Opinion
A165714
01-23-2024
MICHAEL GIOTINIS et al., Plaintiffs and Appellants, v. TRAVELERS PROPERTY CASUALTY COMPANY OF AMERICA, Defendant and Respondent.
NOT TO BE PUBLISHED
(Contra Costa County Super. Ct. No. MSC19-00167)
TUCHER, P.J.
Michael Giotinis and others own a commercial property in Berkeley. Michael brought an unlawful detainer action against their tenant, Pathos Management Group LLC (Pathos). In turn, Pathos and its owner and members cross-complained against Michael and others (the Pathos action). After Michael's insurer, defendant Travelers Property Casualty Company of America (Travelers) declined to defend the cross-complaint, appellants Michael and Ernie Giotinis brought the present action against Travelers for its failure to defend. Concluding there was no potential for coverage and therefore no duty to defend the Pathos action, the trial court granted Travelers' motion for summary judgment. We affirm.
Because many of the parties share the same last names, we will occasionally refer to them by their first names, intending no disrespect.
FACTUAL AND PROCEDURAL BACKGROUND
The facts underlying this appeal are largely undisputed. Michael and Ernie own a commercial property on Shattuck Avenue in Berkeley. They leased the property in 2012 to Pathos, which operated it as a restaurant.
The Underlying Action
Michael filed an unlawful detainer action in July 2016, seeking to evict Pathos and collect back rent. The complaint alleged Pathos owed more than $9,000 in past-due rent. Pathos did not answer, and Michael took his default. A notice of possession was posted at the property in September 2016, and later that month the sheriff carried out the eviction.
Pathos then applied to have the default set aside; the trial court granted the application but did not reinstate Pathos's occupancy. Michael then filed a first amended complaint for rents and other damages, and in February 2017, Pathos, Nick Eftimiou, Anna Eftimiou, and John Eftimiou (the Eftimious) filed their cross-complaint against the Giotinises.
We will occasionally refer to Pathos and the Eftimious collectively as the cross-complainants. The operative first amended cross-complaint named as cross-defendants Michael, Ernie, and Christopher Giotinis individually and doing business as S.C. properties (collectively, the Giotinises).
The cross-complaint alleged five causes of action: breach of contract, intentional interference with contractual relationship, abuse of process, conversion, and fraud. According to the cross-complaint, the crosscomplainants, "through Pathos Management Group LLC, entered into a written Lease with Cross-Defendants Michael Giotinis and Ernie Giotinis" for the property, and Pathos, "through the assistance and involvement of [the Eftimious]," operated a restaurant pursuant to a written lease agreement with the cross-defendants.
The Giotinises tendered the defense of the cross-complaint to Travelers, their insurer, which accepted the tender under a reservation of rights and appointed defense counsel. The trial court granted the Giotinises' anti-SLAPP motion (Code Civ. Proc., § 425.16) as to the abuse of process claim and dismissed that cause of action on June 22, 2017.
Travelers later concluded the cross-complaint was not potentially covered under the policy because the coverage for wrongful eviction claims applied only to eviction from" 'premises that a person occupies,'" and it belatedly realized that Pathos was a limited liability company, not a natural person. It therefore withdrew from defending the cross-complaint.
The Present Action
The Giotinises brought this action against Travelers, as well as their insurance agents. As to Travelers, they alleged causes of action for breach of contract and breach of the implied covenant of good faith and fair dealing, on the theory there was either actual coverage or a possibility of coverage of one or more of the claims in the underlying litigation and that Travelers therefore had, and breached, a duty to defend them.
Travelers moved for summary judgment, contending the underlying action did not fall within the terms of the insurance policy and it had no duty to defend or indemnify. Agreeing with Travelers, the trial court granted summary judgment. The Giotinises appeal from the ensuing judgment.
DISCUSSION
I. General Principles
"An insurer's duty to indemnify and its duty to defend an insured 'lie at the core of the standard policy.' [Citation.] The duty to defend is broader than the duty to indemnify. [Citation.] 'Unlike the obligation to indemnify, which is only determined when the insured's underlying liability is established, the duty to defend must be assessed at the very outset of a case. An insurer may have a duty to defend even when it ultimately has no obligation to indemnify, either because no damages are awarded in the underlying action against the insured, or because the actual judgment is for damages not covered under the policy.'" (Hartford Casualty Ins. Co. v. Swift Distribution, Inc. (2014) 59 Cal.4th 277, 286-287 (Hartford).)
An insurer has the duty to defend against "claims that create a potential for indemnity under the insurance policy," a duty that exists "even' "where the evidence suggests, but does not conclusively establish, that the loss is not covered." '" (Hartford, supra, 59 Cal.4th at p. 287, citing Gray v. Zurich Ins. Co. (1966) 65 Cal.2d 263, 277-278 and Montrose Chemical Corp. v. Superior Court (1993) 6 Cal.4th 287, 299 (Montrose).) In the first instance, the insurer must compare the allegations of the complaint and the terms of the policy to determine whether it must defend an action, but a duty may also exist if the insurer knows of extrinsic facts suggesting the claim may be covered or if," 'under the facts alleged, reasonably inferable, or otherwise known, the complaint could fairly be amended to state a covered liability.'" (Hartford, at p. 287.) The duty to defend arises if the action "seeks damages on any theory that, if proved, would be covered by the policy." (Mirpad, LLC v. California Ins. Guarantee Assn. (2005) 132 Cal.App.4th 1058, 1068 (Mirpad).) Where some claims in an action are potentially covered but some are not, the insurer must defend the action in its entirety (although it may later seek reimbursement of costs attributable solely to claims that are not even potentially covered). (Buss v. Superior Court (1997) 16 Cal.4th 35, 48-53 (Buss).) Doubts as to whether the insurer has the duty to defend must be resolved in favor of the insured. (Hartford, at p. 287.)
Interpretation of an insurance policy presents a question of law. (Waller v. Truck Ins. Exchange, Inc. (1995) 11 Cal.4th 1, 18.) We look first to the language of the insurance contract "to ascertain its plain meaning or the meaning a layperson would ordinarily attach to it." (Ibid.) We interpret the policy's terms in context, and give effect to every part of the policy, looking to each clause to help interpret the others and gleaning the meaning of words from the context and usage of the words in the insurance policy. (Mirpad, supra, 132 Cal.App.4th at p. 1069.)
With these principles in mind, we consider whether there was a potential for coverage under the terms of the insurance policy.
II. Wrongful Eviction Coverage
Coverage B of the insurance policy provides coverage for liability from" 'personal and advertising injury,'" which is defined to include injury arising out of "[t]he wrongful eviction from, wrongful entry into, or invasion of the right of private occupancy of a room, dwelling or premises that a person occupies, committed by or on behalf of its owner, landlord or lessor." (Italics added.)
Travelers withdrew its coverage based on the position that the term "person" in this provision did not encompass Pathos because Pathos was a limited liability company, not a natural person. Mirpad supports this position. In language almost identical to the insurance policy now before us, the policy at issue in Mirpad promised coverage for a claim arising out of a" 'wrongful eviction from, wrongful entry into, or invasion of the right of private occupancy of'" a room, dwelling or premises" 'that a person occupies by or on behalf of its owner, landlord or lessor.'" (Mirpad, supra, 132 Cal.App.4th at p. 1070.) The plaintiffs argued that the word" 'person'" should be construed to include an" 'organization'" such as the corporate claimant in the underlying action. The appellate court rejected this argument, noting that the policy "repeatedly use[d] the words 'person' and 'organization' separately and distinctly," and concluding that "these two words must be accorded their separate and distinct meanings." (Ibid.) For instance, even within the definition of" 'personal injury,'" the word" 'person'" was used without the word" 'organization'" in connection with claims for wrongful eviction and invasion of right to privacy, but the term" 'person or organization'" was used when setting coverage for other claims. The court thus concluded coverage for wrongful eviction did not extend to the wrongful eviction of an organization. (Id. at pp. 1070-1071; see id. at p. 1070, fn. 13.) Any other interpretation would create ambiguity and render the term" 'organization'" surplusage. (Id. at pp. 1072-1073.)
The policy at issue here is similar. For example, among the offenses falling within the policy's definition of" '[p]ersonal and advertising injury'" are wrongful eviction from a room, dwelling or premises "that a person occupies"; oral or written publication of "material that violates a person's right of privacy"; and oral or written publication of "material that slanders or libels a person or organization or disparages a person's or organization's goods, products or services." This provision therefore distinguishes between persons and organizations, providing coverage to both for claims brought for some offenses, and providing coverage only to persons for other claims- among them, wrongful eviction. Moreover, other portions of the policy repeat the phrase "person or organization," reiterating the separateness of these concepts. For instance, the preamble to the policy defines the word" 'insured'" to mean "any person or organization qualifying as such under section II," and "[d]amages because of 'bodily injury'" are defined to include those "claimed by any person or organization" for certain losses. Reading all of these provisions in concert, we conclude that to the extent the crosscomplaint in the underlying action alleges wrongful eviction of Pathos, a limited liability company that appellants do not dispute is an organization, Mirpad establishes the policy does not provide coverage.
Appellants ask us not to follow Mirpad, contending it was wrongly decided. They point out, correctly, that in construing an insurance policy, we seek to ascertain the reasonable expectations created by the policy. (Haynes v. Farmers Ins. Exchange (2004) 32 Cal.4th 1198, 1214-1215.) From this principle, they argue that the policy created the reasonable expectation that wrongful eviction claims by organizational tenants would be covered because the policy provided not just commercial general liability coverage but also "Businessowners Property Coverage," and they were in the business of renting out commercial premises that would likely be leased to corporations or other organizations rather than individuals. We decline to adopt this strained interpretation of the expectations created by the policy. As explained in Mirpad, in determining the meaning of policy language, a court looks not only to the words of a policy in their ordinary sense, but also "in the context of its usage in the policy itself. The word 'person' can . . . have many different meanings, depending on circumstances and context of usage. But, as used in the . . . policy (when the policy is read as a whole), it can only mean a natural person. [The insured] could not have had an objectively reasonable expectation to the contrary. As used in the policy, the meaning of the word 'person' was 'explicit and clear' and free from ambiguity. Therefore, 'person' cannot include an organization (e.g., a corporation)." (Mirpad, supra, 132 Cal.App.4th at p. 1074, fn. omitted.)
This rule has been followed in other California cases. (See, e.g., S.B.C.C., Inc. v. St. Paul Fire &Marine Ins. Co. (2010) 186 Cal.App.4th 383, 395-396 [policy covered right-to-privacy claims brought by a natural person]; Stonelight Tile, Inc. v. California Ins. Guarantee Assn. (2007) 150 Cal.App.4th 19, 40 [claims for wrongful entry or wrongful entry]; Golden Eagle Ins. Corp. v. Cen-Fed, Ltd. (2007) 148 Cal.App.4th 976, 990-991; see also Alco Iron &Metal Co. v. American International Specialty Lines Ins. Co. (N.D.Cal. 2012) 911 F.Supp.2d 844, 853-854 [applying California law]; ABM Industries v. Zurich American Ins. Co. (N.D.Cal., Sep. 11, 2006, No. C 053480 SBA) 2006 U.S. Dist. Lexis 67884, pp. *59-*63 [applying California law].) By the time the insurance policy in this case issued in 2015, Mirpad was firmly established California law. For that reason and because we cannot disagree with that thoroughly reasoned decision, we apply Mirpad here. The insurance policy did not cover claims brought by Pathos for wrongful eviction.
Appellants argue that even under the rule enunciated in Mirpad, the allegations of the cross-complaint show the individual cross-complainants brought claims that potentially fall within the coverage for wrongful eviction. They rely on the following general allegations in the first amended crosscomplaint in the underlying action: the cross-complainants include not only Pathos but also Nicholas, Anna, and John Eftimiou; they allege that "Crosscomplainants, through Pathos Management Group LLC, entered into a written Lease with Cross-Defendants Michael Giotinis and Ernie Giotinis for the premises . . ."; and "Cross-Complainants, and each of them, operated the subject restaurant at the premises until September of 2016, when CrossDefendants, and each of them, improperly, and through an abuse of judicial process, locked out Cross-Complainants, and each of them, and improperly prevented them from continuing operation of the restaurant." And, they point out, there is evidence that John Eftimiou made the deposit on the lease payment with his personal bank account.
Standing in isolation, the general allegation that cross-complainants entered into the lease through Pathos might suggest that not only Pathos but also the individual cross-complainants were parties to the lease and were wrongfully evicted. But the cross-complaint does not so allege. Instead of asserting that any of the Eftimious was a party to the lease or a tenant at the insured property, the cross-complaint alleges that it was Pathos that "through the assistance and involvement of" the individual Eftimious "operated the restaurant . . . pursuant to a written Lease Agreement with" the Giotinises. Moreover, the specific allegations associated with the crosscomplaint's various causes of action refute the notion that the individual cross-complainants were tenants.
The first cause of action, for breach of contract, alleged that the Giotinises breached their obligations under the lease agreement by chaining the doors to the property and locking cross-complainants out. But this cause of action was brought only on behalf of Pathos, not the individual crosscomplainants. Consistent with that, the lease agreement attached to the cross-complaint recites that the tenant is Pathos Management Group LLC. Nothing in that lease agreement or elsewhere in the cross-complaint suggests that the individual cross-complainants were tenants under the lease agreement.
The second cause of action in the cross-complaint was brought on behalf of the individual cross-complainants only, for interference with their contractual relations with Pathos. It alleged that the Giotinises, "being fully knowledgeable of the lease relationship between themselves and Pathos, and being fully knowledgeable of the contractual relations between CrossComplainant Pathos and Cross-Complainants Nick, Anna and John, intentionally and blatantly interfered with the lease relationship with Pathos," knowing the interference would prevent the individual crosscomplainants from realizing the benefit of their contractual relationships with Pathos. Thus, this cause of action, too, is based on the theory that the lessee was Pathos rather than the individual cross-complainants.
The same is true of the fifth cause of action, for intentional misrepresentation/fraud, which alleged that the cross-defendants falsely represented to the Eftimious "that if they, on behalf of Pathos," paid more than $11,000 to cover the claimed deficiencies in rental payments, the crossdefendants would not prevent their continued occupancy and use of the property. This claim on its face indicates that the lessee was Pathos, not the individual cross-complainants.
The fourth cause of action, brought on behalf of all cross-complainants, was for conversion, on the theory that cross-defendants deprived them of "their access and entitlement to the subject premises and the personal property and effects therein." But these allegations do not suggest that the individual cross-complainants were the tenants with "the right of private occupancy" of the premises under the contract between Pathos and the Giotinises, or that their entitlement to use the premises arose from anything other than their relationship with Pathos.
The only cause of action that may potentially be read to include an allegation that the Eftimious themselves were evicted is the third cause of action for abuse of process, which alleged the cross-defendants "improperly obtained a writ of eviction purportedly to evict Cross-Defendants [sic], and each of them, from the subject premises" and pursuant to that writ caused the premises to be locked. But this cause of action was dismissed before Travelers withdrew from defending the matter and could no longer provide a basis for potential liability.
Moreover, other facts known to Travelers confirmed that Pathos was the sole tenant. Not only does the lease agreement list only Pathos as the tenant, but Michael brought the unlawful detainer action and the first amended complaint for rents and damages solely against Pathos. Then Pathos, not the individual cross-complainants, moved to vacate the default. Nowhere either in the motion to vacate or in Anna Eftimiou's supporting declaration is there any suggestion that the individuals were the actual tenants, or that they had a subtenancy or any other tenancy relationship. The minute order of the hearing to set aside the default indicates Nicholas and Anna Eftimiou appeared "as representative of Pathos Management Group, LLC."
Appellants suggest various scenarios that they contend could have given rise to a duty to defend based on the allegations of the cross-complaint. For instance, they posit, the Giotinises could have alleged in their underlying complaint for rent and damages that the Eftimious were the alter egos of Pathos and the actual lessees under the lease, or that the lease was part of a joint venture between Pathos and family members. The short answer is that they did not make any such allegation, nor allege facts that would have supported such a claim. Instead, they alleged that Nick Eftimiou was an "owner and manager" of Pathos, employed by Pathos as its manager and chef, and that Anna and John Eftimiou were "investors and members of Pathos" who had, "in that capacity, lent money to Pathos." In this context, the fact that John Eftimiou may have written a personal check for the deposit for the lease is not a fact tending to establish that he, or any other of the Eftimious, was a lessee instead of or alongside Pathos. Similarly, appellants point out that Travelers, in its motion for summary judgment, did not address the possibility that Pathos entered into the lease as the agent of the Eftimious, that Pathos had sublet the premises to them so that they, not Pathos, were the parties evicted, or that Pathos was a mere sham organization. But these scenarios are all speculative, unsupported by any evidence in the record, or by any allegation in the cross-complaint. "An insured may not trigger the duty to defend by speculating about extraneous 'facts' regarding potential liability or ways in which the third party claimant might amend its complaint at some future date." (Gunderson v. Fire Ins. Exchange (1995) 37 Cal.App.4th 1106, 1114.) Appellants' speculation does not give rise to a duty to defend here.
III. Conversion
Coverage A of the insurance policy covers property damage caused by an" 'occurrence.'" " 'Property damage'" is defined to mean both physical injury to tangible property and "[l]oss of use of tangible property that is not physically injured." And, central to the question before us," '[o]ccurrence'" is defined to mean "an accident, including continuous or repeated exposure to substantially the same general harmful conditions."
Appellants contend this coverage is broad enough to encompass the cross-complaint's cause of action for conversion. That claim alleged that, by blocking access to the premises, the Giotinises prevented Pathos and the Eftimious from operating the restaurant or obtaining their personal effects, and that the Giotinises improperly took possession of personal property, including the supplies, wine collection, and other personal property, and sold off all the furnishings and fixtures owned by Pathos and the Eftimious.
These actions were allegedly "improper, without justification or right, and were vindictive, intentional, willful and malicious."
Appellants argue this alleged conversion may be an "accident" for purposes of the insurance policy because they could have been negligently unaware that there was personal property at the restaurant or that the crosscomplainants had not abandoned their property, or they could have acted under the negligent misapprehension that their actions were legally justified.
Our high court has explained that, "[u]nder California law, the word 'accident' in the coverage clause of a liability policy refers to the conduct of the insured for which liability is sought to be imposed on the insured." (Delgado v. Interinsurance Exchange of Automobile Club of Southern California (2009) 47 Cal.4th 302, 311 (Delgado).) The question in Delgado was whether an insured's unreasonable, subjective belief in the need for selfdefense converts an assault and battery into" 'an accident'" for purposes of an insurance policy. (Ibid.) Answering that question in the negative, the court explained that "an injury-producing event is not an 'accident . . . when all of the acts, the manner in which they were done, and the objective accomplished occurred as intended by the actor." (Id. at pp. 311-312.)
For this principle, the high court cited Stellar v. State Farm General Ins. Co. (2007) 157 Cal.App.4th 1498, 1505. (See Delgado, supra, 47 Cal.4th at p. 312.) The appellate court in Stellar set forth the applicable law as follows:" '[C]ourts have consistently defined the term ["accident"] to require unintentional acts or conduct. [Citations.] The plain meaning of the word "accident" is an event occurring unexpectedly or by chance.' . . .' "An accident . . . is never present when the insured performs a deliberate act .... [W]here the insured intended all of the acts that resulted in the victim's injury, the event may not be deemed an 'accident' merely because the insured did not intend to cause injury."' . . . In short, 'where damage is the direct and immediate result of an intended or expected event, there is no accident.'" (Stellar, at p. 1505.)
In a discussion relevant to the question before us, the high court in Delgado explained that in insurance cases, an insured's mistake of fact or law does not transform a purposefully inflicted harm into an accidental injury. (Delgado, supra, 47 Cal.4th at p. 312.) As examples of this principle, the court pointed to cases holding that that a misunderstanding of legal rights did not turn conversion of property into an accident (Collin v. American Empire Ins. Co. (1994) 21 Cal.App.4th 787 (Collin)); that a mistaken belief that acts were lawful did not render a wrongful eviction accidental (Swain v. California Casualty Ins. Co. (2002) 99 Cal.App.4th 1); and that sexual offenses were not accidental despite the insured's mistaken belief that the victim consented (Merced Mutual Ins. Co. v. Mendez (1989) 213 Cal.App.3d 41 (Merced); Quan v. Truck Ins. Exchange (1998) 67 Cal.App.4th 583 (Quan); Lyons v. Fire Ins. Exchange (2008) 161 Cal.App.4th 880.) (Delgado, supra, 47 Cal.4th at p. 312.) Court of Appeal decisions since Delgado have relied on the same principle. (See, e.g., Ghukasian v. Aegis Security Ins. Co. (2022) 78 Cal.App.5th 270, 274-276 [clearing and leveling neighbor's land not unexpected or unforeseen event despite mistaken belief about property boundary]; Fire Ins. Exchange v. Superior Court (2010) 181 Cal.App.4th 388, 390 [building a structure that encroached on adjacent property not accident even if owners had good faith belief they were legally entitled to build there]; Albert v. Mid-Century Ins. Co. (2015) 236 Cal.App.4th 1281, 1292 (Albert) [damage from trimming adjacent property owner's trees not accidental where insured intended trees to be pruned].)
Collin is particularly pertinent to our inquiry. In that case, the Collins leased their house to a tenant, who hired a contractor to remodel it without authorization and placed the Collins' personal belongings in storage; the personal property was later removed or destroyed. (Collin, supra, 21 Cal.App.4th at pp. 797-798.) When the contractor sued the Collins and the tenant, the Collins cross-complained against the contractor alleging, inter alia, a cause of action for willful conversion of their personal property. (Id. at pp. 798-799.) The contractor defended itself rather than tendering the defense to its insurer, and the Collins won a default judgment against it. They then brought an action against the contractor seeking satisfaction of the judgment. (Id. at p. 800.) The trial court ruled that the judgment in the cause of action for conversion was based on an accident and represented a claim for property damage. (Id. at pp. 801-802.)
The appellate court in Collin concluded the trial court erred in three different ways in finding the cause of action for conversion was based on an accident. (Collin, supra, 21 Cal.App.4th at pp. 803-804.) First, the crosscomplaint pleaded only intentional conduct, and its allegations must be deemed true because they formed the basis for the default judgment. (Ibid.) Second, there was no factual basis for a finding that an accident took place because the Collins stipulated that they did not know what happened to their property. (Id. at p. 804.) Third, and most useful for our inquiry, the trial court's ruling was based on a misunderstanding of the term" 'accident,'" which, under California law, "refers to the nature of the insured's conduct, not his state of mind." (Ibid.) The court explained, "The overwhelming weight of California authority holds that the term 'accident' refers to the nature of the act giving rise to liability, not to the insured's intent to cause harm; for this reason, conversion (absent bizarre circumstances) can never be an 'accident' because the insured's liability is based upon the deliberate taking of property." (Id. at p. 810.) That is, the focus is on "the insured's intent to perform the act which gives rise to liability, not the insured's state of mind. If the claimant's injuries did not result from an 'accident,' it does not matter whether the insured expected or intended his conduct to cause any harm." (Ibid.) The court went on to explain that an accident is" '" 'an unexpected, unforeseen, or undesigned happening or consequence from either a known or unknown cause,'" '" or" 'something out of the usual course of events . . . which happens suddenly and unexpectedly and without design.'" (Ibid.) Thus, deliberate conduct is not an" 'accident'" or" 'occurrence'" regardless of the insured's state of mind. (Ibid.)
Here, the trial court found Collin controlling and concluded the alleged conversion was not an accident, and thus not an occurrence under the policy. Appellants contend this ruling was error, asking us instead to follow the dissent in Collin, which argued that there may be circumstances in which a conversion can be an accident for purposes of insurance coverage. (Collin, supra, 21 Cal.App.4th at pp. 821-824.) But our purpose here is not to engage in an academic discussion of whether there may be circumstances in which conversion is an "accident," it is to determine whether the underlying crosscomplaint potentially alleges accidental conduct. And in our view all the conduct alleged is intentional-that the Giotinises blocked access to the premises and changed the locks on the doors, thus depriving the crosscomplainants of access to the restaurant and all property therein, that they took possession of the cross-complainants' belongings in the restaurant, and that they sold those belongings off. Neither these allegations nor any other facts of which we are aware suggest any of these actions were" '" 'unexpected, unforeseen, or undesigned'" '" or that they" 'happen[ed] suddenly and unexpectedly and without design.'" (Collin, supra, 21 Cal.App.4th at p. 810.)
We recognize that, as appellants point out, Collin considered the duty to indemnify, not the duty to defend. To the extent Collin discusses the effect of the default judgment, under which the allegations of the complaint are deemed true, it has less application here, where the matter had not yet been tried when Travelers withdrew from coverage. (Collin, supra, 21 Cal.App.4th at pp. 805-806.) But the appellate court's application of the California rule we have discussed at length above-that the term" 'accident'" in an insurance policy refers not to the insured's state of mind but to the insured's conduct-was an independent ground for the conclusion that the policy did not cover the conversion cause of action. (Id. at p. 804.)
We also recognize that the cases considering the issue have postulated circumstances in which an intentional act may nevertheless be accidental. As explained in Albert, "coverage is not always precluded when the insured's intentional acts result in injury or damage. [Citation.] An accident may exist 'when any aspect in the causal series of events leading to the injury or damage was unintended by the insured and a matter of fortuity.' [Citation.] For example, '[w]hen a driver intentionally speeds and, as a result, negligently hits another car, the speeding would be an intentional act. However, the act directly responsible for the injury-hitting the other car- was not intended by the driver and was fortuitous. Accordingly, the occurrence resulting in injury would be deemed an accident." (Albert, supra, 236 Cal.App.4th at p. 1291; accord, Quan, supra, 67 Cal.App.4th at p. 600 ["An accident can flow from an intentional act only if 'some additional, unexpected, independent, and unforeseen happening occurs that produces the damage"]; Merced, supra, 213 Cal.App.3d at p. 50; compare, B&B Lamplighter Oceanside Mobilehome Park, LLC v. Wesco Ins. Co. (S.D.Cal., June 10, 2022, No. 20-CV-1302 JAH BGS) 2022 U.S. Dist. Lexis 104633 [claim for conversion of mobile home potentially covered when complaint alleged damage to home that could have occurred from an accident in transit rather than from act of removing mobile home from its spot].) Here, the only behavior that is alleged to have caused damage is that the Giotinises locked Pathos and the Eftimious out of the restaurant and disposed of their belongings. By no reasonable interpretation can these actions be viewed as fortuitous or unexpected. These authorities do not assist appellants.
We accordingly agree with the trial court that the cause of action for conversion was not based on an occurrence, for purposes of the insurance policy. Because we reach this conclusion, we need not consider whether the conversion cause of action stated a claim for loss of use of the property for purposes of the insurance policy.
IV. Coverage for Slander, Libel, or Disparagement
Appellants also contend Travelers owned a duty to defend the crosscomplaint under the policy's coverage for "[o]ral or written publication, in any manner, of material that slanders or libels a person or organization or disparages a person's or organizations goods, products or services." Although the cross-complaint did not allege a cause of action for defamation, appellants argue the complaint alleges a factual basis for such a claim based on appellants' action-after obtaining the default judgment-in posting a writ of execution on their premises on September 15, 2016, which stated that a lockout would occur. Because the cross-complainants contended they were not, in fact behind on their lease payments, and because the notice implied falsely to their vendors, creditors, and customers that they were financially unstable, appellants argue, the notice was disparaging and created a potential for coverage under the policy's defamation coverage. (See Hartford, supra, 59 Cal.4th at p. 284 [disparagement claim requires showing of false or misleading statement referring to plaintiff's product or business that clearly derogates product or business directly or by clear implication].) Thus, they argue, Travelers had a duty to defend them.
We are unpersuaded. Appellants point to no law suggesting that taking the steps necessary to enforce a judgment may support a claim for defamation in these circumstances. In fact, the law appears to be squarely to the contrary. Our high court has held that where the gravamen of an action is communicative (there, the filing of false declarations of service to obtain a default judgment), the litigation privilege of Civil Code section 47 extends to the acts necessary to enforce the judgment and carry out the writ. (Rusheen v. Cohen (2006) 37 Cal.4th 1048, 1052, 1065.) Other cases are in accord. (See, e.g., Brown v. Kennard (2001) 94 Cal.App.4th 40, 49-51 [act of applying for and carrying out writ of execution is privileged]; O'Keefe v. Kompa (2000) 84 Cal.App.4th 130, 133-135 [litigation privilege covers publication in course of judicial proceeding, including enforcement efforts such as levying on bank account and filing abstract of judgment].) Appellants' proposed basis for a cause of action for defamation-that the judgment underlying the writ of execution was based on false allegations that cross-complainants were behind on their rent-falls comfortably within this line of precedent.
At our invitation, the parties submitted supplemental briefing after oral argument addressing whether, in spite of the litigation privilege, the cross-complaint sets forth a factual basis for a claim for defamation based on the posting of a writ of execution.
Citing Downey Venture v. LMI Ins. Co. (1998) 66 Cal.App.4th 478, 507, Appellants assert that Travelers has an obligation to defend its insured even in a case where the litigation privilege provides a valid defense, such that indemnification will not be required. They also point out that the litigation privilege is an affirmative defense that may be waived (see Beroiz v. Wahl (2000) 84 Cal.App.4th 485, 492; Quantification Settlement Agreement Cases (2011) 201 Cal.App.4th 758, 813); thus, they contend, until the privilege is asserted, it is irrelevant to whether there is a potential for coverage. These arguments might have had force if the cross-complaint had included a cause of action for defamation, slander, libel, or some other form of disparagement. It did not. Appellants have not shown that the allegations of the crosscomplaint or the facts known to Travelers would support any such cause of action, so as to trigger a duty to defend.
In their supplemental brief after oral argument, appellants contend that the act of chaining the doors of the premises-apart from posting the writ of execution-could constitute disparagement, thus triggering a duty to defend, because it carried with it the implication that appellants were behind on their rent. That is too late to raise a new argument on appeal. (See Haight Ashbury Free Clinics, Inc. v. Happening House Ventures (2010) 184 Cal.App.4th 1539, 1554, fn. 9 [declining to consider argument raised for first time at oral argument].) In any case, appellants do not explain how chaining the doors constituted an "oral or written publication" of disparaging matter within the terms of the policy.
Indeed, they argue elsewhere in their supplemental brief that the act of chaining the doors falls outside the litigation privilege because it was not a publication or a broadcast.
V. Abuse of Process
The third cause of action of the cross-complaint in the underlying action was for abuse of process. The cross-complainants alleged the Giotinises improperly obtained a writ of eviction, caused the premises to be locked pursuant to the writ, and improperly continued to enforce the writ and maintain the lockout. The Giotinises moved to strike the causes of action for breach of contract, abuse of process, and conversion under the anti-SLAPP statute, Code of Civil Procedure section 425.16. The trial court denied the motion as to the claims for breach of contract and conversion, but granted the motion as to the claim for abuse of process and dismissed that cause of action.
Appellants now contend the cause of action for abuse of process triggered a duty to defend under the insurance policy's coverage for personal and advertising injury, which is defined to include malicious prosecution. In ruling on the motion for summary judgment in the current action, the trial court declined to reach this issue, explaining that Travelers withdrew its defense of the cross-complaint only after the abuse of process claim was dismissed. As a result, the trial court concluded, the dismissed cause of action did not trigger a duty to defend.
On appeal, appellants again argue the coverage for malicious prosecution applied to the claim for abuse of process. Like the trial court, we do not reach the merits of appellants' argument. Even assuming the abuse of process claim originally gave rise to a duty to defend, that claim was no longer part of the action at the time Travelers withdrew from the defense.
Appellants contend that the duty to defend survives dismissal of the cause of action that triggered it, but we are unpersuaded. Citing Buss, supra, 16 Cal.4th at p. 48, appellants point to the principle that in a" 'mixed'" action in which some of the claims are potentially covered but others are not, "the insurer has a duty to defend the action in its entirety." True enough, but once the abuse of process claim was no longer part of the action, it was no longer potentially covered.
But, appellants argue, the insurer must continue to defend such a case through the appellate stage because the judgment might later be set aside and the case retried, potentially giving rise to future liability. (See Pritchard v. Liberty Mutual Ins. Co. (2000) 84 Cal.App.4th 890, 903-904.) Here, there is no question of a future ruling on appeal having the potential to revive the abuse of process claim. That is because the cause of action was dismissed under the anti-SLAPP statute, which provides that an order granting a special motion to strike is immediately appealable. (Code Civ. Proc., § 425.16, subd. (i); see, § 904.1, subd. (a)(13).) Having failed to file a timely appeal of the order, the Eftimious could not challenge it in later proceedings. (See Maughan v. Google Technology, Inc. (2006) 143 Cal.App.4th 1242, 12461247.)
The duty to defend is "a continuing one, arising on tender of defense and lasting until the underlying lawsuit is concluded [citation], or until it has been shown that there is no potential for coverage." (Montrose, supra, 6 Cal.4th at p. 295, italics added.) Once the dismissal of the claim for abuse of process was final, that cause of action could no longer be the source of any potential for coverage. The trial court did not err in so concluding.
DISPOSITION
The judgment is affirmed. Respondents shall recover their costs on appeal.
WE CONCUR: FUJISAKI, J. PETROU, J.