2012-00120037-CU-CL

Mercy San Juan Hospital vs. State Farm Insurance

Nature of Proceeding: Motion for Summary Judgment and/or Adjudication

Filed By: Dana, Richard A.

*** If oral argument is requested, the parties are directed to notify the clerk and
opposing counsel at the time of the request which of the Undisputed Material
Facts will be addressed at the hearing and the parties should be prepared to
point to specific evidence which is claimed to show the existence or non-
existence of a triable issue of material fact. ***

Defendant/cross-complainant State Farm Mutual Automobile Insurance Company’s
(“SFM”) motion for summary judgment or alternatively, for summary adjudication of
issues, is DENIED because SFM’s moving papers failed to satisfy its initial burden of
production under Code of Civil Procedure §437c(p)(1) with respect to Undisputed
Material Fact (“UMF”) Nos. 11, 14 and 23. Even if SFM were deemed to have met its
initial burden of production and thereby successfully shifted to the opposition the
burden of producing admissible evidence sufficient to demonstrate at least one triable
issue of material fact, the opposition satisfied its burden of production particularly since
its evidence must be construed liberally while the evidence in support of the motion is
construed narrowly. (See, e.g., DiLoreto v. Bd. of Education (1999) 74 Cal.App.4th
267; Alvarez v. State of California (1999) 75 Cal.App.4th 903.)

Moving counsel is admonished for failing to comply with CRC Rule 3.1350(b) and (h),
requiring all issues presented for summary adjudication to be stated in the notice of
motion and repeated verbatim in the separate statement.

Moving counsel is also admonished for failing to comply with CRC Rule 3.1350(g)
which requires all evidence (including declarations) which exceeds 25 pages to be
included in a single volume of evidence.

This litigation arises out of a motor vehicle accident involving an insured of SFM. On
the latter’s behalf, SFM settled the personal injury claim asserted by a client of cross-
defendants William L Berg and Berg Injury Lawyers (collectively “Berg”). SFM
contends that the settlement and signed release required Berg to satisfy any and all
liens relating to the subject accident but that Berg has refused to satisfy the substantial
lien asserted by plaintiff Mercy San Juan Hospital (“MSJH”). Accordingly, SFM has
filed a cross-complaint against Berg for express contractual indemnity, breach of
contract and declaratory relief.

SFM now moves for summary judgment of the entire cross-complaint or alternatively,
for summary adjudication of the three individual causes of action therein on the
grounds that the undisputed evidence in this case shows Berg agreed in writing to
satisfy all liens and/or intentionally or carelessly allowed SFM to believe that Berg had
so agreed but Berg has failed and refused to satisfy the lien asserted by plaintiff
MSJH. As support for summary adjudication of each cause of action, SFM offers the
exact same UMF Nos. 1-29. As such, if the Court finds a triable issue of material fact
with respect to any one of these 29 UMF, both summary judgment and summary
adjudication of each cause of action must be denied. (See, Nazir v. United Airlines,
Inc. (2009) 178 Cal.App.4th 243, 252 (citing Weil & Brown, Civil Procedure Before Trial
, Ch.10:95.1) [moving party’s inclusion of facts in its separate statement effectively
concedes each fact’s “materiality,” whether intended or not, and if there is a triable
dispute relating to any one, the motion must be denied].)

Berg opposes the motion, arguing not only that the subject release was draft by SFM
and must be construed against SFM but also that Berg is not a “party” to the
agreement since Berg neither was injured in the subject accident nor asserted any
claim for damages. Additionally, the opposition contends the release was signed
neither by Berg nor by an authorized agent and to the extent SFM contends the
release was signed by one with the ostensible authority of Berg, this constitutes a
triable issue of material fact which mandates denial of this motion. The opposition
further suggests that since the MSJH lien did not exist at the time the release was
signed, there are questions about whether there was actually a “meeting of the minds”
to pay this lien and also that the MSJH lien is invalid/unenforceable. Berg objects to a
handful of SFM’s UMF and contends that even fewer are “disputed” but Berg offers no
additional material facts of its own.

SFM filed no written objections to evidence.

Berg’s written objections to evidence Nos. 1-3 do not comply with CRC Rule 3.1354(b)
(3) but are nevertheless SUSTAINED. However, Berg’s additional objections in its
responsive separate statement to SFM’s UMF Nos. 11, 14 and 23 are OVERRULED
because these objections are, by their own terms, directed at the “form” of these UMF
rather than at any evidence. (See, CRC Rules 3.1352, 3.1354.)

Because Berg’s written objections to evidence Nos. 1-3 are sustained, the Court finds
that SFM’s moving papers are not sufficient to meet its initial burden of production
under Code of Civil Procedure §437c(p)(1) since UMF Nos. 11, 14 and 23 are without
lacking sufficient admissible evidence. Consequently, this motion must be denied
without regard to the evidence, if any, submitted by Berg since these three UMF are
common to each of the six (6) issues presented for summary adjudication and on
which summary judgment is also sought.

However, even if SFM were deemed to have met its initial burden of production under
Code of Civil Procedure §437c(p)(1) and thereby successfully shifted to Berg the
burden of producing admissible evidence which demonstrates the existence of at least
one triable issue of material fact, SFM’s motion would still have to be denied because
Berg has satisfied its burden of production particularly in light of the fact that the
evidence offered in opposition to this motion must be construed liberally while the
evidence in support is construed narrowly.

SFM’s UMF 11 states in its entirety:

“On June 9, 2010, [SFM] claim representative Nicki Vang sent a letter to William
Berg which stated, in part:
‘This letter will confirm our telephone call of June 9, 2010 wherein we
tendered our insured’s $100,000 Policy Limit in settlement of your client’s
injury claim. Our offer is inclusive of any and all liens, specifically the
military lien, and any derivative claim.’ Satisfaction of all liens was an integral part of [SFM’s], pursuant to [SFM] policy.
[SFM] would not have tendered its insureds’ policy limits without the
understanding that all liens, including the [MSJH] lien, or medical bills, were to
be satisfied from the policy limits.”

In response to UMF 11, Berg cites evidence which tends to show that the “alleged”
MSJH lien was not drafted, perfected or even in existence until February 2011 and
thus, it was not contemplated by the parties to the settlement and was not part of the
settlement agreement, which was consummated several months before. Under such
circumstances, the Court finds Berg’s evidence to be sufficient to establish the
existence of a triable issue of material fact relating to whether there was an actual
“meeting of the minds” for the satisfaction of the MSJH lien and because UMF 11 is
common to all six (6) issues presented for summary adjudication, that motion must be
denied as to all causes of action which also results in denial of summary judgment on
the entire cross-complaint. (See, Nazir at 252 (citing Weil & Brown, Civil Procedure
Before Trial, Ch.10:95.1).)

SFM’s UMF 23 asserts:

“On March 17, 2011, Nicki Vang sent a letter which stated, in part: ‘Enclosed is
our settlement draft in the amount of $97,652.48,’ and a settlement check made
payable to ‘Berg Injury Lawyers Valera Fetterman Baham and [sic].’ [SFM]
believed that Berg’s office was going to satisfy the [MSJH] lien from the
settlement proceeds.”

In response, Berg contends that it gave no reason to believe Berg would satisfy the
MSJH lien especially since Berg “had already made it clear to [SFM] that [Berg] did not
consider the alleged lien valid or enforceable.” The Court finds that Berg has
presented evidence sufficient to show a triable issue of material fact with respect to
UMF 23 as well since that evidence must be construed liberally and because UMF 23
is common to all six (6) issues presented for summary adjudication, the motion must
be denied as to all causes of action and as to the entire cross-complaint.

SFM’s UMF 26 quotes deposition testimony to the effect that the subject release was
signed by a person (Larry Burkes) whom the deponent “understood” was an
“employee” of Berg but the evidence cited in response to UMF 26 indicates that Mr.
Burkes was not an employee, only an independent contractor who was not authorized
to enter into any agreement on Berg’s behalf. This evidence is more than sufficient to
create a triable issue of material fact relating to UMF 26 and since UMF 26 is also
common to all six (6) issues presented for summary adjudication, both the summary
adjudication and the summary judgment motion must be denied.

This minute order is effective immediately. Pursuant to CRC Rule 3.1312, counsel for
Berg to prepare an order which conforms to Code of Civil Procedure §437c(g).