers’ contention that section 12414.29 barred the plaintiffs’ UCL claim
and held that the Legislative purpose of section 12414.29 “was to preempt local
regulation, not to exempt title insurers from other state laws governing unfair business
practices.” (Id. at p. 45.) The Supreme Court faulted the Court of Appeal for failing to
“consider the restriction to ratemaking-related activities in . . . sections 12414.26 and
12414.29.” (Id. at p. 46.) The court held that “the Insurance Code does not displace the
UCL except as to title insurance company activities related to rate setting.” (Id. at p. 33.)
It concluded the complaint at issue sufficiently alleged concerted action in restraint of
trade that violated the Cartwright Act, and held that “a title insurer’s violation of the
Cartwright Act in conduct unrelated to rate fixing may be the predicate for a UCL
action.” (Id. at p. 51, italics added.) Since the case involved an alleged conspiracy to

                                              30
refuse to sell title insurance on certain types of property, and not ratemaking activity, it
was not barred by the section 12414.26 immunity
       Two federal district court cases have discussed the section 12414.26 immunity.
We find those cases persuasive. In Lyons v. First American Title Ins. Co. (N.D. Cal.
Dec. 22, 2009, No. C 09-4156 PJH) 2009 U.S. Dist. Lexis 119859 (Lyons), the court held
that a civil action against a title insurer alleging race discrimination based on the title
insurer’s use of different rates for persons with “ ‘non-prime’ ” or “ ‘sub-prime’ ”
mortgages from those with other types of mortgages actually took issue with two separate
refinance rates that had been filed and disclosed under article 5.5 and was therefore
barred by the section 12414.26 immunity. (Id. at pp. *3-*4, *17-*19.) The court in In re
Cal. Title Ins. Antitrust Litigation (N.D. Cal. Nov. 6, 2009, C 08-01341 JSW) 2009 U.S.
Dist. LEXIS 103407 held that a UCL claim based on alleged illegal rebates, kickbacks,
and commissions did not involve ratemaking and was therefore not barred by the section
12414.26 immunity.11
       In State Compensation Insurance Fund v. Superior Court (2001) 24 Cal. 4th 930
(SCIF), the California Supreme Court construed section 11758, an immunity provision
that is analogous to section 12414.26.12 The plaintiffs in that case, businesses that were
insured by SCIF, on behalf of themselves and other insureds, alleged that SCIF had
misallocated medical-legal expenses and misreported their financial information to the

       11
           The statutes prohibiting such conduct (§§ 12404, 12405) are in article 6 not
article 5.5 of Chapter 1 (Title Insurance).
       12
          Section 11758 provides: “No act done, action taken or agreement made
pursuant to the authority conferred by this article shall constitute a violation of or grounds
for prosecution or civil proceedings under any other law of this State heretofore or
hereafter enacted which does not specifically refer to insurance.” The article referred in
section 11758 is article 3 (Rating and Other Organizations) of chapter 3 (Regulation of
Business of Workers’ Compensation Insurance) of part 3 of division 2 of the Insurance
Code.

                                              31
Workers’ Compensation Insurance Rating Bureau. As a result, the insureds’ experience
modifications were artificially inflated, which allowed SCIF to collect excessive
premiums from the insureds. (Id. at pp. 933-934, 936.) The parties disputed whether the
case involved ratemaking. (Id. at p. 936.) “While the question [was] close,” the Supreme
Court concluded that the plaintiff’s allegations related to SCIF’s misconduct before it
sent the data to the rating bureau and did not “challenge the method by which the rate or
premium charged was set, but rather the insurer’s misallocation of certain expenses,” and,
that section 11758 did not immunize SCIF from civil liability under those circumstances.
(Id. at pp. 932, 942, 944.)
       The parties rely on cases that construe the immunity provision in section 1860.1,
which contains language similar to that of sections 12414.26 and 11758. Section 1860.1
provides: “No act done, action taken or agreement made pursuant to the authority
conferred by this chapter shall constitute a violation of or grounds for prosecution or civil
proceedings under any other law of this State heretofore or hereafter enacted which does
not specifically refer to insurance.” (Italics added.) The chapter referenced in section
1860.1 is chapter 9 (Rates and Rating and Other Organizations) of part 2 (The Business
of Insurance) of division 1 (General Rules Governing Insurance) of the Insurance Code
(hereafter, sometimes “Chapter 9”). Chapter 9 applies to “all insurance” except seven
classes of insurance that are expressly excluded in section 1851; notably, the exclusions
include title insurance. (§ 1851, subd. (d).) The section 1860.1 cases were decided after
the passage of Proposition 103, which made “ ‘ “numerous fundamental changes in the
regulation of automobile and other types of insurance.” ’ ” (Walker v. Allstate Indemnity
Co. (2000) 77 Cal. App. 4th 750, 752 (Walker).)
       The court in Walker considered a civil action by a putative class of auto insurance
customers against more than 70 auto insurers and the Insurance Commissioner alleging
four causes of action, including a UCL claim, based “on the insurers’ charging approved
rates alleged nevertheless to be ‘excessive.’ ” (Walker, supra, 77 Cal.App.4th at pp. 752-

                                             32
753.) The court observed that “[h]istorically, [sections 1860.2 and 1860.2] have been
interpreted to provide exclusive original jurisdiction over issues related to ratemaking to
the commissioner. (See Chicago Title Ins. Co. v. Great Western Financial Corp. (1968)
69 Cal. 2d 305, 323 . . . [‘a court is not the appropriate initial arbiter of factors involved in
insurance costs’]; [citation].” (Id. at p. 755.)
       One issue in Walker was whether the changes “wrought” by Proposition 103
affected the immunity provision in section 1860.1. (Walker, supra, 77 Cal.App.4th at
pp. 755-756.) The court held that section 1860.1 barred the plaintiffs’ claims, stating: “If
section 1860.1 has any meaning whatsoever . . . , the section must bar claims based upon
an insurer’s charging a rate that has been approved by the commissioner . . . .” (Id. at
p. 756.) The court observed that under the statutory “scheme, the commissioner is
charged with setting rates after an extensive hearing process in which consumers and
interested parties are encouraged to participate. . . . When this process has run its course,
the insurers must charge the approved rate and cannot be held civilly liable for so doing.
[Citations.] A consumer or an interested party is, however, provided the opportunity to
petition the commissioner to review the continued use of any approved rate, i.e. obtain
prospective, not retrospective, relief. [Citations.] . . . [U]nder the statutory scheme . . . ,
the charging of an approved rate cannot be deemed ‘illegal’ or ‘unfair’ for purposes of
the [UCL] or, indeed, tortious.” (Id. at p. 756.) The court explained that section 1860.1
states that an “ ‘action taken . . . pursuant to the authority conferred by [Chapter 9]’ ”
cannot constitute grounds for civil proceedings, and reasoned that “[w]hatever else
[Chapter 9] does, it definitely confers authority upon the commissioner to approve rates.
Moreover, an insurer’s action of collecting premiums consistent with an approved rate is
certainly done pursuant to the authority conferred on the commissioner by [Chapter 9].”
(Id. at pp. 756–757.) Thus, the court concluded the plaintiffs’ civil action challenging the
approved rates was barred by sections 1860.1 and 1860.2. (Id. at pp. 754, 760.)

                                               33
       In Donabedian v. Mercury Ins. Co. (2004) 116 Cal. App. 4th 968, a policyholder
sued his automobile insurer under the UCL alleging the insurer improperly used his lack
of prior insurance as a criterion to determine insurability, the amount of his premium, and
eligibility for two discounts. The court held the UCL action was not barred because it did
not involve a challenge to approved rates but instead involved how the components of the
insurer’s class plan were applied to the public. (Id. at pp. 991-993.)
       The plaintiff in Krumme v. Mercury Ins. Co. (2004) 123 Cal. App. 4th 924, 928,
936 (Krumme), filed a UCL action challenging the practice of three related insurers of
selling auto and other personal lines of insurance through brokers who were actually the
insurers’ agents but charged broker fees. The plaintiff complained that the broker fees
were not disclosed to the DOI or in the insurers’ comparative premium rate advertising
and alleged that since the insurers’ rates failed to disclose that they would be charged
broker fees, the premiums appeared deceptively low. (Id. at p. 932.) The defendants
argued that if the allegedly illegal broker fees were part of the premium it charged, the
matter came within the Insurance Commissioner’s plenary authority over rates and
premiums. The appellate court concluded the case did not involve ratemaking, since the
plaintiff alleged the insurers violated provisions of the Insurance Code regulating brokers
and engaged in false advertising. (Id. at pp. 936-937.)
       The court in Krumme explained: “The elaborate statutory and administrative
process for setting rates has ‘been interpreted to provide exclusive original jurisdiction
over issues related to ratemaking to the commissioner.’ ([Walker], supra, 77 Cal. App. 4th
750, 755.) The Insurance Code does not, however, displace the UCL ‘except as to . . .
activities related to rate setting.’ (Quelimane[, supra,] 19 Cal. 4th 26, . . . ; see [Walker],
at p. 759.) . . . ‘A judicial act constitutes rate regulation only if its principal purpose and
direct effect are to control rates. . . . In general, a claim that directly challenges a rate and
seeks a remedy to limit or control the rate prospectively or retrospectively is an attempt to
regulate rates,’ but ‘a claim that directly challenges some other activity, such as false

                                               34
advertising . . . is not rate regulation.’ [Citation.] A claim predicated on a violation of
the Insurance Code not related to ratemaking may thus be framed as a claim under the
UCL. [Citation.]” (Krumme, supra, 123 Cal.App.4th at pp. 936-937.)
       The plaintiffs in MacKay, brought a class action lawsuit alleging violations of the
UCL against 21st Century Insurance. They alleged they paid increased premiums due to
a lack of prior insurance and that the defendant used two impermissible factors to
determine auto insurance rates that were based on the lack of prior insurance: accident
verification and persistency. (MacKay, supra, 188 Cal.App.4th at pp. 1433-1434.) The
parties in MacKay disputed whether accident verification had been approved by the DOI
as a rating factor. (Id. at pp. 1435-1436.) The court reviewed the history of the rate
filings and a DOI enforcement action against the insurer and held that accident
verification had been approved by the DOI as a rating factor in that case. (Id. at
pp. 1436-1439.) The court concluded that the DOI’s prior approval of the rating factor
precluded a civil action challenging it, the UCL claim was barred by the immunity in
section 1860.1, and the “statutory provisions for an administrative process (and judicial
review thereof) were the exclusive means of challenging an approved rate.” (Id. at
pp. 1432, 1449-1451.)
       In summary, the cases hold that the immunity provisions in the Insurance Code
(§§ 1860.1, 11758, 12414.26) barred civil actions that challenged as excessive auto
insurance rates that had been approved by the Insurance Commissioner (Walker, supra,
77 Cal. App. 4th 756-757), the use of rating factors that had been approved by the
Insurance Commissioner to set auto insurance rates (MacKay, supra, 188 Cal. App. 4th
1449-1451), and a race discrimination case that was actually a challenge to title insurance
rates that had been accepted by the Insurance Commissioner (Lyons, supra, 2009 U.S.
Dist. Lexis 119859, *15). On the other hand, statutory immunity did not bar civil actions
that were unrelated to rate making, including actions based on an alleged conspiracy to
refuse to provide title insurance (Quelimane, supra, 19 Cal. 4th 44-46, 51); false

                                             35
advertising (Krumme, supra, 123 Cal.App.4th at pp. 936-937); misallocating medical-
legal expenses in reports submitted to the WCIRB (SCIF, supra, 24 Cal. 4th 932, 942,
944); violating statutes that regulate insurance brokers (Krumme, at p. 936-937); and
charging illegal rebates, kickbacks, and commissions (In re Cal. Title Ins. Antitrust
Litigation, supra, 2009 U.S. Dist. LEXIS 103407).

       H. Analysis

       Quelimane instructs that the immunity applies to “ratemaking-related activities”;
we must therefore determine whether the conduct at issue here is “related to ratemaking.”
(Quelimane, supra, 19 Cal.4th at p. 46.) As the cases illustrate, whether the action is
barred by statutory immunity turns on the wrong alleged.
       In our view, this case is more like the cases that involved activities related to
ratemaking than those that did not. Plaintiffs do not allege a conspiracy to refuse to
provide title insurance (Quelimane, supra, 19 Cal. 4th 44-46, 51); false advertising
(Krumme, supra, 123 Cal.App.4th at pp. 936-937); misallocating or misrepresenting
information in a report to an advisory agency (SCIF, supra, 24 Cal. 4th 932, 942, 944);
violating statutes that regulate insurance brokers or title insurance representatives
(Krumme, at p. 936-937; § 12418 et seq.); charging illegal rebates, kickbacks, or
commissions (In re Cal. Title Ins. Antitrust Litigation, supra, 2009 U.S. Dist. LEXIS
103407; §§ 12404-12411). Nor does the complaint allege any violations of the statutes
governing Fidelity’s actual handling of the escrow (§§ 12413.1-12413.5)—which are not
in article 5.5—as opposed to the rates charged for its services.
       Applying section 12414.26 to the different theories of liability asserted at trial aids
the analysis. Plaintiffs’ Delivery Theory No. 2 and the General Draw Deed Theory
challenged the language of Fidelity’s filed rates. Under Delivery Theory No. 2, Plaintiffs
argued that Fidelity’s base rate for escrow services set forth in the filing included the cost
of delivery services and that by charging for delivery services in addition to the base rate,

                                             36
Fidelity was billing them twice. The general Draw Deed Theory argued that drawing a
deed was not the same as “document preparation” for which there was a filed rate. These
theories required the court to interpret Fidelity’s rate filings to determine whether they
encompassed the charges at issue. This was a challenge to the rates as filed by Fidelity.
Since these theories challenged the “basic classifications of . . . services [Fidelity
established] to be used as the basis for determining rates” (§ 12401.2) and the rate
schedules Fidelity filed with the Insurance Commissioner (§ 12401.1), they involved acts
done “pursuant to the authority conferred by Article 5.5” (§ 12414.26) and are subject to
the immunity. Thus, we disagree with the trial court’s conclusion that the
section 12414.26 immunity did not apply to Delivery Theory No. 2 and the General Draw
Deed Theory. (As noted, Plaintiffs have elected not to pursue their claims under either of
these theories on appeal.)
       The more difficult question is whether the immunity applies to Plaintiffs’ Delivery
Theory No. 1 and the Draw Deed Theory of the Gap Period Plaintiffs. The gravamen of
these claims is that Fidelity charged for delivery services and some draw deed services
that it did not include in its rate filings and that were therefore not accepted by the
Insurance Commissioner. Alternatively, the claim may be framed as Fidelity’s failure to
include in its rate filings amounts it charged for third party delivery services and some
draw deed fees. Broadly speaking, these claims appear to be related to Fidelity’ rate-
making activities.
       Furthermore, the primary legal issue under Delivery Theory No. 1 is whether
Fidelity was required to file a rate for delivery services performed by third party vendors.
The trial court concluded it was and Fidelity challenges that finding on appeal. Generally
speaking, the question whether a regulated title entity is required to include the cost of
services performed by third parties in its rate filings appears to be related to ratemaking
activity.

                                              37
       We conclude Plaintiffs’ challenge to charges or rates that were not listed in
Fidelity’s rate filings fall within the authority conferred by article 5.5. The statues in
article 5.5 directed Fidelity to establish basic classifications of services to use as the basis
for determining its rates (§ 12401.2), to file its scheduled of rates with the Insurance
Commissioner (§ 12401.1), to indicate the character and extent of the services
contemplated in its rate filings (§ 12401.1), and prohibited Fidelity from using any rate
“prior to its effective date nor prior to the filing with respect to such rate having been
publicly displayed and made readily available to the public for a period of no less than
30 days . . . ” (§ 12401.7). Fidelity failed to establish rates for third party delivery
services and document preparation for sales escrows during the Gap Period (§ 12401.2).
And although Fidelity filed rate schedules with the Insurance Commissioner throughout
the class period, its rate filings failed to indicate the character and extent of all the
services contemplated (§ 12401.1). Fidelity also used rates or charges prior to any
effective date established by a rate filing in violation of section 12401.7. Thus, Fidelity
failed to comply with sections 12401.1, 12410.2, and 12401.7, all of which are in article
5.5 of Chapter 1. In our view, this conduct constitutes “act[s] done . . . pursuant to the
authority conferred by Article 5.5” (§ 12414.26). Thus, the claims under Delivery
Theory No. 1 and the Draw Deed claims of the Gap Period Plaintiffs are also barred by
the section 12414.26 immunity.

       I. Statutory Scheme Governing Insurance Commissioner’s Exclusive
          Original Jurisdiction Over Rate Making-related Activity

       In construing section 12414.26, we examine the statutory language in “the context
of the statute as a whole . . . with reference to the entire scheme of law of which it is part
so that the whole may be harmonized and retain effectiveness.” (Smith, supra, 39 Cal.4th
at p. 83.) Our conclusion on the immunity question is strengthened by reviewing the
statutes governing the Insurance Commissioner’s exclusive original jurisdiction over the

                                               38
business of title insurance and section 12304.7, which defines the term “rates” as used in
Chapter 1.
       The statutes governing the Insurance Commissioner’s exclusive original
jurisdiction over the business of title insurance are found in article 6.7 of Chapter 1,
which is entitled “Hearings, Procedure, and Judicial Review.” (§§ 12414.13-12414.19;
Stats. 1973, ch. 1130, p. 2311.) Article 6.7 contains procedures for complaints against
regulated title entities regarding their rates and the entity’s compliance with article 5.5.
The statutory scheme provides for three levels of review: (1) informal review of the
complaint by the regulated entity itself, (2) followed by a complaint to and possible
hearing before the Insurance Commissioner, (3) followed by judicial review in the courts.
(§§ 12414.13-12414.19.)
       More specifically, the statutory scheme provides that “[a]ny person aggrieved by
any rate charged, rating plan or rating system followed or adopted by a [regulated title
entity] may request such person or entity to review the manner in which the rate, plan,
system, or rule has been applied . . . .” (§ 12414.13, italics added.) If the regulated title
entity refuses to review that matter or fails to grant the relief requested, “[a]ny person
aggrieved by the action . . . may file a written complaint and request for hearing” with the
Insurance Commissioner. (§ 12414.13.) Section 12414.13 sets forth reasons, both
discretionary and mandatory, for the commissioner to deny a hearing.13 “Otherwise, and
if [the commissioner] finds that the complaint charges a violation of Article 5.5 . . . and
that the complainant would be aggrieved if the violation is proved, [the commissioner]
shall proceed as provided in Section 12414.14.” (§ 12414.13.)

       13
          Section 12414.13 provides that “[i]f the commissioner has information
concerning a similar complaint he may deny the hearing. If he believes that probable
cause for the complaint does not exist or that the complaint is not made in good faith he
shall deny the hearing.”

                                              39
       Section 12414.14 provides that if the Insurance Commissioner has good cause to
believe a regulated title entity or “any rate, rating plan or rating system made or used by
any such person or entity does not comply with the requirements and standards of Article
5.5,” the commissioner shall give written notice of noncompliance and specify a
“reasonable time, . . . , in which such noncompliance may be corrected,” unless there is
good cause to believe such noncompliance is willful. (§ 12414.14, italics added.) If the
commissioner “has good cause to believe such noncompliance to be willful,” or if within
the period prescribed by the commissioner the regulated title entity does not correct the
noncompliance “or establish to the satisfaction of the commissioner that such specified
noncompliance does not exist, then the commissioner may hold a public hearing.”
(§ 12414.15.)
       The statutory scheme sets forth the powers of the commissioner upon finding a
violation or finding the violation was willful or finding the regulated entity has not
complied with the commissioner’s orders in the matter. (§§ 12414.16–12414.18.) It also
provides for judicial review of any findings, rulings, or orders by the commissioner and
contains procedural rules governing such review. (§ 12414.19.)
       In addition to reviewing complaints by aggrieved persons, the Insurance
Commissioner may investigate ratemaking activity on his or her own initiative. The
commissioner “may, . . . , make or cause to be made an examination of every” regulated
title entity “to ascertain whether such person or entity and every rate and rating system
used in the business of title insurance complies with the requirements and standards of
Article 5.5 (commencing with Section 12401) . . . .” (§ 12414.21, italics added; see also
Cal. Code Regs., tit. 10, § 2355.4.) The Insurance Commissioner may examine the
officers, managers, agents, and employees of regulated title entities under oath and order
the production of records, documents, statistics, data, and other information “to which
such examination relates.” (§ 12414.22, 12414.23; Cal. Code Regs., tit. 10, § 2355.4.)

                                             40
       The Insurance Code defines the term “ ‘rate’ ” or “ ‘rates’ ” as used in Chapter 1
as “the charge or charges, . . . , made to the public by [a regulated title entity], for all
services it performs in transacting the business of title insurance.”14 (§ 12340.7, italics
added.) By its express language, section 12414.13—which governs informal requests for
review and complaints and requests for hearing to the Insurance Commissioner—applies
to grievances based on “any rate charged” by a regulated title entity. The statute’s use of
the phrase “any rate charged” in addition to “rating plan or rating system” indicates it
applies to any charge, and not just rates or charges that are included in a rating plan or
rating system (i.e., schedule of rates) that has been accepted by the Insurance
Commissioner.
       Section 12414.13 empowers the Insurance Commissioner to act when a
“complaint charges a violation of Article 5.5.” Similarly, section 12414.14 empowers the
Insurance Commissioner to act when “any rate, rating plan or rating system made or
used” by a regulated title entity does not comply with the requirements and standards of
Article 5.5” and section 12414.21 empowers the Insurance Commissioner to ascertain
whether “every rate and rating system” complies with article 5.5. (Italics added.) Thus,
the statutes governing administrative review of rates support the conclusion that the

       14
          Section 12340.7 provides: “Except as provided in Section 12401.8, and
excluding miscellaneous charges, “rate” or “rates” means the charge or charges, whether
denominated premium or otherwise, made to the public by a title insurer, an underwritten
title company or a controlled escrow company, for all services it performs in transacting
the business of title insurance. As used in this section miscellaneous charges means
conveyancing fees, notary fees, inspection fees, tax service contract fees and such other
fees as the commissioner by regulation may prescribe.” As we have noted, section
12401.8 states the circumstances under which a regulated title entity may charge amounts
in excess of its filed rates. This case does not involve conveyancing fees, notary fees,
inspection fees, or tax service contract fees, and the Insurance Commissioner has not
promulgated any regulations that expands the list of “miscellaneous charges” to include
delivery services or document preparation fees. (Cal. Code Regs., tit. 10, §§ 2355.1-
2355.5.)

                                               41
Insurance Commissioner’s plenary authority over ratemaking extends to “any rate
charged” and “every rate” not just the rates set forth in a rate filing that has been accepted
by the Insurance Commissioner. Plaintiffs allege Fidelity failed to comply with article
5.5 by charging rates for services that were not listed in its rate filings and failing to
include rates for third party delivery services and some document preparation in its rate
filings. The statutes in article 6.7 of Chapter 1, particularly sections 12414.13, 12414.14,
and 12414.21, expressly provide that Plaintiffs’ claims fall within the exclusive original
jurisdiction of the Insurance Commissioner. Thus, article 6.7of Chapter 1 supports our
conclusion that this case is barred by the immunity in section 12414.26.

       J. Effect of Section 12414.27 on Immunity Conferred by Section 12414.26

              1. Language of Section 12414.27

       Plaintiffs contend the conduct at issue here is expressly excluded from the section
12414.26 immunity for ratemaking-related activity by the language of section 12414.27.
Fidelity argues section 12414.27 does not limit the immunity.
       Section 12414.27 provides: “Commencing 120 days following January 1, 1974,
no [regulated title entity] shall charge for any title policy or service in connection with
the business of title insurance, except in accordance with rate filings which have become
effective pursuant to Article 5.5 . . . or as otherwise authorized by such article; provided,
however, where a rate is on file with the commissioner and in effect immediately prior to
such date, such rate shall continue in effect until a new rate filing is thereafter made and
becomes effective in the manner provided in Article 5.5 . . . of this chapter.”
       Plaintiffs argue section 12414.27 prohibits the conduct at issue in this case:
charging for services for which there has been no rate filing. Plaintiffs argue a violation
of section 12414.27 cannot be immunized by section 12414.26 because the section
12414.26 immunity applies to “act[s] done, action[s] taken, or agreement[s] made

                                              42
pursuant to the authority conferred by Article 5.5” and section 12414.27 is in article 6.9,
not article 5.5. They argue that if the Legislature had intended to provide a broad
immunity that applies to any fees charged, even those for which no rate has been filed, it
would not have enacted section 12414.27 or placed it in article 6.9 to which the section
12414.26 immunity does not apply.
       Fidelity advocates another interpretation and urges us to read section 12414.27 as
“the grace period or savings statute the Legislature intended.” Fidelity argues: “[h]aving
established new rate regulation in article 5.5, the Legislature needed an implementing
statute to govern when new requirements take effect, and what happens with rates already
on file under the old law.” It contends the Legislature drafted section 12414.27 as a
miscellaneous procedural statute and placed it in article 6.9 for that reason. Fidelity
argues the first clause in section 12414.27—which states “[c]ommencing 120 days
following January 1, 1974”—“expressly provides a grace period to adjust to the new law,
by postponing the operative date of Article 5.5’s rate regulation.” Fidelity adds that the
“second clause simply means that if title insurers were already using rates on file, they
did not have to re-file them under Article 5.5.”
       Thus, the question presented is whether section 12414.27 is a prohibitory statute
that carves out an exception to the section 12414.26 immunity or an implementing statue
that establishes an operative date for the rate filing and regulatory scheme in article 5.5.
Section 12414.27 does contain prohibitory language. It states: “no [regulated title entity]
shall charge for any . . . service . . . , except in accordance with rate filings that have
become effective . . . .” Although the Legislature placed section 12414.27 directly after
the immunity provision in section 12414.26 and outside article 5.5, section 12414.27 does
not mention section 12414.26 or otherwise indicate an intent to modify the scope of the
immunity provided by section 12414.26.
       The interpretation advanced by Plaintiffs does not take into account the first clause
of section 12414.27: the words “[c]ommencing 120 days following January 1, 1974.”

                                               43
(§ 12414.27.) A brief review of the statute’s history helps illuminate the language of the
first clause. The statutory scheme at issue was enacted in 1973; it amended, repealed,
and added several provisions to the Insurance Code. (Stats. 1973, ch. 1130, pp. 2300-
2315.) The Legislation was signed by the Governor on October 2, 1973 and took effect
on January 1, 1974. (Stats. 1973, ch. 1130, p. 2300; Gov. Code, § 9600.) The timing of
the enactment supports the conclusion that the legislative intent behind section 12414.27
was to delay the operative date of the rate filing regulatory scheme in the new legislation.
In other words, although the statutory scheme took effect on January 1, 1974,
section 12414.27 provides that the rate filing and regulatory provisions of article 5.5
would not be operative until 120 days after the effective date of the new legislation.
       “It has long been recognized that a statute may legally be framed to provide for an
effective date and an operative date. [Citations.] In the usual situation, the effective date
and the operative date are one and the same; however, the power to enact laws includes
the power to fix a future date on which the act will become operative. [Citation.]”
(Estate of Rountree (1983) 141 Cal. App. 3d 976, 980.) “The Legislature may provide for
an operative date subsequent to the effective date of a statute to allow persons affected to
become acquainted with and implement its provisions, as well as to give lead time to the
governmental authorities to establish machinery for the operation of or implementation of
the new law.” (Id. at p. 980, fn. 3.)

              2. Legislative History of Section 12414.27

       The legislative history of section 12414.27 supports the conclusion that the
Legislature’s intent was to delay implementation of the new statutory scheme, not to limit
the immunity provision in section 12414.26. The statutes at issue were enacted by Senate
Bill No. 1293, which was introduced in May 1973 at the request of the California Land

                                             44
Title Association. (Enrolled Bill Memo to Gov. for Sen. Bill No. 1293 (1993-1994 Reg.
Sess.)15 Sept. 30, 1973; Sen. Final Hist. (1973-1974 Reg. Sess.), p. 568.)
       According to the Assembly Committee on Finance and Insurance analysis, the bill
proposed “to regulate the organization and rate making of title insurance companies,
underwritten title companies, and controlled escrow companies. It requires that the rates
be subject to the same tests [that were] applied to other types of insurance by the
MacBride-Grunsky Rating Law. This requires that the rates not be inadequate nor
excessive nor unfairly discriminatory. [¶] Rates, as established by the individual
companies or by rating organizations, would be filed with the Insurance Commissioner
who would have the right to review such rates. Procedures are provided for the review
of the rates and for administrative and judicial hearing if rates are found to be in
violation of the rating act. [¶] Under current statutory law, rates of title insurance
companies are not regulated. . . . [This bill] would subject future rating of title
insurance policies to review by the Insurance Commissioner and thus permit the use of
rating organizations which could be used to develop rates to be made available to the
members of the rating organization.” (Assem. Com. on Finance and Insurance, Analysis
of SB 1293, as amended Aug. 27, 1973, italics added.)
       The bill was amended three times. (Assem. Amend. to SB 1293 Sept. 10, 1973,
p. 1.) When originally proposed, the legislation did not include either section 12414.26
or section 12414.27. (SB 1293 as introduced May 3, 1973, pp. 28-30.) Instead, the
original bill contained a Section 20, which provided: “The Legislature finds and declares
that the changes in the law affecting the business of title insurance made by this act
constitute a major departure from preexisting law and that compliance with this act will
require the formulation, adaptation and implementation of new regulatory and business

       15
         Hereafter, we shall use the shorthand reference “SB 1293” in place of the
phrase “Sen. Bill No. 1293 (1993-1994 Reg. Sess.)” in legal citations.

                                             45
practices by the Insurance Commissioner and persons and entities engaged in the
business of title insurance in this state. In order to promote the public welfare and to
assure an orderly method of transition from the requirements of preexisting law to
compliance with the requirements of this act the Legislature hereby directs that the
provisions of this act be implemented in the following manner.” (SB 1293 as introduced
May 3, 1973, at p. 31.)16 Section 20 then set forth a proposed schedule of three staggered
operative dates for implementing the new legislation and specified which statutes would
become operative on each date. By the first date, the Insurance Commissioner was to
promulgate certain regulations and forms. By the second date, the newly regulated title
entities were to file their schedules of rates. (Ibid.)
        Section 12414.27 was added to the bill by amendment in August 1973; the
language of the statute has not changed since then. (Assem. Amend. to SB 1293
Aug. 27, 1973, p. 22.) As we have noted, it provides: “Commencing 120 days following
January 1, 1974, no [regulated title entity] shall charge for any title policy or service in
connection with the business of title insurance, except in accordance with rate filings
which have become effective pursuant to Article 5.5 . . . or as otherwise authorized by
such article; provided, however, where a rate is on file with the commissioner and in
effect immediately prior to such date, such rate shall continue in effect until a new rate
filing is thereafter made and becomes effective in the manner provided in
Article 5.5 . . . .”
        The August 1973 amendment also deleted Section 20, the uncodified provision
that described the need for an “orderly method of transition” and provided for staggered
operative dates. (Assem. Amend. to SB 1293 Aug. 27, 1973, pp. 36-37.) The Legislature
replaced the staggered schedule in Section 20 with a single, delayed operative date for

        16
          For ease of reference, we shall refer to his uncodified portion of the bill as
“Section 20.” References to “Section 20” in this opinion are not to section 20 of the
Insurance Code, which defines the term “commissioner” as used in that code.

                                               46
rate filings and replaced the 60-day grace period in Section 20 with a 120-day grace
period after the legislation’s operative date for regulated entities to get their rates on file.
Rather than keep these provisions in an uncodified section of the bill, the Legislature
added a statute (§ 12414.27) that expressly set forth the delayed operative date for the
rate filing requirement and provided that after that date no regulated title entity shall
charge for any service except in accordance with its rate filings.
       Prior to 1974, the DOI regulated title insurers and underwritten title companies
through licensing, setting minimum capital requirements, and reviewing audits. Title
insurers were required to file their rates with the DOI, but the DOI did not regulate their
rates. (Legis. Analyst, Analysis of SB 1293, Sept. 11, 1973, p. 1.) And there was no rate
filing requirement for underwritten title companies or controlled escrow companies.
This history supports the conclusion that the Legislature also intended by the language of
section 12414.27 to authorize title insurers to use the rates already on file with the
Insurance Commissioner after the new legislation took effect.17
       We conclude, based on the language of the statute and this legislative history, that
the purpose of section 12414.27 was to establish a delayed operative date for regulated
title entities to prepare for the new statutory scheme and comply with the article 5.5 rate
filing requirements and not to carve out an exception to immunity for cases such as this.

       17
          Section 12414.26 was also added to the bill by the August 1973 amendment.
(Assem. Amend. to SB 1293 Aug. 27, 1973, p. 22.) When added, section 12414.26
provided that “no act done, action taken, or agreement made pursuant to the authority
conferred by this chapter shall constitute a violation of or grounds for prosecution or civil
proceedings . . . .” (Ibid.) Thus, when added to the bill, the section 12414.26 immunity
applied to the entire Chapter 1 and all aspects of the business of title insurance governed
by that chapter. When the bill was amended in September 1973, the phrase “the authority
conferred by this chapter” was changed to “the authority conferred by Article 5.5 . . . or
Article 5.7 . . . of this chapter.” (Assem. Amend. to SB 1293 Sept. 10, 1973, p. 22.) The
September 1973 amendment demonstrates the intent to limit the section 12414.26
immunity to ratemaking-related activity and advisory organizations.

                                               47
       Moreover, while section 12414.27 expressly prohibits charging for services
“except in accordance with rate filings which have become effective pursuant to
Article 5.5 . . . or as otherwise authorized by such article,” that same conduct is also
impliedly prohibited by the language of sections 12401.1, 12401.2, and 12401.7. As we
have observed, sections 12401.1 and 12401.2 required Fidelity to establish classifications
of services to be used as the basis for its rates, file its schedules of rates with the
Insurance Commissioner, and indicate in its rate filings the character and extent of the
services contemplated. (§§ 12401.1, 12401.2.) Section 12401.7 prohibited Fidelity from
using any rate prior to its effective date or prior to the rate filing with respect to that rate
having been publicly displayed and made readily available for 30 days prior to its
effective date. (§ 12401.7.) Here, Fidelity failed to establish classifications of services
for draw deed services for sales transactions during the Gap Period and for third party
delivery services. It also failed to indicate in its rate filings that it intended to charge for
those services and used rates before they were included in a rate filing. By charging for
such services, Fidelity has violated sections 12401.1, 12401.2, and 12401.7, which are in
article 5.5. Thus, its conduct was subject to the section 12414.26 immunity.
       For these reasons, we conclude the section 12414.26 immunity applies to
Plaintiffs’ UCL claims and that the immunity bars this action. Plaintiffs “may not bring a
UCL action for restitution” or any other cause of action in a civil proceeding “that
‘trespasses directly on the core function of the [Insurance] Commissioner’ ” concerning
rate filing and regulation in the business of title insurance. (See Loeffler, supra, 58
Cal.4th at pp. 1126-1127.)
       Plaintiffs are not left without a remedy. Article 6.7 of Chapter 1 describes the
procedures for bringing this matter before the Insurance Commissioner. In its order on
the attorney fees motion, the trial court observed that the Villanuevas did not present any
evidence of any “presuit efforts to contact governmental authorities concerning public
enforcement before filing a lawsuit.” The court added, “[I]t appears to be undisputed that

                                               48
Plaintiff did not attempt to contact the [DOI] prior to initiating the lawsuit. Plaintiff
argues that no action had been taken by the [DOI] and the [DOI] could not have sought
restitution as Plaintiff did. The fact that the [DOI] did not take action prior to the filing
of Plaintiff’s lawsuit does not necessarily mean the [DOI] would not have taken action
had Plaintiff made such a request. Action by the [DOI] could have resulted in a much
more efficient resolution of the issues raised in this action.” Under article 6.7 of
Chapter 1, the Insurance Commissioner has exclusive original jurisdiction over Plaintiffs’
claims. That the Insurance Commissioner had not acted on his or her own initiative or
could not seek restitution is not relevant to the jurisdictional analysis.
       In light of our conclusion on the immunity issue, we shall not address the parties’
other arguments in case No. H041870, except to note that immunity bars “civil
proceedings.” (§ 12414.26.) This includes Plaintiffs’ cause of action based on an alleged
breach of fiduciary duty.

   IV. Appeals of Postjudgment Orders in Case No. H042504

       Both parties appeal the postjudgment order on attorney fees and costs. Plaintiffs
contend the trial court erred when it denied their motion for attorney fees under Code of
Civil Procedure section 1021.5, the private attorney general attorney fees statute. Fidelity
argues the trial court erred when it awarded costs to Plaintiffs, denied Fidelity’s motion to
strike or tax Plaintiffs’ costs, and granted Plaintiffs’ motion to tax Fidelity’s costs in their
entirety.

       A. Order Denying Plaintiffs’ Motion for Attorney Fees Under Code of Civil
          Procedure Section 1021.5

       “[A] party seeking an award of Code of Civil Procedure section 1021.5 attorney
fees must first be determined to be ‘a successful party.’ [Citation.] A necessary
prerequisite to recovery under the statute is the status of the prevailing party. [Citation.]
The terms ‘prevailing party’ and ‘successful party’ are synonymous. (Graham v.

                                               49
DaimlerChrysler Corp. (2004) 34 Cal. 4th 553, 570 . . . .)” (Coalition for a Sustainable
Future in Yucaipa v. City of Yucaipa (2015) 238 Cal. App. 4th 513, 521.) Since we
reverse the judgment, Plaintiffs are no longer a prevailing party and therefore cannot
recover attorney fees under Code of Civil Procedure section 1021.5. (Ibid.)
       An order awarding attorney fees and costs “falls with a reversal of the judgment
on which it is based” and “must also be reversed.” (Merced County Taxpayers’ Ass’n v.
Cardella (1990) 218 Cal. App. 3d 396, 402 (Merced County), citing Purdy v. Johnson
(1929) 100 Cal. App. 416, 421.) In this case, the trial court entered an order denying
Plaintiffs’ motion for attorney fees, reasoning that they had not met the requirements of
Code of Civil Procedure section 1021.5. Since the trial court denied Plaintiffs’ motion
for attorney fees, albeit for reasons unrelated to the reversal of the judgment, we will
affirm the order. “ ‘[W]e review the trial court’s order, not its reasoning, and affirm an
order if it is correct on any theory apparent from the record.’ ” (Wal-Mart Real Estate
Business Trust v. City Council of San Marcos (2005) 132 Cal. App. 4th 614, 625, quoting
Blue Chip Enterprises, Inc. v. Brentwood Sav. & Loan Assn. (1977) 71 Cal. App. 3d 706,
712.) In addition, the reversal of the judgment renders Plaintiffs’ challenge to the order
denying their motion for attorney fees moot. (Merced County, at pp. 401-402.)
Consequently, we will not address the parties’ arguments on the motion for attorney fees
further.

       B. Order on Parties’ Motions to Tax Costs

       Like orders awarding attorney fees, “[a]n order awarding costs falls with a reversal
of the judgment on which it is based.” (Merced County, supra, 218 Cal.App.3d at
p. 402.) Because we conclude that the judgment in favor of Plaintiffs must be reversed,
the order awarding them costs must also be reversed. (County of Humboldt v. McKee
(2008) 165 Cal. App. 4th 1476, 1501, citing Merced County, at p. 402.)

                                             50
       Since we reverse the judgment and order the action dismissed, Fidelity is “a
defendant in whose favor a dismissal is entered” under Code of Civil Procedure
section 1032 and is therefore a prevailing party, “entitled as a matter of right to recover
costs” in this action. (Code Civ. Proc., § 1032, subds. (a)(4), (b).)
       The record is incomplete regarding the litigation of the costs claims.18 However,
Plaintiffs’ appendix contains a copy of the superior court’s “On-line Document List,”
which serves as the register of actions. (Cal. Rules of Court, rules 8.124(b)(1)(A),
8.122(b)(1)(F) [appendix must contain all items required to be included in a clerk’s
transcript, including the “register of actions, if any”].) According to that list, Plaintiffs
filed a motion to tax Fidelity’s costs, Fidelity opposed the motion, and Plaintiffs filed a
reply. Since those papers are not in the record on appeal, we do not know what
arguments Plaintiffs raised below. More importantly, that motion was never adjudicated
on the merits in the trial court. The trial court concluded Plaintiffs were the prevailing
party and awarded costs to Plaintiffs. It also found Fidelity was not a prevailing party
and granted Plaintiffs’ motion to tax Fidelity’s costs on that ground. We will therefore
remand this matter to the trial court to rule in the first instance on Plaintiffs’ motion to tax
Fidelity’s costs and determine the amount of the costs award.

                                        DISPOSITION

       The judgment in case No. H041870 is reversed. The cause is remanded to the
superior court with directions to vacate the judgment and enter a new judgment
dismissing the action since it is barred by the section 12414.26 immunity.
       The postjudgment order denying Plaintiffs’ motion for attorney fees in case
No. H042504 is affirmed. The postjudgment order denying Fidelity’s motion to tax

       18
           The only documents in the appendices regarding the parties’ costs claims are
the memoranda of costs and Plaintiffs’ opposition to Fidelity’s motion to strike or tax
their costs.

                                              51
Plaintiffs’ costs, awarding Plaintiffs their costs of suit, and granting Plaintiffs’ motion to
tax Fidelity’s costs is reversed. The cause is remanded to the superior court with
directions to vacate its order awarding costs to Plaintiffs, to enter a new order awarding
Fidelity its costs of suit, and to conduct a hearing on Plaintiffs’ motion to tax Fidelity’s
costs.
         The parties shall bear their own costs on appeal.

                                            _________________________________
                                            ELIA, J.

WE CONCUR:

_______________________________
PREMO, Acting P. J.

_______________________________
GROVER, J.

Villanueva v. Fidelity National Title Company
H041870, H042504

                                              52
Trial Court:                                     Santa Clara County Superior Court
                                                Superior Court No.: 1-10-CV173356

Trial Judge:                                    The Honorable Pete H. Kirwan

Attorneys for Plaintiffs and Appellants         Chavez & Gertler
Manny Villanueva et al.:
                                                Nance F. Becker
                                                Mark A. Chavez

                                                The Kick Law Firm

                                                Taras Kick
                                                Thomas Segal

Attorneys for Defendant and Appellant:          Hahn Loeser & Park
Fidelity National Title Company:
                                                Michael J. Gleason
                                                Rupa G. Singh
                                                Erica L. Calderas
                                                Steven A. Goldfarb

Villanueva v. Fidelity National Title Company
H041870, H042504

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