Petitioner sought review of the decision of the Superior Court of Contra Costa County (California), which granted summary adjudication in favor of defendant administrator, real party in interest, on grounds that defendant was not a party to the vehicle service agreement (VHS) purchased by petitioner, and finding that the VHS was not a contract of insurance.

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Overview

Petitioner purchased a used-car service contract (VSC) and brought suit against defendant administrator, real party in interest, for its denial of claims under the VSC. Petitioner contended that defendant, though not named as a party to the VSC, in fact was one by virtue of a principal-agent relationship with the car dealer during the contracting. Defendant filed a motion for summary judgment on grounds that its lack of party status to the VSC precluded liability, and also urged that the VSC was not a contract of “insurance” for purposes of petitioner’s claim of bad faith denial of an insurance contract. The trial court agreed and granted the motion. Petitioner sought review. The court found that the existence or absence of agency ordinarily posed a question of fact, unless the evidence permitted only one inference; and the existence of an agency relationship was the key to the ruling on defendant’s motion for summary judgment. The court held that the evidence raised a triable issue of fact whether the car dealer was the agent of defendant in entering into the VSC with petitioner.

Outcome

The court issued a peremptory writ of mandate directing respondent superior court to vacate its order granting defendant administrator, real party in interest, summary judgment on grounds that defendant was not a party to the vehicle service agreement purchased by petitioner. The court held that there were triable issues of fact regarding the existence of agency and whether defendant was an insurer.