Opinion
F082800
01-17-2023
MAMA K'S DINER, LLC, Plaintiff and Appellant, v. AMCO INSURANCE COMPANY, Defendant and Respondent.
Wilkins, Drolshagen &Czeshinski, James H. Wilkins and Quentin Cedar, for Plaintiff and Appellant. Hines Hampton Pelanda, Marc S. Hines and Brian Pelanda, for Defendant and Respondent.
NOT TO BE PUBLISHED
APPEAL from a judgment of the Superior Court of Tulare County. No. VCU279253 Nathan D. Ide, Judge.
Wilkins, Drolshagen &Czeshinski, James H. Wilkins and Quentin Cedar, for Plaintiff and Appellant.
Hines Hampton Pelanda, Marc S. Hines and Brian Pelanda, for Defendant and Respondent.
OPINION
SNAUFFER, J.
Plaintiff Mama K's Diner, LLC (Mama K's) appeals from a grant of summary judgment for defendant AMCO Insurance Company (AMCO). The case involves a dispute over insurance coverage for Mama K's restaurant, which was damaged by a fire. Mama K's sued AMCO for breach of contract and breach of the implied covenant of good faith and fair dealing, contending the damage is covered under the insurance policy it bought from AMCO. AMCO denies there is coverage because Mama K's did not have an automatic fire alarm as required by the policy. The trial court granted summary judgment for AMCO, concluding the damage was not covered because undisputed evidence showed that Mama K's failed to maintain an automatic fire alarm as was required for fire coverage.
We affirm the judgment.
FACTS
I. Record citations
To begin, we note that the vast majority of the factual assertions in Mama K's opening brief are supported only by citations to AMCO's response to Mama K's statement of additional material facts in opposition to AMCO's motion for summary judgment. This is improper and a violation of the California Rules of Court.
Under rule 8.204(a)(1)(C) of the California Rules of Court, each brief must "[s]upport any reference to a matter in the record by a citation to the volume and page number of the record where the matter appears." Rule 8.204(a)(2)(C) requires that an appellant's opening brief "[p]rovide a summary of the significant facts limited to matters in the record." In the context of an appeal from an order granting summary judgment, it is helpful for a party to cite the separate statement of undisputed facts (see Code Civ. Proc., § 437c, subd. (b)), and it is mandatory that the party cite the evidence supporting the separate statement. (Grant-Burton v. Covenant Care, Inc. (2002) 99 Cal.App.4th 1361, 1378 (Grant-Burton).)
All statutory references are to the Code of Civil Procedure unless otherwise stated.
Mama K's many failures to cite the evidence referenced in its separate statement violate the rules of court."' "It is the duty of a party to support the arguments in its briefs by appropriate reference to the record, which includes providing exact page citations."' [Citation.] Because '[t]here is no duty on this court to search the record for evidence' [citation], an appellate court may disregard any factual contention not supported by a proper citation to the record [citations]." (Grant-Burton, supra, 99 Cal.App.4th at p. 1379, italics omitted.)
II. Summary of facts
Mama K's operated a restaurant called Mama K's Diner out of a building on Main Street in Visalia from April 2016 to December 26, 2018 (the day of the fire). Karisa Huertaz was the managing member of Mama K's Diner LLC and Michael Huff was the restaurant's general manager. Huff had been the manager of Mama K's since 2016, and before that he was the general manager and part owner of a restaurant called Main Street Cafe that operated from the same location.
As the general manager of Main Street Cafe and later Mama K's, Huff's responsibilities included procuring insurance for the restaurants. For 13 years, Huff used Buckman-Mitchell Insurance Inc. ("BMI") to obtain insurance for the restaurants he managed, first for Main Street Cafe and then for Mama K's. Mama K's began operating as a restaurant, it procured an insurance policy through BMI with Topa Insurance Company. As part of the insurance policy application, BMI submitted a form that erroneously stated Mama K's had a central station fire alarm. Topa issued Mama K's an insurance policy with a "Protective Safeguards" endorsement conditioning coverage for fire damage on Mama K's maintaining an automatic fire alarm protecting the entire building.
As the Topa policy's term was nearing its end, BMI reached out to Mama K's about switching insurance carriers. BMI sent an insurance proposal to Mama K's that said: "We have marketed your policies and have obtained a Package quote from an admitted carrier, AMCO Insurance Company. This policy offers broader, better and additional coverages from your current, nonadmitted policy. We are recommending the rewriting to AMCO Insurance Company." Mama K's decided to switch to AMCO based on the recommendation.
BMI submitted the electronic application, which resulted in immediately binding coverage from April 1, 2017, to April 1, 2018. The AMCO insurance policy ("Policy") automatically renewed for the 2018-2019 term.
The Policy insured Mama K's business personal property. The Policy included a "Protective Safeguards" endorsement stating: "As a condition of this insurance, you are required to maintain the applicable protective devices or services for fire, denoted by symbols P-1, P-2, P-3, P-4, P-5, P-8, or P-9 ... as designated at each premises by symbols in the Declarations." The endorsement contains the following exclusion to the Policy:
1. FIRE PROTECTIVE SAFEGUARDS
We will not pay for loss or damages caused by or resulting from fire if, prior to the fire you:
....
b. Failed to maintain any protective safeguard as designated at each premises by symbol in the Declarations and over which you have control, in complete working order..
The Policy's Declarations pages for the restaurant have a section called "Protective Safeguards" that says, "This premise has Protective Safeguards identified by symbols below. Insurance for Fire and Burglary at this premise will be excluded if you do not notify us immediately if any of these safeguards are impaired." One of the symbols listed was P-2. The "Protective Safeguards" endorsement defines the symbol "P-2" to mean an "Automatic Fire Alarm, protecting the entire building, that is: a. Connected to a central station; or b. Reporting to a public or private fire alarm station."
The "Protective Safeguards" endorsement also includes the following "NOTICE" in bold capitalized font:
"YOU RISK THE LOSS OF CERTAIN INSURANCE COVERAGE AT PREMISES DESIGNATED IN THE DECLARATIONS IF YOU FAIL TO MAINTAIN ANY OF THE APPLICABLE PROTECTIVE SAFEGUARDS, LISTED BY SYMBOL IN THE DECLARATIONS FOR EACH PREMISES."
The endorsement further states:
"Your acceptance of this policy in the payment of premium when due constitutes your understanding and acknowledgement that you risk the loss of certain insurance at the premises designated if you fail to maintain the protective safeguard and your acceptance and agreement with the terms of this endorsement."
Huff admitted he received the Declarations pages upon receiving each of the Policies in the mail in 2017 and 2018 and that he saw the reference to the "Protective Safeguards" requirement but said that he just "didn't know what a safeguard was." He admitted he never asked anyone, including anyone from BMI, for an explanation.
On December 26, 2018, a fire caused substantial damage to the restaurant. Mama K's submitted a claim to AMCO. Huff spoke with an AMCO adjuster and told him the restaurant did not have an automatic fire alarm. In fact, the restaurant never had an automatic fire alarm. Instead, the restaurant only had an automatic burglar alarm system monitored by a security company. The burglar alarm system keypad had a button marked "fire," but that button had to be pressed by someone to trigger an alarm. The fire happened at 1:00 a.m. when no one was inside the restaurant to press the "fire" button on the keypad.
In February 2019, AMCO sent Mama K's a letter in which AMCO advised that there was no insurance coverage for the fire damage at the restaurant because it did not have an automatic fire alarm connected to a central station. In April 2019, Huertaz sent AMCO a letter in which she disputed the denial of coverage. Huertaz conceded that the restaurant never had an automatic fire alarm but asserted that "Mama K's did not understand (or know of) the existence and/or requirements of the Protective Safeguards endorsement."
Mama K's files suit
In June 2019, Mama K's filed suit against AMCO and BMI. The complaint alleged four causes of action: (1) breach of contract, (2) breach of the implied covenant of good faith and fair dealing, (3) negligence, and (4) breach of oral contract to procure insurance. The four causes of action were separately numbered. The third and fourth causes of action stated that they were against BMI only. The first and second causes of action did not state against which defendant they were asserted, but it is clear from the allegations that the first and second causes of action were against AMCO only. The facts pleaded under those causes of action discuss only AMCO's conduct and do not even mention BMI.
Where there is more than one plaintiff or defendant, the names of the plaintiffs asserting the particular cause of action and the defendants against whom the cause of action is asserted must appear (e.g., "Breach of contract against Defendant AMCO"; or "Breach of contract against all Defendants"). (Cal. Rules of Court, rule 2.112.)
The first cause of action for breach of contract alleged a single theory: that the express terms of the Policy cover the fire damage, and that AMCO has breached the contract by failing to pay benefits to Mama K's.
The second cause of action for breach of the implied covenant of good faith and fair dealing was also alleged against AMCO only. Mama K's alleged that AMCO failed to deal fairly with Mama K's insurance claim before rejecting the claim. Mama K's also alleged AMCO's bad faith conduct was done with fraud, malice, and oppression as defined by Civil Code section 3294, entitling Mama K's to an award of punitive damages.
The third cause of action for negligence, against BMI only, alleged that BMI knew Mama K's restaurant did not have an automatic fire alarm and knew Mama K's requested an insurance policy that would provide complete fire coverage. BMI also allegedly ensured Mama K's that the AMCO policy would cover fire damage yet failed to procure the level of insurance that it ensured Mama K's it would procure. As a result of the inadequate coverage, AMCO denied Mama K's claim.
The fourth cause of action for breach of oral contract to procure insurance, also against BMI only, is based on the same facts underlying the third cause of action. Mama K's claims that BMI breached its oral promise to procure insurance that would cover fire damage despite Mama K's not having an automatic fire alarm. This alleged breach of oral contract caused Mama K's claim to be denied.
AMCO's answer to the complaint contained a general denial of all allegations in Mama K's complaint as well as two affirmative defenses. The first affirmative defense stated the Policy's protective safeguards endorsement barred all of Mama K's claims against AMCO. This affirmative defense quoted language from the protective safeguards endorsement relating to the automatic fire alarm requirement and asserted that AMCO's failure to maintain an automatic fire alarm excludes coverage under the Policy for the fire damage.
Summary judgment proceedings
AMCO and BMI separately moved for summary judgment. Since this appeal concerns only AMCO's motion, the proceedings relating to BMI's motion are not relevant here. We therefore only summarize the proceedings pertaining to AMCO's motion.
AMCO moved for summary judgment, or in the alternative, summary adjudication. As to the first cause of action for breach of contract, AMCO argued that Mama K's failure to maintain an automatic fire alarm as required by the exclusions stated in the Policy's protective safeguards endorsement precludes any coverage for the fire damage. AMCO also argued that the protective safeguards endorsement was unambiguous, that the Policy may not be rewritten to provide coverage, that Mama K's cannot avoid enforcement of the protective safeguards endorsement by proclaiming ignorance, and that Mama K's cannot avoid enforcement of the Policy's protective safeguards endorsement through the doctrines of waiver or estoppel.
AMCO argued the second cause of action for breach of the implied covenant of good faith and fair dealing failed for two reasons. First, Mama K's could not establish the threshold requirement for success on a bad faith claim: coverage under the Policy. Second, even if Mama K's could establish coverage, the "genuine dispute doctrine" precludes a finding of bad faith.
The genuine dispute doctrine "holds that an insurer does not act in bad faith when it mistakenly withholds policy benefits, if the mistake is reasonable or is based on a legitimate dispute as to the insurer's liability." (Century Surety Co. v. Polisso (2006) 139 Cal.App.4th 922, 949 (Century).)
Also, with respect to the second cause of action, AMCO argued it had no duty to advise Mama K's that failing to maintain an automatic fire alarm might preclude coverage. Additionally, it argued that punitive damages could not be awarded to Mama K's for the alleged breach of the implied covenant of good faith and fair dealing because the evidence is insufficient as a matter of law to prove by clear and convincing evidence that AMCO is guilty of oppression, fraud, or malice (Civ. Code, § 3294).
Mama K's opposed the motion. As to the breach of contract cause of action, it asserted triable issues of fact existed regarding whether AMCO should be estopped from relying on the protective safeguards endorsement. It argued that there was a triable issue as to whether BMI was AMCO's agent, and in turn whether AMCO should be estopped from relying on the endorsement because of BMI's negligence in procuring the Policy. Mama K's further contended triable issues existed regarding whether AMCO waived the protective safeguards endorsement, and also asserted the protective safeguards endorsement is unenforceable because it was not "conspicuous, plain and clear."
Mama K's further argued AMCO was not entitled to summary judgment on its bad faith claim because there was a triable issue of fact as to coverage. Mama K's disputed the argument AMCO raised in its summary judgment motion that the genuine dispute doctrine bars the bad faith claim. They also argued AMCO had an affirmative obligation to bring the protective safeguards endorsement to Mama K's attention. Finally, Mama K's argued a triable issue of fact existed as to whether AMCO's bad faith conduct rose to the level justifying an award of punitive damages.
The trial court heard argument on AMCO's motion and granted it in a written order. The order stated Mama K's failure to maintain an automatic fire alarm precluded coverage because of the terms of the protective safeguards endorsement in the Policies. The order rejected Mama K's various arguments that the protective safeguards endorsement was unenforceable, including Mama K's waiver and estoppel arguments.
The court's order did not address the first and second causes of action separately. Even so, it is clear from the context that the trial court concluded there was no triable issue of material fact as to the breach of contract claim because Mama K's failure to maintain an automatic fire alarm precluded coverage for fire damage, and therefore AMCO did not breach the insurance contract by refusing to pay benefits on Mama K's claim. In turn, it is implied that the trial court reasoned that Mama K's claim for breach of the implied covenant of good faith and fair dealing necessarily fails because there was no coverage, and therefore AMCO could not possibly have acted in bad faith because it owed Mama K's no benefits.
DISCUSSION
I. Basic principles governing summary judgment
A party asserting an action has no merit or there is no defense to the action may move for summary judgment. (§ 437c, subd. (a)(1).) The court must grant a motion for summary judgment, "if all the papers submitted show that there is no triable issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." (§ 437c, subd. (c).) "To determine whether a triable issue of material fact exists, the court must consider all evidence laid out in the moving papers and all inferences reasonably deducible from the evidence. [(§ 437c, subd. (c)).] A triable issue of material fact exists if, 'the evidence would allow a reasonable trier of fact to find the underlying fact in favor of the party opposing the motion in accordance with the applicable standard of proof.'" (Jones v. Awad (2019) 39 Cal.App.5th 1200, 1206 (Jones).) A defendant moving for summary judgment bears the burden of establishing, by declarations and evidence, a complete defense to plaintiff's actions or the lack of an essential element of plaintiff's case. (§ 437c, subd. (o).) An appellate court reviews a grant of summary judgment de novo. (Flores v. City of San Diego (2022) 83 Cal.App.5th 360, 372.)
Because a summary judgment motion raises only questions of law about the construction and effect of supporting and opposing papers, we independently apply the same three-step analysis required of the trial court. (Jones, supra, 39 Cal.App.5th at pp. 1206-1207; see § 437c, subd. (o).) First, we identify issues framed by the pleadings. Second, we determine whether the moving party's showing established facts justifying judgment in its favor. Third, if the moving party makes such a showing, we finally determine whether the opposition shows a triable issue of material fact. (Jones, at pp. 1206-1207.)
The operative complaint determines the issues a defendant must address to prevail on a motion for summary judgment. (Laabs v. City of Victorville (2008) 163 Cal.App.4th 1242, 1258 (Laabs).)" 'Evidence offered on an unpleaded claim, theory, or defense is irrelevant because it is outside the scope of the pleadings.'" (Jacobs v. Coldwell Banker Residential Brokerage Co. (2017) 14 Cal.App.5th 438, 444 (Jacobs).) "Thus, a 'defendant moving for summary judgment need address only the issues raised by the complaint; the plaintiff cannot bring up new, unpleaded issues in his or her opposing papers.'" (Laabs, at p. 1253.)" 'If the opposing party's evidence would show some factual assertion, legal theory, defense or claim not yet pleaded, that party should seek leave to amend the pleadings before the hearing on the summary judgment motion. [Citations.]' [Citation.] ... [Plaintiff's] separate statement of material facts is not a substitute for an amendment of the complaint.'" (Ibid.) California law is clear that a party cannot amend its pleadings by raising issues for the first time in an opposition to summary judgment. (Id. at p. 1253, 1257; see also Millard v. Biosources, Inc. (2007) 156 Cal.App.4th 1338, 1353 (Millard) [plaintiff whose complaint alleged negligence but not a theory of negligence per se and who did not seek to amend complaint to include such allegations cannot defeat summary judgment by raising a theory of negligence per se].)
II. The breach of contract cause of action
Mama K's challenges the grant of summary judgment on the breach of contract cause of action. The only theory of breach alleged in the complaint is that the express terms of the Policy cover the fire damage here. This theory fails because the undisputed evidence showed that Mama K's did not have an automatic fire alarm as required by the Policy, which precluded coverage. Since there is no coverage for the damage, AMCO could not have breached the contract by failing to pay benefits on Mama K's claim.
Mama K's did not argue below, and does not argue here, the single theory of breach of contract alleged in its complaint. Instead, Mama K's advances multiple alternative theories for why AMCO cannot rely on the protective safeguards endorsement. None of these alternative theories are breach of contract theories, and the complaint does not allege facts supporting any of these theories. Consequently, Mama K's cannot rely on any of its alternative theories to defeat summary judgment. (Jacobs, supra, 14 Cal.App.5th at p. 444.)
We conclude the grant of summary judgment on the first cause of action was proper based on the theory of breach alleged in the complaint.
A. Basic breach of contract law
"A cause of action for damages for breach of contract is comprised of the following elements: (1) the contract, (2) plaintiff's performance or excuse for nonperformance, (3) defendant's breach, and (4) the resulting damages to plaintiff." (Careau &Co. v. Security Pacific Business Credit, Inc. (1990) 222 Cal.App.3d 1371, 1388.)
"Before any party to an obligation can require another party to perform any act under it, he must fulfill all conditions precedent thereto imposed upon himself; and must be able and offer to fulfill all conditions concurrent so imposed upon him on the like fulfillment by the other party, except as provided by the next section." (Civ. Code, § 1439; see also Alki Partners, LP v. DB Fund Services, LLC (2016) 4 Cal.App.5th 574, 592 ["party's failure to perform a condition precedent will preclude an action for breach of contract"].) "A condition precedent is one which is to be performed before some right dependent thereon accrues, or some act dependent thereon is performed." (Civ. Code, § 1436.)
In the insurance context,"' "[a] condition precedent refers to an act, condition or event that must occur before the insurance contract becomes effective or binding on the parties[.]" '" (American Way Cellular, Inc. v. Travelers Property Casualty Co. of America (2013) 216 Cal.App.4th 1040, 1054, italics omitted (American Way).) In American Way, the Court of Appeal held that a property insurance policy endorsement requiring that the owner of commercial premises maintain an automated sprinkler system was a condition precedent to coverage which required owner to have a functioning, operational sprinkler system during the period of coverage, such that owner's failure to install or maintain such a system precluded coverage for fire damage. (Id. at p. 1055.)
B. Analysis
The breach of contract cause of action is short enough to reproduce in its entirety.
FIRST CAUSE OF ACTION
(Breach Of Contract)
21. MAMA K's realleges paragraphs 1 through 20 as though fully set forth herein.
22. Pursuant to the terms of THE POLICY, AMCO is contractually required to pay for the fire losses sustained.
23. AMCO has failed and refused to provide MAMA K's with the full and complete insurance benefits as expressly required under the AMCO policy. Accordingly, AMCO is in breach of the express and specific terms of THE POLICY.
24. As a direct and proximate result of AMCO's breach of its contractual obligations, MAMA K's has sustained damages in an amount in excess of the jurisdictional minimum limits of this Court, the exact amount of which shall be established at the time of trial.
All four causes of action employ the "chain letter" style of pleading where each claim for relief incorporates by reference all preceding paragraphs and allegations, whether or not such allegations are relevant to the theories of liability or causes of action alleged. This type of pleading is disfavored because it creates ambiguity and redundancy, as well as masks the true causes of action which are the subject of the parties' dispute. (Uhrich v. State Farm Fire &Casualty Co. (2003) 109 Cal.App.4th 598, 605.)
Independently reading the complaint, we conclude the first cause of action asserts just one theory of breach of contract: that the Policy's terms expressly cover the fire damage here, and AMCO has breached the insurance contract by failing to provide that coverage. The undisputed evidence in the record, however, shows that the Policy contained a protective safeguards endorsement requiring that Mama K's must maintain an automatic fire alarm to be covered for fire damage, and that Mama K's failed to maintain an automatic fire alarm. AMCO therefore was not obligated under the Policy to pay any benefits under Mama K's claim. Put differently, the maintenance of the automatic fire alarm was a condition precedent for fire coverage which Mama K's failed to satisfy, and therefore Mama K's cannot sue AMCO for breach of contract. (American Way, supra, 216 Cal.App.4th at p. 1054.)
Mama K's did not address this theory of breach below and continues to ignore it on appeal. Instead, it advances several theories as to why AMCO cannot rely on the protective safeguards endorsement, none of which are breach of contract theories. Primarily, Mama K's argues there are triable issues of fact related to whether AMCO should be estopped from relying on the protective safeguards endorsement. The theory is that BMI was acting as AMCO's agent when it misrepresented to Mama K's that the AMCO policy would provide broader and better coverage than the Topa policy and misrepresented to AMCO that Mama K's had an automatic fire alarm. And because of the agency relationship, AMCO is vicariously liable for BMI's misrepresentations. Mama K's contends there are triable issues of fact related to the alleged agency relationship. Relatedly, Mama K's theorizes AMCO should be deemed to have "waived" the protective safeguards endorsement because of BMI's conduct. Additionally, Mama K's maintains triable issues exist as to whether the protective safeguards endorsement is unenforceable for not being "conspicuous, plain, and clear."
The fatal problem is that the facts underlying these alternative theories were not pleaded in the complaint and therefore cannot be used to reverse the judgment. We recognize that Mama K's alleges in one of the introductory paragraphs of the complaint that "[a]t all times herein mentioned, defendants, and each of them, were acting as the agents, servants, employees, partners and joint venturers of all remaining defendants in doing the things herein alleged[]_." This is a standard allegation to include in a complaint against multiple defendants. There are no other allegations, though, regarding Mama K's and BMI's purported agency relationship. There are also no allegations that any part of the Policy is unenforceable.
We further observe that BMI is not mentioned in the first two causes of action, and AMCO is not mentioned in the third and fourth causes of action. We construe this to mean that Mama K's was suing AMCO and BMI separately for each entity's own conduct, and that neither defendant had anything to do with the other's conduct. But that aside, the most important fact remains that the breach of contract cause of action clearly states that Mama's K's theory of breach is that the Policy's express terms provide coverage. The first cause of action as pleaded states but one theory, and Mama K's never requested leave to amend the complaint to plead additional theories. Any theory regarding the unenforceability of the protective safeguards endorsement is simply not available to Mama K's to reverse the judgment. (Millard, supra, 156 Cal.App.4th at p. 1353.)
III. The bad faith cause of action
Mama K's also contends judgment on its cause of action for breach of the implied covenant of good faith and fair dealing must be reversed. We disagree.
" 'The law implies in every contract, including insurance policies, a covenant of good faith and fair dealing.'" (Hedayati v. Interinsurance Exchange of the Automobile Club (2021) 67 Cal.App.5th 833, 843.) "When the insurer engages in unreasonable conduct in connection with an insured's insurance claim, the insurer is said to have tortiously breached the implied covenant." (Century, supra, 139 Cal.App.4th at p. 948.) An insurer is subject to tort liability when it unreasonably and in bad faith withholds payments of claim of its insured. (Id. at p. 949.)
Thus, a breach of the implied covenant of good faith and fair dealing involves something more than a breach of the contract or mistaken judgment. (Chateau Chamberay Homeowners Ass'n. v. Associated Intern. Ins. Co. (2001) 90 Cal.App.4th 335, 345.) There must be proof the insurer failed or refused to discharge its contractual duties not because of an honest mistake, bad judgment, or negligence," 'but rather by a conscious and deliberate act, which unfairly frustrates the agreed common purposes and disappoints the reasonable expectations of the other party thereby depriving that party of the benefits of the agreement.'" (Century, supra, 139 Cal.App.4th at p. 949.)
"To establish a bad faith claim, the insured must show that (1) benefits due under the policy were withheld and (2) the reason for withholding the benefits was unreasonable or without proper cause." (Century, supra, 139 Cal.App.4th at p. 949.) As explained in the prior section of our Discussion, Mama K's complaint alleges just one theory under which benefits were due, and that theory fails as a matter of law. Since the complaint does not allege any other claim under which Mama K's would be due any benefits under the Policy, the bad faith cause of action necessarily fails. Therefore, summary judgment on the second cause of action was proper. And since summary judgment was proper on all causes of action against AMCO, there is no basis for an award of punitive damages against it.
DISPOSITION
The judgment is affirmed. Respondent is awarded its costs on appeal. Respondent's motion to strike portions of appellant's reply brief is denied.
WE CONCUR: MEEHAN, Acting P. J., DE SANTOS, J.