Antonopoulos v. Mid-Century Ins. Co.

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TED ANTONOPOULOS et al., Plaintiffs and Appellants, v. MID-CENTURY INSURANCE COMPANY, Defendant and Respondent.

A164243

California Court of Appeals, First District, Second Division

March 28, 2023

NOT TO BE PUBLISHED

(Sonoma County Super. Ct. No. SCV263268)

RICHMAN, J.

This is the second appeal in this case, which began when plaintiffs and appellants Ted Antonopoulos and Susie Antonopoulos (plaintiffs), who lost their home in a fire, sued their insurer, respondent Mid-Century Insurance Company (Mid-Century). Both parties filed cross-motions for summary judgment or summary adjudication, and the trial court granted summary adjudication for plaintiffs, following which the parties agreed to a stipulated judgment, putting the case in a posture where it could be appealed.

As pertinent here, the parties also entered into a settlement agreement that provided eventualities in which plaintiffs would be entitled to high and low amounts-$2 million and $250,000 respectively-the low amount to be their recovery if Mid-Century appealed and "obtains a reversal of the stipulated judgment." Mid-Century did appeal, and in a published opinion we "affirmed in part and reversed in part," with a disposition that read as follows: "The order denying summary judgment or summary adjudication for Mid-Century is affirmed. The order granting summary adjudication for plaintiffs on the issue of Mid-Century's duty to cover their loss is reversed. The stipulated judgment for plaintiffs shall be set aside. Each side shall bear its own costs on appeal." (Antonopoulos v. Mid-Century Ins. Co. (2021) 63 Cal.App.5th 580, 603 (Antonopoulos I.)

Following the appeal, plaintiffs filed a motion to enforce the settlement agreement and seeking their entitlement to the high amount, $2 million. The trial court granted the motion but held that plaintiffs were entitled to the low amount $250,000. Plaintiffs appeal, contending that the trial court got it wrong, that it "misconstrued the disposition in" our opinion and "what 'set aside' means." We conclude otherwise, that the trial court got it right. We thus affirm.

BACKGROUND

The General Setting

We distilled the essential background in the introductory paragraphs of our earlier opinion: "Plaintiffs Ted and Susie Antonopoulos lost their Santa Rosa home in the 2017 Tubbs fire. They promptly submitted a claim under their homeowners insurance policy to defendant Mid-Century which denied the claim on the ground that the policy had been canceled for nonpayment of premium six days before the fire. Plaintiffs immediately paid the past due premium, and the policy was reinstated. Mid-Century continued to deny the claim, however, taking the position that reinstatement did not retroactively cover the loss that occurred when the policy was out of force.

"Plaintiffs sued for breach of contract and breach of the implied covenant of good faith and fair dealing, and the parties filed cross-motions for summary judgment or summary adjudication. Mid-Century argued the undisputed facts showed it did not owe plaintiffs a duty to cover their loss and thus did not breach the insurance contract or the implied covenant of good faith and fair dealing and could not be liable for exemplary damages. Plaintiffs argued the undisputed facts showed that Mid-Century reinstated the policy without a lapse in coverage and thus owed them a duty to cover their loss. The trial court agreed with plaintiffs, concluding the undisputed facts showed that Mid-Century waived forfeiture of the policy and reinstatement was retroactive with no lapse in coverage. Accordingly, the court granted summary adjudication for plaintiffs on the issue of MidCentury's duty to provide coverage and denied Mid-Century's motion in its entirety. Pursuant to a stipulation by the parties, judgment was then entered for plaintiffs." (Antonopoulos I, supra, 63 Cal.App.5th at pp. 583-584.)

The Settlement

Following the trial court's rulings on the motions, and before the appeal was taken, the parties entered into a comprehensive 16-page settlement agreement, signed by plaintiffs, Mid-Century, and their attorneys. The last paragraph of the recitals provided that: "The purpose of this Agreement is to bring an end to trial court proceedings in the Action, reserving rights to appeal and to petition the Supreme Court, as between Plaintiffs and Defendant, and to settle and compromise all claims, disputes, controversies, and liabilities existing between Plaintiffs and Defendant on the terms set forth herein, and to avoid the further expense of the burdensome, protracted and costly trial which would be involved in prosecuting and defending the Action in the trial court, without in any way acknowledging any liability."

Then, at page 2, under paragraph 1.A. the settlement agreement provided this: "Defendant shall have the right, but not the obligation, to pursue an appeal from the Stipulated Judgment. In the event Defendant does not pursue an appeal, or pursues an appeal and does not obtain a reversal of the Stipulated Judgment, Defendant shall pay to Plaintiffs the sum of two million dollars and zero cents ($2,000,000.00) and Plaintiffs shall immediately thereafter file an Acknowledgement of Satisfaction of Judgment, in full. Said payment shall be made within ten (10) days after the expiration of the time to file a Notice of Appeal, if no appeal is taken or within ten (10) days after the Court of Appeal issues the remittitur if an appeal is taken. In the event Defendant obtains a reversal of the Stipulated Judgment, Defendant shall pay to Plaintiffs the sum of two hundred fifty thousand dollars and zero cents ($250,000.00), said payment to be made within ten (10) days after the Court of Appeal issues the remittitur."^[1] The Settlement Agreement contained an integration clause, a waiver of Civil Code section 1654 regarding ambiguities and uncertainties, and a choice of law provision. The Settlement Agreement did not limit or define the issues that could be appealed, nor did it specially define or limit the term "reversal."

The Appeal

Mid-Century appealed, and on April 27, 2021, we filed our opinion. Our introductory remarks began with the distilled version of facts quoted above. The next two paragraphs then described the appeal, and our holding: "Mid-Century appeals, asserting two fundamental arguments:

(1) the loss-in-progress rule precludes coverage for a known loss, so Mid-Century could not, as a matter of law, reinstate the policy retroactively to provide coverage for the loss that occurred while the policy was out of force; and (2) even if Mid-Century could have reinstated the policy without a lapse in coverage, the undisputed facts show it did not do so and that it reinstated the policy subject to a lapse of nine days that included the date plaintiffs lost their home."

"We reject Mid-Century's first argument. Its second argument hinges on its intent when it reinstated the policy, and as to this, there exists a triable issue of material fact. Thus, we conclude Mid-Century's motion was properly denied but plaintiffs' motion was improperly granted. We therefore affirm in part and reverse in part." (Antonopoulos I, supra, 63 Cal.App.5th at p. 584.)

From there we went on for some 20 pages analyzing the matter, in the course of which we described the dispositive issue for Mid-Century this way:

"Having concluded that Mid-Century could have retroactively reinstated the policy knowing plaintiffs suffered a loss during the period during the period the policy was out of force, the question becomes whether Mid-Century did in fact do so. The trial court concluded from the evidence that it could 'only be reasonably inferred that Mid-Century had decided to cover plaintiffs' loss.' As to such inference, we have a number of observations. First, in ruling on a summary adjudication or judgment motion, the trial court must view the evidence and inferences drawn from it in the light most favorable to the opposing party. (Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 843.) Second, 'summary judgment shall not be granted by the court based on inferences reasonably deducible from the evidence if contradicted by other inferences or evidence that raise a triable issue as to any material fact.' (Code Civ. Proc., § 437c, subd. (c).) And third, on appeal, we must draw all reasonable inferences in favor of the party against whom summary adjudication was entered. (Ragland v. U.S. National Assn. (2012) 209 Cal.App.4th 182, 197.) [¶] "With these principles in mind, we reach a different conclusion than the trial court-that the evidence and reasonable inferences raise a triable issue as to whether Mid-Century intended to retroactively reinstate the policy without a lapse. This precludes summary adjudication for Mid-Century-and for plaintiffs." (Antonopoulos v. Mid Century Ins. Co., supra, 63 Cal.App.5th at p. 599.)

Following that, we discussed the conflicting inferences that could be drawn from the evidence submitted on the issue of waiver and Mid-Century's intent, (Antonopoulos I, supra, 63 Cal.App.5th at pp. 600-602), and then set forth our disposition quoted above: "The order denying summary judgment or summary adjudication for Mid-Century is affirmed. The order granting summary adjudication for plaintiffs on the issue of Mid-Century's duty to cover their loss is reversed. The stipulated judgment for plaintiffs shall be set aside. Each side shall bear its own costs on appeal." (Antonopoulos I, supra, 63 Cal.App.5th at p. 603.)

Proceedings Following Our Opinion

On April 28, the day after our opinion was filed, counsel for MidCentury emailed plaintiffs' counsel stating that "by the terms of the settlement agreement, my client owes plaintiffs $250,000.00."

Plaintiffs' couns...