Preview
1 Glenn R. Kantor (SBN 122643)
Stacy Monahan Tucker (SBN 218942)
2 E-mail: gkantor@kantorlaw.net
KANTOR & KANTOR, LLP
3 19839 Nordhoff Street
Northridge, CA 91324
4 Tel: 818.886.2525
Fax: 818.350.6272
5
6 Attorneys for Plaintiff Gary Koop
7
8 SUPERIOR COURT OF THE STATE OF CALIFORNIA
9 COUNTY OF SONOMA
10 GARY KOOP, Case No. SCV-266944
11 Plaintiff,
PLAINTIFF GARY KOOP’S REDACTED
Northridge, California 91324
KANTOR & KANTOR LLP
12
19839 Nordhoff Street
v. MOTION FOR SUMMARY
(818) 886 2525
ADJUDICATION OF CAUSES OF
13 FIRE INSURANCE EXCHANGE, dba ACTION FOR FRAUD,
FARMERS INSURANCE GROUP; BRIAN MISREPRESENTATION AND
14 HUNSAKER, NEGLIGENCE AGAINST BRIAN
HUNSAKER
15 Defendants.
16 Date January 11, 2023
Time: 3:00 p.m.
17 Dept: 19
18 [Filed concurrently with Plaintiff’s Separate
Statement of Material Facts, Declaration of
19 Stacy M. Tucker, Declaration of Gary Koop,
Declaration of Kenneth Bunger, Evidence in
20 Support of Motion, Request for Judicial Notice
and Proposed Order]
21
22
Complaint filed: August 24, 2020
23
Trial Date: February 23, 2023
24
25
26
27
28
PLAINTIFF’S REDACTED MOTION FOR
SUMMARY ADJUDICATION AGAINST BRIAN
HUNSAKER
1 TABLE OF CONTENTS
2 Contents
3 TABLE OF CONTENTS ............................................................................................ i
4
I. INTRODUCTION AND SUMMARY OF ARGUMENT ............................. 1
5
II. FACTS ............................................................................................................ 2
6
7 A. The House and Neighborhood ........................................................................ 2
8 B. Hunsaker Insures 2650 Amber Lane............................................................... 3
9
C. 360Value and Farmers’ Instructions to Its Agents ......................................... 5
10
D. Plaintiff Asks Farmers to Confirm Adequacy of Insurance in Case of Fire... 7
11
E. Request for Reformation ................................................................................. 8
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19839 Nordhoff Street
(818) 886 2525
13 F. Policy Language ............................................................................................ 11
14 III. Legal Argument ............................................................................................ 12
15
A. Standard of Review ....................................................................................... 12
16
B. Contract Damages ......................................................................................... 12
17
18 C. Negligence..................................................................................................... 13
19 D. Fraud and Misrepresentation......................................................................... 14
20 IV. Conclusion..................................................................................................... 16
21
22
23
24
25
26
27
28
PLAINTIFF’S REDACTED MOTION FOR
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1 TABLE OF AUTHORITIES
2 Page(s)
3 State Cases
4
City of Atascadero v. Merrill Lynch, Pierce, Fenner & Smith, Inc.,
5 (1998) 68 Cal.App.4th 445 ........................................................................................................ 14
Eddy v. Sharp,
6
(1988) 199 Cal.App.3d 858 ....................................................................................................... 14
7 Free v. Republic Ins. Co.,
8 Cal. App. 4th 1726, 11 Cal. Rptr. 2d 296 (1992) ................................................................... 13
8
Paper Savers, Inc. v. Nacsa,
9 51 Cal. App. 4th 1090, (1996) ................................................................................................... 12
Third Eye Blind, Inc. v. Near N. Ent. Ins. Servs., LLC,
10
127 Cal. App. 4th 1311 (2005) .................................................................................................. 14
11 Troyk v. Farmers Group, Inc.,
(2009) 171 Cal.App.4th 1305 .................................................................................................... 12
12
Northridge, California 91324
KANTOR & KANTOR LLP
State Statutes
19839 Nordhoff Street
13
(818) 886-2525
14 Code Civ. Proc., § 437c, subds. (b), (c) ......................................................................................... 12
Code of Civil Procedure section 437c............................................................................................ 12
15
16 State Regulations
17 Cal. Code Regs. Tit. 10, § 2695.183 ................................................................................................ 5
18
19
20
21
22
23
24
25
26
27
28
PLAINTIFF’S REDACTED MOTION FOR
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1 I. INTRODUCTION AND SUMMARY OF ARGUMENT
2 Plaintiff Gary Koop’s home was underinsured by almost $1.6 million dollars by Fire
3 Insurance Exchange (“Farmers”) and its agent, Brian Hunsaker (“Hunsaker”). The Policy requires
4 that the insured accept Farmers’ estimate of replacement cost when the insured obtains extended
5 replacement coverage. Gary Koop had extended replacement coverage.
6 Mr. Koop obtained the Policy in 2006 for his custom-built, 3,000 square foot home on 3
7 acres in the hills above Santa Rosa. He used Brian Hunsaker as his insurance agent because
8 Hunsaker assured him that he knew the details of the property, as he insured it with the prior
9 owner. Hunsaker did not inspect or enter the home. The insurance application confirms that the
10 kitchen was listed as “custom.” In 2013 Farmers transitioned Plaintiff’s policy to a new
11 reconstruction estimate system, 360Value, and also transitioned him to a new policy form.
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12 The basis of a 360Value estimate is the “grade” assigned to the property. The insurer
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13 inputs whether the appropriate grade is standard, above-average, custom or premium. Farmers
14 provides objective criteria to follow in assigning grades, which confirm that the Koop property
15 should have been graded as a “premium” home, a determination confirmed by Farmers’ own
16 claims adjuster who noted that the destroyed home was “premium” grade. But Farmers insured it
17 as “above average,” intended for tract housing, which created a coverage deficit of 65%.
18 Hunsaker failed to review the transitioned policy for errors. He did not send Mr. Koop an
19 estimate to review as required by California insurance regulations when Plaintiff called to review
20 his coverage in 2013, and did not tell him that new coverages were available. Plaintiff called
21 again in September 2015 to specifically inquire if he had enough coverage to rebuild in the event
22 of a wildfire. Hunsaker had Liz Evans, who started work at his agency that very morning, speak
23 with Plaintiff and assure him that he had ample coverage, despite never reviewing his policy
24 history, his coverage limits, or discussing the quality grade.
25 When Mr. Koop’s home burned to the ground in the 2017 Tubbs Fire and he attempted to
26 rebuild, he learned he was dramatically underinsured. He asked Farmers to reform his policy. The
27 in-house investigator assigned to the request did not look at any historical documents related to
28 the policy and simply asked Hunsaker if he believed he made a mistake. Despite admitting to the
PLAINTIFF’S REDACTED MOTION FOR
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HUNSAKER
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1 investigator that he had no recollection of offering increased coverages available since the 2006
2 inception of the policy, and that he had no idea if the house should be considered “custom,”
3 Hunsaker opined that he made no errors and Farmers took him at his word. Farmers, meanwhile,
4 knew that Hunsaker had failed to do any of this, yet summarily determined that where its agent
5 refused to admit error, there was none--even though he repeatedly confessed he did not know
6 what he had done for Plaintiff’s coverage.
7 Where Hunsaker communicated inaccurate estimates that did not comply with §2695.183,
8 where the statements in the policy declarations literally instruct insureds to obtain and rely on
9 replacement estimates from Hunsaker and Hunsaker then disavows those estimates, and where
10 Hunsaker knew he had failed to properly calculate Plaintiff’s estimate and still insisted he made
11 no error, he is also liable for negligence, fraud and misrepresentation.
12 II. FACTS
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13 A. The House and Neighborhood
(818) 886-2525
14 Plaintiff Gary Koop bought a custom-built, 5 bedroom, 3.5 bath, 2,967 sq. foot home at
15 2650 Amber Lane, Santa Rosa, California (the “Property”) in the Riebli-Wallace neighborhood in
16 2006, paying over $1 million for the home. (¶1.) In the hills above Santa Rosa, Reibli-Wallace
17 and its adjacent neighborhood Fountaingrove boast expansive views, multi-acre lots, and large,
18 custom homes. (¶2.) Amber Lane is a private road with eight homes, with lots ranging in size
19 from 3.6 acres to over 12 acres. Plaintiff’s home was custom built in 1976. (¶3.) As originally
20 built, the redwood home included redwood steps leading up to large double front doors. The
21 house included oak floors, stained glass windows, built-in etched glass cabinetry, marble
22 fireplaces, and floor-to-ceiling built in bookshelves. The home was a PG&E Award-Winning
23 Passive Solar Home. (¶4.) Plaintiff’s home had vaulted ceilings, interior French doors, a custom-
24 made redwood spiral staircase with abalone inlays, crown molding in every room and chair rail in
25 the majority of the rooms, three marble baths, a wet bar, and crystal chandeliers. (Tucker Decl.,
26 Exhibits 2, 3 and 4). In 2004, the Bungers installed a marble top breakfast bar, granite
27 countertops, and Miele appliances. (¶5.) The Property also included a redwood barn designed to
28 match the house, with an included pump room for the 240 foot well. There was a separate
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HUNSAKER
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1 redwood garage, a basketball court, and a baseball pitching machine field. On April 7, 2006, the
2 Bungers sold the Property to Mark Picano for $1,055,000. (¶6) Just five months later, on
3 September 7, 2006, Mr. Picano sold the Property to Plaintiff.
4 B. Hunsaker Insures 2650 Amber Lane
5 Plaintiff paid $1,025,000 when he purchased the Property in September 2006. (¶7.)
6 Plaintiff used Hunsaker as his insurance agent, as Hunsaker had insured the house with the prior
7 owner and held himself out as an authority on the property. (¶8.) Since 1985, Hunsaker has been
8 an insurance agent of Farmers Insurance Group, meaning that he works solely for Farmers and
9 represents Farmers with insureds. (¶9)
10 Hunsaker did not visit the home before insuring it for Plaintiff. (¶10) He simply pulled
11 into the driveway once to have him sign forms. (Id.) Hunsaker also did not visit the house when
12 he insured it originally for Mr. Picano, stating that he may have “driven by it” to “inspect” it.
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13 (¶11.) He never stepped foot inside the Property and had no idea what it looked like inside. (¶12.)
(818) 886-2525
14 Farmers issued a low-end Protector Plus insurance policy to Plaintiff on September 5, 2006,
15 setting Coverage A limits of $478,000. (¶13)
16 Farmers used Residential Component Technology, or “RCT,” as a software program to
17 prepare replacement estimates for homes in 2006. (¶14.) By 2013, Farmers had transitioned to a
18 product called 360Value to increase the automation in its replacement estimates while also
19 allowing for customization. (¶15). In the 360Value program, the software pre-populates most
20 choices based on the information provided by the insured. The individual preparing the estimate
21 has significant flexibility to change those pre-populated fields if he chooses, and 360Value
22 encourages itsusers to do so in its training materials. (¶16.) The 360Value software calculates
23 the cost of rebuilding differently depending on the style and grade of house assigned in the
24 system. The grade choices are “standard,” defined as “typical of standard tract-style houses built
25 in recent decades;” “above average,” defined on the Farmers’ website as “upgraded tract style
26 houses built in recent decades;” “custom,” defined as “upgraded tract-style houses with additional
27 custom features;” and “premium,” “custom-built houses with plenty of premium features.” (¶17)
28 Where Mr. Koop’s home was custom-built in 1976, it should have been calculated at the
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1 “premium” level based on Farmers’ own documentation. Farmers internal documentation of the
2 home included French doors, “premium” and “deluxe” woodwork and cabinetry and fixtures,
3 custom fireplaces, oak flooring and “premium” tile. (¶18.)
4 When Plaintiff bought the home in 2006, RCT lacked the flexibility to enter detailed types
5 of information in the database that created the estimates. (¶19.) Hunsaker did not insure it as a
6 “premium” custom-built home, or even “custom.” Hunsaker does not recall ever selecting a grade
7 for Plaintiff’s home in 360Value, and apparently let it default to “above average.” (¶20) 1
8 Each Farmers estimate correctly lists the features of the home – 2967 sq. ft., built in 1976,
9 three marble bathrooms, crown molding and chair rail, custom kitchen with a peninsula bar and
10 glass cabinets throughout, two rooms with cathedral ceilings, two fireplaces, two chandeliers,
11 French doors, built in bookcases and desk, and a spiral staircase, with columns in the front of the
12 home. There were no “errors” for Plaintiff to spot and change when he reviewed them, and the
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13 estimates provided did not explain the “grade” of home used. The only error was in how
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14 Hunsaker and Farmers inaccurately interpreted the information Plaintiff provided. 2
15 The Policy incorporates the Declarations, which state, “The limit of liability for this
16 structure (Coverage A) is based on an estimate of the cost to rebuild your home, including an
17 approximate cost for labor and materials in your area, and specific information that you have
18 provided about your home.” It also directs insureds to contact their Farmers agent to “ensure that
19 your family is properly protected” and to learn the “coverage options and our various other
20 product offerings that may be available to you.” The Policy also includes extended replacement
21 coverage. With extended replacement coverage, “you must have selected or increased the
22 Coverage A dwelling amount to an amount at least equal to the estimated replacement cost of the
23 dwelling…you must agree to any resulting increases in the Coverage A “Dwelling” limit and
24
1
25 On the Farmers’ website in 2022, after years of successive wildfires, Farmers estimates the cost
to rebuild Mr. Koop’s original house at $703,000 when listed as “above-average.” (¶21.) When
26 correctly listed as “premium,” the estimated rebuild cost is $1,069,000, over 65% higher. (Id.)
2
27 In 2016, the cost to rebuild a custom home was approximately $450 per square foot. At the time
of theTubbs fire, it was estimated to be “$500–$800 for northeast hillside custom homes in the
28 Fountaingrove area of Santa Rosa. ‘That's the bare minimum - drywall, paint, baseboard.’” (See
articles in Press Democrat April 12, 2016 and North Bay Business Journal, October 20, 2017
(RJN Exs. B and C.)Yet in 2017 Farmers insured Plaintiff’s home for $221 per square foot. (¶22)
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1 other stated limited as calculated.” (¶23) Farmers determines the replacement estimates. (¶24.)
2 These statements would appear to directly conflict with other sections of the policy claiming that
3 Farmers bears no responsibility for selecting coverage limits. (¶25.)
4 C. 360Value and Farmers’ Instructions to Its Agents
5 Farmers began using 360Value in June 2007 for its high value homes only, continuing to
6 use its “RCT” system otherwise. (¶26) On June 8, 2011, Farmers announced that in response to
7 the new Cal. Code Regs. Tit. 10, § 2695.183, itwould transition to using 360Value for every
8 home, not just high value homes. (¶27) In 360Value, an insured’s “Primary Information”
9 “includes questions that make the largest impact on the home’s replacement cost.” (¶28) One of
10 the questions in that section is “style” of the home. 360Value emphasizes the importance of this
11 information when it explains its “Assumptive Program” that auto-fills most of the information in
12 an estimate. (¶29.) “The “Assumptive” program’s selection of the Dwelling Quality Grade is
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13 driven by important dwelling characteristics, such as Year of Construction, Square Footage,
(818) 886-2525
14 Number of Stories/Style of Home, and ZIP Code.” Hunsaker left the “style” blank. (¶30.)
15 On December 19, 2011, Farmers announced that 360Value would now automatically
16 select the Dwelling Quality Grade. 3 Farmers’ policies and procedures stated that the agent should
17 not accept the assumptive information input, but should check each item with the insured. (¶31) It
18 noted that if an estimate seemed too low, it was likely due to the wrong quality grade being
19 selected, and that the more expensive a home, the more detail should be input to correctly insure
20 it. (¶32)
21 Farmers also insisted that it was imperative for agents to have “regular” FFRs to review
22 the dwelling features and confirm the home quality grade. (¶34) Hunsaker told Farmers that he
23 never had a FFR with Plaintiff. (¶35.) In 2013, Farmers sent out advice to its agents on how to
24 select a “style” of home for a 360Value estimate, noting that it affects the valuation, and
25 explaining that “based on the ZIP code, Style of Construction and home size, 360Value will pre-
26 fill default data about certain dwelling features….” (¶36)
27 3
The assumptions would be validated by comparisons to Xactware’s claims adjustment estimates.
28 (¶33.) These programs are both owned by Verisk and are based on the same data, meaning that
they simply reinforce each other’s assumptions without any third-party data comparison.
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1 Farmers provided clear direction to its agents on how to determine the “quality grade” of a
2 home. If a home was custom-built, it should be considered either “custom” or “premium.” (¶37)
3 Farmers noted, “The Dwelling Quality Grade is one of the most critical components of a
4 Reconstruction Cost Estimate and it can have a significant impact on the estimate amount.” (¶38.)
5 Farmers has a detailed chart of how to determine the quality grade. (¶39) At the top of the chart
6 there was an explanation of how to rate a property as “Above Grade,” “Custom” or “Premium” if
7 it has finishes that could be considered either “Custom” or “Premium.” The chart states that
8 fixtures such as built-in bookcases, wet bars, or cabinetry other than the kitchen and bathrooms
9 were considered premium. Chair rail, crown molding, and baseboards throughout the house were
10 premium. Countertops and vanities with marble should be considered premium. Premium flooring
11 would be a mixture of high-end carpet, tile,stone and hardwood. Plaintiff’s home, with all of
12 these fixtures, would be “premium” under Farmers’ own guidelines. (¶40)
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13 On April 1, 2013 Farmers stated that all policies would migrate from RCT to 360Value.
(818) 886-2525
14 (¶41.) Agents were instructed to assign as the home “quality grade” whatever “Kitchen Quality
15 Grade” had previously been assigned in RCT. (¶42.) In the application that Hunsaker submitted
16 for Plaintiff’s insurance, he had listed the “Kitchen Quality Grade” as “Custom.” (¶43.) Under
17 Farmers’ own documentation, the Property should have been insured as at least “Custom” quality
18 grade. (¶44.)
19 Farmers instructed agents, “The key to obtaining accurate dwelling feature information is
20 interviewing the prospect during the quote process and verifying all of the dwelling features.
21 Inspecting the property before you bind coverage helps you to confirm eligibility, as well as
22 dwelling feature accuracy.” (¶45). Hunsaker informed Plaintiff that he obtained the information
23 about the Property from the prior owner, but in fact had never discussed it with him and relied on
24 the auto-populated information provided. Plaintiff thus believed it had been verified previously by
25 Hunsaker. (¶46.)
26 Hunsaker received and reviewed as a matter of his general practice the “Breaking News”
27 bulletins sent to agents by Farmers, which would include the documents discussed above. (¶110.)
28 He knew he had a duty to follow Farmers’ policies and procedures. (¶110.) He also knew he had
PLAINTIFF’S REDACTED MOTION FOR
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1 a duty to follow California law. (¶110.)
2 D. Plaintiff Asks Farmers to Confirm Adequacy of Insurance in Case of Fire.
3 In 2013, Gary Koop first contacted Hunsaker to ask to review his policy coverage.
4 Hunsaker did not send him a written estimate to review. (¶47) In that discussion, Hunsaker
5 decided to raise his deductible and did not ask to lower any coverages. Hunsaker confirmed that
6 while they reviewed Plaintiff’s specific coverages on that call, he did not inform Plaintiff that
7 higher amounts were available since 2006 because “He did not ask.” (¶48)
8 By 2015, Gary Koop had divorced, working extensively with Hunsaker to sort out his
9 various insurance obligations related to the separation. He was not an uninvolved participant in
10 his insurance –he spoke with Hunsaker’s office 16 times in 2014. (¶49) Mr. Koop became
11 concerned about the adequacy of his insurance coverage after the 2015 Rocky, Humboldt,
12 Jerusalem and Tesla fires in his area. Plaintiff followed the instructions in his Policy and on
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13 Farmers’ website stating that if he was concerned about having adequate home insurance
(818) 886-2525
14 coverage, he should contact his agent. (¶50) He called Hunsaker on September 1, 2015 to ask
15 specifically if he had sufficient coverage in the event of a wildfire. (¶51.) Liz Evans, a new
16 employee of Hunsaker, took his call that morning. September 1, 2015 was her first day working
17 at the agency. (¶52) Ms. Evans had no prior knowledge of Mr. Koop’s Policy history. While she
18 admits her standard practice would be to review the history of the policy as part of a review, she
19 did not recall doing so for Mr. Koop and did not believe she had a responsibility to do so. (¶53.)
20 She did not check to see how old the Policy was, or whether it was correctly transitioned to
21 360Value. (¶54.) Ms. Evans also did not review the historical coverage increases of the Policy,
22 and had not been aware that Farmers had not made any increases to Mr. Koop’s coverage for five
23 of the nine years it had insured him at that point. (¶55) Farmers had originally insured the
24 Property for $495,000 in 2006. From there it provided coverage to reflect inflation and increases
25 in building costs as follows: $495,000 in 2007; $530,000 in 2008; $548,000 in 2009, 2010, 2011,
26 2012, 2013; and then an increase to $564,000 in 2014. (¶56.) By 2015, Farmers provided no
27 increases whatsoever for over half the time it insured Plaintiff.
28 Ms. Evans failed to make a note of the September 1, 2015 call, but forwarded a 360Value
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1 estimate to Mr. Koop showing that it would cost him $502,000 to replace his home, and asked
2 him to correct any errors. (¶57.) 4 Ms. Evans did not discuss the quality grade of the house with
3 Plaintiff, erroneously believing that the insured had selected the grade. (¶59.) By only reviewing
4 the 360Value estimate with Mr. Koop, she did not review the actual coverages available to him at
5 all, as those are not listed on the 360Value estimate. (¶60.) She simply asked him to review the
6 estimate and let her know if there were any errors in it. Ms. Evans’ testimony was contradictory.
7 She testified that she did not recall whether or not she heard back from Mr. Koop about his
8 coverage. Evans then testified that when she wrote that “all was okay,” she must have meant that
9 she assumed “all was okay” because she did not hear back from Mr. Koop, despite testifying
10 immediately before that she did not recall whether or not she heard back from him. (¶61.) Mr.
11 Koop, meanwhile, confirmed that Ms. Evans affirmatively told him he had sufficient coverage, a
12 recollection that matches Ms. Evans’ written note. (¶62.) Though Ms. Evans confirmed
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13 repeatedly that Plaintiff wanted to review the accuracy of his insurance coverage and that she
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14 reviewed Plaintiff’s “coverages” with him, she admitted later that she did not actually review any
15 of the calculated values with him. (¶63.) She only reviewed certain information listed in the
16 360Value estimate, a document that does not list the insurance coverages at all, with the result
17 that she did not discuss his insurance coverage with him at all. (¶64)
18 E. Request for Reformation
19 On October 17, 2017, Plaintiff’s home was destroyed in the Tubbs Fire. (¶65.)
20 Once able to obtain a rebuilding estimate in 2019, Plaintiff learned that he was dramatically
21 underinsured. Farmers already knew this; it confirmed within a month of the claim that Plaintiff’s
22 home was “of a premium grade quality” and its own post-fire estimate for replacing the Property
23 “exceeds the policy limits on an ACV basis and ERC on an RCV basis.” (¶66.) Plaintiff raised his
24 concerns to Farmers in a letter dated June 17, 2019, and asked it to “review the value of my home
25 and comparable homes before the fire.” (¶67.)
26 4
The estimate that Hunsaker sent to Mr. Koop was not the complete document, but only a
27 summary. (¶57 and 58). The complete document, produced during litigation, confirms that all the
rooms had crown molding, half had chair rail, all the baths had marble, the chandeliers were
28 leaded crystal, the home featured built-in bookcases, a built-in desk, French doors, columns, a
spiral staircase, skylights and a wet bar. It also confirmed that the “style” of the house had been
listed as “unknown.” (Id.)
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1 Per Farmers’ internal policies and procedures, when an insured asks to have his policy
2 limits reformed due to underinsurance, the a “claims investigator” speaks with the insured and the
3 agent to determine if a reformation should be pursued. If the facts support reformation, it is
4 submitted to underwriting for review. (¶68.) Investigator Justin Price of Farmers spoke with both
5 Plaintiff and Hunsaker. He left Hunsaker a voicemail, stating that to evaluate Plaintiff’s claims he
6 needed to know why the quality grade was set at above average, if the house was custom grade, if
7 Hunsaker ever visited the property, if Plaintiff ever requested any coverage changes, and if
8 Plaintiff ever asked for or was offered 50% extended replacement coverage. (¶69.) Hunsaker
9 admitted that he had no idea if the computer field offering different options of building grade had
10 been an option in 2006, and had not ever updated the information on the home to fill in the more
11 detailed fields now available. Hunsaker told Farmers that he did not know if Plaintiff’s home was
12 listed as a custom home, and did not know whether or not it should be. (¶70) When asked why the
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13 Property was listed as “above grade” and not “custom” or “premium,” Hunsaker responded:
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14 “Usually itbased on what type of house it is…depending on the features etc..
based on what the 360 evaluation system provides.. taking a look what the house
15 would classify as, we did have the home insured with a prior owner Mark Picano
under policy 926773075 valued at 478K... then insured bought the house from
16 him. Agent said this policy was written such a long time ago there is no "style
code" showing as unknown.” (¶71.)
17
Hunsaker said that instead of meeting with clients annually for an FFR as instructed to by
18
Farmers’ policies and procedures, he “participated in the post card program with letters being sent
19
out for reviews. Agent said he is not sure if there were any FFRs performed over the years. Agent
20
said he had a couple of other clients with similar claim issues after the wildfires…so he is aware of
21
the claims of being under insured.” Hunsaker did “not believe there were any specific discussions
22
about increasing the Dwelling Limit or ERC.” He also noted that he was well aware that 360Value
23
estimates were “low,” and that he tried to “bump up” the amount by a couple of thousand dollars
24
because of it. (¶72)
25
When asked if he visited the Property and knew if the house was custom, Hunsaker falsely
26
stated, “Yes, we actually insured it previously...not sure if it is ‘custom.’” In deposition, Hunsaker
27
testified that he believed the definition of the verb “visit” was open to interpretation and it was
28
possible he had “visited” the house per his definition of it by driving by. (¶73.) Justin Price
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1 testified that he understood that when Hunsaker said “yes” to the question of whether he had
2 visited the Property, Hunsaker meant that he had inspected the interior of the dwelling. (¶74.)
3 Hunsaker said he was “Not sure” if Plaintiff ever had the opportunity to select his own
4 extended coverage amount. “Agent said he doesn’t recall if 125% was the highest option at New
5 business when Farmers went from Pro Plus to Next Gen…not sure if 150% was even an option
6 prior to Next Gen.” In deposition, Hunsaker confirmed that these options were not available in
7 2006, and that his office never informed Plaintiff that higher ones had become available. (¶75.)
8 Despite all of these obvious errors and violations of Farmers policies and procedures, Hunsaker
9 stated that he believed he made “no error” because, “with the information he had available
10 (360Value) the policy was written correctly.” (¶76.) Of course, it was Mr. Hunsaker who entered
11 the information into 360Value on which he relied in the first place. (¶77.)
12 Justin Price, the investigator tasked with gathering information about Mr. Koop’s
Northridge, California 91324
KANTOR & KANTOR LLP
19839 Nordhoff Street
13 reformation request, did not check to see if the Property should have been listed as “custom,” and
(818) 886-2525
14 did not check to see if the Policy had been correctly converted from RCT to 360Value. (¶78.) Mr.
15 Price did not know what “custom” meant and did not know what the available grades were in
16 360Value. (¶79.) Mr. Price noted that he had been in high school when the conversion took place,
17 and that it would be Underwriting’s job to check that information. (¶80.) He did not know what
18 coverage was available in 2006. (¶81.) He did not know how Plaintiff could have selected 50%
19 coverage if it had never been offered to him. (¶82.) Mr. Price did not ask Hunsaker what “all was
20 okay” meant, because it was “common knowledge” that a coverage review would include
21 confirming that the dwelling limits were sufficient. (¶83.)
22 Mr. Price sent his summary to Account Underwriting. (¶84.) However, it was not assigned
23 to an underwriter, but to Brianne Hall, a Customer Advocate with no underwriting training and no
24 training on California law (¶85.) Ms. Hall spent less than 30 minutes on Mr. Koop’s request
25 before recommending that it be refused. (¶86.) She did not investigate whether there were
26 objective criteria in place to determine quality grade, or whether Plaintiff’s Policy was correctly
27 transitioned to 360Value. (¶87.) Ms. Hall has no recollection of looking at the history of the
28 Policy, or at the Application to determine if the Appli
Preview
1 Glenn R. Kantor (SBN 122643) Stacy Monahan Tucker (SBN 218942) 2 E-mail: gkantor@kantorlaw.net KANTOR & KANTOR, LLP 3 19839 Nordhoff Street Northridge, CA 91324 4 Tel: 818.886.2525 Fax: 818.350.6272 5 6 Attorneys for Plaintiff Gary Koop 7 8 SUPERIOR COURT OF THE STATE OF CALIFORNIA 9 COUNTY OF SONOMA 10 GARY KOOP, Case No. SCV-266944 11 Plaintiff, PLAINTIFF GARY KOOP’S REDACTED Northridge, California 91324 KANTOR & KANTOR LLP 12 19839 Nordhoff Street v. MOTION FOR SUMMARY (818) 886 2525 ADJUDICATION OF CAUSES OF 13 FIRE INSURANCE EXCHANGE, dba ACTION FOR FRAUD, FARMERS INSURANCE GROUP; BRIAN MISREPRESENTATION AND 14 HUNSAKER, NEGLIGENCE AGAINST BRIAN HUNSAKER 15 Defendants. 16 Date January 11, 2023 Time: 3:00 p.m. 17 Dept: 19 18 [Filed concurrently with Plaintiff’s Separate Statement of Material Facts, Declaration of 19 Stacy M. Tucker, Declaration of Gary Koop, Declaration of Kenneth Bunger, Evidence in 20 Support of Motion, Request for Judicial Notice and Proposed Order] 21 22 Complaint filed: August 24, 2020 23 Trial Date: February 23, 2023 24 25 26 27 28 PLAINTIFF’S REDACTED MOTION FOR SUMMARY ADJUDICATION AGAINST BRIAN HUNSAKER 1 TABLE OF CONTENTS 2 Contents 3 TABLE OF CONTENTS ............................................................................................ i 4 I. INTRODUCTION AND SUMMARY OF ARGUMENT ............................. 1 5 II. FACTS ............................................................................................................ 2 6 7 A. The House and Neighborhood ........................................................................ 2 8 B. Hunsaker Insures 2650 Amber Lane............................................................... 3 9 C. 360Value and Farmers’ Instructions to Its Agents ......................................... 5 10 D. Plaintiff Asks Farmers to Confirm Adequacy of Insurance in Case of Fire... 7 11 E. Request for Reformation ................................................................................. 8 Northridge, California 91324 KANTOR & KANTOR LLP 12 19839 Nordhoff Street (818) 886 2525 13 F. Policy Language ............................................................................................ 11 14 III. Legal Argument ............................................................................................ 12 15 A. Standard of Review ....................................................................................... 12 16 B. Contract Damages ......................................................................................... 12 17 18 C. Negligence..................................................................................................... 13 19 D. Fraud and Misrepresentation......................................................................... 14 20 IV. Conclusion..................................................................................................... 16 21 22 23 24 25 26 27 28 PLAINTIFF’S REDACTED MOTION FOR SUMMARY ADJUDICATION AGAINST BRIAN HUNSAKER i- 1 TABLE OF AUTHORITIES 2 Page(s) 3 State Cases 4 City of Atascadero v. Merrill Lynch, Pierce, Fenner & Smith, Inc., 5 (1998) 68 Cal.App.4th 445 ........................................................................................................ 14 Eddy v. Sharp, 6 (1988) 199 Cal.App.3d 858 ....................................................................................................... 14 7 Free v. Republic Ins. Co., 8 Cal. App. 4th 1726, 11 Cal. Rptr. 2d 296 (1992) ................................................................... 13 8 Paper Savers, Inc. v. Nacsa, 9 51 Cal. App. 4th 1090, (1996) ................................................................................................... 12 Third Eye Blind, Inc. v. Near N. Ent. Ins. Servs., LLC, 10 127 Cal. App. 4th 1311 (2005) .................................................................................................. 14 11 Troyk v. Farmers Group, Inc., (2009) 171 Cal.App.4th 1305 .................................................................................................... 12 12 Northridge, California 91324 KANTOR & KANTOR LLP State Statutes 19839 Nordhoff Street 13 (818) 886-2525 14 Code Civ. Proc., § 437c, subds. (b), (c) ......................................................................................... 12 Code of Civil Procedure section 437c............................................................................................ 12 15 16 State Regulations 17 Cal. Code Regs. Tit. 10, § 2695.183 ................................................................................................ 5 18 19 20 21 22 23 24 25 26 27 28 PLAINTIFF’S REDACTED MOTION FOR SUMMARY ADJUDICATION AGAINST BRIAN HUNSAKER - ii - 1 I. INTRODUCTION AND SUMMARY OF ARGUMENT 2 Plaintiff Gary Koop’s home was underinsured by almost $1.6 million dollars by Fire 3 Insurance Exchange (“Farmers”) and its agent, Brian Hunsaker (“Hunsaker”). The Policy requires 4 that the insured accept Farmers’ estimate of replacement cost when the insured obtains extended 5 replacement coverage. Gary Koop had extended replacement coverage. 6 Mr. Koop obtained the Policy in 2006 for his custom-built, 3,000 square foot home on 3 7 acres in the hills above Santa Rosa. He used Brian Hunsaker as his insurance agent because 8 Hunsaker assured him that he knew the details of the property, as he insured it with the prior 9 owner. Hunsaker did not inspect or enter the home. The insurance application confirms that the 10 kitchen was listed as “custom.” In 2013 Farmers transitioned Plaintiff’s policy to a new 11 reconstruction estimate system, 360Value, and also transitioned him to a new policy form. Northridge, California 91324 KANTOR & KANTOR LLP 12 The basis of a 360Value estimate is the “grade” assigned to the property. The insurer 19839 Nordhoff Street (818) 886 2525 13 inputs whether the appropriate grade is standard, above-average, custom or premium. Farmers 14 provides objective criteria to follow in assigning grades, which confirm that the Koop property 15 should have been graded as a “premium” home, a determination confirmed by Farmers’ own 16 claims adjuster who noted that the destroyed home was “premium” grade. But Farmers insured it 17 as “above average,” intended for tract housing, which created a coverage deficit of 65%. 18 Hunsaker failed to review the transitioned policy for errors. He did not send Mr. Koop an 19 estimate to review as required by California insurance regulations when Plaintiff called to review 20 his coverage in 2013, and did not tell him that new coverages were available. Plaintiff called 21 again in September 2015 to specifically inquire if he had enough coverage to rebuild in the event 22 of a wildfire. Hunsaker had Liz Evans, who started work at his agency that very morning, speak 23 with Plaintiff and assure him that he had ample coverage, despite never reviewing his policy 24 history, his coverage limits, or discussing the quality grade. 25 When Mr. Koop’s home burned to the ground in the 2017 Tubbs Fire and he attempted to 26 rebuild, he learned he was dramatically underinsured. He asked Farmers to reform his policy. The 27 in-house investigator assigned to the request did not look at any historical documents related to 28 the policy and simply asked Hunsaker if he believed he made a mistake. Despite admitting to the PLAINTIFF’S REDACTED MOTION FOR SUMMARY ADJUDICATION AGAINST BRIAN HUNSAKER 1- 1 investigator that he had no recollection of offering increased coverages available since the 2006 2 inception of the policy, and that he had no idea if the house should be considered “custom,” 3 Hunsaker opined that he made no errors and Farmers took him at his word. Farmers, meanwhile, 4 knew that Hunsaker had failed to do any of this, yet summarily determined that where its agent 5 refused to admit error, there was none--even though he repeatedly confessed he did not know 6 what he had done for Plaintiff’s coverage. 7 Where Hunsaker communicated inaccurate estimates that did not comply with §2695.183, 8 where the statements in the policy declarations literally instruct insureds to obtain and rely on 9 replacement estimates from Hunsaker and Hunsaker then disavows those estimates, and where 10 Hunsaker knew he had failed to properly calculate Plaintiff’s estimate and still insisted he made 11 no error, he is also liable for negligence, fraud and misrepresentation. 12 II. FACTS Northridge, California 91324 KANTOR & KANTOR LLP 19839 Nordhoff Street 13 A. The House and Neighborhood (818) 886-2525 14 Plaintiff Gary Koop bought a custom-built, 5 bedroom, 3.5 bath, 2,967 sq. foot home at 15 2650 Amber Lane, Santa Rosa, California (the “Property”) in the Riebli-Wallace neighborhood in 16 2006, paying over $1 million for the home. (¶1.) In the hills above Santa Rosa, Reibli-Wallace 17 and its adjacent neighborhood Fountaingrove boast expansive views, multi-acre lots, and large, 18 custom homes. (¶2.) Amber Lane is a private road with eight homes, with lots ranging in size 19 from 3.6 acres to over 12 acres. Plaintiff’s home was custom built in 1976. (¶3.) As originally 20 built, the redwood home included redwood steps leading up to large double front doors. The 21 house included oak floors, stained glass windows, built-in etched glass cabinetry, marble 22 fireplaces, and floor-to-ceiling built in bookshelves. The home was a PG&E Award-Winning 23 Passive Solar Home. (¶4.) Plaintiff’s home had vaulted ceilings, interior French doors, a custom- 24 made redwood spiral staircase with abalone inlays, crown molding in every room and chair rail in 25 the majority of the rooms, three marble baths, a wet bar, and crystal chandeliers. (Tucker Decl., 26 Exhibits 2, 3 and 4). In 2004, the Bungers installed a marble top breakfast bar, granite 27 countertops, and Miele appliances. (¶5.) The Property also included a redwood barn designed to 28 match the house, with an included pump room for the 240 foot well. There was a separate PLAINTIFF’S REDACTED MOTION FOR SUMMARY ADJUDICATION AGAINST BRIAN HUNSAKER -2- 1 redwood garage, a basketball court, and a baseball pitching machine field. On April 7, 2006, the 2 Bungers sold the Property to Mark Picano for $1,055,000. (¶6) Just five months later, on 3 September 7, 2006, Mr. Picano sold the Property to Plaintiff. 4 B. Hunsaker Insures 2650 Amber Lane 5 Plaintiff paid $1,025,000 when he purchased the Property in September 2006. (¶7.) 6 Plaintiff used Hunsaker as his insurance agent, as Hunsaker had insured the house with the prior 7 owner and held himself out as an authority on the property. (¶8.) Since 1985, Hunsaker has been 8 an insurance agent of Farmers Insurance Group, meaning that he works solely for Farmers and 9 represents Farmers with insureds. (¶9) 10 Hunsaker did not visit the home before insuring it for Plaintiff. (¶10) He simply pulled 11 into the driveway once to have him sign forms. (Id.) Hunsaker also did not visit the house when 12 he insured it originally for Mr. Picano, stating that he may have “driven by it” to “inspect” it. Northridge, California 91324 KANTOR & KANTOR LLP 19839 Nordhoff Street 13 (¶11.) He never stepped foot inside the Property and had no idea what it looked like inside. (¶12.) (818) 886-2525 14 Farmers issued a low-end Protector Plus insurance policy to Plaintiff on September 5, 2006, 15 setting Coverage A limits of $478,000. (¶13) 16 Farmers used Residential Component Technology, or “RCT,” as a software program to 17 prepare replacement estimates for homes in 2006. (¶14.) By 2013, Farmers had transitioned to a 18 product called 360Value to increase the automation in its replacement estimates while also 19 allowing for customization. (¶15). In the 360Value program, the software pre-populates most 20 choices based on the information provided by the insured. The individual preparing the estimate 21 has significant flexibility to change those pre-populated fields if he chooses, and 360Value 22 encourages itsusers to do so in its training materials. (¶16.) The 360Value software calculates 23 the cost of rebuilding differently depending on the style and grade of house assigned in the 24 system. The grade choices are “standard,” defined as “typical of standard tract-style houses built 25 in recent decades;” “above average,” defined on the Farmers’ website as “upgraded tract style 26 houses built in recent decades;” “custom,” defined as “upgraded tract-style houses with additional 27 custom features;” and “premium,” “custom-built houses with plenty of premium features.” (¶17) 28 Where Mr. Koop’s home was custom-built in 1976, it should have been calculated at the PLAINTIFF’S REDACTED MOTION FOR SUMMARY ADJUDICATION AGAINST BRIAN HUNSAKER -3- 1 “premium” level based on Farmers’ own documentation. Farmers internal documentation of the 2 home included French doors, “premium” and “deluxe” woodwork and cabinetry and fixtures, 3 custom fireplaces, oak flooring and “premium” tile. (¶18.) 4 When Plaintiff bought the home in 2006, RCT lacked the flexibility to enter detailed types 5 of information in the database that created the estimates. (¶19.) Hunsaker did not insure it as a 6 “premium” custom-built home, or even “custom.” Hunsaker does not recall ever selecting a grade 7 for Plaintiff’s home in 360Value, and apparently let it default to “above average.” (¶20) 1 8 Each Farmers estimate correctly lists the features of the home – 2967 sq. ft., built in 1976, 9 three marble bathrooms, crown molding and chair rail, custom kitchen with a peninsula bar and 10 glass cabinets throughout, two rooms with cathedral ceilings, two fireplaces, two chandeliers, 11 French doors, built in bookcases and desk, and a spiral staircase, with columns in the front of the 12 home. There were no “errors” for Plaintiff to spot and change when he reviewed them, and the Northridge, California 91324 KANTOR & KANTOR LLP 19839 Nordhoff Street 13 estimates provided did not explain the “grade” of home used. The only error was in how (818) 886-2525 14 Hunsaker and Farmers inaccurately interpreted the information Plaintiff provided. 2 15 The Policy incorporates the Declarations, which state, “The limit of liability for this 16 structure (Coverage A) is based on an estimate of the cost to rebuild your home, including an 17 approximate cost for labor and materials in your area, and specific information that you have 18 provided about your home.” It also directs insureds to contact their Farmers agent to “ensure that 19 your family is properly protected” and to learn the “coverage options and our various other 20 product offerings that may be available to you.” The Policy also includes extended replacement 21 coverage. With extended replacement coverage, “you must have selected or increased the 22 Coverage A dwelling amount to an amount at least equal to the estimated replacement cost of the 23 dwelling…you must agree to any resulting increases in the Coverage A “Dwelling” limit and 24 1 25 On the Farmers’ website in 2022, after years of successive wildfires, Farmers estimates the cost to rebuild Mr. Koop’s original house at $703,000 when listed as “above-average.” (¶21.) When 26 correctly listed as “premium,” the estimated rebuild cost is $1,069,000, over 65% higher. (Id.) 2 27 In 2016, the cost to rebuild a custom home was approximately $450 per square foot. At the time of theTubbs fire, it was estimated to be “$500–$800 for northeast hillside custom homes in the 28 Fountaingrove area of Santa Rosa. ‘That's the bare minimum - drywall, paint, baseboard.’” (See articles in Press Democrat April 12, 2016 and North Bay Business Journal, October 20, 2017 (RJN Exs. B and C.)Yet in 2017 Farmers insured Plaintiff’s home for $221 per square foot. (¶22) PLAINTIFF’S REDACTED MOTION FOR SUMMARY ADJUDICATION AGAINST BRIAN HUNSAKER -4- 1 other stated limited as calculated.” (¶23) Farmers determines the replacement estimates. (¶24.) 2 These statements would appear to directly conflict with other sections of the policy claiming that 3 Farmers bears no responsibility for selecting coverage limits. (¶25.) 4 C. 360Value and Farmers’ Instructions to Its Agents 5 Farmers began using 360Value in June 2007 for its high value homes only, continuing to 6 use its “RCT” system otherwise. (¶26) On June 8, 2011, Farmers announced that in response to 7 the new Cal. Code Regs. Tit. 10, § 2695.183, itwould transition to using 360Value for every 8 home, not just high value homes. (¶27) In 360Value, an insured’s “Primary Information” 9 “includes questions that make the largest impact on the home’s replacement cost.” (¶28) One of 10 the questions in that section is “style” of the home. 360Value emphasizes the importance of this 11 information when it explains its “Assumptive Program” that auto-fills most of the information in 12 an estimate. (¶29.) “The “Assumptive” program’s selection of the Dwelling Quality Grade is Northridge, California 91324 KANTOR & KANTOR LLP 19839 Nordhoff Street 13 driven by important dwelling characteristics, such as Year of Construction, Square Footage, (818) 886-2525 14 Number of Stories/Style of Home, and ZIP Code.” Hunsaker left the “style” blank. (¶30.) 15 On December 19, 2011, Farmers announced that 360Value would now automatically 16 select the Dwelling Quality Grade. 3 Farmers’ policies and procedures stated that the agent should 17 not accept the assumptive information input, but should check each item with the insured. (¶31) It 18 noted that if an estimate seemed too low, it was likely due to the wrong quality grade being 19 selected, and that the more expensive a home, the more detail should be input to correctly insure 20 it. (¶32) 21 Farmers also insisted that it was imperative for agents to have “regular” FFRs to review 22 the dwelling features and confirm the home quality grade. (¶34) Hunsaker told Farmers that he 23 never had a FFR with Plaintiff. (¶35.) In 2013, Farmers sent out advice to its agents on how to 24 select a “style” of home for a 360Value estimate, noting that it affects the valuation, and 25 explaining that “based on the ZIP code, Style of Construction and home size, 360Value will pre- 26 fill default data about certain dwelling features….” (¶36) 27 3 The assumptions would be validated by comparisons to Xactware’s claims adjustment estimates. 28 (¶33.) These programs are both owned by Verisk and are based on the same data, meaning that they simply reinforce each other’s assumptions without any third-party data comparison. PLAINTIFF’S REDACTED MOTION FOR SUMMARY ADJUDICATION AGAINST BRIAN HUNSAKER -5- 1 Farmers provided clear direction to its agents on how to determine the “quality grade” of a 2 home. If a home was custom-built, it should be considered either “custom” or “premium.” (¶37) 3 Farmers noted, “The Dwelling Quality Grade is one of the most critical components of a 4 Reconstruction Cost Estimate and it can have a significant impact on the estimate amount.” (¶38.) 5 Farmers has a detailed chart of how to determine the quality grade. (¶39) At the top of the chart 6 there was an explanation of how to rate a property as “Above Grade,” “Custom” or “Premium” if 7 it has finishes that could be considered either “Custom” or “Premium.” The chart states that 8 fixtures such as built-in bookcases, wet bars, or cabinetry other than the kitchen and bathrooms 9 were considered premium. Chair rail, crown molding, and baseboards throughout the house were 10 premium. Countertops and vanities with marble should be considered premium. Premium flooring 11 would be a mixture of high-end carpet, tile,stone and hardwood. Plaintiff’s home, with all of 12 these fixtures, would be “premium” under Farmers’ own guidelines. (¶40) Northridge, California 91324 KANTOR & KANTOR LLP 19839 Nordhoff Street 13 On April 1, 2013 Farmers stated that all policies would migrate from RCT to 360Value. (818) 886-2525 14 (¶41.) Agents were instructed to assign as the home “quality grade” whatever “Kitchen Quality 15 Grade” had previously been assigned in RCT. (¶42.) In the application that Hunsaker submitted 16 for Plaintiff’s insurance, he had listed the “Kitchen Quality Grade” as “Custom.” (¶43.) Under 17 Farmers’ own documentation, the Property should have been insured as at least “Custom” quality 18 grade. (¶44.) 19 Farmers instructed agents, “The key to obtaining accurate dwelling feature information is 20 interviewing the prospect during the quote process and verifying all of the dwelling features. 21 Inspecting the property before you bind coverage helps you to confirm eligibility, as well as 22 dwelling feature accuracy.” (¶45). Hunsaker informed Plaintiff that he obtained the information 23 about the Property from the prior owner, but in fact had never discussed it with him and relied on 24 the auto-populated information provided. Plaintiff thus believed it had been verified previously by 25 Hunsaker. (¶46.) 26 Hunsaker received and reviewed as a matter of his general practice the “Breaking News” 27 bulletins sent to agents by Farmers, which would include the documents discussed above. (¶110.) 28 He knew he had a duty to follow Farmers’ policies and procedures. (¶110.) He also knew he had PLAINTIFF’S REDACTED MOTION FOR SUMMARY ADJUDICATION AGAINST BRIAN HUNSAKER -6- 1 a duty to follow California law. (¶110.) 2 D. Plaintiff Asks Farmers to Confirm Adequacy of Insurance in Case of Fire. 3 In 2013, Gary Koop first contacted Hunsaker to ask to review his policy coverage. 4 Hunsaker did not send him a written estimate to review. (¶47) In that discussion, Hunsaker 5 decided to raise his deductible and did not ask to lower any coverages. Hunsaker confirmed that 6 while they reviewed Plaintiff’s specific coverages on that call, he did not inform Plaintiff that 7 higher amounts were available since 2006 because “He did not ask.” (¶48) 8 By 2015, Gary Koop had divorced, working extensively with Hunsaker to sort out his 9 various insurance obligations related to the separation. He was not an uninvolved participant in 10 his insurance –he spoke with Hunsaker’s office 16 times in 2014. (¶49) Mr. Koop became 11 concerned about the adequacy of his insurance coverage after the 2015 Rocky, Humboldt, 12 Jerusalem and Tesla fires in his area. Plaintiff followed the instructions in his Policy and on Northridge, California 91324 KANTOR & KANTOR LLP 19839 Nordhoff Street 13 Farmers’ website stating that if he was concerned about having adequate home insurance (818) 886-2525 14 coverage, he should contact his agent. (¶50) He called Hunsaker on September 1, 2015 to ask 15 specifically if he had sufficient coverage in the event of a wildfire. (¶51.) Liz Evans, a new 16 employee of Hunsaker, took his call that morning. September 1, 2015 was her first day working 17 at the agency. (¶52) Ms. Evans had no prior knowledge of Mr. Koop’s Policy history. While she 18 admits her standard practice would be to review the history of the policy as part of a review, she 19 did not recall doing so for Mr. Koop and did not believe she had a responsibility to do so. (¶53.) 20 She did not check to see how old the Policy was, or whether it was correctly transitioned to 21 360Value. (¶54.) Ms. Evans also did not review the historical coverage increases of the Policy, 22 and had not been aware that Farmers had not made any increases to Mr. Koop’s coverage for five 23 of the nine years it had insured him at that point. (¶55) Farmers had originally insured the 24 Property for $495,000 in 2006. From there it provided coverage to reflect inflation and increases 25 in building costs as follows: $495,000 in 2007; $530,000 in 2008; $548,000 in 2009, 2010, 2011, 26 2012, 2013; and then an increase to $564,000 in 2014. (¶56.) By 2015, Farmers provided no 27 increases whatsoever for over half the time it insured Plaintiff. 28 Ms. Evans failed to make a note of the September 1, 2015 call, but forwarded a 360Value PLAINTIFF’S REDACTED MOTION FOR SUMMARY ADJUDICATION AGAINST BRIAN HUNSAKER -7- 1 estimate to Mr. Koop showing that it would cost him $502,000 to replace his home, and asked 2 him to correct any errors. (¶57.) 4 Ms. Evans did not discuss the quality grade of the house with 3 Plaintiff, erroneously believing that the insured had selected the grade. (¶59.) By only reviewing 4 the 360Value estimate with Mr. Koop, she did not review the actual coverages available to him at 5 all, as those are not listed on the 360Value estimate. (¶60.) She simply asked him to review the 6 estimate and let her know if there were any errors in it. Ms. Evans’ testimony was contradictory. 7 She testified that she did not recall whether or not she heard back from Mr. Koop about his 8 coverage. Evans then testified that when she wrote that “all was okay,” she must have meant that 9 she assumed “all was okay” because she did not hear back from Mr. Koop, despite testifying 10 immediately before that she did not recall whether or not she heard back from him. (¶61.) Mr. 11 Koop, meanwhile, confirmed that Ms. Evans affirmatively told him he had sufficient coverage, a 12 recollection that matches Ms. Evans’ written note. (¶62.) Though Ms. Evans confirmed Northridge, California 91324 KANTOR & KANTOR LLP 19839 Nordhoff Street 13 repeatedly that Plaintiff wanted to review the accuracy of his insurance coverage and that she (818) 886-2525 14 reviewed Plaintiff’s “coverages” with him, she admitted later that she did not actually review any 15 of the calculated values with him. (¶63.) She only reviewed certain information listed in the 16 360Value estimate, a document that does not list the insurance coverages at all, with the result 17 that she did not discuss his insurance coverage with him at all. (¶64) 18 E. Request for Reformation 19 On October 17, 2017, Plaintiff’s home was destroyed in the Tubbs Fire. (¶65.) 20 Once able to obtain a rebuilding estimate in 2019, Plaintiff learned that he was dramatically 21 underinsured. Farmers already knew this; it confirmed within a month of the claim that Plaintiff’s 22 home was “of a premium grade quality” and its own post-fire estimate for replacing the Property 23 “exceeds the policy limits on an ACV basis and ERC on an RCV basis.” (¶66.) Plaintiff raised his 24 concerns to Farmers in a letter dated June 17, 2019, and asked it to “review the value of my home 25 and comparable homes before the fire.” (¶67.) 26 4 The estimate that Hunsaker sent to Mr. Koop was not the complete document, but only a 27 summary. (¶57 and 58). The complete document, produced during litigation, confirms that all the rooms had crown molding, half had chair rail, all the baths had marble, the chandeliers were 28 leaded crystal, the home featured built-in bookcases, a built-in desk, French doors, columns, a spiral staircase, skylights and a wet bar. It also confirmed that the “style” of the house had been listed as “unknown.” (Id.) PLAINTIFF’S REDACTED MOTION FOR SUMMARY ADJUDICATION AGAINST BRIAN HUNSAKER -8- 1 Per Farmers’ internal policies and procedures, when an insured asks to have his policy 2 limits reformed due to underinsurance, the a “claims investigator” speaks with the insured and the 3 agent to determine if a reformation should be pursued. If the facts support reformation, it is 4 submitted to underwriting for review. (¶68.) Investigator Justin Price of Farmers spoke with both 5 Plaintiff and Hunsaker. He left Hunsaker a voicemail, stating that to evaluate Plaintiff’s claims he 6 needed to know why the quality grade was set at above average, if the house was custom grade, if 7 Hunsaker ever visited the property, if Plaintiff ever requested any coverage changes, and if 8 Plaintiff ever asked for or was offered 50% extended replacement coverage. (¶69.) Hunsaker 9 admitted that he had no idea if the computer field offering different options of building grade had 10 been an option in 2006, and had not ever updated the information on the home to fill in the more 11 detailed fields now available. Hunsaker told Farmers that he did not know if Plaintiff’s home was 12 listed as a custom home, and did not know whether or not it should be. (¶70) When asked why the Northridge, California 91324 KANTOR & KANTOR LLP 19839 Nordhoff Street 13 Property was listed as “above grade” and not “custom” or “premium,” Hunsaker responded: (818) 886-2525 14 “Usually itbased on what type of house it is…depending on the features etc.. based on what the 360 evaluation system provides.. taking a look what the house 15 would classify as, we did have the home insured with a prior owner Mark Picano under policy 926773075 valued at 478K... then insured bought the house from 16 him. Agent said this policy was written such a long time ago there is no "style code" showing as unknown.” (¶71.) 17 Hunsaker said that instead of meeting with clients annually for an FFR as instructed to by 18 Farmers’ policies and procedures, he “participated in the post card program with letters being sent 19 out for reviews. Agent said he is not sure if there were any FFRs performed over the years. Agent 20 said he had a couple of other clients with similar claim issues after the wildfires…so he is aware of 21 the claims of being under insured.” Hunsaker did “not believe there were any specific discussions 22 about increasing the Dwelling Limit or ERC.” He also noted that he was well aware that 360Value 23 estimates were “low,” and that he tried to “bump up” the amount by a couple of thousand dollars 24 because of it. (¶72) 25 When asked if he visited the Property and knew if the house was custom, Hunsaker falsely 26 stated, “Yes, we actually insured it previously...not sure if it is ‘custom.’” In deposition, Hunsaker 27 testified that he believed the definition of the verb “visit” was open to interpretation and it was 28 possible he had “visited” the house per his definition of it by driving by. (¶73.) Justin Price PLAINTIFF’S REDACTED MOTION FOR SUMMARY ADJUDICATION AGAINST BRIAN HUNSAKER -9- 1 testified that he understood that when Hunsaker said “yes” to the question of whether he had 2 visited the Property, Hunsaker meant that he had inspected the interior of the dwelling. (¶74.) 3 Hunsaker said he was “Not sure” if Plaintiff ever had the opportunity to select his own 4 extended coverage amount. “Agent said he doesn’t recall if 125% was the highest option at New 5 business when Farmers went from Pro Plus to Next Gen…not sure if 150% was even an option 6 prior to Next Gen.” In deposition, Hunsaker confirmed that these options were not available in 7 2006, and that his office never informed Plaintiff that higher ones had become available. (¶75.) 8 Despite all of these obvious errors and violations of Farmers policies and procedures, Hunsaker 9 stated that he believed he made “no error” because, “with the information he had available 10 (360Value) the policy was written correctly.” (¶76.) Of course, it was Mr. Hunsaker who entered 11 the information into 360Value on which he relied in the first place. (¶77.) 12 Justin Price, the investigator tasked with gathering information about Mr. Koop’s Northridge, California 91324 KANTOR & KANTOR LLP 19839 Nordhoff Street 13 reformation request, did not check to see if the Property should have been listed as “custom,” and (818) 886-2525 14 did not check to see if the Policy had been correctly converted from RCT to 360Value. (¶78.) Mr. 15 Price did not know what “custom” meant and did not know what the available grades were in 16 360Value. (¶79.) Mr. Price noted that he had been in high school when the conversion took place, 17 and that it would be Underwriting’s job to check that information. (¶80.) He did not know what 18 coverage was available in 2006. (¶81.) He did not know how Plaintiff could have selected 50% 19 coverage if it had never been offered to him. (¶82.) Mr. Price did not ask Hunsaker what “all was 20 okay” meant, because it was “common knowledge” that a coverage review would include 21 confirming that the dwelling limits were sufficient. (¶83.) 22 Mr. Price sent his summary to Account Underwriting. (¶84.) However, it was not assigned 23 to an underwriter, but to Brianne Hall, a Customer Advocate with no underwriting training and no 24 training on California law (¶85.) Ms. Hall spent less than 30 minutes on Mr. Koop’s request 25 before recommending that it be refused. (¶86.) She did not investigate whether there were 26 objective criteria in place to determine quality grade, or whether Plaintiff’s Policy was correctly 27 transitioned to 360Value. (¶87.) Ms. Hall has no recollection of looking at the history of the 28 Policy, or at the Application to determine if the Appli