Kacha v. Allstate Insurance

45 Cal. Rptr. 3d 92, 140 Cal. App. 4th 1023, 2006 Cal. Daily Op. Serv. 5794, 2006 Daily Journal DAR 8230, 2006 Cal. App. LEXIS 947
CourtCalifornia Court of Appeal
DecidedJune 1, 2006
DocketD046961
StatusPublished
Cited by22 cases

This text of 45 Cal. Rptr. 3d 92 (Kacha v. Allstate Insurance) is published on Counsel Stack Legal Research, covering California Court of Appeal primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Kacha v. Allstate Insurance, 45 Cal. Rptr. 3d 92, 140 Cal. App. 4th 1023, 2006 Cal. Daily Op. Serv. 5794, 2006 Daily Journal DAR 8230, 2006 Cal. App. LEXIS 947 (Cal. Ct. App. 2006).

Opinion

Opinion

McCONNELL, P. J.

This is an appeal from a judgment confirming an insurance appraisal award. It is settled that “appraisers have the power only to determine a specific question of fact, ‘namely, the actual cash value of the insured [item].’ ” (Safeco Ins. Co. v. Sharma (1984) 160 Cal.App.3d 1060, 1063 [207 Cal.Rptr. 104] (Sharma); Ins. Code, 1 § 2071.) Plaintiff Jeff Kacha contends the award here exceeds the appraisers’ jurisdiction as it includes determinations of whether certain damages were covered by his insurer, defendant Allstate Insurance Company (Allstate), and the trial court erred by finding he waived the jurisdictional rule of Sharma and section 2071. Kacha also contends the court erred by finding he is precluded from challenging the appraisal award because he took possession of, but did not negotiate, checks Allstate provided him to cover the award.

We agree with Kacha on both points. We reverse the judgment and direct the trial court on remand to enter an order vacating the appraisal award.

FACTUAL AND PROCEDURAL BACKGROUND

Kacha and his wife Tania Kacha’s 2 custom home in the Scripps Ranch area of San Diego was completed in July 2002. In October 2003 the home and personal property were damaged by heat and smoke in a wildfire designated the Cedar Fire. Homes on three sides of Kacha’s property burned to the ground.

*1027 Allstate provided Kacha’s homeowners insurance. Allstate valued the cost to clean the home and contents at $25,799.77, and it paid that amount to Kacha. Kacha then retained Kevin Dawson, of Professional Insurance Evaluations, a licensed public adjuster, to assist him in the presentation of his claim. In December 2003 Kacha demanded an appraisal, as provided by Allstate’s policy if the parties could not agree on the amount of loss.

In May 2004 Kacha submitted a sworn statement claiming $639,688.82 in covered losses, supported by inventories Dawson prepared. The claim included the cleaning of damaged property “when applicable” and “the repair or replacement of permanently damaged property.” The same month, Kacha petitioned the superior court to compel an appraisal and appoint an umpire. Allstate opposed the petition on the ground of prematurity, arguing an appraisal was inappropriate until and unless the extent of covered loss was established, on which a value could be determined. Allstate advised the court that under Sharma, supra, 160 Cal.App.3d 1060, “an appraisal panel is empowered to determine the value of a loss and not coverage issues, such as the extent of the loss.”

The court granted Kacha’s motion to compel an appraisal and appointed the Honorable Anthony Joseph, a retired superior court judge, as umpire. Each of the parties was entitled to choose an arbitrator. Kacha chose Keith Charleston and Allstate chose Louis Heilbron. Under the policy, if the parties’ appraisers could not agree on valuation, a written award agreed on by Judge Joseph and one of the appraisers would determine valuation.

In an August 2004 letter, Judge Joseph asked the parties to agree on “a draft form for the award.” The following month Judge Joseph renewed his request.

In late October 2004 Allstate provided Kacha’s attorney, Peter Lawrence, and Dawson with a draft form appraisal award. The form included several pages of damaged items Kacha claimed were covered under the policy, such as kitchen cabinets and flooring, garage cabinets and flooring, and carpet and interior walls. For each item, the form provided: “Damage, if any, to the [e.g., kitchen cabinets] attributable to the fire of October 26, 2003.” The form included a line for the entry of a dollar amount for each item.

The appraisal was held at Kacha’s home, on November 15 and 16, 2004, and January 4, 2005. Allstate presented an appraisal brief that stated, “[T]his is not your standard appraisal where value of the loss is the only issue; there are still many issues regarding the existence and scope of damage that have *1028 not been resolved between the parties. This is due in large part to the insureds’ prematurely demanding appraisal without coming to an agreement upon a scope of loss or even providing Allstate with the specifics of their claim.” The brief asserted that damage to numerous items was not caused by smoke or heat from the Cedar Fire.

On November 15, Allstate provided the panel members with its draft appraisal award form. The parties had not yet agreed to the form, however, and Judge Joseph instructed them to do so before the conclusion of the hearing.

On November 16, the parties stipulated in writing that the appraisal panel “should utilize replacement cost value less depreciation to determine the actual cash value of the loss.” The parties also stipulated to the amount of loss for certain items, including interior light fixtures and cleaning of windows, HVAC (heating, ventilation and air conditioning) ducts and “[ojzone.” The same date, Kacha increased the value of his loss to $858,393.87, and that prompted Judge Joseph to schedule the third hearing day.

On November 30, Dawson sent Allstate’s attorney, Dale Amato, via e-mail, a proposed revised form for the appraisal award. Dawson reorganized the form by adding the italicized language to the following introductory paragraph that appeared in Amato’s version; “We, the undersigned, ... in accordance with our appointment as Appraisers and/or umpire, without bias or personal interest, have observed the subject property and have examined the evidence submitted to us and, in accordance with our appointments, have made the following determination and award of damage, if any, to the structure of the insured’s residence attributable to the fire of October 26, 2003.” (Italics added.) The form then listed the claimed items, without repeating the italicized language for each item, as Amato’s version had, and provided space for an award for each item.

In a December 11 e-mail, Amato sent Dawson minor amendments to the appraisal award form, including the deletion of the words “structure of the” in the italicized sentence in the preceding paragraph, and asked Dawson to let him know if they were acceptable. In a December 22 e-mail, Dawson responded, “I reviewed the changes, all is fine.” Accordingly, the introductory paragraph of the appraisal award form stated the panel members “have made the following determination and award of damage, if any, to the insured’s residence attributable to the fire of October 26, 2003.”

*1029 Allstate submitted a supplemental appraisal brief, again claiming certain damages were unrelated to the Cedar Fire. For one example, Allstate asserted that discoloration of a door “could have been caused by sunlight, weather and/or a breakdown of the factory applied finish.” Allstate urged the appraisal panel to award Kacha nothing for items that were damaged but, according to Allstate, not in the Cedar Fire.

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Nelson v. Huhn CA2/8
California Court of Appeal, 2025
Rees v. American Security Insurance Co. CA2/6
California Court of Appeal, 2021
Natsu Corp. v. Penn-Star Ins. Co. CA1/3
California Court of Appeal, 2020
Khorsand v. Liberty Mutual Fire Ins. Co.
California Court of Appeal, 2018
Khorsand v. Liberty Mut. Fire Ins. Co.
230 Cal. Rptr. 3d 89 (California Court of Appeals, 5th District, 2018)
Li-Lin Sung Lee v. California Capital Insurance
237 Cal. App. 4th 1154 (California Court of Appeal, 2015)
Reid v. AMCO Ins. CA4/2
California Court of Appeal, 2014
Alexander v. Farmers Insurance
219 Cal. App. 4th 1183 (California Court of Appeal, 2013)
Ernest Bell v. Liberty Mutual Fire Insurance
Court of Appeals of Georgia, 2012
Bell v. Liberty Mutual Fire Insurance
734 S.E.2d 894 (Court of Appeals of Georgia, 2012)
Doan v. State Farm General Insurance
195 Cal. App. 4th 1082 (California Court of Appeal, 2011)
Kirkwood v. California State Automobile Ass'n Inter-Insurance Bureau
193 Cal. App. 4th 49 (California Court of Appeal, 2011)
Hynix Semiconductor Inc. v. Rambus Inc.
609 F. Supp. 2d 988 (N.D. California, 2009)
Shopoff & Cavallo LLP v. Hyon
167 Cal. App. 4th 1489 (California Court of Appeal, 2008)
Devonwood Condominium Owners Ass'n v. Farmers Insurance Exchange
162 Cal. App. 4th 1498 (California Court of Appeal, 2008)

Cite This Page — Counsel Stack

Bluebook (online)
45 Cal. Rptr. 3d 92, 140 Cal. App. 4th 1023, 2006 Cal. Daily Op. Serv. 5794, 2006 Daily Journal DAR 8230, 2006 Cal. App. LEXIS 947, Counsel Stack Legal Research, https://law.counselstack.com/opinion/kacha-v-allstate-insurance-calctapp-2006.