Vanderloo v. Allstate Northbrook Indemnity Company

Background

Evan Vanderloo was injured as a passenger in a rear-end car accident on February 24, 2016. The at-fault driver’s insurer paid Vanderloo $15,000, and Vanderloo then submitted an underinsured-motorist claim to Allstate under a policy with a $100,000 limit, reduced by amounts paid by or for the underinsured vehicle.

Vanderloo made four policy-limit demands. Allstate requested additional medical records, authorizations, wage-loss information, discovery responses, a deposition, and an independent medical examination. Allstate offered $5,000 in April 2021 and again after receiving records concerning Vanderloo’s 2021 surgery. The parties attempted to proceed to arbitration, but arbitration was postponed three times. On April 5, 2023, Allstate paid the remaining $85,000 policy limit.

Vanderloo sued Allstate for breach of contract, bad faith insurance denial, breach of the implied covenant of good faith and fair dealing, and punitive damages. Allstate moved for summary judgment on all claims.

Evidentiary rulings

The court overruled Allstate’s objection to the declaration of J. Lloyd Buckley insofar as it contained procedural facts supported by attached documents. The court excluded portions of that declaration expressing legal conclusions about bad faith and unreasonable withholding of benefits.

The court also excluded portions of the declaration of Yeney Crespo that offered legal conclusions. It considered the remaining portions but found them conclusory and unsupported by factual detail, so they did not create a genuine dispute of material fact.

Breach of contract

The court assumed, for purposes of the motion, that an unreasonable delay in paying insurance benefits could constitute a breach even when the insurer ultimately paid the full policy benefits. It nevertheless granted summary judgment because the undisputed evidence showed that Allstate diligently processed and paid the claim.

The court found that Vanderloo did not provide requested medical authorizations, records, and wage-loss information promptly. It also found delays in Vanderloo’s discovery responses, independent medical examination, and deposition. The court further found that Vanderloo’s counsel repeatedly missed arbitration deadlines and postponed arbitration three times. Based on these facts, the court concluded that Vanderloo had not produced evidence of an unreasonable delay by Allstate.

Bad-faith claims

Under California law, the bad-faith claims required Vanderloo to show that benefits due under the policy were withheld for an unreasonable reason. The court found that Allstate had a genuine, good-faith basis to dispute the amount of coverage because it relied on reports from two independent medical examiners, Dr. McCormack and Dr. Schick.

The court found that both examiners were qualified and reviewed the medical evidence. Their opinions concluded that Vanderloo suffered mild injuries and that his later treatment was not related to the accident. The court also found that Vanderloo did not identify flaws in the doctors’ reports or methods, evidence that either doctor failed to consider relevant medical information, or evidence that Allstate dishonestly selected or directed Dr. McCormack. Vanderloo’s assertions about Dr. McCormack’s defense-related work did not create a genuine factual dispute.

The court therefore granted summary judgment on the bad-faith claims. It treated the claim for breach of the implied covenant of good faith and fair dealing in the insurance context as the same claim as bad-faith insurance denial.

Punitive damages and disposition

The court held that punitive damages were available only in connection with the bad-faith claims, not the contract claim. Because the bad-faith claims failed as a matter of law, and because Vanderloo identified no evidence of oppression, fraud, or malice, the court granted summary judgment on punitive damages.

The court granted summary judgment for Allstate on all claims and dismissed the complaint with prejudice. The supplied text identifies the judge’s signature only imperfectly, appearing to read “umi K. Lee.”