Rackohn & Rackohn

There is no question that under California law, policy holders are legally entitled to allege promissory fraud in insurance bad faith cases.
In No Cost Conf., Inc. v. Windstream Communs., Inc. 940 F. Supp. 2d 1285 (S.D. Cal. 2013) the Court allowed Plaintiff leave to amend a promissory fraud cause of action in a contract case based on California law explaining:

In Erlich, the California Supreme Court generally discussed the differences between tort and contract claims…However, the California Supreme Court clarified that “conduct amounting to a breach of contract becomes tortious only when it also violates a duty independent of the contract arising from principles of tort law.” Id. at 983. …The Court further explained that “[t]ort damages have been permitted in contract cases where a breach of duty directly cause physical injury; for breach of the covenant of good faith and fair dealing in insurance contracts; for wrongful discharge in violation of fundamental public policy; or where the contract was fraudulently induced….…Rather, as the California Supreme Court made clear, a plaintiff may assert a tort claim, in addition to contract claims, if he based the tort claim on conduct, independent of the mere act of breach of contract. See also Lazar v. Sup. Ct., 12 Cal 4th 631, 49 Cal. Rptr. 2d 377, 909 P. 2s 981, 985 (Cal. 1996) (“In [cases of promissory fraud]. The [plaintiff’s claim does not depend upon whether the defendant’s promise is ultimately enforceable as a contract. “if it is enforceable, the [plaintiff] has a cause of action in tort as an alternative at least, and perhaps in some instances in addition to his cause of action on the contract.’” (citation omitted)….No Cost Conf., Inc. v. Windstream Communs., Inc. 940 F. Supp. 2d at 1301-1302.

“The elements of fraud, which give rise to the tort action for deceit, are misrepresentation (false representation, concealment, or non-disclosure);knowledge of falsity (or scienter); (c) intent to defraud, i.e., to induce reliance; (d) justifiable reliance; and (e) resulting damage.” (Lazar v. Superior Court (1996) 12 Cal.4th 631, 638.) “Promissory fraud” is a subspecies of the action for fraud and deceit. A promise to do something necessarily implies the intention to perform; hence, where a promise is made without such an intention, there is an implied misrepresentation of fact that may constitute actionable fraud. (Id.)

An open homeowner’s insurance policy requires payment of actual cash value for a structure’s contents, the measure of the actual cash value recovery is the amount it would cost the policyholder to repair, rebuild, or replace the thing lost or injured less a fair and reasonable deduction for physical depreciation based upon its condition at the time of the injury or the policy limit, whichever is less.

Any depreciation adjustments should be based on its market value at the time of the loss taking into consideration the condition and age of the property. Provided that the property can be repaired and replaced during the useful life of the property.

If your claim has been wrongfully denied call today for your free consultation with a partner. No recovery. No fee.

In No Cost Conf., Inc. v. Windstream Communs., Inc. 940 F. Supp. 2d 1285 (S.D. Cal. 2013) the Court allowed Plaintiff leave to amend a promissory fraud cause of action in a contract case. In Erlich, the California Supreme Court generally discussed the differences between tort and contract claims. However, the California Supreme Court clarified that “conduct amounting to a breach of contract becomes tortious only when it also violates a duty independent of the contract arising from principles of tort law.” Id. at 983. …The Court further explained that “[t]ort damages have been permitted in contract cases where a breach of duty directly cause physical injury; for breach of the covenant of good faith and fair dealing in insurance contracts; for wrongful discharge in violation of fundamental public policy; or where the contract was fraudulently induced….…Rather, as the California Supreme Court made clear, a plaintiff may assert a tort claim, in addition to contract claims, if he based the tort claim on conduct, independent of the mere act of breach of contract. See also Lazar v. Sup. Ct., 12 Cal 4th 631, 49 Cal. Rptr. 2d 377, 909 P. 2s 981, 985 (Cal. 1996) (“In [cases of promissory fraud]. The [plaintiff’s claim does not depend upon whether the defendant’s promise is ultimately enforceable as a contract. “if it is enforceable, the [plaintiff] has a cause of action in tort as an alternative at least, and perhaps in some instances in addition to his cause of action on the contract.’” (citation omitted)….No Cost Conf., Inc. v. Windstream Communs., Inc. 940 F. Supp. 2d at 1301-1302.

“The elements of fraud, which give rise to the tort action for deceit, are misrepresentation (false representation, concealment, or non-disclosure);knowledge of falsity (or scienter); (c) intent to defraud, i.e., to induce reliance; (d) justifiable reliance; and (e) resulting damage.” (Lazar v. Superior Court (1996) 12 Cal.4th 631, 638.) “Promissory fraud” is a subspecies of the action for fraud and deceit. A promise to do something necessarily implies the intention to perform; hence, where a promise is made without such an intention, there is an implied misrepresentation of fact that may constitute actionable fraud. (Id.)

If your insurance claim has been wrongfully denied call today for your free consultation with a partner. No recover. No Fee.

The appropriate procedure to obtain production of other claim files handled by a claims adjuster is to obtain an order to compel that requires the parties to agree on a letter sent to the policy holders requesting authorization to release their claims files. Any order for discovery of other claims files must be conditional on obtaining the written consent of the other claimants in response to a court-approved request form. The consent form must be dated, signed, and obtained within a year prior to disclosure. [See Ins. Code section 791.13; Mead Reinsurance Co. v. Sup. Court (1986) 186 Cal. App.3d 313, 317; See also Colonial Life & Acc. Ins. Co. v. Sup. Ct., (1982), 31 Cal. 3d785, 792.] This procedure protects the policy holders’ right to privacy.

Evidence of claims files of other insureds may be discoverable if relevant to the subject matter of the action or reasonably calculated to lead to admissible evidence. [See Code of Civil Procedure section 2031.010(a); Colonial Life & Acc. Ins. Co. v. Sup. Ct. (1982) 31 Cal. 3d. 785, 790] Evidence of other homeowner claims handled by the claims adjuster is relevant on the issue of Defendant’s bad faith handling of Plaintiff’s claim and punitive damages.

Your homeowner’s insurance policy is an all risk policy. If the risk is not excluded it is included. Homeowner policies exclude earth movement, including but not limited to earthquake, volcanic eruption, landslide, mudflow, earth sinking, rising or shifting,” and losses caused “by . . . settling, cracking, shrinkage, bulging or expansion of pavements, patios, foundations, walls, floors, roofs or ceilings” as a covered risk.

Unless your insurance policy specifically excludes contractor negligence your policy may provided coverage for losses caused by contractor negligence under the policy.

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In California, the Insurance Code establishes the terms of standard fire insurance policies. Standard fire insurance policy is based on the policy identified in California Insurance Code. The standard insuring clause calls for coverage “to the extent of the actual cash value of the property at the time of loss, but not exceeding the amount which it would cost to repair or replace the property with material of like kind and quality within a reasonable time after the loss …”

In case of a partial loss to the structure, or loss to its contents, depreciation is taken into consideration in determining the amount it would cost the policyholder to repair, rebuild, or replace the damaged item.

If your insurance company has wrongfully denied your claim, or paid less than you are entitled to call today for your free consultation with a partner. No recovery. No fee.

In Elder Abuse claims involving insurance the key question is whether or not the insurance company retained policy benefits owed to the policyholder with intent to defraud or by undue influence. The focus is whether or not there has been a wrongful use of policy benefits.

An insurance company may engage in elder abuse by misappropriating funds to which an elder is entitled under a policy of insurance. To establish a wrongful use of property to which an elder has a contract right, the elder must demonstrate a breach of the contract, or other improper conduct.

In additional beyond the existence of improper conduct, the insurance company knew or should have known that this conduct is likely to be harmful to the elder. Wrongful conduct occurs when the insurance company actually knows that it is engaging in a harmful breach of the contract, or reasonably should be aware of the harmful breach.

If your claim has been wrongfully denied call today for your free consultation with a partner. No recovery. No fee.

In California Landlords have no right to recover from an insurance company for tenant improvements and betterments unless the landlord has an insurable interest in the property insured. In order to have an insurable interest the landlord must have a pecuniary interest in the property.

Most commercial lease agreements imposed no financial risk on the landlord for damages to the tenant improvements during the life of the lease. The risk is on the tenant to have insurance to cover damages caused by a cover loss to tenant improvements and betterments. Generally there is no coverage to the landlord under a typical commercial general liability policy that provides for tenant improvements and betterments.

The tenant has the insurable interests in improvements and betterments.

If your claim has been wrongfully denied call today for your free consultation with a partner. No recovery. No fee.

If you make a false representation in the application for insurance on a material point your insurance company is entitled to rescind the policy. The insurance company may avoid liability for benefits provided under the policy even on pending claims. A rescission effectively renders the policy totally unenforceable form the outset, and therefore no benefits are payable.

Upon rescission you are entitled to a full refund of the premiums paid to your insurance company. Once rescission has occurred there are no longer any duties or obligations owed to you as an insured.

If your insurance claim has wrongfully withheld money that you are entitled to call today for your free consultation with a partner. No Recovery. No Fee.

On bad faith claims the statute of limitations does not run until your insurance company commits an act of bad faith. This occurs when your insurance company unreasonably withholds policy benefits due on your claim by notifying you its denied.

During the time your insurance company is investigating your claim the statute of limitations is tolled until your insurance company denies your claim.

On the other hand if the policy holder is unaware of insurance coverage and contends that he belatedly discovered that the policy provided coverage for a claim that does not toll the statute of limitations.

If your insurance company has wrongfully denied your claim call today for your free consultation with a partner. No Recovery. No fee.