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PETITION TO CONFIRM UNANIMOUS APPRAISAL AWARD |
BACKGROUND
A. Petition
Petitioner Pharmacists Mutual Insurance Company (“Petitioner”) filed this verified petition on July 9, 2020 against Respondent Natalie Gold Inc. (“Respondent”). Petitioner seeks to confirm a unanimous appraisal award entered on August 29, 2019 and served on September 10, 2019.
Petitioner insures Respondent located at 140 N San Fernando Boulevard in Burbank under policy BOP 0161600 with an effective date of July 11, 2016 to July 11, 2017. Respondent was in the process of opening a pharmacy when it reported 3 separate water losses on August 23, 2016, November 3, 2016, and June 5, 2017. Respondent alleges that the policy excludes water that backs up or overflows a drain, but the Property Plus Coverage Endorsement provides limited coverage up to $25,000 for damages resulting from such backup or overflow. Petitioner alleges that it paid Respondent the full amount of the policy benefits, but a dispute arose over the loss of Respondent’s business as a result of water intrusion from the adjacent building.
On April 23, 2018, Respondent invoked the appraisal provision in the Amendatory Endorsement – California of the Business Owners Policy. The parties chose Lynn Mitchell (Petitioner’s appraiser), Madeline Mamaux (Respondent’s appraiser), and Steven A. Rosenthal (Petitioner’s chosen umpire). On August 29, 2019, by unanimous decision, Respondent was awarded business income for all losses, net of a 48-hour waiting period, and consideration of the 30-day extended period of indemnity provision, totaling $89,421.00. On December 23, 2019, Petitioner paid the amount to Respondent.
The Court is not in receipt of an opposition brief from Respondent.
This matter initially came for hearing on October 30, 2020. The Court continued the hearing to December 11, 2020, in order to provide Petitioner time to file a proof of service demonstrating notice of the hearing on Respondent. On November 12, 2020, Petitioner filed a Proof of Service of Petition and Related Documents.
LEGAL STANDARD
CCP § 1285 states: “Any party to an arbitration in which an award has been made may petition the court to confirm, correct or vacate the award. The petition shall name as respondent all parties to the arbitration and may name as respondents any other persons bound by the arbitration award.”
CCP § 1285.4 requires the petition to:
(a) Set forth the substance of or have attached a copy of the agreement to arbitrate unless the petitioner denies the existence of such an agreement;
(b) Set forth names of the arbitrators; and
(c) Set forth or have attached a copy of the award and the written opinion of the arbitrators, if any.
(CCP §1285.4.)
CCP § 1286 states: “If a petition or response under this chapter is duly served and filed, the court shall confirm the award as made, whether rendered in this state or another state, unless in accordance with this chapter it corrects the award and confirms it as corrected, vacates the award or dismisses the proceeding.” Section 1287.4 states that once confirmed, an award is enforceable as a judgment.
DISCUSSION
A. Service of the Petition and Notice of Hearing
CCP § 1290.4 requires the Petition and Notice of Hearing to be served on Respondents “in the manner provided in the arbitration agreement for the service of such petition and notice” or “[i]f the arbitration agreement does not provide the manner in which such service shall be made . . . [s]ervice within this State shall be made in the manner provided by law for the service of summons in an action.” (CCP § 1290.4(a), (b).)
Therefore, the Court finds that Respondent has notice of the current hearing date.
B. Service of the Arbitration Award and Timeliness of the Petition
CCP § 1288 states: “A petition to confirm an award shall be served and filed not later than four years after the date of service of a signed copy of the award on the petitioner. A petition to vacate an award or to correct an award shall be served and filed not later than 100 days after the date of the service of a signed copy of the award on the petitioner.” “No petition may be served and filed under this chapter until at least 10 days after service of the signed copy of the award upon the petitioner.” (CCP § 1288.4.) U nder CCP § 1290.2, no less than 10 days’ notice must be provided to the responding party before any hearing on the confirmation petition.
The appraisal took place on August 29, 2019. (Pet., ¶12.) The Appraisal of Insurance Claim Award (“Appraisal Award”) was entered on August 29, 2019, which required Petitioner to pay Respondent the amount of $89,421. (Pet., ¶12; Ex. B.) The Appraisal Award was served on all parties, the party appraisers, and the neutral umpire on September 10, 2019. (Id., ¶13.) The petition was filed on July 9, 2020, which is within 4 years of service of the Appraisal Award.
Therefore, the Court finds that the requirements of CCP §§ 1283.6 and 1288 have been satisfied.
C. Merits of the Petition
The petition includes a copy of the insurance policy with various attachments. (Pet., Ex. A.) The appraisal provision is contained in the Amendatory Endorsement California (BP 0673 06 12) and states in section 13 (“Appraisal”) that if the parties do not agree on the actual cash value of the property or the amount of loss, either party may request the amount be determined by appraisal. (Pet., Ex. A [Policy at Amendatory Endorsement at p. 4 of 5].) Upon acceptance of the written request for appraisal, each selects a competent and impartial appraiser and the two appraisers select a competent and impartial umpire. (Id. at p. 5 of 5.) The appraisal proceedings are informal unless mutually agreed to otherwise. (Id. ) The appraisers determine and state separately the amount of each loss and determine the actual cash value of covered property items at the time of loss. (Id.) If the appraisers disagree, then they submit their differences to the umpire, who will determine the amount of actual cash value and loss. (Id.) Each appraiser is paid by the party who selected that appraiser. (Id.)
The appraisal was conducted by Lynn Mitchell, CPA (Petitioner’s appraiser) and Madeline Mamaux, CFA (Respondent’s appraiser), and Steven A. Rosenthal, CFE (Respondent’s chosen umpire, which Petitioner agreed to). (Pet., ¶10.) According to the Appraisal Award, the appraisers and umpire investigated and considered all the materials and available information in determining that the business income for all losses, net of the 48-hour waiting period, and in consideration of the 30-day extended period of indemnity provision was $89,421.00. (Pet., ¶¶11-12, Ex. B.) The Appraisal Award was signed by the umpire and both appraisers.
On December 23, 2019, Petitioner paid the $89,421.00 amount to Respondent. (Pet., ¶14, Ex. C.)
Petitioner seeks to confirm the Appraisal Award, arguing that there are no grounds to correct or vacate the award, no application has been made to the umpire or the court to correct or vacate the award, and more than 100 days have passed since service of the award such that Respondent may not petition to correct or vacate the award. (Pet., ¶¶15-17.)
Therefore, there is substantive merit to granting this petition according to the terms of the Appraisal Award. In addition, the petition is not opposed and Respondent has not filed a petition to vacate the award within 100 days of service of the signed award (i.e., 100 days from September 10, 2019 is December 19, 2019). (See CCP § 1288.)
CONCLUSION AND ORDER
Petitioner’s petition to confirm the appraisal award is granted.
Petitioner shall provide notice of this order.