Northern Cal. Collection Service v. Perez CA1/4

BACKGROUND

I. The policies

In February 2014 Perez, doing business as ALP Construction, purchased a workers’ compensation insurance policy from State Fund. The policy, number 9089033-14, was for the period from February 13, 2014 through February 13, 2015 (the 2014 policy). Perez paid State Fund $37,008.32 in premiums for the coverage period. The 2014 policy automatically renewed on February 13, 2015. On March 5, 2015, Perez informed State Fund that he had incorporated his business as ALP Inc. State Fund issued an endorsement changing the name of its insured from Perez as an individual to ALP Inc., effective the February 13, 2015 renewal date. The notice sent to ALP Inc. expressly stated that the endorsement did not otherwise “vary, alter, waive or extend” any policy terms, conditions, agreements or limitations. State Fund thereafter used the “ALP Inc.” corporate entity’s name on its correspondence and documents, even if they related to the prior coverage period for Perez’s sole proprietorship as ALP.1 In July 2015, as a result of a standard payroll audit, State Fund billed ALP Inc. $99,769.02 in additional premiums owed on

1 State Fund did not require a new application for…