Michael Cingari vs. Farmers Insurance Company

Response

Cal. Super. - 4th Dist.January 17, 2017

A I T K E N 4 A I T K E N ¢ C O H N 3 M A C A R T H U R P L A C E , S U I T E 80 0 = ~ W N O X 9 O N W n 10 1 12 13 14 15 16 71 4- 43 4- 14 24 71 4- 43 4- 36 00 F A C S I M I L E S A N T A A N A , C A 92 70 7 17 18 19 20 21 22 23 24 25 26 24 28 € PRINTED ON RECYCLED PAPER WYLIE A. AITKEN (SBN 37777) RICHARD A. COHN (SBN 145156) CASEY R JOHNSON (SBN 223523) AITKEN +AITKEN 4 COHN 3 MACARTHUR PLACE, SUITE 800 SANTA ANA, CA 92707-2555 (714) 434-1424 Telephone (714) 434-3600 Facsimile Attorneys for Plaintiffs SUPERIOR COURT OF THE STATE OF CALIFORNIA FOR THE COUNTY OF ORANGE COUNTY, CENTRAL JUSTICE CENTER MICHAEL CINGARI, an individual; H. REY GUBERNICK, D.C., individually and as an actual and ostensible agent ofNATURAL HEALTH SPORTS THERAPY, INC.; MARK ROCHE, individually, and as President of NATURAL HEALTH SPORTS THERAPY, INC.; AARON BERGER, individually, and as Vice President of NATURAL HEALTH SPORTS THERAPY, INC., Plaintiffs, Vs. FARMERS INSURANCE COMPANY; MID-CENTURY INSURANCE COMPANY; CNA INSURANCE COMPANY; AMERICAN CASUALTY COMPANY; MARTIN STUKA and DOES 1 to 100, inclusive Defendants. 1 CASE NO. 30-2017 00897866-CU-PO-CIC Assigned to Honorable Linda S. Marks Dept. C10 PLAINTIFFS RESPONSE TO DEFENDANT MARTIN STUKA’S SEPARATE STATEMENT OF UNDISPUTED MATERIAL FACTS IN SUPPORT MOTION FOR SUMMARY JUDGMENT [Filed concurrently with Opposition to Defendant Stuka’s Motion For Summary Judgment; Memorandum OfPoints And Authorities; Declaration OfDonald Petrie; Declaration ofRichard A. Cohn] Date: October 22, 2018 Time: 10:00 am Department: C-10 Reservation 1D: 72838875 Complaint Filed: 1/17/17 Trial Date: 5/28/19 PLAINTIFFS RESPONSE TO DEFENDANT MARTIN STUKA’S SEPARATE STATEMENTOF UNDISPUTED MATERIAL FACTS IN SUPPORT MOTION FOR SUMMARY JUDGMENT 2 3 4 5 6 7 8 9 10 Bl 12 g 13 552 31 ny Ea EF iE 18 19 20 21 3 23 24 25 26 27 28 € PRINTED ON RECYCLED PAPER TO ALL PARTIES AND THEIR ATTORNEYS OF RECORD: Plaintiffs, NATURAL HEALTH SPORTS THERAPY, INC. and MARK ROCHE, hereby submits the following Separate Statement of Undisputed Material Facts, together with reference to supporting evidence, in support of their Opposition to Defendant Martin Stuka’s Motion for Summary Judgment: MOVING PARTY’S UNDISPUTED MATERIAL FACTS AND SUPPORTING EVIDENCE: OPPOSING PARTY’S RESPONSE AND SUPPORTING EVIDENCE: 1. On December 10, 2010, Roche faxed a copy ofhis Zurich commercial general liability policy to Stuka and requested Mr. Stuka to match the types of coverage that he had with Zurich and only add employee theft, which Mr. Stuka added. Deposition ofMark Roche (“Plaintiff's Depo. ”), p.44.:17-45.:4; p.49:1-25; p. 50.:1-25, relevant portions oftranscript attached as Exhibit B to Gonzalez Decl., 3. Declaration ofMartin Stuka 92. Disputed. Defendant blatantly misstates the cited testimony. First, Stuka (not Roche) added employee theft, (see Roche depo at p. 45, line 3-4). Also, Roche does not remember being told that Stuka would simply match the Zurich policy. Rather, Roche told Stuka he wanted to be “double covered - if anything happened in his office.” Roche Depo at p. 50, line 16-25. 2. At the time when Roche wasfirst discussing insurance with Stuka, Roche knew that Stuka did not sell medical malpractice insurance. Plaintiff's Depo., p.53:2-25; p.54:1- 24; p.55:1-2, relevant portions of transcript attached as Exhibit B to Gonzalez Decl, 43. Disputed that this is what the cited testimony says. The cited testimony says that Roche was not seeking medical malpractice insurance for the individual practitioners (himself Berger, and Gubernick) because they already had it. But Roche wanted him to get other insurance to be double covered for the business, but Roche did not know whatthat insurance was called (evidencing that Roche did not understand that the business also needed professional liability coverage). Based on Stuka’s representation, Roche reasonably believed Stuka was obtaining said insurance. 9 PLAINTIFFS RESPONSE TO DEFENDANT MARTIN STUKA’S SEPARATE STATEMENT OF UNDISPUTED MATERIAL FACTS IN SUPPORT MOTION FOR SUMMARY JUDGMENT A I T K E N 4 A I T K E N 4 C O H N 3 M A C A R T H U R P L A C E , S U I T E 80 0 ~ ~ L N S S O X 9 O N W n 1 1 12 13 14 15 16 71 4- 43 4- 14 24 71 4- 43 4- 36 00 F A C S I M I L E 17 S A N T A A N A , C A 92 70 7 18 19 20 21 22 13 24 25 26 27 28 & PRINTED ON RECYCLED PAPER Roche depo p. 53, line 2 to p. 55 line 23. See also Declaration of Plaintiff’s Expert Petrie at paragraph ) Roche did not want nor request medical malpractice insurance from Stuka. Plaintiff's Depo., p.53:2-25; p.54:1- 24; p.55:1-2, relevant portionsof transcript attached as Exhibit B to Gonzalez Decl. Disputed that this is what the cited testimony says. The cited testimony says that Roche was not seeking medical malpractice insurance for the individual practitioners (himself Berger, and Gubernick) because they already had it. But Roche wanted him to get other insurance to be double covered for the business, but Roche did not know what that insurance was called (evidencing that Roche did not understand that the business also needed professional liability coverage). Based on Stuka’s representation, Roche reasonably believed Stuka was obtaining said insurance. Roche depo p. 53, line 2 to p. 55 line 23. See also Declaration of Plaintiff’s Expert Petrie at paragraph At the time when Roche was first discussing insurance with Stuka, Roche believed that he had his own medical malpractice insurance; that plaintiff Aaron Berger had his own medical malpractice insurance; and that plaintiff H. Rey Gubernick had his own medical malpractice insurance. Plaintiff’s Depo., p.53:2-25; p.56:3- 25; 1-24; p.57:1-25; p. 58: 1-24, relevant portionsoftranscript attached as Exhibit B to Gonzalez Decl, 43. Undisputed. But see Plaintiff’s response to number 2, and number 3, above. 3 PLAINTIFFS RESPONSE TO DEFENDANT MARTIN STUKA’S SEPARATE STATEMENT OF UNDISPUTED MATERIAL FACTS IN SUPPORT MOTION FOR SUMMARY JUDGMENT A I T K E N ¢ A I T K E N ¢ C O H N 3 M A C A R T H U R P L A C E , S U I T E 80 0 S O 0 9 O N U n B W -_ - = = e m e m e m A A n n A W N 71 4- 43 4- 14 24 71 4- 43 4- 36 00 F A C S I M I L E S A N T A A N A , C A 9 2 7 0 7 N o N o N o N o N o N o N o - _ - - a N w i ~ ~ W w N o - l = O o c o ~ J N o ~ 28 € PRINTED ON RECYCLED PAPER On December 15, 2010, Stuka presented Roche a Mid-Century Insurance Company business office insurance policy proposal, which Roche accepted. Plaintiff's Depo., p.60:4-25; p. 61:1-25; p. 62:1-25, p.63.1-24, relevant portionsoftranscript attached as Exhibit B to Gonzalez Decl., 93. Declaration ofMartin Stuka 13 Undisputed as phrased. Stuka did not misrepresent to Roche that he was procuring medical malpractice insurance for Roche nor NHST. Declaration ofMartin Stuka 95. Disputed that this is what the cited testimony says. The cited testimony says that Roche was not seeking medical malpractice insurance for the individual practitioners (himself Berger, and Gubernick) because they already had it. But Roche wanted him to get other insurance to be double covered for the business, but Roche did not know what that insurance was called (evidencing that Roche did not understand that the business also needed professionalliability coverage). Based on Stuka’s representation, Roche reasonably believed Stuka was obtaining said insurance. Roche depo p. 53, line 2 to p. 55 line 23. See also Declaration of Plaintiff's Expert Petrie at paragraph 4 PLAINTIFFS RESPONSE TO DEFENDANT MARTIN STUKA’S SEPARATE STATEMENT OF UNDISPUTED MATERIAL FACTS IN SUPPORT MOTION FOR SUMMARY JUDGMENT A I T K E N ¢ A I T K E N + C O H N 3 M A C A R T H U R P L A C E , S U I T E 80 0 H B W w N O 0 9 O Y w n 10 11 12 13 14 15 16 17 71 4- 43 4- 14 24 71 4- 43 4- 36 00 F A C S I M I L E S A N T A A N A , C A 92 70 7 18 19 20 21 22 23 24 25 26 27 28 €9 PRINTED ON RECYCLED PAPER PLAINTIFFS ADDITIONAL FACTS PLAINTIFF'S SEPARATE FACTS: SUPPORTING EVIDENCE: In 2000, Mark Roche assumed sole ownership of Natural Health Sports Therapy, a business that offered physicaltraining, physical therapy and chiropractic services to patients and clients. (PAF 1, Roche Depo, p. 7:8 - 14:25) On April 13, 2006, Natural Health Sports Therapy was incorporated in California. (PAF 2, Roche Depo 15:10-19:5, 20:8-9; Articles ofIncorporation from California Secretary of State Website attached as Exhibit C to RAC Declaration.) The officers of Natural Health Sports Therapy, Inc. (“NHST”) are Valinda Roche, Pat Roche and Aaron Berger. (PAF 3, Roche Depo 16:6-17:25) The shareholders of NHST as of June 2015 were Aaron Berger, Valinda Roche and Pat Roche. (PAF 4, Roche Depo 16:6 - 17:25) As of September 2013, individualsworking at the NHST locationincluded therapist Mark Roche(“Roche”), therapist Aaron Berger,chiropractor Rey Gubernick, frontdesk worker Brittany Thomas, andtwo therapy aides/interns. (PAF 5, Roche Depo 22:10-23:17) 5PLAINTIFFS RESPONSE TO DEFENDANT MARTIN STUKA’S SEPARATE STATEMENT OFUNDISPUTED MATERIAL FACTS IN SUPPORT MOTION FOR SUMMARY JUDGMENT A I T K E N ¢ A I T K E N ¢ C O H N 3 M A C A R T H U R P L A C E , S U I T E 80 0 A W N N O R X 3 O N W n 10 11 12 13 14 15 16 71 4- 43 4- 14 24 71 4- 43 4- 36 00 F A C S I M I L E 17 18 [9 20 21 S A N T A A N A , C A 92 70 7 22 23 24 25 26 27 28 &€9 PRINTED ON RECYCLED PAPER Payroll for NHST is done through ADP, with checks cut from the NHST’s bank account with Wells Fargo Bank. (PAF 6, Roche depo 26:20-28:1) Dr. Gubernick paid 30% of his gross earnings to pay for his space at NHST. (PAF 7, Roche depo . 28:18-29:2) Earnings for Dr. Gubernick’s work were collected by NHST and then NHST paid Dr. Gubernick, after deduction of NHST’s 30% cut, from a check from NHST’s Wells Fargo bank account. (PAF 8, Roche Depo 25:2 - 25:18, 27:5 - 32:5) Beginning in 1995, NHST, through Roche, procured Zurich insurance for its business through Don Barenson. (PAF 9, Roche Depo 39:18-40:15, 41:22 - 42:3) 10. Roche sought to secure insurancecoverage from Mr. Barenson thatwould comply with NHST’s leaseagreement, and cover the business incase the business was sued for theactions ofthose within the business,as well as any equipmentfailure ormisrepresentation made by a memberof his business to the community. (PAF 10, Roche Deop 160:2-14; 160:21-161:4; 177:24 - 178:25) 6 PLAINTIFFS RESPONSE TO DEFENDANT MARTIN STUKA’S SEPARATE STATEMENT OF UNDISPUTED MATERIAL FACTS IN SUPPORT MOTION FOR SUMMARY JUDGMENT A I T K E N ¢ A I T K E N 4 C O H N 3 M A C A R T H U R P L A C E , S U I T E 80 0 [ N e © E E N U - _ - = = e m e e e d p e SA N n n B A W N = 71 4- 43 4- 14 24 71 4- 43 4- 36 00 F A C S I M I L E S A N T A A N A , C A 9 2 7 0 7 D o N o N o N o N o N o N D - _ - - a N W n B w o N o - S \ O o o ~ N o ~ 28 3 PRINTED ON RECYCLED PAPER 11. Roche met Farmers Insurance captive casualty broker-agent, Martin Stuka (“Stuka™), when their children played sports together. (PAF 11, Roche Depo 48;12-49:8, 65:14- 66:14; Stuka Depo 12:15-17:21, 47:10-16; 52:1-5, 62:23-63:15) 12. In 2010, Stuka offered to procure insurance for Roche’s business. (PAF 12, Roche depo 48:15-18) 13. At Stuka’s request, Roche provided Stuka with a copy of NHST’s then existing business policy. (PAF 13, Roche Depo 50:5-8) 14. In addition to ensuring that Stuka was securing the same coverage that NHST had previously had through Zurich, Roche also explicitly told Stuka “I wanted to be double covered... if anything happened in my office, | wanted to be covered.” (PAF 14, Roche Depo 50:18-51:9; 160:2- 162:2; 164:2-23; 177:24 - 178:25) 15. Roche assumed that the insurancethat Mr. Stuka procured for NHSTthrough Mid-Century would providecoverage “if anything happened in[the NHST] office, just as theprevious Zurich policy had. (PAF 15, Roche Depo 37:20 - 38: 20;160:2-162:2; 164:2-23; 177:24 - 178:25) 7 PLAINTIFFS RESPONSE TO DEFENDANT MARTIN STUKA’S SEPARATE STATEMENT OF UNDISPUTED MATERIAL FACTS IN SUPPORT MOTION FOR SUMMARY JUDGMENT A I T K E N 4 A I T K E N ¢ C O H N 1 16. Roche knew that the individual (PAF 16, Roche Depo 53:2-20; 161:8-22; practitioners had their own medical 164:2-23) 2 malpractice insurance, but wanted to 3 be sure that NHST was covered such that “if anything happened in the 4 office, I wanted to be double covered.” 5 6 17. Roche, as an individual, had (PAF 17, Roche 53:12-17) malpractice insurance coverage. 7 8 9 10 18. Roche was not expecting Stuka to (PAF 18, Roche 55:6-16; 160:2-162:12; 11 secure medical malpractice insurance 164:2 -168:4) for himself, individually, because he 12 } ; already had personal professional g 13 liability coverage through another = carrier, but Roche wanted Stuka to zz 2 14 procure (or help procure) whatever o 3 2 15 insurance was necessary to cover = 43 x “anything that happened in the 2%] g 16 office.” ZEEE 19. Roche, on behalf of NHST, relied (PAF 19 Roche 164:5-164:23) z3 1 upon Stuka’s expertise as an 3 © 18 insurance professional to secure the = necessary coverage to fully protect 19 NHST. 20 21 20. Prior to purchasing the policy offered (PAF 20, Stuka Depo 75:25 - 84:4) 27 by Farmers, Farmers generated an insurance proposal including a Mid- 23 Century insurance policy that was 24 provided by Stuka to Roche on behalf ofNHST. 25 26 27 28 €3 PRINTED ON A RECYCLED PAPER PLAINTIFFS RESPONSE TO DEFENDANT MARTIN STUKA’S SEPARATE STATEMENT OF ’ UNDISPUTED MATERIAL FACTS IN SUPPORT MOTION FOR SUMMARY JUDGMENT A I T K E N ¢ A I T K E N 4+ C O H N 3 M A C A R T H U R P L A C E , S U I T E 80 0 N O 0 d N n n A W N - _ - = e m e m e d p d p e d A A n n B R A W N = O 71 4- 43 4- 14 24 71 4- 43 4- 36 00 F A C S I M I L E S A N T A A N A , C A 9 2 7 0 7 | ) N o N o N o N o N o n o - _ - _ - lo ) W n EE N W w NS ) E k o S O o 0 ~ N o ~ 28 €9 PRINTED ON RECYCLED PAPER Jl. This was done after Stuka had visited the NHST office and become familiar with the nature of NHST’s business. (PAF 21, Stuka Depo 75:25 - 84:4) 22, Stuka requested, and Roche also provided him with a copy of NHST’s then current Zurich policy. (PAF 22, Roche Depo 50:1-25) 23. The Zurich policy was reviewed by the commercial group in the Farmers’ District office who aided in putting together the Mid-Century proposal for NHST for a business office policy. (PAF 23, Stuka Depo 38:14-39:15) 24. This was also after Roche had explained to Stuka on several occasions that he wanted “double coverage” and an “umbrella” to ensure that NHST would be covered “if anything happened in [the NHST] office.” (PAF# 24, Roche Depo 38:15-20; 50:16- 25; 51:7 - 52:20; 53:2-20, 63:22-64:14; 98:7-10; 160:2-162:2; 167:3-11) 23, Stuka told Roche that NHST wouldbe so covered. (PAF# 25, Roche Depo 38:15-20; 53:2-20,63:22-64:14; 103:9-23; 160:2-162:2;164:2-23) 9 PLAINTIFFS RESPONSE TO DEFENDANT MARTIN STUKA’S SEPARATE STATEMENT OF UNDISPUTED MATERIAL FACTS IN SUPPORT MOTION FOR SUMMARY JUDGMENT A I T K E N ¢ A I T K E N ¢ C O H N 3 M A C A R T H U R P L A C E , S U I T E 80 0 == ] \ O o o ~ a N w n EE N W w N o - _ - _ = e e e d e e w n B R A W N = 71 4- 43 4- 14 24 71 4- 43 4- 36 00 F A C S I M I L E S A N T A A N A , C A 9 2 7 0 7 D O N o NS ) N o N o NS ) N o - -_ - - _ - _ a N W n ES N W w NS ) - _ o o O o 0 ~ a N N o ~ 28 € PRINTED ON RECYCLED PAPER 26. Roche, on behalf ofNHST, relied upon Stuka’s expertise as an insurance professional. (PAF 26, 164:5-164:23) 27. At no time prior to securing the insurance proposal for NHST did Stuka ever inquire as to the legal structure ofNHS, despite being trained by Farmeres to do so. (PAF 27, Stuka Depo 83:8-84:17; 170:22- 171:24) 28. In fact, Farmers’/Mid-Century’s agent Stuka doesn’t even know ifit would matter as to whether NHST was a corporation versus a dba (an individual doing business as), and testified that it shouldn’t make a difference as to what coverages were provided for business/commercial policies. (PAF 28, Stuka Depo 83:8-12; 151:7-18; 170:22-171:24) 29. Stuka was also never trained on “grey areas” of coverage between liability and malpractice coverage in order to properly advise an insurer secures the necessary coverage. (PAF 29, Stuka 184:4-186:20) 30. Nevertheless, Stuka would not wantan insured to have a “gap” incoverage where the business ownerpolicy does not provide coverage anda professional liability policy is not inplace, and vice versa. ( PAF 30, Stuka 187:15-188:7) 10 PLAINTIFFS RESPONSE TO DEFENDANT MARTIN STUKA’S SEPARATE STATEMENT OF UNDISPUTED MATERIAL FACTS IN SUPPORT MOTION FOR SUMMARY JUDGMENT A I T K E N ¢ A I T K E N ¢ C O H N 3 M A C A R T H U R P L A C E , S U I T E 80 0 SO S O O 0 N N S N U n B R A W N _ - = = e d e d e d A N L n B A W N = 71 4- 43 4- 14 24 71 4- 43 4- 36 00 F A C S I M I L E S A N T A A N A , C A 9 2 7 0 7 D o N o N o N o N o N o N D - _ - - _ a N W n a W w N o - _ o S O o 0 3 N o ~ 28 € PRINTED ON RECYCLED PAPER 31. Despite securing a business owner policy for NHST, a Healthcare Practitioner, Stuka never discussed malpractice coverage of any kind with Roche/NHSTfor the business “because (Stuka) wouldn’t be writing that.” (PAF 31, Stuka Depo 189:7-191:13) 32. Stuka never told Roche/NHST that he did not sell malpractice insurance. (PAF 32, Stuka Depo 191:2-191:12) 33. In the Farmers’/Mid-Century Insurance generated insurance proposal itself, Farmer's held out its agents as “Professional agents and underwriters, specialists in business,” confirming that “[o]ur agents are underwriters who are highly-trained professionals who specialize in providing insurance to business owners.” (PAF 33, Stuka Depo, 86:10-24 (and insurance proposal p. 108-119 attached as an exhibit to Declaration of Richard A. Cohn) 34. Farmers’/Mid-Century Insurance, through the proposal generated for NHST and conveyed to NHST through Stuka further confirmed that Stuka “will also offer expertise and coverage recommendations.” (PAF 34, Stuka Depo, 92:15-1, (and insurance proposal p. 110 attached as an exhibit to RAC Declaration) 35. Farmers/Mid-Century and Stuka,through the proposal also specificallypromised that “Insurance requireschoices, and choices requireguidance. With our industry-specificcoverages we provide the coveragesand optional choices you need. Asyour agent, we will be there toexplain those options and provideassistance in selecting and securingthe coverage.” (PAF 35, Stuka Depo 92:20-93:7; andinsurance proposal p. 110 attached as anexhibit to Declaration ofPlaintiff’scounsel, Richard A. Cohn, attached.) 11 PLAINTIFFS RESPONSE TO DEFENDANT MARTIN STUKA’S SEPARATE STATEMENT OF UNDISPUTED MATERIAL FACTS IN SUPPORT MOTION FOR SUMMARY JUDGMENT A I T K E N 4 A I T K E N 4 C O H N 3 M A C A R T H U R P L A C E , S U I T E 80 0 O O 0 9 O N W n B A W N 10 11 12 13 14 15 16 71 4- 43 4- 14 24 71 4- 43 4- 36 00 F A C S I M I L E 17 18 S A N T A A N A , C A 92 70 7 19 20 21 22 23 24 25 26 27 28 €9 PRINTED ON RECYCLED PAPER 36. Farmers/Mid-Century also warrants (PAF 36, Stuka Depo 93:12-25, and to sell “insurance thatis easy to insurance proposal p. 110 attached as understand” and includes coverage exhibit to Declaration of Richard A. enhancements specific to your Cohn. business. 37. Farmers promises to offer “one (PAF 37, Stuka Depo 94:1 - 21; and agency” to handle all commercial and insurance proposal p. 110 attached as personal insurance needs, including exhibit to Declaration of Richard A. workers compensation coverage.) Cohn.) 38 Stukais not sure if he ever spoke with (PAF 38, Stuka depo 142:13-25) Roche about workers’ compensation coverage for NHST, even though Stuka wrote workers compensation coverage. 39. Roche had repeatedly relied upon (PAF 39, Stuka depo 143:1-25) Stuka with respect to the necessary coverage for both commercial and personal coverages. 40. |.) Despite acknowledging that NHST (PAF 40, Stuka depo 151:19-152:16) as a healthcare practitioner, could be a retail business, Stuka explains that Farmers makes that determination, and that despite representations to the contrary in the insurance proposal, Stuka has testified “I’m not an expert on determining that.” 12 PLAINTIFFS RESPONSE TO DEFENDANT MARTIN STUKA’S SEPARATE STATEMENT OF UNDISPUTED MATERIAL FACTS IN SUPPORT MOTION FOR SUMMARY JUDGMENT A I T K E N 4 A I T K E N ¢ C O H N 3 M A C A R T H U R P L A C E , S U I T E 80 0 S N © R U - _ - = = e d e d e d A N n n B R A W N = O 71 4- 43 4- 14 24 71 4- 43 4- 36 00 F A C S I M I L E S A N T A A N A , C A 92 70 7 N D N Y N N N N D = = = N A L r A W N = O O 28 €9 PRINTED ON RECYCLED PAPER 41. Furthermore, despite Farmers/Mid- Century holding its/their agents out as having expertise for specific business coverages, NHST is the only “healthcare practitioner” customerfor whom Stuka has ever procured insurance. (PAF 41, Stuka 154:3-19) 42. Other than NHST, Stuka has never written insurance for another physical therapy office, and never disclosed this to Roche/NHST. (PAF 42, Stuka 154:11-157:3) 43. Stuka never told NHST/Roche that he did not write medical malpractice coverage. (PAF 43, Stuka Depo 191:2-191:12) 44, As is explained by Plaintiff’s expert Don Petrie, whose declaration is filed concurrently herewith, from the outset, and based on the facts set forth in the depositions of Roche and Stuka, Stuka/Farmers/Mid Century had created a special relationship with its insured NHST (via Mark Roche) to advise NHST regarding its specific needs. Indeed, Farmers/Mid Century and Stuka held themselves out as highly trained experts and specialists in providing insurance to business owners. (See Depo of Stuka p. 86-94, and see the insurance proposal sent by Stuka to NHST, identified as Stuka 108-110.) Stuka/Farmers/Mid Century hold themselves out as undertaking the duty of “offering expertise and coverage recommendations.” Id. Indeed, the agent Stuka through the (PAF 44, See Declaration of Donald Petrie at Paragraph 4) 13 PLAINTIFFS RESPONSE TO DEFENDANT MARTIN STUKA’S SEPARATE STATEMENT OF UNDISPUTED MATERIAL FACTS IN SUPPORT MOTION FOR SUMMARY JUDGMENT A I T K E N ¢ A I T K E N ¢ C O H N 3 M A C A R T H U R P L A C E , S U I T E 80 0 S S O O 0 9 a N n n A W N - _ - = = e e e d e d A A D n B A W N = 71 4- 43 4- 14 24 71 4- 43 4- 36 00 F A C S I M I L E S A N T A A N A , C A 9 2 7 0 7 n o N o N o N o N o N o n N - - - _ a N w i E N W w N o - S O le e] ~ N o | 28 € PRINTED ON RECYCLED PAPER insurance proposal to NHST promised that the insured needed only “one agency” to handle all commercial and personal insurance needs. Id. 45. Petrie notes that the above representations alone are sufficient to establish the special relationship between the agent and the insured, and these representations are evidence that Stuka intended to establish such a relationship. Notably, these representations (or misrepresentations in reality) are in sharp contrast to Defendant Stuka’s claims in his motion for summary judgment that the agent intended to undertake no duty/role in advising the insured regarding his coverage needs or “volunteering”to the insured that the insured should procure additional or different coverage. Indeed Stuka/Farmers/Mid Century made representations to the insured (which the insured could/did reasonably rely upon) that the agent would in fact render such customized advice. Where the agent undertakes such duty, he must do so with reasonable diligence and care so as to assure the insured is armed with the necessary information to understand the coverage he is being sold, and to know (and then decide whether or not) to obtain any additional coverage and avoid any gap in coverage. (PAF 45, See Declaration of Donald Petrie at Paragraph 5) 14 PLAINTIFFS RESPONSE TO DEFENDANT MARTIN STUKA’S SEPARATE STATEMENT OF UNDISPUTED MATERIAL FACTS IN SUPPORT MOTION FOR SUMMARY JUDGMENT A I T K E N 4 A I T K E N 4 C O H N 3 M A C A R T H U R P L A C E , S U I T E 80 0 B B W N S O 0 J O N W n 1 11 12 13 14 15 16 71 4- 43 4- 14 24 71 4- 43 4- 36 00 F A C S I M I L E 17 S A N T A A N A , C A 92 70 7 18 19 20 21 22 23 24 23 26 27 28 €9 PRINTED ON RECYCLED PAPER 46. Petrie goes on to state that 1. In the instant case, any reasonable insurance agent in Stuka’s position needed to address with the insured the concern for the potential for a “gap” in coverage that can exist for a “healthcare practitioner” business. And, while Stuka is aware ofthe potential for a “gap”(as he states in his deposition) the unsophisticated insured (Roche for NHST) is clearly unaware of this based on his deposition testimony. The “gist” of Roche’s testimony is that he did not realize (and Stuka did not advise him) that the business (as opposed to the individual practitioners working at the business) needed some sort of professional liability coverage to fill in the “gap” where the business owner's liability policy might not cover the business. It is clear that Roche simply did not understand the concept that the business (as opposed to the individual practitioners) needed a special policy for medical malpractice; nor that the NHST business owners policy sold by Stuka might not cover such an eventuality. This explains why Roche stated that “he” (individually) already had medical malpractice coverage and thus did not requestit from Stuka (for NHST). It also explains why Roche thought he had successfully communicated with Stuka when he told Stuka that he wanted to be “double covered” and have an “umbrella” of coverage over the business, such that whenthis loss occurred he was surprised to learn he did not have what he thought was “double coverage.” However, the core of Stuka’s negligence is that Stuka, by his testimony, clearly understood that the insured should (PAF 46, See Declaration of Donald Petrie at Paragraph 6) 15 PLAINTIFFS RESPONSE TO DEFENDANT MARTIN STUKA’S SEPARATE STATEMENTOF UNDISPUTED MATERIAL FACTS IN SUPPORT MOTION FOR SUMMARY JUDGMENT A I T K E N 4 A I T K E N ¢ C O H N 3 M A C A R T H U R P L A C E , S U I T E 80 0 = w o S S O O 0 9 O N W n 1 11 12 13 14 15 16 71 4- 43 4- 14 24 71 4- 43 4- 36 00 F A C S I M I L E 17 18 S A N T A A N A , C A 92 70 7 19 20 21 22 23 24 25 26 27 28 €9 PRINTED ON RECYCLED PAPER not have such a gap in coverage,, and that the insured (NHST as a business) needed both general liability and professionalliability coverage - - and yet Stuka by his own admission never spoke to the insured specifically on the topic of professionalliability coverage (i.e. medical malpractice coverage) for the business. Stuka, by his own testimony did not address the issue at all. He did not ask the insured if NHST had such coverage, did not advise/explain the need for such coverage, and simply “assumed” that NHST had such coverage. The failure to directly address this potential gap in coverage with the insured underthe circumstances of this case is clearly below the standard of care for an insurance agent servicing a health care practitioner business. Indeed, the standard of care dictates that in every circumstance where the agent is providing insurance agent/brokerservices to such a business,that the agent advise the insured that there is the potential for a gap in coverage ifthe insured does not have both a general liability and professional liability policy in place. The insured should be advised ofthis in writing and thus provided the information necessary to make an educated decision on whether or not to obtain both types of coverage. In this case, Stuka breached this standard ofcare, and negligently assumed that his unsophisticated client (Roche) had professional liability coverage in place for the business when such was not the case. Indeed, Stuka’s assumption that NHST had professionalliability coverage in place makes no sense at all, where Stuka had requested Roche to send Stuka “the insurance that 16 PLAINTIFFS RESPONSE TO DEFENDANT MARTIN STUKA’S SEPARATE STATEMENT OF UNDISPUTED MATERIAL FACTS IN SUPPORT MOTION FOR SUMMARY JUDGMENT A I T K E N 4 A I T K E N 4 C O H N 3 M A C A R T H U R P L A C E , S U I T E 80 0 2 O o 0 9 O N w n b h 10 11 12 13 14 15 16 17 71 4- 43 4- 14 24 71 4- 43 4- 36 00 F A C S I M I L E S A N T A A N A , C A 92 70 7 18 19 20 21 22 23 24 25 26 27 28 € PRINTED ON RECYCLED PAPER NHST had” (so that Stuka could then match it and advise NHST what other coverages could be added) - but when Roche sent over what NHST had for coverage, there was no professional liability policy, nor mention of it. Thus, Stuka actually knew or should have known, the exact opposite - namely, that NHST did not have professional liability coverage and needed it. It was negligent for Stuka to fail to, at a minimum, discuss the issue with Roche; and it was clearly negligent to assume for no reason that NHST had professionalliability coverage. 47. On September 23, 2013, Michael Cingari suffered back injuries while undergoing treatment by Dr. H. Rey Gubernick (“Gubernick™) at NHST. (PAF 47, Statement of Decision of Judge Frederick P. Horn dated April 28, 2016, 1:19-2:5) 48. As a result of his injuries, Michael Cingari (“Cingari”) brought suit against Gubernick and NHST. (PAF 48, Cingari Complaint) 49. Thereafter, Roche tendered the defense ofNHST to Mid-Century, a Farmers Insurance Exchange Company. (PAF 49, Claims Log, p. 1 & 4. Exhibit E to Defendants” Motion). 50. By letter dated June 11, 2015, Mid-Century denied coverage and refusedto defend NHST in the Cingari v.NHST matter. (PAF 50, Denialletter dated June 11, 2015- Exhibit H to defendants motion.) 17PLAINTIFFS RESPONSE TO DEFENDANT MARTIN STUKA’S SEPARATE STATEMENT OFUNDISPUTED MATERIAL FACTS IN SUPPORT MOTION FOR SUMMARY JUDGMENT A I T K E N 4 A I T K E N ¢ C O H N 3 M A C A R T H U R P L A C E , S U I T E 80 0 N o H W S S O O X X 9 O N W n 1 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 S A N T A A N A , C A 92 70 7 71 4- 43 4- 14 24 71 4- 43 4- 36 00 F A C S I M I L E €3 PRINTED ON RECYCLED PAPER 51. Having been abandoned by Mid- Century, and facing a substantial judgmentin the face of Cingari’s injuries, NHST, Roche, and Gubernick entered into a settlement agreement with Cingari, whereby Gubernick and NHST would make payments totaling $20,000 to Michael Cingari and Cingari would be assigned all assignable bad faith causes of action by NHST, Gubernick and Roche. (PAF 51, Settlement Agreement) 52. The Cingari v. NHST matter proceeded to bench trial before Judge Frederick Horn from April 18, 2016 through April 20, 2016, resulting in a six-page statement of decision, and Judgement against NHST, Roche and Gubernick totaling over $6.2 million (PAF 52, Statement of Decision) 53. Judge Horn specifically found that Michael Cingari suffered a disc herniation of 26 mm,resulting in back surgery within 10 days, followed by 17 epidural and steroid injection procedures, radiofrequency ablations and facet joint injections. Cingari underwent surgical placement of spinal cord stimulator and will require lifelong future monitoring and care and replacement ofthe spinal cord stimulator battery. (PAF 53, Statement of Decision of Judge Frederick P. Horn dated April 28, 2016, 2:20-27) DATED: October 5, 2018 By: 18 AIT KEN<4 COHN RICHARD A. COHN CASEY R. JOHNSON Attorneys for Plaintiffs PLAINTIFFS RESPONSE TO DEFENDANT MARTIN STUKA’S SEPARATE STATEMENT OF UNDISPUTED MATERIAL FACTS IN SUPPORT MOTION FOR SUMMARY JUDGMENT