SIMMONS v. Civil Service Employees Insurance Company, Appellant.*

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District Court of Appeal, Third District, California.

Rebecca SIMMONS, Plaintiff and Respondent, v. CIVIL SERVICE EMPLOYEES INSURANCE COMPANY and Civil Service Employees Insurance Union, Defendants, Civil Service Employees Insurance Company, Appellant.*

Civ. 10021.

Decided: October 16, 1961

Sedgwick, Detert, Moran & Arnold, San Francisco, for appellant. E. Glynn Stanley, Vallejo, for respondent.

This is an appeal from a summary judgment entered against the only defendant involved in this appeal, Civil Service Employees Insurance Company.

On November 6, 1954, plaintiff was injured through the negligence of one Eddie Lee Symon in the driving of an automobile. On December 6th Symon reported the accident to the Department of Motor Vehicles, stating that defendant had issued to him a policy extending public liability coverage. In fact, although defendant had issued to him a policy of insurance, the policy did not cover public liability, but covered fire, theft and collision only. Thereafter, plaintiff brought action against Symon and recovered a judgment for $20,000. She demanded of defendant herein that it pay such judgment. Defendant refused and this action was brought by plaintiff against it.

The complaint alleged that plaintiff had been injured through the negligence of Symon; that Symon had reported the accident to the department, claiming coverage; that thereafter defendant received from the department a written notice containing said claim of Symon and requesting defendant to report to the department within twenty days whether or not such a liability policy was in effect at the date of the accident, as required by Section 422.6 of the Vehicle Code1 of this state as it then read; that defendant failed within said period of twenty days or at all to state to the department whether or not it had issued insurance coverage as Symon alleged; that in reliance on the existence of such a policy, and in reliance on the failure of defendant to state to the department whether or not there was such a policy in effect at the time of the accident, and believing that such a policy was in existence, plaintiff filed a complaint for damages against Symon; that thereafter, and still relying upon the foregoing, plaintiff obtained a judgment against Symon; that defendant is estopped to deny such a contract of liability insurance and to deny its legal obligation to satisfy said judgment.

Defendant answered the complaint against it, denying liability, but admitting that it had received from the department notice of Symon's allegations as to coverage and had not responded thereto.

Thereafter plaintiff moved for a summary judgment against defendant for the sum of $20,000 with interest thereon and costs of suit incurred in the action against Symon. The court granted the motion ordering that plaintiff recover the sum of $6,575. This sum, which included interest, equaled the minimum liability coverage to qualify Symon for exemption from security deposit.

In respondent's brief estoppel is argued in support of the judgment, but the trial court, in a memorandum of decision, asserted that the judgment it pronounced was not based upon estoppel and that it would not give a judgment upon that theory. Herein we think the trial court was correct, for it is obvious that on that theory the motion for summary judgment would have to be denied. Summary judgment proceedings have no application where there are issues of fact to be tried before a judgment can be pronounced; rather the issue on motion for summary judgment is whether or not there are issues to be tried. Plaintiff asserted, and defendant denied, that defendant had made either express or implied representations to plaintiff as to insurance coverage. Plaintiff asserted, and defendant denied, that plaintiff, in bringing the action against Symon, relied upon any representations express or implied as to the existence of insurance coverage. Plaintiff alleged and defendant denied that plaintiff had been in any wise damaged by representations express or implied even if they had been made as charged. Without going further, we think it apparent that the summary judgment could not be supported upon the theory of estoppel.

However, the trial court, as evidenced by its memorandum of decision, considered that the complaint was broad enough in its allegations to be treated as one whereunder plaintiff could recover because defendant, being under a legal duty to do so, failed to reply when called upon by the department to state whether or not coverage existed.

The statutes relied upon by plaintiff are contained within those provisions of the Vehicle Code which have to do with financial responsibilities of those licensed to operate automobiles. Although our laws do not require as a condition of obtaining an operator's license that any showing be made by an applicant as to his financial responsibility to respond in damages if, through his negligence in the operation of an automobile, he causes injuries to the persons or property of others, nevertheless provisions are contained therein whereunder, after such injuries have been inflicted through his negligence, the licensed operator is required to afford financial responsibility in favor of those who have been injured by his conduct and upon his failure to do so the statutes provide for the suspension of his operator's license and for other sanctions, all intended, through threat of the imposition of such sanctions, to result in the affording of limited financial relief to the injured. As the Supreme Court said in Continental Casualty Company v. Phoenix Construction Co., 46 Cal.2d 423, 434, 296 P.2d 801, 807, 57 A.L.R.2d 914:

‘At the times concerned Oilfields was also subject to California's general automobile financial responsibility law. That law is found in section 410 through 423.1 of the Vehicle Code. * * * Section 410–418.5 * * * cover the matter of establishing responsibility after an accident and an unpaid judgment, while sections 419–423.1 * * * provide for such a showing after the accident and before any judgment, all directly intended for the benefit of drivers and owners of motor vehicles as a means of forestalling suspension of the license of the driver and of the registration of the vehicle or vehicles, and, more fundamentally, designed to give monetary protection to that ever changing and tragically large group of persons who while lawfully using the highways themselves suffer grave injury through the negligent use of those highways by others. Such a law is remedial in nature and in the public interest is to be liberally construed to the end of fostering its objectives.’

It is our view that the relevant statutes impose a standard of conduct upon those engaged in the business of writing public liability insurance and that plaintiff was one of those for whose benefit the legislation was enacted; that a violation of that duty exposed defendant to liability for such damages as might proximately flow from that violation; but that where no policy coverage had been extended the damages flowing from such violation could not be measured by reference to such a policy. In this case the issue of actual damages was raised and presented a triable issue, so the summary judgment cannot stand.

The judgment appealed from is reversed.


1.  Now Vehicle Code 1959, §§ 16059, 16060.

VAN DYKE, Presiding Justice.

PEEK and SCHOTTKY, JJ., concur.