HOA

In this case, the appellant, 1231 Euclid Homeowners Association (HOA), a homeowners association of a 10-unit residential condominium, made a claim to its insurer for damages resulting from the January 17, 1994 Northridge earthquake. HOA’s building was insured by the respondent, State Farm Fire and Casualty Company (State Farm), under a policy with coverage of $1,191,600 for earthquake damage, subject to a 10 percent deductible ($119,160). The appellate record reflects that, after a preliminary inspection by representatives of both State Farm and HOA, it was determined that the damage sustained was largely cosmetic and totaled an amount that was well below the deductible under the State Farm policy. Thereafter, HOA withdrew its claim and State Farm closed its file. Nearly eight years later, after the passage of Code of Civil Procedure, section 340.9, HOA filed this action against State Farm, alleging claims for breach of contract and breach of the implied covenant of good faith and fair dealing.

On State Farm’s motion for summary judgment, the trial court concluded that there was no dispute of material fact with respect to HOA’s 1994 withdrawal of its claim. The court…