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1 GARRY L. MONTANARI, State Bar No. 89790
WESLEY S. WENIG, State Bar No. 162351
2 JOHN H. MOON, State Bar No. 253811
MICHAELIS, MONTANARI & JOHNSON, P.C.
3 4333 Park Terrace Dr. #100
Westlake ViJlage, CA 91361 2/18/2021
4 Telephone No.: (818) 865-0444
5 Attorneys for defenda11ts, STEPHEN MAGEE and
SAC AERO FL YING CLUB, INC.
6
7
8 SUPERIOR COURT OF THE STATE OF CALIFORNIA
9 COUNTY OF SAN MATEO
10
11
BRYAN TRUJILLO and CINDY ) Case No.: 18CIV01901
12 TRUJILLO, ) Honorable Nancy L. Fineman; Dept. 4
)
13 Plaintiffs, ) OPPOSITION TO PLAINTIFFS'
) MOTION IN LIMINE NO. 8 TO
14 vs. ) EXCLUDE EVIDENCE REGARDING
) PAYMENTS BY INSURERS
15 )
STEPHEN MAGEE, SAC AERO FL YING ) Date: March 8, 2021
16
CLUB, INC. and DOES 1 - 50, ) Time: 1:30 p.m.
) Dept.: 4
17 Defendants. )
) Complaint filed: April 17, 2018
18 ) Trial Date: TBD
)
19
20 I. INTRODUCTION
21 Plaintiffs' homeowners insurance was provided by plaintiffs-in-intervention Allied Property
22 and Casualty Insurance Company and Amco Insurance Company (hereinafter "Allied Prope1ty").
23 These entities are owned by Nationwide Insurance Co. (collectively "NATIONWIDE"). In
24 connection with the subject accident, NATIONWIDE made payments to plaintiffs of over $500,000
25 in connection with their obligations under the homeowners policy. These payments included over
26 $106,000 to remediate the gasoline wetted soil. These payments were made under the name of
27 NATIONWIDE. Additionally, NATIONWIDE filed a first amended subrogation complaint against
2s the defendants initially asserting the claims under the name ofNATIONWIDE. NATIONWIDE and
-1-
OPPOSITION TO PLAINTIFFS' MOTION IN LIMINE NO. 8 TO EXCLUDE EVIDENCE REGARDING
'AYMENTS BY INSURERS
1 the defendants reached a settlement of the complaint encompassing all claim payments to plaintiffs.
2 (See defendants' Motion in Limine No. 7 and supporting declaration of Garry L. Montanari.)
3 Based on the foregoing, the Court is requested to order that defendants may submit as
4 evidence NATIONWIDE's payments ru1d benefits provided to or on behalf of plaintiffs arising out
5 of the subject incident. Defendants ru·e entitled to a setoff of plaintiffs' proved dan1ages in this case
6 in the an1ount of the payments NATIONWIDE made to or on behalf of plaintiffs.
7 II. PLAINTIFFS CITE NO AUTHORITY
8 From the outset, plaintiffs fail to cite any authority whatsoever that supports their position
9 that payments made by a plaintiff-in-intervention insurer should be excluded. Therefore, there is
10 insufficient legal authority for the Court to grant plaintiffs' motion in limine. Furthermore,
11 plaintiffs' purported diminution in value is a double recovery based upon the "anticipated" costs of
12 remediation. (See Defendants' Motion in Limine No. 4.) In fact, the actual costs ofremediation are
13 known and were paid by plaintiffs' insurers and are highly relevant.
14 III. COLLATERAL SOURCE RULE
15 The collateral source rule provides that if an injured party received some compensation for
16 his injuries from a source wholly independent of the tortfeasor, such payment should not be deducted
17 from the damages which the plaintiff would otherwise collect from the tortfeasor. (Hrnjak v.
18 Graymar, Inc. (1971) 4 Cal.3d 725, 729; He(fend v. Southern Cal. Rapid Transit Dist. (1970) 2
19 Cal.3d 1, 6 ("Heljend").)
20 The Collateral Source Rule also applies in property damage claims. (Shaffer v. Deb bas
21 (1993) 17 Cal. App. 4th 33, 40.)
22 IV. SUBROGATION MODIFIES THE COLLATERAL SOURCE RULE
23 Where, as here, an insurance canier such as NATIONWIDE becomes subrogated to the claim
24 of an insured against a third-party tortfeasor, the rules of subrogation modify the collateral source
25 rule and the insurance proceeds are no longer a collateral source.
26 In Garbe!/ v. Con~jo Hardwoods (2011) 193 Cal.App.4th 1563 ("Garbell"), smoke from a
27 fire at the plaintiffhomeowners' property damaged their personal property. Their insurance company
28 paid them policy limits, which covered about half their losses. The plaintiffs sued the defendant
-2-
OPPOSITION TO PLAINTIFFS' MOTION IN LIMINE NO. 8 TO EXCLUDE EVIDENCE REGARDING
'A YMENTS BY INSURERS
1 flooring contractors ("contractors") for their uninsured loss, and the plaintiffs' insurers sued
2 contractors in a separate subrogation action to recover what it paid the plaintiffs.
3 On appeal, plaintiffs argued that the trial court miscalculated their damages by deducting the
4 insurance payment they received after determining comparative fault for the total personal property
5 loss. Plaintiffs claimed only their uninsured loss was subject to comparative fault. The Court of
6 Appeal, however, held that upon paying the plaintiffs on their insurance policy the insurer became
7 subrogated forthe amount and "stepped into the shoes" of plaintiffs to the extent of the payment. (Id.
8 at 1571.) "[S]ubrogation does no more than assign to the insurer the claims ofits insured against the
9 legally responsible party." (Id.) By virtue of the subrogation, the plaintiffs assigned the right to
10 recover the insured portion of total damages to the insurer. (Id. at 1572.)
11 Analyzing He/fend, the Court of Appeal held that the collateral source rule did not "address
12 the insurer's right to recover in a subrogation action for its payment to the insured." (Id.)
13 Significantly, the Court of Appeal held that when the insurer becomes subrogated against a third
14 party tortfeasor, the insurance proceeds are "no longer a collateral source." (Id.)
15 v. DEFENDANTS' OFFSET IS NOT LIMITED TO THE
16 SETTLEMENT AMOUNT WITH INTERVENERS
17 The First District Court of Appeal has emphasized that "[t]he doctrine of setoff is an
18 equitable principle." (Barnhill v. Robert Saunders & Co. (!st Dist. 1981) 125 Cal. App. 3d 1, 8.)
19 Therefore, it is also proper for the court to reduce the verdict prior to entry of judgment where the
20 jury was informed of settlement but not specifically instructed to reduce its award. (May v. Miller
21 (1991) 228 Cal.App.3d 404, 411.)
22 In Garbe!/, the record was silent as to the settlement amount, however, the trial court, in
23 calculating damages to the plaintiffs' insureds, subtracted the entire amount that the insurer paid to
24 plaintiffs, and not the settlement amount. (Garbell, supra, 193 Cal.App.4th at 1568, 1571.) The
25 Comi of Appeal also held that "[b ]y virtue of the subrogation, the [plaintiffs] assigned the right to
26 recover the insured portion of the total damages ($424,050) to [the insurer]." (Id. at 1572.) The
27 $424,050 amount was the amount of the insurance payment. (Id. at 1571.) Moreover, the appellate
28 court held that they were "not concerned with whether [the insurer] recovered the entire $424,050
-3-
OPPOSITION TO PLAINTII'l'S' MOTION IN LIMINE NO. 8 TO EXCLUDE EVIDENCE REGARDING
A YMENTS BY INSURERS
1 in its subrogation action. (Id. at 1572, fn 3 .) Thus, the offset here just for the subrogation settlement
2 should be the full amount of the insurance proceeds paid, which is in excess of $500,000.
3 VI. CONCLUSION
4 Based on the foregoing, the Court is requested to permit defendants to introduce into
5 evidence the amounts NATIONWIDE paid to or on behalf of plaintiffs as a setoff of plaintiffs'
6 provable damages arising out of the incident.
7
8 DATED: February 17, 2021 MICHAELIS, MONTANARI & JOHNSON
ll: By: _~~A~~~R~--,.~r.>O~N~TM-\A~ f7A~RI~'A,'"
Attorneys for Defendants STEPHEN MAGEE
',{. ,l~-
and SAC AERO FL YING CLUB, INC.
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OPPOSITION TO PLAINTirfS' MOTION IN LIMINE NO. 8 TO EXCLUDE EVIDENCE REGARDING
'AYMENTS BY INSURERS
1 PROOF OF SERVICE
2 ST ATE OF CALIFORNIA )
) S.S.
3 COUNTY OF LOS ANGELES )
4 I am emp loyed in the County of Los Angeles, State of California. I am over the age of 18
and not a party to the within action; my busi ness address is 4333 Park Terrace Dr. #100, Westlake
5 Village, California 91361.
6 On Fe bruary 17, 202 1, l served the foregoing document described as OPPOSITION TO
PLAINTIFFS' MOTION IN LIMINE NO. 8 TO EXCLUDE EVIDENCE REGARDING
7 PAYMENTS BY INSURERS on the interested parties in this action by placing a true copy thereof
in a sealed envelope with postage thereon fully prepaid in the United States mail at Westlake Village,
8 California, addressed as follows:
9 Michael S. Danko, Esq. Attorneys for Plaintiffs
Shawn M iller, Esq.
10 Danko Meredith
333 Twin Dolphin Dr. # 145
11 Redwood Shores, CA 94065
tel: (650) 453 -3600; fax: (650) 394-8672
12 Email: mdanko@dankolaw.com; smiller@dankolaw.com
13 [X] (MAIL) I deposited such envelope addressed in the mail at Westlake Village, California.
The envelope was mailed with postage thereon fully prepaid. I am " read il y familiar" with firm's
14 practice of collection and processing correspondence for mailing. It is deposited with U.S . postal
service on that same day in the ordinary course of business. I am aware that on motion of party
15 served, service is presumed invalid if postal cancellation date o r postage meter date is more than I
day after date of deposit for mailing in affidavit.
16
17 [X] (ELECTRONIC TRANSFER) I caused all of the pages of the above-entitled document to
be sent to the recipient noted above via electronic transfer (email) at the respective email addresses
18 indicated above because of the COVID- 19 virus.
19 [] (FEDERAL EXPRESS) I deposited such envelope addressed at the Federal Express office
located at Westlake Vi llage, Californ ia. The envelope was mai led fully prepaid. I am "readily
20 fami li ar" with firm 's practice of col lection and processing correspondence for mai ling with Federal
Express. It is deposited with the Westlake Village Federal Express service on that same day in the
21 ordinary course of business . I am aware that on motion of party served, service is presumed invalid
if cancellation date is more than 1 day after date of deposit for overnight mailing in affidavit.
22
23 I declare under penalty of petjury under the laws of the State of California that the foregoing
is true and correct.
24
25 Executed on February 17, 2021 at Westlake Village, California.
26
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Preview
1 GARRY L. MONTANARI, State Bar No. 89790 WESLEY S. WENIG, State Bar No. 162351 2 JOHN H. MOON, State Bar No. 253811 MICHAELIS, MONTANARI & JOHNSON, P.C. 3 4333 Park Terrace Dr. #100 Westlake ViJlage, CA 91361 2/18/2021 4 Telephone No.: (818) 865-0444 5 Attorneys for defenda11ts, STEPHEN MAGEE and SAC AERO FL YING CLUB, INC. 6 7 8 SUPERIOR COURT OF THE STATE OF CALIFORNIA 9 COUNTY OF SAN MATEO 10 11 BRYAN TRUJILLO and CINDY ) Case No.: 18CIV01901 12 TRUJILLO, ) Honorable Nancy L. Fineman; Dept. 4 ) 13 Plaintiffs, ) OPPOSITION TO PLAINTIFFS' ) MOTION IN LIMINE NO. 8 TO 14 vs. ) EXCLUDE EVIDENCE REGARDING ) PAYMENTS BY INSURERS 15 ) STEPHEN MAGEE, SAC AERO FL YING ) Date: March 8, 2021 16 CLUB, INC. and DOES 1 - 50, ) Time: 1:30 p.m. ) Dept.: 4 17 Defendants. ) ) Complaint filed: April 17, 2018 18 ) Trial Date: TBD ) 19 20 I. INTRODUCTION 21 Plaintiffs' homeowners insurance was provided by plaintiffs-in-intervention Allied Property 22 and Casualty Insurance Company and Amco Insurance Company (hereinafter "Allied Prope1ty"). 23 These entities are owned by Nationwide Insurance Co. (collectively "NATIONWIDE"). In 24 connection with the subject accident, NATIONWIDE made payments to plaintiffs of over $500,000 25 in connection with their obligations under the homeowners policy. These payments included over 26 $106,000 to remediate the gasoline wetted soil. These payments were made under the name of 27 NATIONWIDE. Additionally, NATIONWIDE filed a first amended subrogation complaint against 2s the defendants initially asserting the claims under the name ofNATIONWIDE. NATIONWIDE and -1- OPPOSITION TO PLAINTIFFS' MOTION IN LIMINE NO. 8 TO EXCLUDE EVIDENCE REGARDING 'AYMENTS BY INSURERS 1 the defendants reached a settlement of the complaint encompassing all claim payments to plaintiffs. 2 (See defendants' Motion in Limine No. 7 and supporting declaration of Garry L. Montanari.) 3 Based on the foregoing, the Court is requested to order that defendants may submit as 4 evidence NATIONWIDE's payments ru1d benefits provided to or on behalf of plaintiffs arising out 5 of the subject incident. Defendants ru·e entitled to a setoff of plaintiffs' proved dan1ages in this case 6 in the an1ount of the payments NATIONWIDE made to or on behalf of plaintiffs. 7 II. PLAINTIFFS CITE NO AUTHORITY 8 From the outset, plaintiffs fail to cite any authority whatsoever that supports their position 9 that payments made by a plaintiff-in-intervention insurer should be excluded. Therefore, there is 10 insufficient legal authority for the Court to grant plaintiffs' motion in limine. Furthermore, 11 plaintiffs' purported diminution in value is a double recovery based upon the "anticipated" costs of 12 remediation. (See Defendants' Motion in Limine No. 4.) In fact, the actual costs ofremediation are 13 known and were paid by plaintiffs' insurers and are highly relevant. 14 III. COLLATERAL SOURCE RULE 15 The collateral source rule provides that if an injured party received some compensation for 16 his injuries from a source wholly independent of the tortfeasor, such payment should not be deducted 17 from the damages which the plaintiff would otherwise collect from the tortfeasor. (Hrnjak v. 18 Graymar, Inc. (1971) 4 Cal.3d 725, 729; He(fend v. Southern Cal. Rapid Transit Dist. (1970) 2 19 Cal.3d 1, 6 ("Heljend").) 20 The Collateral Source Rule also applies in property damage claims. (Shaffer v. Deb bas 21 (1993) 17 Cal. App. 4th 33, 40.) 22 IV. SUBROGATION MODIFIES THE COLLATERAL SOURCE RULE 23 Where, as here, an insurance canier such as NATIONWIDE becomes subrogated to the claim 24 of an insured against a third-party tortfeasor, the rules of subrogation modify the collateral source 25 rule and the insurance proceeds are no longer a collateral source. 26 In Garbe!/ v. Con~jo Hardwoods (2011) 193 Cal.App.4th 1563 ("Garbell"), smoke from a 27 fire at the plaintiffhomeowners' property damaged their personal property. Their insurance company 28 paid them policy limits, which covered about half their losses. The plaintiffs sued the defendant -2- OPPOSITION TO PLAINTIFFS' MOTION IN LIMINE NO. 8 TO EXCLUDE EVIDENCE REGARDING 'A YMENTS BY INSURERS 1 flooring contractors ("contractors") for their uninsured loss, and the plaintiffs' insurers sued 2 contractors in a separate subrogation action to recover what it paid the plaintiffs. 3 On appeal, plaintiffs argued that the trial court miscalculated their damages by deducting the 4 insurance payment they received after determining comparative fault for the total personal property 5 loss. Plaintiffs claimed only their uninsured loss was subject to comparative fault. The Court of 6 Appeal, however, held that upon paying the plaintiffs on their insurance policy the insurer became 7 subrogated forthe amount and "stepped into the shoes" of plaintiffs to the extent of the payment. (Id. 8 at 1571.) "[S]ubrogation does no more than assign to the insurer the claims ofits insured against the 9 legally responsible party." (Id.) By virtue of the subrogation, the plaintiffs assigned the right to 10 recover the insured portion of total damages to the insurer. (Id. at 1572.) 11 Analyzing He/fend, the Court of Appeal held that the collateral source rule did not "address 12 the insurer's right to recover in a subrogation action for its payment to the insured." (Id.) 13 Significantly, the Court of Appeal held that when the insurer becomes subrogated against a third 14 party tortfeasor, the insurance proceeds are "no longer a collateral source." (Id.) 15 v. DEFENDANTS' OFFSET IS NOT LIMITED TO THE 16 SETTLEMENT AMOUNT WITH INTERVENERS 17 The First District Court of Appeal has emphasized that "[t]he doctrine of setoff is an 18 equitable principle." (Barnhill v. Robert Saunders & Co. (!st Dist. 1981) 125 Cal. App. 3d 1, 8.) 19 Therefore, it is also proper for the court to reduce the verdict prior to entry of judgment where the 20 jury was informed of settlement but not specifically instructed to reduce its award. (May v. Miller 21 (1991) 228 Cal.App.3d 404, 411.) 22 In Garbe!/, the record was silent as to the settlement amount, however, the trial court, in 23 calculating damages to the plaintiffs' insureds, subtracted the entire amount that the insurer paid to 24 plaintiffs, and not the settlement amount. (Garbell, supra, 193 Cal.App.4th at 1568, 1571.) The 25 Comi of Appeal also held that "[b ]y virtue of the subrogation, the [plaintiffs] assigned the right to 26 recover the insured portion of the total damages ($424,050) to [the insurer]." (Id. at 1572.) The 27 $424,050 amount was the amount of the insurance payment. (Id. at 1571.) Moreover, the appellate 28 court held that they were "not concerned with whether [the insurer] recovered the entire $424,050 -3- OPPOSITION TO PLAINTII'l'S' MOTION IN LIMINE NO. 8 TO EXCLUDE EVIDENCE REGARDING A YMENTS BY INSURERS 1 in its subrogation action. (Id. at 1572, fn 3 .) Thus, the offset here just for the subrogation settlement 2 should be the full amount of the insurance proceeds paid, which is in excess of $500,000. 3 VI. CONCLUSION 4 Based on the foregoing, the Court is requested to permit defendants to introduce into 5 evidence the amounts NATIONWIDE paid to or on behalf of plaintiffs as a setoff of plaintiffs' 6 provable damages arising out of the incident. 7 8 DATED: February 17, 2021 MICHAELIS, MONTANARI & JOHNSON ll: By: _~~A~~~R~--,.~r.>O~N~TM-\A~ f7A~RI~'A,'" Attorneys for Defendants STEPHEN MAGEE ',{. ,l~- and SAC AERO FL YING CLUB, INC. 12 13 N:\17517\pld\trial\MIL -oppositions\p-opp.1nil.8.wpd 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 -4- OPPOSITION TO PLAINTirfS' MOTION IN LIMINE NO. 8 TO EXCLUDE EVIDENCE REGARDING 'AYMENTS BY INSURERS 1 PROOF OF SERVICE 2 ST ATE OF CALIFORNIA ) ) S.S. 3 COUNTY OF LOS ANGELES ) 4 I am emp loyed in the County of Los Angeles, State of California. I am over the age of 18 and not a party to the within action; my busi ness address is 4333 Park Terrace Dr. #100, Westlake 5 Village, California 91361. 6 On Fe bruary 17, 202 1, l served the foregoing document described as OPPOSITION TO PLAINTIFFS' MOTION IN LIMINE NO. 8 TO EXCLUDE EVIDENCE REGARDING 7 PAYMENTS BY INSURERS on the interested parties in this action by placing a true copy thereof in a sealed envelope with postage thereon fully prepaid in the United States mail at Westlake Village, 8 California, addressed as follows: 9 Michael S. Danko, Esq. Attorneys for Plaintiffs Shawn M iller, Esq. 10 Danko Meredith 333 Twin Dolphin Dr. # 145 11 Redwood Shores, CA 94065 tel: (650) 453 -3600; fax: (650) 394-8672 12 Email: mdanko@dankolaw.com; smiller@dankolaw.com 13 [X] (MAIL) I deposited such envelope addressed in the mail at Westlake Village, California. The envelope was mailed with postage thereon fully prepaid. I am " read il y familiar" with firm's 14 practice of collection and processing correspondence for mailing. It is deposited with U.S . postal service on that same day in the ordinary course of business. I am aware that on motion of party 15 served, service is presumed invalid if postal cancellation date o r postage meter date is more than I day after date of deposit for mailing in affidavit. 16 17 [X] (ELECTRONIC TRANSFER) I caused all of the pages of the above-entitled document to be sent to the recipient noted above via electronic transfer (email) at the respective email addresses 18 indicated above because of the COVID- 19 virus. 19 [] (FEDERAL EXPRESS) I deposited such envelope addressed at the Federal Express office located at Westlake Vi llage, Californ ia. The envelope was mai led fully prepaid. I am "readily 20 fami li ar" with firm 's practice of col lection and processing correspondence for mai ling with Federal Express. It is deposited with the Westlake Village Federal Express service on that same day in the 21 ordinary course of business . I am aware that on motion of party served, service is presumed invalid if cancellation date is more than 1 day after date of deposit for overnight mailing in affidavit. 22 23 I declare under penalty of petjury under the laws of the State of California that the foregoing is true and correct. 24 25 Executed on February 17, 2021 at Westlake Village, California. 26 27 28