James Parks, et al. v. Safeco Insurance Company of America
Published: Nov. 25, 2003 | Result Date: Aug. 26, 2003 | Filing Date: Jan. 1, 1900 |Case number: 1096761 Bench Decision – $2,187,890
Judge
Court
Santa Barbara Superior
Attorneys
Plaintiff
Martin E. Pulverman
(Pulverman & Pulverman LLP)
Raymond J. Pulverman
(Pulverman & Pulverman LLP)
Roy Wayne McClean
(Law Offices of Wayne McClean)
Defendant
Facts
According To The Plaintiff: Eddie Barnette owned a house in Santa Maria. He purchased homeowner's insurance through Safeco Insurance Company of America covering the residence. The policy issued by Safeco provided liability coverage for bodily injury. The policy named Eddie Barnette as the insured. The policy provided that insureds included resident relatives or minors in the care of the named insured. Miller was sued by James Parks for non-auto related negligence. Miller tendered her defense and indemnification to Safeco for her non-auto related torts. Safeco refused the tender. Parks' lawsuit was submitted to a binding arbitration. He obtained a judgment against Miller on a theory that Miller undertook a duty to care for Parks and breached that duty when she abandoned him on the side of Highway 101 late at night. He was subsequently struck by a hit and run motorist and suffered severe personal injuries, including a crushed pelvis, multiple fractures and a complete amputation of his left leg. After obtaining a judgment against Miller, Parks and Miller executed an assignment of rights in exchange for a covenant not to execute. Parks and Miller filed separate actions against Safeco for breach of contract and insurance bad faith. Safeco filed a declaratory relief action contending that Miller was not entitled to a defense or indemnification. The actions were consolidated. Safeco claimed that Miller was not an additional insured. In Safeco's action for declaratory relief, it alleged no duty to defend or indemnify under an auto exclusion. The declaratory relief action was tried first. The court ruled that Safeco owed a duty to defend and indemnify and owed the judgment of $2,187,886 to Parks. In Park's action, he contended that Safeco committed bad faith in denying Miller a defense and/or indemnification and failing to settle within the policy limits. * * *
Settlement Discussions
Parks and Miller made no demand at the mandatory settlement conference; Safeco made no offer.
Result
Barnette died prior to trial. Safeco has filed an appeal.
Other Information
* * * Facts According To The Defendant: Eddie Barnette lived at Townsend Lane with Gloria Barnette, to whom Eddie Barnette was not married. Whether Gloria Barnette's 17-year-old daughter, Michelle Miller, resided at the house was in dispute. This action arises out of an action for personal injuries sustained during an auto v. pedestrian collision on Highway 101 on Feb. 28, 1999. On Feb. 27, at approximately 10 p.m., James Parks, 21, drove Michelle Miller, 17, in his Mitsubishi Eclipse to Santa Barbara to go club hopping. Early the next morning, with a blood alcohol level estimated to be well over .20, Parks was too intoxicated to drive and was even having difficulty walking. As a result, Miller undertook to drive them home in Park's vehicle at around 1:45 a.m. on Feb. 28. While driving on Highway 101, Miller evidently struck the curb, causing the right front tire to deflate and rendering the car disabled. At approximately 2:15 a.m., Miller called the California Highway Patrol dispatcher to telephone her friend, Teresa Cooney for a ride. Cooney had her friend, Isaiah Rivera, drive them in Cooney's Nissan Sentra to pick up Parks and Miller. Rivera and Cooney arrived at the location of the disabled Eclipse at around 3:30 a.m. Following the arrival of Cooney and Rivera, Parks was reluctant to get into Cooney's car. While in Cooney's car, Parks became abusive. Miller forced Parks to exit the vehicle, leaving him stranded on the side of Highway 101. After being stranded, Parks began walking down the middle to the traffic lanes. At approximately 4:04 a.m., Parks was struck by a hit-and-run driver traveling the highway. The highway patrol later found Parks in the middle to the traffic lanes with serious injuries to his lower body. He was transported to a hospital, and a blood sample drawn at 5:15 a.m. revealed a blood alcohol level of .158. Parks brought suit against Miller, Cooney and Rivera for his personal injuries in the Parks v. Miller action. Cooney's automobile insurer, California Casualty, provided a defense to Miller, Cooney and Rivera. A year after the personal injury lawsuit was filed, California Casualty placed Safeco on notice of the suit against Miller. During Safeco's investigation of the claim, Eddie and Gloria Barnette provided statements to Safeco indicating that Miller was not a resident of the insured household. Eddie and Gloria Barnette also testified during deposition in the personal injury action that Miller was not a resident of their household. In addition, Safeco learned that Miller's father, Charles Miller, had been awarded sole physical and legal custody of her, and that on Feb. 28, she was living with Miller in his residence in Santa Maria. As a result, Safeco declined Miller's tender of defense. After California Casualty paid its policy limits for a release of Cooney and Rivera and California Casualty itself, Parks proceeded against Miller only. The two of them agreed to go to binding arbitration, and the arbitrator gave Parks a net award of $2,187,866. Parks had the award confirmed into a judgment, and Miller assigned to Parks any rights that she had against Safeco in exchange for a covenant not to execute, consistent with the terms of their agreement to go to binding arbitration. Safeco sued Parks and Miller for declaratory relief. In its first cause of action, Safeco sought a judicial declaration that Miller was not an insured under its policy. The second cause of action requested a judicial declaration that the "auto" exclusion in its policy precludes coverage for Park's injuries. The court bifurcated Safeco's complaint for declaratory relief and tried that complaint first in a bench trial. After finding in favor of Parks and Miller, and court severed the complaint for declaratory relief from the bad faith action to allow an immediate appeal.
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