State Farm Fire & Casualty Co. v. Superior Court

Petitioners State Farm Fire and Casualty Company and State Farm adjuster Don Dennison (together State Farm) seek mandate directing the superior court to vacate its ruling denying State Farm’s motion for summary judgment on Aegea Homeowners Association, Inc.’s (Aegea) complaint for breach of the duty of good faith and fair dealing, breach of statutory duties and breach of contract. We conclude summary judgment was improperly denied because State Farm’s insurance policy unambiguously excluded coverage for the losses involved here.

Facts

In 1978, Aegea purchased an insurance policy from State Farm for its condominium complex in Oceanside, California. The policy generally insured “against all risks of direct physical loss.” The policy specifically excluded coverage for: “[ljoss caused by . . . inherent or latent defect. . . settling, cracking, shrinkage, bulging or expansion of pavements, foundations, walls, floors, roofs or ceilings” unless the loss was caused by a peril not otherwise excluded in which case the ensuing loss was covered; loss caused by “faulty materials or workmanship; unless loss by fire or explosion not otherwise excluded ensues” in which case the ensuing…