Guzman v. Allstate Indemnity Co. CA4/1

Filed 2/8/21 Guzman v. Allstate Indemnity Co. CA4/1
NOT TO BE PUBLISHED IN OFFICIAL REPORTS
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for
publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication
or ordered published for purposes of rule 8.1115.

COURT OF APPEAL, FOURTH APPELLATE DISTRICT

DIVISION ONE

STATE OF CALIFORNIA

DELINA GUZMAN, D075688

Plaintiff and Appellant,

v. (Super. Ct. No. 37-2015-
00018523-CU-BC-CTL)
ALLSTATE INDEMNITY COMPANY,

Defendant and Appellant.

APPEAL from a judgment of the Superior Court of San Diego County,
Eddie C. Sturgeon, Judge. Affirmed.
White & Amundson, Daniel M. White; Lack Law Group and Rebecca D.
Lack, for Plaintiff and Appellant.
Sheppard Mullin Richter & Hampton, Peter H. Klee, Karin Dougan
Vogel and Matthew G. Halgren, for Defendant and Appellant.
INTRODUCTION
In February 2009, Delina Guzman suffered injuries in an automobile
accident, for which she was not at fault. She sought underinsured motorist
coverage (UIM) from her insurer, Allstate Indemnity Company (Allstate).
While that matter was pending, Guzman was injured in a second automobile
accident on January 20, 2010, for which Guzman also was not at fault.
Guzman filed a second UIM claim with Allstate. Allstate began investigating
Guzman’s injuries after her formal demand in 2012. By 2014, Allstate had
not settled the matter, so Guzman filed for arbitration, which increased her
attorney fees. The arbitrator awarded Guzman the full limits on the policy.
Guzman then sued Allstate for breach of the implied covenant of good faith
and fair dealing, or bad faith. Following trial, the jury awarded Guzman
economic damages but no noneconomic damages.
Guzman timely filed this appeal, contending (1) the special verdict form
separated language for economic and noneconomic damages, improperly
emphasizing proximate cause requirements for noneconomic damages;
(2) Allstate engaged in misconduct by blaming Guzman’s attorney for delays
in payment and any resulting emotional distress; (3) the court improperly
denied portions of two motions in limine by permitting photographs of the
automobile accidents to be shown to the jury; (4) the court erroneously denied
her requests to conform the complaint to evidence of punitive damages
presented at trial; and (5) the court erroneously denied Guzman’s motion for
new trial because she presented uncontroverted evidence of emotional
distress. Allstate filed a cross-appeal, arguing (1) the court improperly
denied its motion for summary judgment on the bad faith claim, and
(2) Guzman suffered no net financial loss and therefore failed to meet an
elemental requirement for proving bad faith. We conclude that Guzman
forfeited her challenges to attorney misconduct and the motions in limine.
Further, we conclude none of these contentions has merit, and we affirm.

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 BACKGROUND AND PROCEDURAL FACTS
On February 9, 2009, 17-year-old Delina Guzman hit a vehicle that
turned left in front of her. She sustained some bodily injury that required
treatment.
Guzman reported the accident to Allstate, and on February 16, 2009,
Allstate sent Guzman a letter requesting she sign an authorization that
would allow Allstate to obtain her medical records to evaluate her injuries.
Guzman did not return the requested authorization.
Guzman retained an attorney, Donna Eyman, who sent Allstate a letter
August 10, 2010 that enclosed proof of Guzman’s settlement with the other
driver for the $15,000 limit; she also gave notice that Guzman would make a
UIM claim for the accident. She indicated she would supply a demand letter
with supporting documentation.
On August 19, 2010, Allstate requested signed medical and wage
authorizations from Guzman. The same day, Allstate sent Eyman a letter
asking her to forward medical authorizations “and/or provide [her] client’s
current status and providers.” Richard Salinas, the original claims adjuster,
testified that Guzman had a choice of providing the authorization or
providing medical information. On August 31, Allstate spoke with Eyman
and learned that Guzman was receiving treatment from a chiropractor, a
neurologist, and a neuropsychologist.
In the meantime, on January 20, 2010, Guzman was involved in a
second automobile accident in which she was rear-ended. The at-fault driver
in this accident was also insured for minimum limits of $15,000.
On April 7, 2011, Eyman submitted Guzman’s UIM claim for the
second accident.

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 On April 11, 2011, Eyman informed Allstate that Guzman had suffered
a concussion and was being treated by a neuropsychologist for a traumatic
brain injury. That day, Allstate mailed Eyman a letter acknowledging
receipt of the second UIM claim, asking for a list of medical providers,
medical bills, reports, and notes, and enclosing medical and wage
authorization forms. Guzman did not return the authorizations.
On June 20, 2011, Allstate left Eyman a phone message inquiring
about Guzman’s treatment status and asking about the promised demand
package. Allstate also requested the authorization form again. Allstate left a
message on August 8, 2011, asking about treatment status and any new
medical provider information.
In September and November 2011, Eyman contacted Allstate and
informed it that Guzman was still receiving treatment and Eyman was
working on a specific demand.
On January 3, 2012, Allstate left a message for Eyman requesting
treatment updates and seeking medical and wage authorizations. On
January 18, 2012, Eyman told Allstate she was continuing to work on the
case; although she did not make a specific demand or provide specific medical
records at that time, she provided a treatment update. On February 21,
Eyman left a message updating Allstate on Guzman’s status and indicating
she would likely make a global demand to cover the expenses from both
accidents.
On April 17, 2012, Guzman submitted a global settlement demand for
$85,000 for each accident, an amount that took into consideration the UIM
limit minus the funds she had received from the motorists’ insurance.
Medical records were enclosed with the demand.

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 Allstate denied the demand. On May 16 and May 24, 2012, Allstate
sent letters seeking to depose Guzman and hold an independent medical
exam (IME), and it sought a medical record review to evaluate Guzman’s
injuries.
On June 19, 2012, Allstate asked Guzman to waive the statutory notice
requirements and proceed with a deposition and the IME within 30 days.
Eyman agreed to waive the statutory time requirements. Allstate retained
an independent orthopedic surgeon, who conducted an IME November 26,
2012.
Guzman’s deposition was scheduled for November 29, 2012. Eyman
told Allstate that Guzman was experiencing cognitive and physical
impairments, had anxiety about driving, and had no money for gas or access
to a car, and she asked that the deposition be held in San Diego instead of
Temecula, closer to where Guzman lived. Allstate rescheduled the
deposition.
On January 10, 2013, Allstate received the records and report from the
IME. The doctor had no opinion about Guzman’s neurological symptoms,
which fell outside his area of expertise.
Allstate deposed Guzman January 21, 2013.
Allstate then noticed an IME with neuropsychologist Dr. Philip
Stenquist for March 20, 2013. Eyman telephoned Allstate to inform it of
defects in the notice and eventually offered the objections in writing, more
than 20 days after receiving notice. The IME notice should have been for a
mental health exam, but it was for a physical exam. It stated Guzman
should expect to remove her clothing and should expect “palpation,
inspection, [and] measurement,” which Eyman noted was an improper scope
for a mental health exam.

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 Allstate renoticed the IME for May 8, 2013. When Allstate called
Eyman to confirm the date a few days before, Eyman said she had not
received the notice. Allstate rescheduled the IME for July 23, 2013.
Following the IME, Dr. Stenquist sought raw data from Guzman’s treating
neuropsychologist to complete his report, so Allstate sent a request for
medical authorization on July 26, 2013, which Guzman signed. Eyman

testified she sent the authorization to Allstate in August via fax,1 but
Allstate’s records indicated it received the requested authorization December
31, 2013.
On February 12, 2014, Guzman’s neuropsychologist contacted Eyman
about a request for raw data. By March 7, 2014, Allstate had not received
the raw data from Guzman’s neuropsychologist, so it canceled the mediation
scheduled for March 10.
On March 31, 2014, arbitration was triggered, scheduled for May 2,
2014. Once arbitration was triggered, a provision in the agreement between
Guzman and Eyman required an increased contingency fee to 40 percent
instead of 33 and 1/3 percent, a difference of $11,333.34.
In the first half of April 2014, Guzman’s neuropsychologist provided
Allstate’s neuropsychologist with the raw data. Dr. Stenquist reported to
Allstate that he could not allocate the cognitive injuries to each UIM claim
without reviewing Guzman’s pre-accident medical records. So, Allstate
allocated the cognitive impairment and all related symptoms to the first
accident and offered full policy limits, $85,000, to settle that claim on April
25, 2014, and Guzman accepted the offer. On April 29, Allstate offered
Guzman $8,000 to settle the claim for the second accident. Guzman rejected
this offer.

1 Allstate challenged the veracity of Eyman’s testimony on this point.
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 The arbitrator awarded Guzman $85,000 for the second accident.
On June 3, 2015, Guzman sued Allstate for breach of contract and
breach of the implied covenant of good faith and fair dealing, i.e., bad faith.
Allstate moved for summary judgment, a motion the court denied. However,
the court granted Allstate’s motion for summary adjudication of Guzman’s
associated punitive damages claim.
The case proceeded to a jury trial. Near the end of trial, Guzman made
a motion to amend the complaint to conform to proof to revive the punitive
damages claim. The court denied the motion.
The jury awarded Guzman $16,803.34 in economic damages and no
noneconomic damages.
Guzman filed a motion for new trial or additur, which the trial court
denied.
Guzman appealed, and Allstate cross appealed.
DISCUSSION
I
JURY VERDICT FORM
A. Additional Facts
The court used jury instruction CACI No. 2331, which stated in
relevant part:
“Ms. Guzman claims that Allstate breached the obligation
of good faith and fair dealing by delaying payment of
benefits due under the insurance policy. To establish this
claim, Ms. Guzman must prove all of the following:

“1) That Ms. Guzman suffered a loss covered under an
insurance policy with Allstate;

“2) That Allstate was notified of the loss;

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 “3) That Allstate unreasonably delayed payment of policy
benefits;

“4) That Ms. Guzman was harmed; and

“5) That Allstate’s delay in payment of policy benefits was
a substantial factor in causing Ms. Guzman’s harm.”

The parties each supplied the court with special verdict forms. Guzman’s
version of the form mirrored CACI VF No. 2301, which begins with a series of
questions about whether the plaintiff suffered a loss, then turns to the delay
in payment, and finally provides for a single question regarding economic and
noneconomic damages, followed by the calculations:
“5. Was Allstate’s delay in payment of policy benefits a
substantial factor in causing harm to Ms. Guzman?

“_____ Yes _____ No

“If your answer to question 5 is yes, then answer
question 6. If you have answered no, stop here, answer no
further questions, and have the presiding juror sign and
date this form.

“6. What are Ms. Guzman’s damages?

“A. Past Economic Loss $ __________

“B. Past Non-Economic Loss $ __________

“TOTAL $ __________”

The special verdict form actually used at trial began with two questions
about Allstate’s delay in payment, then separately addressed causation for

economic and noneconomic damages:2

2 In the original version proposed by Allstate, jurors were instructed to
answer no further questions if they answered “no” to number 4.
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 “3. Was Allstate’s unreasonable or improper delay in the
payment of policy benefits a substantial factor in causing
economic harm to Ms. Guzman?

“_____ Yes _____ No

“If your answer to question 3 is ‘yes,’ then answer
question 4. If you answered ‘no,’ stop here, answer no
further questions, and have the presiding juror sign and
date this form.

“4. Was Allstate’s unreasonable or improper delay in the
payment of policy benefits a substantial factor in causing
non-economic harm to Ms. Guzman?

“_____ Yes _____ No

“Please answer the next question.

“5. What are Ms. Guzman’s damages?

“A. Past Economic Loss $ __________

“B. Past Non-Economic Loss $ __________

“TOTAL $ __________”

The trial court commented that the two forms differed because one did
not reference “substantial factor” for each type of damage, and the court’s
preference was to have it “broken down.” The court explained it previously
had a verdict challenged on appeal because the verdict did not break down
the damages. Guzman’s attorneys argued the court should use CACI VF
No. 2301 because economic and noneconomic damages were separate line
items, addressing the court’s concern. The court responded, “I just prefer it
this way, Counsel,” and counsel replied, “Understood, sir.”

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 The jury answered “yes” to question 3 (Allstate’s delays caused
economic harm) and “no” to question 4 (Allstate’s delays caused noneconomic
harm). The jury awarded $16,803.34 in past economic loss and $0 for past
noneconomic loss.
B. No Forfeiture
Allstate contends that Guzman forfeited her ability to challenge the
form on appeal because she did not object at trial and further contends the
instruction accurately reflects the law and therefore was proper.
“A party who fails to object to a special verdict form ordinarily waives
any objection to the form.” (Behr v. Redmond (2011) 193 Cal.App.4th 517,
530.) However, forfeiture is not automatic if the record indicates the failure
to object was not for the purpose of gaining a technical advantage or engaging
in a litigious strategy. (Ibid.)
Here, although Guzman’s attorneys did not use the words, “I object,”
the discussion on the record demonstrates their disagreement with the use of
Allstate’s special verdict form. After the court told them its preference and
asked if the parties were comfortable, Guzman’s attorneys disagreed with the
decision, until the court finally concluded “I just prefer it this way.” The
issue was preserved for appeal.
C. Special Verdict Form
Guzman argues she was prejudiced by the verdict form because it
improperly emphasized a causation requirement for noneconomic damages.
We disagree.
We “analyze the special verdict form de novo” (Saxena v. Goffney (2008)
159 Cal.App.4th 316, 325; City of San Diego v. D.R. Horton San Diego
Holding Co., Inc. (2005) 126 Cal.App.4th 668, 678) and determine whether it

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correctly states the law it intends to apply (Wilson v. Ritto (2003) 105
Cal.App.4th 361, 366).
Guzman contends that once the jury concluded delay of payment was a
substantial factor in causing harm, it should have calculated economic
damages, then noneconomic damages. In essence, she maintains that asking
the jury to consider whether the delays were a substantial factor in causing
economic harm separately from whether delays were a substantial factor in
causing noneconomic harm misled the jury by indicating economic and
noneconomic harm were separate legal claims.
There is no separate cause of action for emotional distress caused by a
delay in payment in a bad faith case (Gourley v. State Farm Mut. Auto. Ins.
Co. (1991) 53 Cal.3d 121, 128) because the emotional distress damages in bad
faith actions flow from or are incidental to the economic damages. (Major v.
Western Home Ins. Co. (2009) 169 Cal.App.4th 1197, 1215-1216 (Major)).
Thus, the insured can recover for emotional distress damages that flow from
the breach because the mental suffering is an aggravation of the financial
damages. (Gourley, at p. 129.) Although a plaintiff can recover for “ ‘all
emotional distress proximately caused by the insurer’s bad faith without
proving any causal link between the emotional distress and the financial
loss’ ” (Clayton v. United Servs. Auto. Ass’n (1997) 54 Cal.App.4th 1158, 1161,
quoting Waters v. United Services Auto. Assn. (1996) 41 Cal.App.4th 1063
(Waters)), there is still a proximate cause requirement because the
“ ‘emotional distress is the anxiety arising from the financial deprivation
traceable directly to nonpayment of the claim.’ ” (Major, at p. 1215, citing
Silberg v. Cal. Life Ins. Co. (1974) 11 Cal.3d 452.)
The special verdict form used in this case did not misstate the law or
mislead the jury because proximate cause is a requirement. (See Major,

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supra, 169 Cal.App.4th at p. 1215.) It asked jurors to first determine the
existence of economic damages. Then, after that threshold requirement was
met, it asked jurors whether the delay was also the proximate cause of
noneconomic damages. Guzman’s challenge implies that any time there is
economic harm, a jury must also award damages to compensate for any
emotional distress. But that is not the law. If a plaintiff’s emotional distress
is not derived from the delay in payment but instead caused by some other
act, it would be proper for a jury to deny noneconomic damages. That is what
the special verdict form allowed for in this case.
Guzman suggests that because there was a second question specifically
addressing noneconomic damages, it is not clear whether the jury concluded
Guzman did not experience emotional distress or whether the jury determined
that the delay was not the proximate cause of emotional distress. But in

either instance, it would be proper to exclude noneconomic damages.3
Accordingly, we cannot conclude the special verdict form incorrectly stated
the law.
II.
CLOSING ARGUMENT
Guzman contends that Allstate engaged in misconduct by blaming
Guzman’s attorney for the delay in payment and for the resulting emotional

3 Guzman also contends, in connection with this issue, that she proved
with substantial evidence that Allstate’s delay was a substantial factor in
causing noneconomic damages. The proper standard for evaluating the
propriety of a jury’s factual finding is not whether the appellant provided
substantial evidence to support her position, but rather whether there is
substantial evidence to support the jury’s verdict, notwithstanding the
existence of contrary or contradictory evidence supplied by an appellant.
(Baxter Healthcare Corp. v. Denton (2004) 120 Cal.App.4th 333, 369.) We
address the evidence regarding emotional distress post.
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distress. Allstate maintains there was nothing improper about its closing
argument, and even if there were, Guzman forfeited the ability to challenge it
by failing to object at the time.
A. Additional Facts
Allstate’s theory was that Eyman, not Allstate, caused delays, and that
any emotional distress was therefore derived from Eyman’s actions.
Eyman testified that she apprised Allstate of Guzman’s treatment and
provided information about Guzman’s medical providers. Although she
provided the information, she directed Guzman not to sign the medical and
wage authorization forms because she found them objectionable. Eyman
believed they were overbroad and nonspecific, and they infringed on
Guzman’s constitutional right to privacy by opening up Guzman’s entire
medical history, including information irrelevant to the accidents, and by
permitting redisclosure of Guzman’s personal information. Eyman also
believed she could provide Guzman’s status and supply information about the
medical providers to meet Allstate’s needs, and she noted that forms offered
in connection with the second accident included a statement that it was the
insured’s decision whether or not to sign them.
Eyman further testified that she had numerous conversations with
Guzman about how Allstate handled the claim. Guzman asked when Allstate
would settle the matter, and Eyman told her repeatedly that she was doing
what she could, but nothing was happening. Guzman could not understand
why it was taking so long to receive funds from Allstate. She cried as she
told Eyman she felt like Allstate was intentionally trying to slow down
everything; she felt like a joke, and she was losing hope. Eyman told
Guzman that Allstate had acted unreasonably by not paying the policy limits
on the claims within the 30-day deadline Eyman had imposed on the demand.

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 Guzman had told Eyman she felt intimidated about meeting Allstate’s
neuropsychologist at a hotel. And she told Eyman she was worried about her
medical bills because she had never owed money before and was concerned
about being responsible for them. Eyman acknowledged during her
deposition that it was reasonable for Allstate to have Guzman examined by
its own doctors before paying policy limits for both claims, but when
Allstate’s attorney asked if Eyman had created some of Guzman’s stress,
Eyman said, “Absolutely not.”
During closing arguments, Allstate’s attorney argued that Guzman’s
life had changed because of the accident, not because of anything Allstate had
done or not done. He said that if the jury was considering emotional distress,
it should consider Eyman’s role in Guzman’s emotional distress. He pointed
out that Eyman had admitted to telling Guzman that Allstate was
mistreating her by not paying within 30 days of her demand, but Eyman had
also admitted it was appropriate to not pay within 30 days because there
were still things to be done in this case. Allstate’s attorney told the jury the
only information Guzman had was the information Eyman was telling her,
and it was Eyman that told Guzman numerous times that Allstate was being
unfair. He commented, “No wonder Ms. Guzman has got some emotional
distress. But is that caused by Allstate or is that caused by her attorney
making a statement that her attorney acknowledged under oath on the
witness stand was not true?”
In rebuttal, Guzman’s attorney pointed out that there was a delay in
paying out the claims, and Eyman had merely conveyed the truth to her
client, which she was obligated to do. He argued that Allstate was
irresponsible to argue an attorney sharing her honest opinion with her client

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was the cause of the client’s injury when it was Allstate’s action and inaction
that was the cause.
After the verdict was returned, Guzman requested a new trial, pointing
to Allstate’s closing argument as one basis for the request. Guzman’s
attorney argued Eyman was under an affirmative duty to keep the client
informed, and that at best Eyman’s comments had a minor impact but did
not constitute a substantial factor of Guzman’s emotional distress. Guzman’s
motion for new trial also recognized that “the core of defense counsel’s
argument was about Ms. Eyman’s disclosures to her client of Allstate’s delays
in handling Guzman’s UIM claims.” But Guzman’s attorney argued this was
improper because those disclosures were required by law.
B. Analysis
Attorney misconduct is an irregularity in the trial and a basis for a new
trial. (City of Los Angeles v. Decker (1977) 18 Cal.3d 860, 870.) “[A] trial
judge is accorded wide discretion in ruling on a motion for new trial
and . . . the exercise of this discretion is given great deference on appeal.” (Id.
at pp. 871-872.) In reviewing an order denying new trial, we review the
entire record to make an independent determination regarding whether the
error was prejudicial. (Id. at p. 872; Bigler-Engler v. Breg, Inc. (2017) 7
Cal.App.5th 276, 296, fn. 16 (Bigler-Engler).)
A claim of attorney misconduct usually requires a timely and proper
objection, accompanied by a request for admonition to preserve it for appeal.
(Cassim v. Allstate Ins. Co. (2004) 33 Cal.4th 780, 794-795 (Cassim);
Sabella v. Southern Pac. Co. (1969) 70 Cal.2d 311, 319; Bigler-Engler, supra,
7 Cal.App.5th at p. 295.) If the court’s action is not requested, the alleged
misconduct is not considered on appeal unless an admonition to the jury
would have been inadequate. (Cassim, at pp. 794-795; Bigler-Engler,

15
at p. 295; Horn v. Atchison, T. & S. F. R. Co. (1964) 61 Cal.2d 602, 610-611
(Horn); Garcia v. ConMed Corp. (2012) 204 Cal.App.4th 144, 148.)
Although Guzman challenged the substance of Allstate’s closing
argument in the motion for new trial and responded during the rebuttal
argument, Guzman’s attorney did not object to Allstate’s argument at the
time it was made. And Guzman does not explain why an objection at the
time of trial would have been futile or ineffective. Accordingly, any challenge
to it was forfeited. (See Cassim, supra, 33 Cal.4th at pp. 794-795; Horn,
supra, 61 Cal.2d at pp. 610-611.)
Moreover, Allstate’s alternate causation argument was not misconduct.
Attorney misconduct typically involves dishonesty, or attempting to persuade
the jury using deceptive methods. (People v. Parson (2008) 44 Cal.4th 332,
359.) However, attorneys have wide latitude to discuss the case during
closing arguments and can state fully their views as to what the evidence
shows and what conclusions to draw therefrom. (Cassim, supra, 33 Cal.4th
at p. 795.) “ ‘ “An attorney is permitted to argue all reasonable inferences
from the evidence, . . . .” [Citation.]’ ” (Id. at p. 795.)
Allstate’s defense was that it did not delay payment or act in bad faith
because its investigatory process and decision-making could be explained by
Eyman’s actions and inactions. This was not a surprise to Guzman’s
attorneys, as it was the focus of Allstate’s case, and Guzman challenged this
theory by offering evidence to explain Eyman’s choices in handling the matter
and her reasons for her statements to Guzman. Further, Guzman does not
supply us with any law to support her contention that identifying actions of
opposing counsel as an alternative cause constitutes misconduct. We cannot
conclude under the facts of this case that the court’s denial of a new trial was
erroneous.

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 III.
MOTIONS IN LIMINE
Guzman argues the court abused its discretion by failing to grant two
motions in limine without qualification. Allstate argues the challenged
evidence was relevant to explain the delays in payment because it provided
context to show why Allstate had acted reasonably in light of the information
available to it at the time. Allstate also argues Guzman forfeited the
challenge because Guzman did not object at trial, did not argue Allstate was
out of compliance with the rulings on the motions in limine, and relied
improperly on a juror’s declaration to conclude that the evidence admitted
prejudiced the jury.
A. Additional Facts
Before trial, Guzman filed motion in limine No. 6, seeking to exclude
references to any evidence that placed the value of the UIM claims at issue
and motion in limine No. 7, seeking to exclude references to biomechanical
evidence that the nature and force of the accidents could not have caused the
claimed injuries. Neither motion mentioned photographs specifically.
The trial court agreed that neither the value of the claims nor the
biomechanics of the accident were relevant to determining whether Allstate
acted in bad faith. However, it concluded that some of that information was
relevant to explain why Allstate followed the process it did in investigating
Guzman’s claims. Accordingly, the court permitted limited photographic
evidence to aid in Allstate’s explanation of its process.
B. Analysis
We review a trial court’s ruling on motions in limine for an abuse of
discretion. (McCoy v. Pacific Maritime Assn. (2013) 216 Cal.App.4th 283,
295.) We presume an order by the trial court is correct (Denham v. Superior

17
Court (1970) 2 Cal.3d 557, 564), and it is the appellant’s burden to
affirmatively demonstrate error. (In re Marriage of Falcone & Fyke (2008)
164 Cal.App.4th 814, 822.)
The motions in limine did not seek to exclude photographs of the
accident, and Guzman did not challenge their inclusion as irrelevant or
unduly prejudicial when they were introduced at trial. As Allstate notes, the
reasonableness of an insurer’s decisions are based on its actions at the time
they were made, not in retrospect. (Chateau Chamberay Homeowners Assn.
v. Associated Internat. Ins. Co. (2001) 90 Cal.App.4th 335, 347 (Chateau
Chamberay).)
Guzman also does not argue that Allstate improperly referenced the
photographs in a manner that would lead jurors to question the biomechanics
of the accidents or that directed jurors to contemplate whether she had
already received enough money. Allstate did neither.
Instead, Guzman focuses on information supplied by a juror about how
jurors perceived the photographs during their deliberations. In his
declaration, one juror explains that some jurors referenced the photo of
Guzman’s car and discussed whether Guzman could have actually been hurt
to the extent she claimed, and whether she had already received enough
money. However, the juror’s declaration is inadmissible under Evidence
Code section 1150, subdivision (a), and we do not rely on it. Furthermore, the
court’s decision to admit the photographs for the limited purpose for which
they were actually used could not have been informed by the jury’s apparent
misuse of the information later on, particularly given that Guzman did not
object to the admission of the information or seek a limiting instruction of
some kind. This was not an abuse of discretion.

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 IV
PUNITIVE DAMAGES
Guzman contends the trial court erred by denying her request to
conform the complaint to evidence regarding punitive damages.
A. Additional Facts
Before trial, the court granted Allstate’s motion for summary
adjudication on the issue of punitive damages. In its minute order, the court
explained Guzman had failed to meet her burden to show oppression, malice,
or fraud because she did not offer explanations for the payment delay that
would give rise to such a finding. It did not comment on whether the alleged
delays had been ratified by an officer, director or managing agent, although
Allstate made that argument in its request for summary adjudication. (See
Civ. Code, 3294, subds. (a), (b).)
At the close of trial, Guzman sought to revive the punitive damages
claim by conforming the complaint to the evidence. Guzman argued Allstate
had hired its own orthopedist and neuropsychologist for the sole purpose of
defeating the UIM claim. Guzman’s attorney also argued a settlement offer
for the second accident consciously disregarded Guzman’s rights because it
was based on a doctor’s misstatement of Guzman’s injuries. Finally, Guzman
argued that Allstate’s in-house counsel contributed to delays, and this
information taken together demonstrated a conscious disregard for her
rights.
Allstate countered that Guzman failed to show by clear and convincing
evidence that Allstate had acted intentionally or consciously disregarded her
rights in its actions. Allstate pointed to evidence showing the company
moved the claim forward, and even if Allstate had contributed to the pace of
the process, Allstate did not behave despicably. In particular, Allstate noted

19
that it believed it had fully compensated Guzman for the cognitive problems
she experienced as part of its settlement of the first accident, so there was no
evidence it intentionally attempted to deprive her of benefits she was owed
due to the second accident. Allstate also argued there was no evidence the
delays were known and ratified by a managing agent.
During trial, Allstate employee Richard Cosand testified. Cosand
began working for Allstate as a litigation claims adjuster and was promoted
to a managerial role after three years. As a claims service leader, he
supervised 9 to 11 claims handlers working on UIM claims. He discussed
strategies about the cases frequently and was sometimes involved in round
table discussions about valuing a claim. His primary role was as a consultant
rather than in valuing claims.
He supervised Richard Salinas, who handled the first claim. In that
capacity, he asked Salinas’s claims processor to obtain additional detail on
the head injury and directed her to follow up to gather information after
Eyman indicated she would be sending a demand. He consulted with Salinas
before determining whether it should be handled by a special investigation
handler because there were two different accidents with a similar injury, and
he reviewed the file before transferring it to the litigation department. By
the time an arbitration demand was made, another claims handler had taken
over the case, someone he did not supervise.
The court denied the motion to conform to proof.

20
 B. Analysis
We review a trial court’s denial of a motion for leave to amend a
complaint for abuse of discretion. (Branick v. Downey Savings & Loan Assn.
(2006) 39 Cal.4th 235, 242.)
Punitive damages are available if a jury finds by clear and convincing
evidence that a defendant committed malice, fraud, or oppression. (Civ.
Code, § 3294, subd. (c)(2).) To meet this burden, the evidence demonstrating
malice, fraud, or oppression must have been strong enough “ ‘ “to command
the unhesitating assent of every reasonable mind” ’ ” and must also have
been inconsistent with the theory that Allstate’s actions were the result of
mistake, honest error in judgment, or even negligence. (In re Angelia P.
(1981) 28 Cal.3d 908, 919.)
Guzman maintains that Allstate acted with oppression because its
conduct was “despicable” and subjected her to “cruel and unjust hardship in
conscious disregard of [her] rights.” (Civ. Code, § 3294, subd. (c)(2).)
“Despicable” conduct is that which is “so vile, base, contemptible, miserable,
wretched or loathsome that it would be looked down upon and despised by
ordinary decent people.” (Steward v. Truck Ins. Exchange (1993) 17
Cal.App.4th 468, 483, fn. 29.)
Allstate does not persuade us that the court abused its discretion.
Guzman offered testimony that Allstate hired doctors solely for the purpose
of defeating Guzman’s claim, and it listed individuals Allstate did not
interview. She argued Allstate ignored Guzman’s doctors’ opinions, failed to
hire a neurologist and did not directly question Guzman’s neuropsychologist,
that Allstate relied on incomplete medical information, delayed getting
certain medical examinations or canceled them, undervalued claims, failed to
take into consideration lost wages, misstated injuries, and misstated the

21
status of the claims to Guzman’s attorney. But Allstate presented evidence
at trial to explain or justify these complaints, showing why they do not
demonstrate maliciousness or oppression. For example, Allstate points to
evidence that Guzman did not provide the names of the witnesses, that her
doctors’ opinions were considered, that the neuropsychology evaluation was
the most appropriate examination, and that it used incomplete information
only because Guzman supplied incomplete information. Allstate also offered
evidence that Eyman contributed to delays and cancelations, and that
Allstate did not depress or devalue Guzman’s injuries; it allocated them to
the first accident. And Allstate provided testimony that Allstate did not
misrepresent the status of the claims, because its investigation was ongoing.
Given the conflicting evidence before the trial court, we cannot say it abused
its discretion to conclude Guzman had not met the requisite clear and

convincing standard.4

4 Guzman’s argument before the trial court focused on whether Allstate’s
actions demonstrated a conscious disregard for Guzman’s rights. Allstate
argued that Guzman had failed to meet this standard by clear and convincing
evidence. But Allstate also argued there, as it does in its respondent’s brief
here, that no managing agent had ratified Allstate’s conduct. Allstate
responded that Richard Cosand’s “fingerprints [were] all over the file” and he
was a manager. The court explained that it had reviewed the testimony and
the complaint and was well aware of the standard of proof required. Then it
denied the motion. Guzman only addresses ratification by a managing agent
in reply to Allstate’s argument that its conduct was not ratified by a
managing agent, as required. (See Civ. Code, § 3294, subds. (a), (b); Roby v.
McKesson Corp. (2009) 47 Cal.4th 686, 714.) Although Allstate challenged
whether Cosand demonstrated the necessary substantial independent
authority (see White v. Ultramar (1999) 21 Cal.4th 563, 566-567), the trial
court did not make any factual finding regarding ratification.
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 V.
REQUEST FOR NEW TRIAL
Guzman separately argues the court erred by failing to grant a new
trial because she provided uncontested evidence of emotional distress,
entitling her to those damages.
Although Guzman has framed the issue as challenging the amount of
damages received, arguing there is substantial evidence to support her
request for emotional distress damages, we are tasked with determining
whether the trial court’s denial of a motion for new trial was erroneous. We
review such a denial for abuse of discretion. (Rayii v. Gatica (2013) 218
Cal.App.4th 1402, 1415 (Rayii).) We reverse the denial of a new trial motion
based on inadequate damages if there is “no substantial conflict in the
evidence and the evidence compels the conclusion that the motion should
have been granted.” (Id. at p. 1416.) We view the facts in the light most
favorable to the prevailing party and draw all reasonable inferences in favor
of the judgment. (Gersick v. Shilling (1950) 97 Cal.App.2d 641, 645.)
Code of Civil Procedure section 657, subdivision (5) authorizes a new
trial if the trial court is convinced after weighing the evidence that the jury
“clearly should have reached a different verdict or decision.” Civil Code
section 3333 entitles a party to damages that compensate for all injury
proximately caused by a defendant’s tortious act. (See Haskims v. Holmes
(1967) 252 Cal.App.2d 580, 586 (Haskims).)
However, a jury may refuse to award damages when the claim depends
on subjective evidence and witness credibility. (Christ v. Schwartz (2016) 2
Cal.App.5th 440, 453-454.) And a jury may reject a witness’s uncontroverted
testimony as long as the jury does not do so arbitrarily. (Graf v. Marvin
Engh Truck Co. (1962) 207 Cal.App.2d 550, 555.) A jury can also opt not to

23
award noneconomic damages if it concludes such damages are trivial or
transitory (Lee v. Bank of Am. (1990) 218 Cal.App.3d 914, 920), and it can
decline to award damages if it concludes an element, like causation, is not
proved. (See Jonkey v. Carignan Construction Co. (2006) 139 Cal.App.4th 20,
24-26 [jury has fact-finding power and is not required to find causation].)
Here, the jury was asked to determine both the existence of emotional
distress and, if it existed, evaluate its proximate cause. The special verdict
form shows the jury did not believe Guzman deserved noneconomic damages.
This could have been because the delayed payments were not a substantial
factor in creating emotional distress, or because the emotional distress
damages were trivial or transitory, or the jury may have found the witnesses’
testimony regarding emotional distress incidental to payment delays
unpersuasive. Any of these explanations provides a valid reason for
awarding no economic damages.
The trial court likewise concluded there was sufficient evidence that
Allstate’s conduct was not a substantial factor in causing emotional distress;
thus, it was not clear the jury should have reached a different conclusion
than it did. (See Code Civ. Proc., § 657, subd. (5); Civ. Code, § 3333; Haskims,
supra, 252 Cal.App.2d at p. 586.) Even though there was testimony about
emotional distress, there was controversy surrounding its cause; therefore,
the evidence did not compel the conclusion that the motion should have been
granted. (Rayii, supra, 218 Cal.App.4th at p. 1416.)
VI.
GENUINE DISPUTE DOCTRINE
Allstate contends in its cross-appeal that the trial court erred by
denying its motion for summary judgment because there was a genuine

24
dispute over the UIM claims that should have barred the action as a matter
of law. We disagree.
A. Additional Facts
In its motion for summary judgment, Allstate emphasized that the
parties disagreed about the cause and extent of Guzman’s injuries and
argued it would have been improvident to approve the claim before it verified
the amount. Allstate argued that Guzman delayed in making UIM claims,
waited to make a demand or provide any supporting documentation, refused
to provide medical authorizations until 2013, and stalled efforts to depose
her.
Guzman submitted declarations from Eyman and from an expert, Rob
Dietz, among others. Eyman explained the first request she received for
medical and wage authorizations was in August 2010. However, she objected
to the language contained in the August 2010 authorization forms as an
overreach beyond the terms of the insurance policy which gave Allstate
access to information otherwise protected through HIPAA and allowed
redisclosure of Guzman’s personal medical information. Eyman provided
information about Guzman’s treating doctors that month, and she provided
periodic telephonic updates regarding the nature of Guzman’s injuries, her
treatment progress, and the names of her treating doctors. Allstate never
informed her this was insufficient or indicated her failure to sign the specific
authorization forms could lead to a rescission of the contract.
When Eyman received a request for wage and medical authorizations
for the second accident on April 11, 2011, she objected to them on the same
grounds as she had previously. There was also language in those
authorization forms that stated Guzman was not required to sign them.
However, Eyman continued to provide updates. Again, Allstate did not seek

25
information about the status of the authorizations or inform Eyman that
failure to return the signed authorizations would result in denial of UIM
benefits or rescission of the policy.
Eyman made a global demand for payment for both accidents on April
17, 2012, set to expire in 30 days, only after she understood the extent of
Guzman’s injuries. Allstate did not respond to the demand within 30 days, so
the offer lapsed.
Eyman waived the statutory timeline for Guzman’s deposition and
agreed to expedited timelines, but she insisted the deposition and medical
exam occur in San Diego because Guzman did not like to drive long distances
and did not have a car for use. Despite Guzman’s willingness to move
forward even without formal notice for a deposition, Allstate canceled it.
Around February 14, 2013, Eyman received notice for a defense
physical medical exam with Dr. Stenquist, although he was a
neuropsychologist, and she objected to the location and the absence of a
witness during the exam. She received a second notice for the exam on May
6, 2013, but Allstate had not addressed the objections, and she again
objected. The exam went forward in July 2013 after Allstate corrected the
language in the notice.
Around July 26, 2013, Allstate sought a medical authorization for the
records managed by one of Guzman’s doctors, which Guzman signed August
10, 2013 and sent August 12, even though Guzman had sent all the medical
records from that doctor to Allstate previously. Eyman did not hear from
Allstate in August, September, October or November 2013.
On March 7, 2014, Allstate canceled the mediation scheduled for March
10, 2014. Allstate claimed Dr. Stenquist had not completed his report from
the July 2013 exam because he needed raw data from Guzman’s treating

26
neuropsychologist’s testing. On March 19, Eyman sent another request for
policy benefits. The matter eventually proceeded to arbitration, where
Guzman was awarded the maximum allowable award.
Dietz is a licensed independent insurance adjuster and public adjuster

in the state of Washington.5 His declaration stated that Allstate’s
authorizations overreached the conditions or requirements of the insurance
policy, negating any reasonable expectation that the medical and wage
authorizations would be signed, and he explained that were the
authorizations important to the investigation, industry practice would have
been to communicate the importance of the authorizations to the insured. He
opined that Allstate also failed to conduct a thorough and objective
investigation by failing to interview certain people and because it did not
make a settlement offer for more than two years after Guzman requested the
policy limit.
The court denied the summary judgment motion, recognizing that some
delay could have been reasonable, but Allstate “did not offer anything for
4 years on the first accident.” The court explained there was a factual
dispute about whether Allstate acted reasonably in its investigation, as well
as regarding the value of economic damages.
B. Legal Principles
Summary judgment is properly granted when there is no triable issue
of material fact and the moving party is entitled to judgment as a matter of
law. (Code Civ. Proc., § 437c, subd. (c).) The moving party bears the initial
burden to make a prima facie showing of the nonexistence of a triable issue of
material fact. (Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 850-

5 Allstate objected to Dietz’s declaration, and the trial court overruled
the objections.
27
851.) “ ‘We review the trial court’s decision de novo, considering all the
evidence set forth in the moving and opposing papers except that to which
objections were made and sustained.’ ” (State Dept. of Health Services v.
Superior Court (2003) 31 Cal.4th 1026, 1035.) “We liberally construe the
evidence in support of opposing summary judgment and resolve doubts
concerning the evidence in favor of that party.” (Wilson v. 21st Century Ins.
Co. (2007) 42 Cal.4th 713, 717 (Wilson).)
To meet its burden in a bad faith insurance claim and show the insurer
breached the implied covenant of good faith and fair dealing, a plaintiff must
show the insurer withheld benefits unreasonably and without proper cause.
(Rappaport-Scott v. Interinsurance Exchange of the Automobile Club (2007)
146 Cal.App.4th 831, 837.) A simple difference in opinion or mistake in
judgment is not bad faith; the conduct must be unreasonable. (Notrica v.
State Comp. Ins. Fund (1999) 70 Cal.App.4th 911, 931, fn. 12.)
Under the “genuine dispute doctrine,” withholding or delaying
insurance benefits is not unreasonable when there is a legitimate question
about the existence of coverage or the amount due. (Chateau Chamberay,
supra, 90 Cal.App.4th at p. 347.) It is not a court’s role to determine which
party is “right” about its dispute, only that the dispute is reasonable and
legitimate. (Id. at p. 347, fn. 7.) In those circumstances, the only issue is
whether the insurance company’s position was objectively reasonable in light
of the law that existed at the time. (Morris v. Paul Revere Life Ins. Co. (2003)
109 Cal.App.4th 966, 974.)
However, the genuine dispute doctrine does not relieve an insurer from
its obligation to thoroughly and fairly investigate, process, and evaluate the
insured’s claim; an insurer must proceed through its evaluation in good faith
and on reasonable grounds. (Wilson, supra, 42 Cal.4th at p. 723.) “[A]n

28
insurer is not entitled to judgment as a matter of law where, viewing the
facts in the light most favorable to the plaintiff, a jury could conclude that the
insurer acted unreasonably.” (Amadeo v. Principal Mut. Life Ins. Co. (9th
Cir. 2002) 290 F.3d 1152, 1162.)
C. Analysis
The genuine dispute doctrine generally applies to situations when there
is a legitimate question about the existence of coverage or the amount due.
(Chateau Chamberay, supra, 90 Cal.App.4th at p. 347.) Allstate’s focus on
this doctrine asks us to view the dispute as one about Allstate’s evaluation of
the amount of coverage due in light of Guzman’s injuries. To this end,
Allstate’s main focus in its motion for summary judgment was whether its
actions regarding hiring medical professionals and investigating Guzman’s
injuries independently were reasonable. However, Guzman’s bad faith claim
did not challenge the existence of a dispute over the amount of coverage due,
but instead challenged Allstate’s actions as dilatory: Allstate unreasonably
dragged out its investigation, breaching its duty.
Under these facts, whether Allstate acted reasonably or unreasonably
in its investigation was a factual question, not a legal one. Allstate argued it
was Guzman’s fault the valuation took so long because she failed to provide
medical and wage authorization signature, items to which Allstate argued it
was entitled within 10 days of its request. Because Guzman did not supply
the requested authorization, Allstate argued, her entitlement to policy
benefits was stayed under the Insurance Code.
Guzman responded by explaining that the authorizations were
unreasonable, overreaching, and sought information beyond the scope of the
policy’s terms. Dietz’s declaration explained that Allstate could not
reasonably expect Guzman to sign the authorizations in that form. Eyman

29
provided Allstate with information about Guzman’s medical providers,
information which Allstate’s letters suggested could be an alternative to the
authorization forms, and Allstate did not inform Eyman that it was
insufficient to do so.
Because Guzman supplied evidence that explained that the missing
medical authorizations were the result of Allstate supplying ones that were
objectionable, then ignoring its ability to obtain the information through
other means, there was a question as to whether Allstate acted reasonably at
all. Reviewing this evidence liberally and construing it in favor of Guzman
(Wilson, supra, 42 Cal.4th at p. 717), we conclude a jury could decide Allstate
acted unreasonably, in breach of the implied covenant of good faith and fair
dealing.
VII.
ECONOMIC LOSS
Allstate contends that the trial court incorrectly denied its motion for
summary judgment because Guzman sustained no net economic damages.
Although Allstate concedes Guzman paid additional attorney fees that she
would not have paid had the claim resolved before proceeding to arbitration,
Allstate’s theory is that Guzman must prove net economic loss based on the
judgment amount in comparison to her lowest settlement offer plus her
increased attorney fees and arbitration costs.
A. Additional Facts
On April 17, 2012, Guzman offered to settle her claims for $85,000 per
accident, or $170,000 total. Allstate allowed the offer to lapse. In late
November or early December 2012, Guzman made a statutory offer to
compromise (Code Civ. Proc., § 998) for $150,000, or $75,000 per accident.
Allstate rejected this offer.

30
 Between its settlement of the first claim and the arbitration decision
regarding the value of the second claim, Allstate paid $170,000.
Filing the arbitration increased Guzman’s attorney fees from
$28,333.33 per claim to $34,000 per claim, increasing the attorney’s fees by
$11,333.34. Guzman paid arbitration fees totaling $5,470, bringing the total
expenses related to arbitration to $16,803.34.
B. Analysis
To prevail in a bad faith insurance claim, the plaintiff must provide
evidence of actual financial loss. (Waters, supra, 41 Cal.App.4th at p. 1078.)
Under certain conditions, attorney fees can be an economic loss: “When an
insurer’s tortious conduct reasonably compels the insured to retain an
attorney to obtain the benefits due under a policy, it follows that the insurer
should be liable in a tort action for that expense. The attorney’s fees are an
economic loss—damages—proximately caused by the tort.” (Brandt v.
Superior Court (1985) 37 Cal.3d 813, 817 (Brandt); see Delos v. Farmers
Group, Inc. (1979) 93 Cal.App.3d 642, 659 [concluding the money spent for
attorneys to recover for bad faith actions is an adequate financial loss to
establish genuineness of a claim].)
Allstate cites to no legal authority for the proposition that the correct
measure of economic harm is net financial loss, and we could locate none.
The Waters case cited by Allstate references attorney fees and costs as
possible evidence of economic harm. There, the parties settled the underlying
homeowners’ insurance claim so that the homeowners incurred no out-of-
pocket repair expenses. (Waters, supra, 41 Cal.App.4th at pp. 1067-1069.)
And the court concluded that because they did not offer proof that they had
incurred any fees due to the insurer’s delays, the homeowners suffered no
financial loss. (Id. at p. 1081.) But the court also noted a reference in a post-

31
argument letter to a redacted contingency fee agreement that had not been
presented at trial and commented that even if the fees referenced in the
agreement were not recoverable, “proof of fees and costs would have at least
provided some evidence of economic harm.” (Id. at p. 1081, fn. 15.) This
suggests a party can meet the economic harm requirement even if the
financial loss is not one the plaintiff can recover.
Here, the claims were actually valued at $170,000, the amount Guzman
recovered from Allstate. But she incurred additional costs, and those costs
represent a financial loss because the increased attorney fees and arbitration
costs were an expense Guzman would not have incurred had Allstate not
delayed in its investigation. Thus, whether or not Guzman ultimately came
out ahead under a net benefit analysis, she suffered a financial loss.
Accordingly, it was an economic injury for which Allstate is liable. (See
Brandt, supra, 37 Cal.3d at p. 817.)
DISPOSITION
The judgment is affirmed. Parties will bear their own costs on appeal.

HUFFMAN, Acting P. J.

WE CONCUR:

IRION, J.

GUERRERO, J.

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