Opinion
NOT TO BE PUBLISHED
APPEAL from the judgment of the Superior Court of Los Angeles No. BC345422. Jon Mayeda, Judge.
Zelig & Associates and Steven L. Zelig for Plaintiff and Appellant.
Luce, Forward, Hamilton & Scripps, David R. Krause-Leemon and Grant P. Alexander for Defendant and Respondent.
RUBIN, J.
Ziqiong Lu appeals from the judgment dismissing her complaint after the trial court sustained the demurrer of Walter McCurley to Lu’s second amended complaint without leave to amend. We affirm.
FACTS AND PROCEEDINGS
Appellant Ziqiong Lu had a homeowner’s insurance policy with Allstate Insurance Company covering her house in Arcadia. In January 2005, her home suffered severe wind damage for which she submitted a claim with Allstate. Allstate assigned its employee, respondent Walter McCurley, to handle appellant’s claim and hired American Leak Detection to examine damage to appellant’s roof. American Leak Detection (ALD) concluded wind damage was causing the roof to leak, but respondent did not tell appellant about ALD’s findings. Instead, respondent told appellant that Allstate was denying coverage for the damage.
Appellant complains that Allstate’s denial of coverage letter misrepresented the statute of limitations for her to file a complaint. Allstate has not challenged the timeliness of appellant’s lawsuit, and the issue is not before us.
Rebuffed by Allstate and respondent, appellant hired a public claims adjuster. Respondent and Allstate refused to cooperate with appellant’s adjuster. For example, they refused to give the adjuster “claims related documents” and failed to answer the adjuster’s letters. Their intransigence forced appellant to hire her own expert to investigate the roof damage and leak, who confirmed the roof’s problems in late April 2005. One week later, appellant asked respondent to reassign her claim to another Allstate adjuster. Four days after that, a new adjuster informed appellant that she was assuming responsibility for handling appellant’s claim. Eventually, Allstate paid appellant a little more than $32,000 for her claim, although she allegedly suffered more than half a million dollars in property damage.
In January 2006, appellant filed a complaint against Allstate and respondent. They demurred to the complaint. Before the hearing on the demurrer, appellant filed a first amended complaint. It alleged causes of action against respondent for intentional and negligent interference with contractual relations, fraud and negligent misrepresentation, and intentional infliction of emotional distress. Summarizing her allegations against respondent, appellant states he “summarily denied [her] claim, lied to [her] about the statute of limitations, misrepresented coverage, concealed the American Leak report, refused to provide claim related documents, refused to respond to inquiries from [her] and the public adjuster and engaged in a litany of other acts which a reasonable trier of fact could have concluded constituted fraud, interference and intentional infliction of emotional distress.”
Respondent demurred to the first amended complaint. The demurrer’s thrust was that Allstate, but not respondent, was liable to policyholders such as appellant for the acts of Allstate’s agents and employees if respondent’s relationship with Allstate were disclosed to appellant. The trial court sustained the demurrer with leave to amend.
Allstate also demurred to the first amended complaint, but its demurrer is not at issue in this appeal and Allstate remains a defendant in the case. Our opinion does not purport to be an analysis of Lu’s claims against Allstate.
Appellant filed a second amended complaint to which respondent demurred. Respondent argued the new complaint contained no new allegations against him. He asserted the complaint’s central fatal flaw thus remained: He was not personally liable for his acts as Allstate’s employee because the agency relationship had been disclosed to appellant. (Respondent also argued the complaint failed to state viable causes of action against him for other reasons that we discuss below.)
The court sustained respondent’s demurrer without leave to amend. The court noted that appellant did not allege any acts by respondent that could be reasonably construed as outside the scope of his employment with Allstate. Because respondent’s agency relationship with Allstate was fully disclosed, the court concluded only Allstate, but not respondent, could be liable for respondent’s acts. (Lippert v. Bailey (1966) 241 Cal.App.2d 376, 383.)
The court entered judgment for respondent and awarded him his costs. Respondent filed a cost bill for $4,395.79. Appellant moved to tax respondent’s costs, her principal objection being her belief that Allstate was trying to recover some of its costs through respondent. Respondent conceded one error in his costs bill and reduced it to $4,173.79, which was the amount the court awarded him. This appeal followed.
STANDARD OF REVIEW
“ ‘We treat the demurrer as admitting all material facts properly pleaded, but not contentions, deductions or conclusions of fact or law. [Citation.] We also consider matters which may be judicially noticed.’ [Citation.] Further, we give the complaint a reasonable interpretation, reading it as a whole and its parts in their context. [Citation.] When a demurrer is sustained, we determine whether the complaint states facts sufficient to constitute a cause of action. [Citation.] And when it is sustained without leave to amend, we decide whether there is a reasonable possibility that the defect can be cured by amendment: if it can be, the trial court has abused its discretion and we reverse; if not, there has been no abuse of discretion and we affirm. [Citations.] The burden of proving such reasonable possibility is squarely on the [appellant]. [Citation.]” (Blank v. Kirwan (1985) 39 Cal.3d 311, 318; see also Schifando v. City of Los Angeles (2003) 31 Cal.4th 1074, 1081.)
DISCUSSION
1. No Causes of Action for Fraud and Negligent Misrepresentation
Appellant alleged causes of action for two types of fraud – in the inducement and in performance – and for negligent misrepresentation, which entailed the same purported misrepresentations as the fraud allegations. None of those claims was well-pleaded, and therefore the court properly sustained respondent’s demurrer. As to fraud in the inducement, the complaint does not allege respondent was involved in appellant’s decision to buy her Allstate homeowner’s insurance policy; rather, appellant’s first alleged contact with respondent occurred when Allstate assigned him to handle her claim for wind damage. Not having participated in the formation of the insurance contract between appellant and Allstate, respondent does not bear any liability for its purportedly fraudulent inducement. (Lazar v. Superior Court (1996) 12 Cal.4th 631, 638.)
As to fraud in the performance and negligent misrepresentation, the complaint alleges respondent suppressed the ALD report supporting her claim for coverage. Whether intentional or negligent, a misrepresentation cause of action requires appellant’s reliance on the misrepresentation, but the complaint describes no reliance. (Lazar v. Superior Court, supra, 12 Cal.4th at p. 638.) To the contrary, appellant resisted tooth and nail respondent’s (and Allstate’s) purported mishandling of her claim in that she disputed their denial of coverage, hired her own adjuster and roofing expert, and eventually sued them. Because she did not yield to their purported attempts to suppress the truth about her property damage, she cannot allege reliance, and thus cannot allege a cause of action for fraud or negligent misrepresentation.
In discussing her fraud claims against respondent, appellant weaves a separate contention that Allstate owed her a fiduciary duty as her insurer. (Vu v. Prudential & Casualty Ins. Co. (2001) 26 Cal.4th 1142, 1150-1151 [insurer owes policyholder a duty of good faith and performance resembling those of a fiduciary]; Gruenberg v. Aetna Ins. Co. (1973) 9 Cal.3d 566, 574, 576, fn. 5 [insurer has duty of good faith and fair dealing for policyholder’s claim and insurer can be liable if its agents violate the duty].) As her insurer, Allstate owed appellant a duty, among others, to investigate appellant’s claim fairly and expeditiously and to pay promptly a proper claim. (Egan v. Mutual of Omaha (1979) 24 Cal.3d 809, 818-819; Waller v. Truck Ins. Exchange, Inc. (1995) 11 Cal.4th 1, 46.) Appellant contends respondent helped Allstate violate those duties, and therefore is personally liable.
A fatal weakness running throughout appellant’s theory of respondent’s liability is her failure to grapple with the difference between her relationship with Allstate with whom she contracted, and respondent’s status as Allstate’s employee whom she alleges acted within the course and scope of his employment. According to appellant, respondent can be personally liable even when acting on Allstate’s behalf for acts wrongful in their nature. (Civ. Code, § 2343 [“[o]ne who assumes to act as an agent is responsible to third persons as a principal for his acts in the course of his agency . . . [¶] . . . [¶] . . . [w]hen his acts are wrongful in their nature”].) True enough as far as it goes. But the acts she attributes to respondent involve either duties owed only by Allstate as the contracting insurer or, if they involve respondent’s independent duties, have not been properly pleaded. With little discussion and even less analysis, appellant sweeps her pen across a hodgepodge of authorities that she believes prove respondent is personally liable for how he handled her claim. For example, she cites Doctors’ Co. v. Superior Court (1989) 49 Cal.3d 39. It stands for the proposition that an insurer’s attorney and expert witness cannot be liable for violating provisions of the Insurance Code that apply only to persons engaged in the insurance business; it does not, however, discuss the pertinent issue here of whether employees (as opposed to nonemployee agents) are personally liable for violating the Insurance Code when they do so in the course and scope of their employment.
In another part of her brief, she cites Schulz v. Neovi Data Corp. (2007) 152 Cal.App.4th 86 to argue, “If a Tort Cause of Action is Available Against an Attorney of an Insurer in a Third Party Claim Setting, Then A Fortiori a Cause of Action is Likewise Available Against an Investigator Who Conspires With or ‘Aids and Abets’ the Insurer in Avoiding Payment Under the Insurance Contract.” In Schulz, an internet consumer sued four businesses offering online payment processing services, alleging unfair business competition in their aiding and abetting an illegal lottery. We do not see how Schulz advances appellant’s argument, notwithstanding her assertion that “Schulz provides compelling support for Plaintiffs contention that Buckley [sic] can be sued as a co-conspirator and/or aider/abetter.”
Appellant also cites Saunders v. Superior Court (1994) 27 Cal.App.4th 832. In that case, shorthand reporters sued other shorthand reporters and two insurance companies for unfair business practices based on the insurance companies’ exclusive contracts with the second group of reporters for covering depositions. (Id. at p. 837.) Saunders has nothing to do with an insurance company’s claims handling. Indeed, Saunders has nothing to do with the insurance industry beyond the happenstance that the companies hiring the reporters were insurance companies, but could have been any other consumer of reporter services under the Saunders court’s analysis. (Ibid.)
Appellant also cites Shafer v. Berger, Kahn, Shafton, Moss, Figler, Simon & Gladstone (2003) 107 Cal.App.4th 54. It held that a lawyer representing a client can be liable to a third party for the lawyer’s misrepresentations. (Id. at p. 67.) Appellant’s reliance on Shafer is inapt because it does not discuss an employee’s personal liability for conduct within the course and scope of employment. And finally, as well as inapt and misleading, is the section heading in appellant’s brief stating “In Applied Equipment [Corp.] v. Litton [Saudi Arabia Ltd.] (1994) 7 Cal.4th 503, 511- 514, the California Supreme Court Clearly Articulated that an Agent or Employee Can Be Liable for Engaging in a Conspiracy With an Insurer.” Applied Equipment, which did not involve an insurance company, stands for the proposition that a party to a contract cannot be liable for conspiring to interfere with the contract – a rule that helps respondent and to which we turn.
2. No Contractual Interference Cause of Action
Appellant alleged causes of action for intentional and negligent interference with contractual relations. She alleges respondent interfered with her Allstate insurance policy by mishandling her claim and denying coverage. She contends the trial court therefore erred in sustaining respondent’s demurrer to the interference causes of action.
Appellant’s contention is unavailing because she does not discuss the well-settled principle that a contracting party cannot interfere with its own contract. (Applied Equipment Corp. v. Litton Saudi Arabia Ltd., supra, 7 Cal.4th at p. 514 [“the tort cause of action for interference with contract does not lie against a party to the contract”].) That principle extends to the contracting party’s employees and agents. As Shoemaker v. Myers (1990) 52 Cal.3d 1, 24 (Shoemaker) explains:
“[T]here can be no action for inducement of breach of contract against the other party to the contract. [Citation.] It is also well established that corporate agents and employees acting for and on behalf of a corporation cannot be held liable for inducing a breach of the corporation’s contract.” (Shoemaker, at p. 24; see also Woods v. Fox Broadcasting Sub., Inc. (2005) 129 Cal.App.4th 344, 352, citing Shoemaker.)
The trial court properly sustained respondent’s demurrer to the interference causes of action.
3. No Cause of Action for Intentional Infliction of Emotional Distress
Appellant alleged respondent’s denial of coverage caused her severe emotional distress because it denied her the peace of mind a policyholder expects from insurance and forced her to incur the cost of hiring her own adjuster and consultants to prove coverage. She contends the trial court therefore erred in sustaining respondent’s demurrer.
Appellant’s contention is unavailing. The trial court is the gatekeeper in the first instance for determining whether conduct is sufficiently outrageous to support a cause of action for intentional infliction of emotional distress. (Fowler v. Varian Associates, Inc. (1987) 196 Cal.App.3d 34, 44.) The gate is not easy to pass through. As another division of this district explained in Cochran v. Cochran (1998) 65 Cal.App.4th 488:
“In evaluating whether the defendant’s conduct was outrageous, it is ‘not enough that the defendant has acted with an intent which is tortious or even criminal, or that he has intended to inflict emotional distress, or even that his conduct has been characterized by “malice,” or a degree of aggravation which would entitle the plaintiff to punitive damages for another tort. Liability has been found only where the conduct has been so outrageous in character, and so extreme in degree, as to go beyond all possible bounds of decency, and to be regarded as atrocious, and utterly intolerable in a civilized community.’ ” (Id. at p. 496; cf. Cramer v. Consolidated Freightways, Inc. (9th Cir. 2001) 255 F.3d 683, 697 [secretly videotaping employees in restroom is per se actionable as outrageous conduct because it violates Penal Code].)
Cases in which the defendant’s conduct was not sufficiently outrageous to support a cause of action for intentional infliction of emotional distress include Schneider v. TRW, Inc. (9th Cir. 1991) 938 F.2d 986, 992-993, where a supervisor screamed, yelled, and made threatening gestures while criticizing the plaintiff’s job performance; Thomas v. Douglas (9th Cir. 1989) 877 F.2d 1428, 1434-1435, where a police department failed to protect the plaintiff police officer from another officer’s threats to render the plaintiff’s “ass” into “grass” in retaliation for reporting an officer’s misconduct; and, finally, Ankeny v. Lockheed Missiles & Space Co. (1979) 88 Cal.App.3d 531, 536-537, where an employer prevented the plaintiff employee from becoming a union steward, transferred him from job to job, wrongly denied him promotions, assigned him inappropriate job tasks, and personally insulted him. Consistent with the law’s strict test for outrageousness, disputes over claims handling and needing to hire one’s own expert and consultants to prove coverage are not outrageous conduct sufficient to support a cause of action for intentional infliction of emotional distress. (Schlauch v. Hartford Accident & Indemnity Co. (1983) 146 Cal.App.3d 926, 930-931, 936 [unfair claims practices including misrepresenting facts and insurance policy, failing to communicate, failure to settle claim and violation of duties under Insurance Code are not outrageous].) This is not to say that the handling of an insurance claim could never support a cause of action for intentional infliction of emotional distress, just that this is not one of them. The trial court, therefore, properly sustained respondent’s demurrer.
4. Leave to Amend Second Amended Complaint
Appellant contends the court erred in not granting her leave to amend her second amended complaint. She does not describe her proposed amendments. It is her duty to do so. (Blank v. Kirwan, supra, 39 Cal.3d at p. 318.) By not describing possible amendments, she fails to show the court abused its discretion in sustaining the demurrer without leave to amend, and we pass on her contention without further discussion. (Ibid.)
5. Costs Bill
The trial court may award costs to a prevailing party. (Code Civ. Proc., § 1032.) Appellant contends the court erred in awarding costs to respondent because some of the claimed costs were Allstate’s, not respondent’s. We review for abuse of discretion a costs award when a case involves multiple defendants. (Textron Financial Corp. v. National Union Fire Ins. Co. (2004) 118 Cal.App.4th 1061, 1075.)
Appellant does not support her contention with argument or citation to authority showing how the court erred in accepting respondent’s costs bill or in denying her motion to tax respondent’s costs. The argument in her brief consists largely of a verbatim quotation from her letter to opposing counsel listing her objections to respondent’s costs bill. She has not, however, included in the record on appeal the reporter’s transcript from the costs hearing, nor does she cite to places in the record that illustrate the purported errors in the court’s order granting respondent his costs. Appellant thus fails to show the court abused its discretion.
DISPOSITION
The judgment is affirmed. Respondent to recover his costs on appeal.
WE CONCUR: COOPER, P. J., FLIER, J.