(Please note: the names and locations of all parties have been changed to protect the confidentiality of the participants in this automobile accident/insurance coverage case and its proceedings.)
Defendant’s underwriters state that they act as soon as they receive the relevant medical records. Yet underwiter Ms. Smith did not act in this case after receiving Dr. Xavier W.’s medical report concerning Bob Lawrence on March 2, 2001. See defendant’s statement of facts, fact numbers 62-65. She could have rescinded the contract based on that information but chose not to do so. Instead, she waited three more months to act, during which time Mr. Lawrence sustained injuries which defendant later chose not to cover. She did this, too, without alerting plaintiffs that there was a possibility their coverage might be terminated. Had she informed them of this possibility in a timely manner, plaintiffs could have obtained replacement coverage that would have been in effect at the time of Bob Lawrence’s automobile accident.
Furthermore, Ms. Smith testified that her practice was to rescind a contract if allowing the coverage to continue would cost Blue Shield more money, but not otherwise. In addition, upon recent review of defendant’s first motion for summary judgment, it appears that Ms. Smith and Ms. Bird have submitted declarations in support of the present motion that are materially different from those they submitted the first time around. Plaintiffs will utilize the additional time they request herein (argument III, infra), in part, to examine these apparent discrepancies in more detail.
Another serious matter is defendant’s intentional omission of parts 4-9 of Sally Lawrence’s paper application from the online version of the application which defendant includes in its motion. The omission is significant for several reasons. First, the omitted parts contain critical information regarding Sally Lawrence’s irritable bowel condition, her treatment history and Blue Shield’s consequent duty to make further inquiry before issuing coverage. The language of those parts also reinforces plaintiffs’ contention that Sally Lawrence believed the balance of the application applied to her only and not to Steve. Those parts also contain evidence that Mr. Shulman was a Blue Shield agent and that he falsely attested that he had asked each question in the application exactly as set forth.
These practices, and others, directly support plaintiffs’ claims that Blue Shield acted in bad faith and engaged in intentional misconduct designed and intended to inflict severe emotional distress upon plaintiffs. As discussed in argument IV, above, the Court of Appeal has already determined that these are viable claims with contested facts that must be placed before a jury for decision.
For the foregoing reasons, plaintiffs respectfully request that Blue Shield’s motion for summary judgment or, alternatively, for summary adjudication of issues be denied in its entirety. Plaintiffs also respectfully request their costs and fees for having to defend this second summary judgment motion.
For more information you are welcome to contact Sacramento personal injury lawyer, Moseley Collins.