Quelimane Co. v. Stewart Title Guaranty Co.

In this case we are again called upon to construe and apply the unfair competition law (UCL). (Bus. & Prof. Code, §§ 17200-17209.) 1 The principal question here is whether the Insurance Code displaces the UCL and provides the only remedies for plaintiffs who have been harmed by an alleged conspiracy among title insurers to refuse to sell title insurance on real property acquired at a tax sale.

We conclude that the Insurance Code does not displace the UCL except as to title insurance company activities related to rate setting. We shall reverse the judgment of the Court of Appeal which reached a contrary conclusion.

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Background

Although plaintiffs’ first amended complaint set out seven causes of action against several defendants, only those in which First American Title Insurance Co. (First American) is a defendant are in issue here. Defendants Stewart Title Guaranty Company (Stewart Title) and Placer Title Company (Placer Title) have been dismissed from the action, without prejudice, by stipulation. 2

In the allegations 3 in support of the first and second, which incorporates the first, causes of action, the first amended complaint alleges the…

At oral argument, it became apparent there is no factual basis to support the allegations in the complaint that defendants “conspired” to refuse title insurance to plaintiffs’ tax-defaulted property. Counsel conceded plaintiffs presently have no evidence of an agreement. Establishing an “unlawful” agreement under the Cartwright Act is the heart of plaintiffs’ case, the central predicate on which their derivative claim under the unfair competition law (Bus. & Prof. Code, § 17200 et seq. (UCL)) rests. (Maj. opn., ante, at pp. 49-50.) Without a factual basis, it collapses. The majority’s decision to reverse the judgment of dismissal thus turns on a technical rule of pleading—that a demurrer admits all facts properly pleaded in a complaint—combined with official indulgence of plaintiffs’ desire to conduct a fishing expedition. I would put this sham lawsuit out of its misery. Because the allegations of the complaint are hopelessly clouded by counsel’s *61 concession at oral argument, I would dismiss the petition for review in this case as improvidently granted.

Even without plaintiffs’ concession, I would still find the complaint insufficient to state a claim under the UCL and for…

BAXTER, Justice.

In this case we are again called upon to construe and apply the unfair competition law (UCL). (Bus. & Prof.Code, §§ 17200-17209.) [1] The principal question here is whether the Insurance Code displaces the UCL and provides the only remedies for plaintiffs who have been harmed by an alleged conspiracy among title insurers to refuse to sell title insurance on real property acquired at a tax sale.

We conclude that the Insurance Code does not displace the UCL except as to title company activities related to rate setting. We shall reverse the judgment of the Court of Appeal which reached a contrary conclusion.

Although plaintiffs' first amended complaint set out seven causes of action against several defendants, only those in which First American Title Insurance Co. (First American) is a defendant are in issue here. Defendants Stewart Title Guaranty Company (Stewart Title) and Placer Title Company (Placer Title) have been dismissed from the action, without prejudice, by stipulation. [2]

In the allegations [3] in support of the first and second, which incorporates the first, causes of action, the first amended complaint alleges the following:

Plaintiffs Quelimane…