Garvey v. State Farm Fire & Casualty Co.

MOSK, J.

I dissent.

The question to be resolved in this case is the liability vel non of an insurer when multiple risks—including perils insured against and perils excepted from coverage—concur to cause a loss. In Sabella v. Wisler (1963) 59 Cal.2d 21 [27 Cal.Rptr. 689, 377 P.2d 889], and State Farm Mut. Auto. Ins. Co. v. Partridge (1973) 10 Cal.3d 94 [109 Cal.Rptr. 811, 514 P.2d 123], the court set forth the governing rule. In the years that have followed, however, the federal courts and the state Courts of Appeal have inconsistently construed and applied Sabella and Partridge.1 Because of the importance and evident difficulty of the question, the court has decided to address the matter anew. As I shall explain, I am of the opinion that the rule is as follows: When two risks, one included within the coverage of the policy and the other excluded, concur as proximate causes in producing a loss and are dependent—i.e., when one sets the other in motion—there is coverage if the included risk triggers the excluded, but not if the excluded triggers the included. When, however, the included and excluded risks concur as proximate causes in producing a loss and are independent—i.e., when one does not set the other in motion—coverage exists in all cases.

The majority, I must acknowledge, have succeeded in reaching a clear result: in this court, the insurer wins and the insureds lose. But they have *417failed to offer a sound rationale in support. They claim that Sabella establishes a single rule of “efficient proximate cause” or “predominating cause”; that Partridge is, and should be, limited to third party insurance policies; and that in any event Partridge is inapplicable on the facts of this case. But as will appear, none of these claims is well founded.

I

In 1974 plaintiffs Jack and Rita Garvey purchased a house in Fairfax. It appears that the house was built prior to 1938; it sat on a hill, with a downslope to the rear; a rock wall of unknown age was located on the downslope; at some time before 1960, a deck was constructed below the southeast corner of the house; in 1960, a room addition was built onto the lower southwest portion of the house on level ground. At all times relevant herein Mr. Garvey was a lawyer and a professor of law.

In 1977 plaintiffs purchased from defendant State Farm Fire and Casualty Company a policy of homeowner’s insurance, which was in effect at all times relevant. The policy was what is commonly known as an “all risk” policy—i.e., a policy that covers all perils generally and without enumeration except those specifically excepted, as opposed to the typical policy which specifies both included and excluded perils. The policy in question provided coverage for “all risk of physical loss,” except the following: losses “caused by, resulting from, contributed to or aggravated by any earth movement, including but not limited to earthquake, volcanic eruption, landslide, mudflow, earth sinking, rising or shifting,” and losses caused “by . . . settling, cracking, shrinkage, bulging or expansion of pavements, patios, foundations, walls, floors, roofs or ceilings . . . .”

In August 1978 the room addition, which was built on level ground, separated from the main structure. It was subsequently discovered that the room had neither a foundation nor any structural connection to the house. Around the same time plaintiffs found that the deck constructed below their house had suffered damage.

Plaintiffs undertook to determine from defendant whether the loss they had sustained was covered by their homeowner’s insurance policy, and eventually submitted a claim for $11,550. Over a period of many months defendant investigated the matter; over the same period Mr. Garvey and defendant’s counsel disputed about the law that should govern the determination of the claim. Plaintiffs became dissatisfied with the pace of the investigation and advised defendant that they might institute class-action litigation involving breach of the covenant of good faith and fair dealing with *418regard to its interpretation of the earth movement exclusion of the homeowner’s policy.

In October 1979, after receiving from counsel an opinion that the loss was not covered, defendant notified plaintiffs by letter that the “policy excludes coverage for the loss herein. Normally, such a denial of coverage would leave you to your remedies. [][] However, because the company wishes to resolve the coverage issue in an atmosphere free from extraneous matters such as bad-faith and class-action issues, the company is prepared to advance you the claimed sum of $11,550 subject to a reservation of rights as authorized by Johansen v. CSAA, 15 Cal.3d 9, 123 Cal.Rptr. 288.” Under the agreement proposed, defendant would make the advance and file a declaratory relief action on the issue of coverage; and plaintiffs would pay back the advance if the court ruled in defendant’s favor, would waive “any claim of consequential or punitive damages arising out of any allegation of bad-faith, mental distress, oppression, fraud or insurance-related tort,” and would not “institute any class-action against defendant on account of the facts and issues involved in this loss and claim.”

Thereupon, plaintiffs filed the complaint in this action. They asserted against defendant the following causes of action, among others. First, they alleged that defendant had breached its obligations under the policy to pay for the loss they had sustained to their property. They next alleged that defendant had violated the covenant of good faith and fair dealing both in its decision to deny their claim and in its general handling of the matter, including the tendering of the so-called “Johansen ” agreement; they further stated that defendant’s conduct caused them emotional distress; they also stated that defendant acted with intent to oppress and defraud. Plaintiffs further alleged that defendant violated various provisions of the Insurance Code, both in its decision to deny the claim and in its general handling of the matter, and that it thereby caused them emotional distress; they further stated that defendant acted with intent to oppress and defraud. Plaintiffs prayed for compensatory damages for economic and noneconomic injury; they also prayed for punitive damages.

Trial was by jury. Plaintiffs’ expert, Donald H. Hillebrandt, and defendant’s expert, Jay A. Nelson, agreed that negligent construction was a direct and substantial cause of the loss that plaintiffs sustained to their property. For example, Hillebrandt responded to the question, “In your opinion, is there any particular reason that the [room] addition gave way when it did as opposed to two years earlier or two years later or some other time?,” as follows: “Not really .... [I]t was just kind of a failure waiting to happen, and it’s hard to say what triggered it. It was basically faulty construction and at some given time—you know, sometimes if these things occur during *419the winter you can kind of say, well, maybe the soil was soft or weak or— but this, in my understanding, occurred during the summer in the dry season. So it was tacked on there, it reached a point where it was over stressed. The nails couldn’t hold it any more, there were no ties at the foundation level, no ties at the roof level, no ties at the floor level, and it just fell away.” Nelson testified to similar effect. “[B]ad construction,” he stated, “was one reason why [the room addition] settled.”

The experts did not agree, however, as to whether and if so to what extent earth movement played a part. For example, Nelson stated soil creep was a cause of the separation of the room addition from the main structure. Hillebrandt testified to the contrary. To the question, “Was what happened to the room addition in August of 1978 related to any respect to soil creep, in your opinion?,” Hillebrandt responded: “In my opinion, it didn’t. And the reason is because the actual breaking—the footing of the support beam was actually on a level surface. It was on a level fill surface that had been placed behind the rock wall, and the whole hillside may have been creeping, but this was just one part of it, and it was a level surface.” Nelson testified that although he believed both negligent construction and soil creep were causes of the loss to the room addition, he could not make a determination as to their relative order or significance: “Well, it all goes back to the chicken or the egg. I mean, which comes first.”

Plaintiffs also introduced evidence to show that defendant breached its obligations under the terms of the policy, the covenant of good faith and fair dealing, and the Insurance Code not only by its decision to deny the claim but also by its handling of the matter generally.

After the parties rested, on plaintiffs’ motion the trial court directed a verdict in their favor on the issue of coverage. In support of the ruling, it stated: “[The Supreme Court] told me in Sabella that negligent construction can be a proximate cause. They told me in Partridge there may be coverage whenever an insured risk constitutes simply a concurrent proximate cause of the injuries, [fl] Now, to me that is crystal clear, putting those two causes together, that if negligent construction is a concurrent proximate cause of the loss, there is coverage.” The court continued: “The key witness for the defense, Mr. Nelson, conceded in his testimony, as I heard it and understood it, that the negligent construction was a cause of the room falling away. He did not use the word ‘proximate.’ He said a causative factor at one time. I don’t recall the exact language when he answered a question. In substance, that it was a cause on another occasion. As a matter of law, based upon the evidence, it was a proximate cause.”

The trial court subsequently instructed the jury with regard to the remaining issues in the case. Because plaintiffs’ allegation of, and evidence on, *420“bad faith” related to conduct other than the actual decision to deny the claim, the court charged the jurors that the “ruling directing a verdict of the issue of coverage shall have no bearing on any issue remaining in this case.” It further instructed them that “An attorney has the right to give a legal opinion to his client. The mere fact that the attorney’s opinion turns out later to be erroneous does not by itself make the giving of the opinion unreasonable or constitute evidence of bad faith on the part of the client.” It went on: “Therefore, you should concern yourself not with the correctness or incorrectness of the legal point of view of the attorney, but with whatever circumstances, if any, you find relevant which bear upon the state of mind of the attorney at the time.”

The jury rendered a general verdict in favor of plaintiffs and against defendant, and assessed damages in the amount of $1,047,593. As its answers to special interrogatories reveal, the jury found that defendant had breached both the terms of the policy (thereby entitling plaintiffs to compensatory damages in the amount of $19,790) and the covenant of good faith and fair dealing (thereby entitling them to compensatory damages in the amount of $27,803). It also found that defendant was liable for punitive damages, and assessed the amount at $ 1 million. The court entered judgment in accordance with the verdict. From that judgment defendant appealed.

On appeal, the parties raised several contentions. Some went to the issue of coverage and to the directed verdict; others went to other issues.

By a two-to-one vote, the Court of Appeal reversed. At the threshold the majority rejected defendant’s claims that Partridge is applicable only to third party liability policies and that in any event negligence could not be deemed a risk included within the coverage of the policy.

Reviewing Sabella and Partridge and many of the cases in which those decisions had been construed and applied, the Court of Appeal majority fashioned the following interpretation of Sabella and Partridge: “[Wjhether the covered risk and excluded risk are causes in fact should be a court’s threshold inquiry .... If (i) they both are causes in fact and if the two risks are independent of each other, Partridge analysis is triggered: the insured is covered if the covered risk was a concurring proximate cause of the loss. If (ii) the two risks are dependent on each other, Sabella analysis is triggered: the insured is covered only if the covered risk was the moving cause of the loss.” Crucial to the majority’s interpretation was the meaning it gave to the term “independent”: causes are independent when they are of separate origin and are each a sufficient condition of the loss in question.

*421Applying its interpretation to the facts of this case, the Court of Appeal majority concluded that in directing the verdict for plaintiffs on the issue of coverage the trial court erred. It reasoned as follows: “It may be that the loss was due to the fact that the covered risk (negligent construction of the house addition) was dependent on the excluded risk (earth movement). In other words, if the negligently constructed house addition was the agency through which the earth movement caused the loss, then coverage would be denied under Sabella. On the other hand, if the house addition was negligently constructed such that the addition is what caused the earth to move with the resulting loss, then coverage exists. Finally, if the earth was caused to move independent of the house addition and the addition was tearing away from the house independent of the earth movement, with the two happening to join together to cause the loss, then coverage exists. All of these issues were jury questions because sufficient evidence was introduced to support all three possibilities.”

The majority did not address any other contentions raised by the parties going to the issue of coverage, and did not reach any of the contentions bearing on other issues. It reasoned that because it had held that the directed verdict on coverage was error, “the entire judgment must be reversed (see Johansen v. California State Auto Assn. Inter-Ins. Bureau (1975) 15 Cal.3d 9, 19 [123 Cal.Rptr. 288, 538 P.2d 744] [if there is no coverage, defendant cannot be liable for damages flowing from refusal to settle a claim]).”

Finding that the majority’s “newly discovered independence requirement is neither mandated by, nor is it consistent with, the decision in Partridge, ” the dissenting member of the Court of Appeal read the cases as follows: Sabella governs “where the injury causing agent is literally set in motion, like the first toppled domino, by a single cause”; Partridge controls when the causes are not in a “chain,” and declares simply that “where one of the concurrent proximate causes of a loss is a covered risk the policy provides coverage.” Under this interpretation, the dissenter would have affirmed the judgment.

II

Plaintiffs contend that under Sabella v. Wisler, supra, 59 Cal.2d 21, and State Farm Mut. Auto. Ins. Co. v. Partridge, supra, 10 Cal.3d 94, the directed verdict in this case was proper. I agree.

In Sabella, the insurer issued to the insureds a fire insurance policy on their house containing an “ ‘All Physical Loss’ Building Endorsement.” Under the endorsement, the insurer agreed to insure the house “against all *422risks of physical loss except as hereinafter excluded.” In the subdivision “Exclusions,” it was stated: “This endorsement does not insure against loss . . . by . . . settling . . . .” Subsequently, the house suffered damage that was caused by settling, which in turn was caused by the rupture of a sewer line attributable to the negligence of the builder and the consequent emptying of waste water into loose fill on which the house was built. Thereupon, the insureds brought an action against the insurer, among others, seeking recovery for their loss. Determining that the insurer was exempt from liability under the policy because the loss was caused by “settling” within the meaning of the exclusion clause, the trial court entered judgment in its favor.

Having granted a hearing in the matter, we reversed. Our reasoning was as follows. “Plaintiff [insureds] . . . correctly argue . . . that defendant [insurer] is liable because the rupture of the sewer line attributable to the negligence of a third party, rather than settling, was the efficient proximate cause of the loss. The policy excepted loss by settling, and the findings of the court below indicate that the broken sewer line emptied waste water into the loose fill, setting in motion the forces tending toward settlement. As stated in 6 Couch, Insurance (1930) § 1466, ‘[I]n determining whether a loss is within an exception in a policy, where there is a concurrence of different causes, the efficient cause—the one that sets others in motion—is the cause to which the loss is to be attributed, though the other causes may follow it, and operate more immediately in producing the disaster.’ . . .

“Defendant insurer attempts to establish its non-liability by reliance upon section 532 of the Insurance Code, which states that ‘If a peril is specially excepted in a contract of insurance and there is a loss which would not have occurred but for such peril, such loss is thereby excepted even though the immediate cause of the loss was a peril which was not excepted.’ The insurer’s argument is that since in a factual sense the loss herein would not have occurred ‘but for’ the settling of the underlying earth and house, the plaintiffs are thereby exempt from coverage for this loss. But section 532 must be read in conjunction with related section 530 of the Insurance Code (Pacific etc. Co. v. Williamsburgh City Fire Ins. Co. [(1910)] 158 Cal. 367, 372 [111 P. 4]), and section 530 provides that ‘An insurer is liable for a loss of which a peril insured against was the proximate cause, although a peril not contemplated by the contract may have been a remote cause of the loss; but he is not liable for a loss of which the peril insured against was only a remote cause.’ It is thus apparent that if section 532 were construed in the manner contended for by defendant insurer, where an excepted peril operated to any extent in the chain of causation so that the resulting harm *423would not have occurred ‘but for’ the excepted peril’s operation, the insurer would be exempt even though an insured peril was the proximate cause of the loss. Such a result would be directly contrary to the provision in section 530, in accordance with the general rule, for liability of the insurer where the peril insured against proximately resulted in the loss[.] [Citation.]

“It would appear therefore that the specially excepted peril alluded to in section 532 as that ‘but for’ which the loss would not have occurred, is the peril proximately causing the loss [citation], and the peril there referred to as the ‘immediate cause of the loss’ is that which is immediate in time to the occurrence of the damage.” (59 Cal.2d at pp. 31-34.)

In Partridge, the insurer issued to the insured a “Homeowner’s Policy,” which contained, in addition to the normal coverage against fire and theft, a common comprehensive “personal liability” provision generally covering the insured for all personal liability not falling within specified exclusions. Among the exclusions was “Bodily Injury . . . Arising Out of the . . . Use . . . of . . . Any Motor Vehicle . . . .”

One evening, the insured took two friends, Vanida Neilson and Ray Albertson, out for a drive in the countryside in his four-wheel-drive Ford Bronco. With Vanida sitting between them in the front seat, the insured and Albertson hunted jackrabbits by shooting out of the windows of the moving vehicle; the insured was using a .357-caliber Magnum pistol whose trigger mechanism he had filed to produce a “hair trigger action.” As he was driving, the insured spotted a jackrabbit running across the road and—in order to keep the animal within the range of his headlights—steered the vehicle off the pavement onto the adjacent rough terrain. He hit a bump; the pistol—which he was then holding in his lap or on top of the steering wheel pointed in Vanida’s direction—discharged; and a bullet penetrated through the woman’s left arm and down to her spinal cord and caused paralysis. Vanida then filed a personal injury action against the insured.

Thereupon, the insurer brought a declaratory judgment action, claiming inter alia that it was exempt from liability under the homeowner’s policy through the operation of the “use-of-a-motor-vehicle” exclusion. The trial court disagreed. It first found that the insured had been negligent both in modifying the pistol and in driving his vehicle off the paved road onto the rough terrain. It also found that these two negligent acts were independent, concurrent proximate causes of Vanida’s injuries. Finally, it concluded, inter alia, that the homeowner’s policy afforded coverage. Accordingly, it entered judgment holding the insurer liable.

Having granted a hearing in the matter, we affirmed. Our reasoning was as follows. “[T]he crucial question presented is whether a liability insurance *424policy provides coverage for an accident caused jointly by an insured risk (the negligent filing of the trigger mechanism) and by an excluded risk (the negligent driving). [The insured] correctly contend[s] that when two such risks constitute concurrent proximate causes of an accident, the insurer is liable so long as one of the causes is covered by the policy.

“In Brooks v. Metropolitan Life Ins. Co. (1945) 27 Cal.2d 305 [163 P.2d 689] this court faced a somewhat similar problem of determining insurance coverage in a case involving a multiplicity of causes. In Brooks, an insured, afflicted with debilitating cancer, was covered by an accident policy which excluded ‘ “injury . . . [or] death . . . caused wholly or partly, directly or indirectly, by disease or mental infirmity . . . .” ’ [Citation.] The insured died in a fire, and the insurer sought to escape liability by establishing that a healthy individual would not have perished and thus that the insured’s infirm condition did contribute to his death. While acknowledging that the insured’s condition did contribute to his death, our court rejected the insurer’s contention that coverage was unavailable simply because one of two joint causes of the death was an excluded risk. Chief Justice Gibson, writing for a unanimous court, declared that under such circumstances ‘the presence of preexisting disease or infirmity will not relieve the insurer from liability if the accident is the proximate cause of death . . . [R]ecovery may be had even though a diseased or infirm condition appears to actually contribute to cause the death if the accident sets in progress the chain of events leading directly to death, or if it is the prime or moving cause.’ [Citation.] The court accordingly permitted recovery under the policy.

“The rationale of the Brooks decision equally applies to the instant case. Here, as in Brooks, an insured risk (the modification of the gun) combined with an excluded risk (the negligent use of the car) to produce the ultimate injury. Although there may be some question whether either of the two causes in the instant case can be properly characterized as the ‘prime,’ ‘moving’ or ‘efficient’ cause of the accident10 we believe that coverage under a liability insurance policy is equally available to an insured whenever an insured risk constitutes simply a concurrent proximate cause of the injuries.11 That multiple causes may have effectuated the loss does not negate any single cause; that multiple acts concurred in the infliction of injury does not nullify any single contributory act.

“In the instant case the trial court specifically found that [the insured’s] negligence in filing the trigger mechanism of his gun constituted a proxi*425mate cause of Vanida’s injuries. Applying the above principles, we conclude that the trial court properly found the homeowner’s policy applicable to the accident.” (10 Cal.3d at pp. 102-105, fn. omitted and italics in original.)

In footnote 10 to the Partridge opinion, we stated as follows. “In Sabella v. Wisler (1963) 59 Cal.2d 21, 31-32 [27 Cal.Rptr. 689, 377 P.2d 889], the court, quoting 6 Couch on Insurance (1930) section 1466, restated the Brooks principle in terms of ‘efficient cause’: ‘“[I]n determining whether a loss is within an exception in a policy, where there is a concurrence of different causes, the efficient cause—the one that sets others in motion—is the cause to which the loss is attributed, though the other causes may follow it, and operate more immediately in producing the disaster.” ’ In Sabella, although damage to an insured dwelling resulted from ‘settling,’ an excluded risk, the court found that the settling, in turn, had resulted directly from leakage from a broken sewer pipe, an insured risk; on these facts the ‘efficient cause’ terminology was useful, because the court could find that the break in the pipe ‘set the other cause,’ settling, ‘in motion.’ [Citations.]

“In the instant case, however, the ‘efficient cause’ language is not very helpful, for here both causes were independent of each other: the filing of the trigger did not ‘cause’ the careless driving, nor vice versa. Both, however, caused the injury. In traditional tort jargon, both are concurrent proximate causes of the accident, the negligent driving constituting an intervening, but non-superseding, cause of the accident.” (10 Cal.3d at p. 104, fn. 10.)

In footnote 11, we stated as follows. “Our conclusion that coverage is available whenever an insured risk constitutes a proximate cause of an accident, even if an excluded risk is a concurrent proximate cause, is consistent with Insurance Code sections 530 and 532, as authoritatively construed in Sabella v. Wisler (1963) 59 Cal.2d 21 [27 Cal. Rptr. 689, 377 P.2d 889] (discussed in fn. 10, supra). . . .

“In interpreting these two sections in light of one another, the Sabella court rejected the insurer’s contention that coverage was unavailable whenever an excluded risk constituted a ‘but for’ cause of an accident. The Sabella court declared: ‘[I]f section 532 were construed in the manner contended for by defendant insurer, where an excepted peril operated to any extent in the chain of causation so that the resulting harm would not have occurred “but for” the excepted peril’s operation, the insurer would be exempt even though an insured peril was the proximate cause of the loss. Such a result would be directly contrary to the provision in section 530, in accordance with the general rule, for liability of the insurer where the peril *426insured against proximately resulted in the loss.’ [Citation.]” (10 Cal.3d at p. 105, fn. 11.)

Thus, Sabella and Partridge stand for the following rule. When two risks, one included within the coverage of the policy and the other excluded, concur as proximate causes in producing a loss and are dependent—i.e., when one sets the other in motion—there is coverage if the included risk triggers the excluded, but not if the excluded triggers the included. When, however, the included and excluded risks concur as proximate causes in producing a loss and are independent—i.e., when one does not set the other in motion—coverage exists in all cases.

I turn now to the case at bar. Under the Sabella-Partridge rule, the directed verdict was proper. It is the law that “Such a verdict may be properly granted if and only if, after disregarding conflicting evidence, and indulging every legitimate inference which may be drawn from the evidence in [the opposing party’s] favor, it can be said that there is no evidence of sufficient substantiality to support a jury verdict in [that party’s] favor.” (Taylor v. Centennial Bowl, Inc. (1966) 65 Cal.2d 114, 120-121 [52 Cal.Rptr. 561, 416 P.2d 793].) Here there was no evidence of sufficient substantiality to support a determination in defendant’s favor.

Specifically, the evidence adduced at trial establishes without dispute that the included risk—negligent construction—and the excluded risk—soil creep—were independent: neither set the other in motion. Thus, there is no evidence of sufficient substantiality to support a jury finding to the contrary. Contrary to the majority’s assertion, this case clearly does not “present[ ] a classic Sabella situation.” (Maj. opn. at p. 412, ante.) Indeed, the record is not as the majority represent. As stated above, defendant’s expert Nelson testified in effect that both negligent construction and soil creep were direct and substantial causes of the loss to the room addition, but that neither could be termed the prime, moving, efficient, or predominant cause. Plaintiff’s expert Hillebrandt testified that there was only one cause, negligent construction.

The evidence also reveals—as the trial court expressly held—that negligent construction was a proximate cause of the loss as a matter of law. As stated above, plaintiffs’ expert Hillebrandt and defendant’s expert Nelson agreed that negligent construction was a direct and substantial cause of the loss. Thus, there is no evidence of sufficient substantiality to support a jury finding that negligent construction was not a proximate cause. It is true, as I recognized above, that the experts did not agree as to whether and if so to what extent soil creep played a part. But that disagreement is immaterial here: since the included risk of negligent construction was a proximate *427cause of the loss, coverage existed under the policy even if the excluded risk of soil creep was also a proximate cause.

The majority claim that Sabella establishes a single “workable” rule of concurrent causation generally applicable to all cases—i.e., a rule of “efficient proximate cause” or “predominating cause.” (Maj. opn. at pp. 403-404, ante.) I cannot agree that Sabella establishes such a rule: the very language of the opinion, quoted at length above, is to the contrary. Nor can 1 agree that such a rule would be “workable”: to my mind, it is so totally devoid of standards as to allow—indeed, encourage—insureds always to claim coverage, insurers always to deny coverage, and juries always to decide between them arbitrarily.

The majority also claim that Partridge applies, and should apply, only to third party insurance policies. Again I cannot agree. Although the policy under consideration in Partridge happened to provide liability insurance, the court’s discussion there does not suggest that the analysis is or should be limited to such policies; indeed, it cites and relies on first party and third party cases without distinction. Indeed, apparently no reported decision has ever found in Partridge the limitation the majority now “discover.”

Moreover, I do not find persuasive any of the arguments the majority present in support of limiting Partridge to third party insurance policies. First, analysis of concurrent causation is not different for first party and third party policies. I recognize, of course, that such policies differ the one from the other: the former indemnifies the insured for losses he sustains directly when he suffers damage to or destruction of his own property; the latter indemnifies the insured for losses he sustains indirectly when he incurs liability to a third party. But I do not see how the analysis of concurrent causation differs between first party and third party policies. In my view, the same principles apply to the determination of coverage both when the insured suffers direct loss through the concurrence of an included risk (such as fire) and an excluded risk (such as earthquake) and when the insured suffers indirect loss through the concurrence of an included risk (such as negligent use of a gun) and an excluded risk (such as negligent use of an automobile).

Second, Partridge would not frustrate the reasonable expectation of the insurer and insured in a first party policy. The majority imply that it would be inappropriate to allow coverage when included and excluded risks concur as independent proximate causes of a loss. I strongly disagree. In my opinion, it is altogether appropriate to find the insurer liable when an included risk—i.e., a risk the insured has paid the insurer a premium to *428assume—is a proximate cause of the loss: in such a situation the insurer merely gives the insured the benefit of the protection he has purchased.

Third, Partridge would not lead to a result unfair to the insurer. The majority assert that “if the rule in Partridge . . . were extended to first party cases, the presence of [an included risk] . . . , no matter how minor, would give rise to coverage.” (Maj. opn. at p. 408, ante.) Again I strongly disagree. As its very terms show, Partridge applies only when an included risk is a proximate—i.e., substantial—cause.

In the course of their discussion, the majority express general approval of the Court of Appeal majority opinion. I cannot concur.

Crucial to the analysis of the Court of Appeal majority is their holding that Partridge requires the concurrent causes to be independent in the sense that each is a sufficient condition of the loss. In Partridge, however, this court clearly stated: “[.H\ere both causes were independent of each other: the filing of the trigger did not ‘cause’ the careless driving, nor vice versa. Both, however, caused the injury. In traditional tort jargon, both are concurrent proximate causes of the accident . . . .” (10 Cal.3d at p. 104, fn. 10, italics added.)

As the majority themselves recognize, it is plain from Partridge that the causes of a loss must be independent only in the sense that each was of separate origin. In that case, the court held the two causes—the insured’s negligent modification of his pistol and his careless driving of his vehicle— to be independent. Each was indeed of separate origin. But unlike, for example, the independent acts of the two motorcyclists who negligently rode past a man on horseback and caused the animal to run away and the man to be injured (Corey v. Havener (1902) 182 Mass. 250 [65 N.E. 69]), neither the modification of the pistol nor the driving of the vehicle was a sufficient condition of the injury in question. The “traditional tort jargon” that the court used suggests the same limited scope of the “independence” requirement. “A ‘concurrent cause []’... is a substantial cause which combines with another substantial cause to effect the loss, neither being sufficient to do so alone.” (Brewer, Concurrent Causation in Insurance Contracts (1961) 59 Mich.L.Rev. 1141, 1145, italics added; see generally Peaslee, Multiple Causation and Damage (1934) 47 Harv.L.Rev. 1127.)

Read against Partridge, the Court of Appeal majority opinion is clearly wrong. First, its interpretation of Partridge changes the definition that this court gave the term “independent” in its opinion. This court’s words, which are quoted above, in no way suggest that to be “independent” a cause must constitute a sufficient condition of the loss in question. Second, the interpre*429tation of Partridge set forth in the Court of Appeal majority opinion, if applied to the facts of that case, would lead to a result opposite to that which this court reached. Partridge contains no facts from which it could be concluded that either the negligent filing of the trigger or the careless driving of the vehicle constituted a sufficient condition of the injury in question. Under the interpretation of the Court of Appeal majority, there would have been no coverage in that case: the negligent filing of the trigger cannot be deemed the “moving” cause of the careless driving and hence could not be held to be the responsible cause of the loss.

Moreover, even if the interpretation of Partridge set forth in the Court of Appeal majority opinion were not clearly incorrect, I would be compelled to reject it as unworkable. As the dissenting member of the Court of Appeal soundly stated, “In order to comply with its new independent cause requirement the majority returns this case for retrial, directing the jury to follow what can only be characterized as a maze-like analytical pattern which may yield an answer as to coverage or then again may not. . . . [ft] None of these results will, I suspect, further the cause of creating greater predictability in coverage cases or in limiting coverage to risks against which the parties sought to insure. Indeed, under the rule set out by the majority the writing of policy exclusions will become the most arcane of art forms. The policies so produced will only puzzle the insureds and engender more bad faith litigation. These problems need not arise, however, if we read Partridge to mean what it holds, namely that there is coverage when an insured risk is a ‘concurrent proximate cause’ of injury.”

Although the majority do not discuss the point, I recognize that if the matter were of first impression Insurance Code sections 530 and 532 (hereinafter sections 530 and 532) might be susceptible of an interpretation different from that which this court has previously adopted. Section 530 states: “An insurer is liable for a loss of which a peril insured against was the proximate cause, although a peril not contemplated by the contract may have been a remote cause of the loss; but he is not liable for a loss of which the peril insured against was only a remote cause.” Section 532 states: “If a peril is specially excepted in a contract of insurance and there is a loss which would not have occurred but for such peril, such loss is thereby excepted even though the immediate cause of the loss was a peril which was not excepted.” These provisions might perhaps be read as follows: When an included risk was the proximate cause of a loss, there is coverage whether or not a risk not specified in the policy was a remote cause of that loss; but when the included risk was only a remote cause, there is no coverage. When, however, an excluded risk was a cause in fact of a loss, there is no coverage whether or not the immediate cause of that loss was either an included risk or an unspecified risk.

*430Even if I should believe that the foregoing interpretation of sections 530 and 532 is consistent with the intent of the Legislature when it enacted the provisions in 1872 as Civil Code sections 2626 and 2628, I would be reluctant to adopt it now. As I shall explain, I think that the Legislature has clearly approved the interpretation of sections 530 and 532 that this court originally set forth in 1910 in Pacific etc. Co. v. Williamsburgh City Fire Ins. Co. (1910) 158 Cal. 367 [111 P. 4], and reiterated more recently in Sabella and Partridge.

In determining the question of legislative approval, a court applies well-settled principles. “ ‘After the enactment of a statute, when a construction has been placed upon it by the highest court of the state, it will be steadily adhered to in subsequent cases, unless very plainly shown to have been wrong, and more especially where the construction so given is supported by a line of uniform decisions, and where it has been acquiesced in by the legislature for a succession of years. In that case, the construction becomes as much a part of the statute as if it had been written into it originally.’ ” (People v. Hallner (1954) 43 Cal.2d 715, 720 [277 P.2d 393]; accord, People v. Curtis (1969) 70 Cal.2d 347, 352 [74 Cal.Rptr. 713, 450 P.2d 33].)

Further, although “[the Legislature], of course, is not required to act each time a statute is interpreted erroneously and legislative silence in the face of such interpretation is not necessarily equivalent to legislative approval^] ... a consistent . . . interpretation of a statute, shown clearly to have been brought to the attention of [the Legislature] and not changed by it, is almost conclusive evidence that the interpretation has [legislative] approval.” (Kay v. Federal Communications Commission (D.C. Cir. 1970) 443 F.2d 638, 646-647, fns. omitted [administrative interpretation of statute]; accord, J.H. Rutter Rex Mfg. Co., Inc. v. United States (5th Cir. 1983) 706 F.2d 702, 711.)

Applying the foregoing principles, I believe that the Legislature has given its approval to this court’s interpretation of sections 530 and 532. First, the Legislature has acquiesced in that interpretation for more than three-quarters of a century. Second and more important, it has actively manifested its approval of those provisions as construed. To begin with, it has rejected attempts to amend or repeal those provisions as construed by this court. Moreover, it has enacted Insurance Code section 10088 as an exception to the general rule of sections 530 and 532, and thereby made plain the continuing viability of this court’s interpretation of those provisions: "Notwithstanding the provisions of Section 530, 532, or any other provision of law, and in the absence of an endorsement or an additional policy provision specifically covering the peril of earthquake, no policy which by its terms does not cover the peril of earthquake shall provide or shall be held to *431provide coverage for any loss or damage when earthquake is a proximate cause regardless of whether the loss or damage also directly or indirectly results from or is contributed to, concurrently or in any sequence by any other proximate or remote cause, whether or not covered by the policy.” (Italics added.)2

III

It follows from my discussion above that the Court of Appeal misread Sabella and Partridge and accordingly erred in concluding that the trial court’s ruling on plaintiffs’ motion for a directed verdict on the issue of coverage was improper.

The Court of Appeal chose not to address the contentions other than those going to coverage evidently on the assumption that the judgment had to be reversed in its entirety as necessarily predicated on a determination that the policy did in fact cover the loss in question. In so doing, however, it erred. In their complaint plaintiffs alleged facts, and at trial they introduced evidence, to support the jury’s findings of breach of the covenant of good faith and fair dealing and its award of compensatory and punitive damages on grounds other than defendant’s decision to deny the claim.

Accordingly, I would reverse the judgment of the Court of Appeal and remand the cause to that court with directions to address the noncoverage issues.

E.g., State Farm Fire & Casualty Co. v. Keenan (1985) 171 Cal.App.3d 1 [216 Cal.Rptr. 318]; Farmers Ins. Exchange v. Adams (1985) 170 Cal.App.3d 712 [216 Cal.Rptr. 287]; Daggs v. Foremost Ins. Co. (1983) 148 Cal.App.3d 726 [196 Cal.Rptr. 193]; Ohio Casualty Ins. Co. v. Hartford Accident & Indemnity Co. (1983) 148 Cal.App.3d 641 [196 Cal.Rptr. 164]; Atlas Assurance Co. v. McCombs Corp. (1983) 146 Cal.App.3d 135 [194 Cal.Rptr. 66]; Underwriters Ins. Co. v. Purdie (1983) 145 Cal.App.3d 57 [193 Cal.Rptr. 248]; Hartford Fire Ins. Co. v. Superior Court (1983) 142 Cal.App.3d 406 [191 Cal.Rptr. 37, 39 A.L.R.4th 189]; Safeco Ins. Co. v. Gilstrap (1983) 141 Cal.App.3d 524 [190 Cal.Rptr. 425]; Premier Ins. Co. v. Welch (1983) 140 Cal.App.3d 720 [189 Cal.Rptr. 657]; Allstate Ins. Co. v. Jones (1983) 139 Cal.App.3d 271 [188 Cal.Rptr. 557]; State Farm Fire & Cas. Co. v. Kohl (1982) 131 Cal.App.3d 1031 [182 Cal.Rptr. 720]; National Indemnity Co. v. Farmers Home Mutual Ins. Co. (1979) 95 Cal.App.3d 102 [157 Cal.Rptr. 98]; State Farm Fire & Cas. Co. v. Camara (1976) 63 Cal.App.3d 48 [133 Cal.Rptr. 600]; Gonzalez v. St. Paul Mercury Ins. Co. (1976) 60 Cal.App.3d 675 [131 Cal.Rptr. 626]; Arata v. California-Western States Life Ins. Co. (1975) 50 Cal.App.3d 821 [123 Cal.Rptr. 631]; Glens Falls Ins. Co. v. Rich (1975) 49 Cal.App.3d 390 [122 Cal.Rptr. 696]; United Services Automobile Assn. v. United States Fire Ins. Co. (1973) 36 Cal.App.3d 765 [111 Cal.Rptr. 595]; Safeco Ins. Co. of America v. Guyton (9th Cir. 1982) 692 F.2d 551, reversing (C.D. Cal. 1979) 471 F. Supp. 1126; Safeco Ins. Co. of America v. Guyton (C.D.Cal.) 471 F.Supp. 1126, reversed (9th Cir. 1982) 692 F.2d 551.

As Michael E. Bragg, assistant counsel to State Farm Insurance Companies has stated: “[T]he insurance industry introduced several bills during the 1982 and 1983 legislative sessions which would have either repealed or amended both sections. These efforts were strongly opposed . . . and each of the bills died early in the legislative process, [fl] Realizing that broad legislation to resolve concurrent causation had little chance of passage, the insurance industry focused its attention on the one peril whose catastrophic potential endangered its very solvency—the peril of earthquake. Unsuccessful efforts were made during the 1983 session to legislatively exclude earthquake losses from property insurance policies which did not specifically cover earthquakes. Finally, some relief was achieved in 1984 with the passage of Assembly Bill 2865, which became effective on January 1, 1985[, codified as chapter 8.5 of the Insurance Code, section 10081 et seq.].” (Bragg, Concurrent Causation and the Art of Policy Drafting: New Perils for Property Insurers (1985) 20 Forum 385, 398, fn. omitted.)