genuine dispute doctrine in California

2025(Chateau Chamberay, supra, 90 Cal.App.4th at p. 346; see Century Surety Co. v. Polisso (2006) 139 Cal.App.4th 922, 949 [genuine dispute doctrine “holds that an insurer does not act in bad faith when it mistakenly withholds policy benefits, if the mistake is reasonable or is based on a legitimate dispute as to the insurer’s liability”].) Numerous state and federal decisions have recognized the genuine dispute doctrine is not compatible with the principles that govern third party duty to defend cases, in which the possibility of coverage triggers the duty.

2025(Chateau Chamberay, supra, 90 Cal.App.4th at p. 346 ; see Century Surety Co. v. Polisso (2006) 139 Cal.App.4th 922, 949 [genuine dispute doctrine “holds that an insurer does not act in bad faith when it mistakenly withholds policy benefits, if the mistake is reasonable or is based on a legitimate dispute as to the insurer’s liability”].) Numerous state and federal decisions have recognized the genuine dispute doctrine is not compatible with the principles that govern third party duty to defend cases, in which the possibility of coverage triggers the duty.

2026Co. in the City of New York (2009) 175 Cal.App.4th 1208, 1237 , italics omitted.) However, “[a] genuine dispute exists only where the insurer’s position is maintained in good faith and on reasonable grounds.” (Wilson, supra, 42 Cal.4th at p. 723 .) Thus, the genuine dispute rule “does not relieve an insurer from its obligation to thoroughly and fairly investigate, process and evaluate the insured’s claim.” (Ibid.; see Bosetti, at p. 1237 [“An insurer cannot claim the benefit of the genuine dispute doctrine based on an investigation or evaluation of the insured’s claim that is not full, fair an

2026Co. in the City of New York (2009) 175 Cal.App.4th 1208, 1237 , italics omitted.) However, “[a] genuine dispute exists only where the insurer’s position is maintained in good faith and on reasonable grounds.” (Wilson, supra, 42 Cal.4th at p. 723 .) Thus, the genuine dispute rule “does not relieve an insurer from its obligation to thoroughly and fairly investigate, process and evaluate the insured’s claim.” (Ibid.; see Bosetti, at p. 1237 [“An insurer cannot claim the benefit of the genuine dispute doctrine based on an investigation or evaluation of the insured’s claim that is not full, fair an

2025(Chateau Chamberay, supra, 90 Cal.App.4th at p. 346; see Century Surety Co. v. Polisso (2006) 139 Cal.App.4th 922, 949 [genuine dispute doctrine “holds that an insurer does not act in bad faith when it mistakenly withholds policy benefits, if the mistake is reasonable or is based on a legitimate dispute as to the insurer’s liability”].) Numerous state and federal decisions have recognized the genuine dispute doctrine is not compatible with the principles that govern third party duty to defend cases, in which the possibility of coverage triggers the duty.

2025(Chateau Chamberay, supra, 90 Cal.App.4th at p. 346 ; see Century Surety Co. v. Polisso (2006) 139 Cal.App.4th 922, 949 [genuine dispute doctrine “holds that an insurer does not act in bad faith when it mistakenly withholds policy benefits, if the mistake is reasonable or is based on a legitimate dispute as to the insurer’s liability”].) Numerous state and federal decisions have recognized the genuine dispute doctrine is not compatible with the principles that govern third party duty to defend cases, in which the possibility of coverage triggers the duty.

2026Co. in the City of New York (2009) 175 Cal.App.4th 1208, 1237 , italics omitted.) However, “[a] genuine dispute exists only where the insurer’s position is maintained in good faith and on reasonable grounds.” (Wilson, supra, 42 Cal.4th at p. 723 .) Thus, the genuine dispute rule “does not relieve an insurer from its obligation to thoroughly and fairly investigate, process and evaluate the insured’s claim.” (Ibid.; see Bosetti, at p. 1237 [“An insurer cannot claim the benefit of the genuine dispute doctrine based on an investigation or evaluation of the insured’s claim that is not full, fair an

2026Co. in the City of New York (2009) 175 Cal.App.4th 1208, 1237 , italics omitted.) However, “[a] genuine dispute exists only where the insurer’s position is maintained in good faith and on reasonable grounds.” (Wilson, supra, 42 Cal.4th at p. 723 .) Thus, the genuine dispute rule “does not relieve an insurer from its obligation to thoroughly and fairly investigate, process and evaluate the insured’s claim.” (Ibid.; see Bosetti, at p. 1237 [“An insurer cannot claim the benefit of the genuine dispute doctrine based on an investigation or evaluation of the insured’s claim that is not full, fair an

2024(Ibid.) The Maslo court thus rejected the insurer’s reliance on the genuine dispute rule, explaining “there can be no genuine dispute in the absence of a thorough and fair investigation.” (Maslo, supra, 227 Cal.App.4th at p. 637 .) The court further distinguished Rappaport-Scott, since the insurer in that case “fairly investigated, processed and evaluated the insured’s claim,” made a settlement offer, and participated in mediation prior to arbitration.

2022(See Maslo v. Ameriprise Auto & Home Ins. (2014) 227 Cal.App.4th 626, 633 [“ ‘[A]n insurer’s obligations under the implied covenant of good faith and fair dealing with respect to first party coverage include a duty not to unreasonably withhold benefits due under the policy[,]’ ” italics added].) 43 Defendants’ argument that XL Specialty relied on a policy interpretation with which two other judges had agreed appears to be an invocation of the genuine dispute rule.

2016Co. (2008) 166 Cal.App.4th 1225, 1238-1240 [ 83 Cal.Rptr.3d 410 ].) The application of the genuine dispute doctrine “becomes a question of law where the evidence is undisputed and only one reasonable inference can be drawn from the evidence.” (Chateau Chamberay Homeowners Assn., supra, 90 Cal.App.4th at p. 346 .) We conclude that the Paslays’ bad faith claim fails under the genuine dispute doctrine.

2013Co., supra, 166 Cal.App.4th at p. 1238 [“an important limitation on the genuine dispute rule” is that the insurer must still thoroughly investigate the claim].) “The insurer cannot claim a ‘genuine dispute’ regarding coverage in such cases because, by failing to investigate, it has deprived itself of the ability to make a fair evaluation of the claim.” (Jordan v. Allstate Ins.

2013Co. (E.D.Cal. 2009) 636 F.Supp.2d 1030, 1040 [“[b]ecause the existence of a genuine dispute as to the insurer‟s liability indicates that there is at a potential for coverage, the existence of a genuine dispute is itself enough to trigger the insurer‟s duty to defend,” and therefore “the genuine dispute doctrine appears wholly incompatible with duty to defend cases”]; Century Surety Co. v. Polisso (2006) 139 Cal.App.4th 922, 951 [noting that the insurer in that case “has failed to cite any cases that apply the genuine dispute doctrine to the duty to defend and our research has not disclosed any

2013Co. (E.D.Cal. 2009) 636 F.Supp.2d 1030, 1040 [“[b]ecause the existence of a genuine dispute as to the insurer’s liability indicates that there is at least a potential for coverage, the existence of a genuine dispute is itself enough to trigger the insurer’s duty to defend,” and therefore “the genuine dispute doctrine appears wholly incompatible with duty to defend cases”]; Century Surety Co. v. Polisso (2006) 139 Cal.App.4th 922, 951 [ 43 Cal.Rptr.3d 468 ] [noting that the insurer in that case “has failed to cite any cases that apply the genuine dispute doctrine to the duty to defend and our r

2013Co. (2010) 187 Cal.App.4th 498, 530 [“it has never been held that an insurer in a third party case may rely on a genuine dispute over coverage to refuse settlement”]; Croskey et al., Cal. Practice Guide: Insurance Litigation (The Rutter Group 2012) ¶ 12:618, p. 12B-104 (rev. #1, 2011) [“[t]he extent to which the „genuine dispute‟ doctrine may apply in third party cases is presently unclear”].) 20 (See Harbison v. American Motorists Ins.

2013Co. (2010) 187 Cal.App.4th 498, 530 [ 115 Cal.Rptr.3d 42 ] [“it has never been held that an insurer in a third party case may rely on a genuine dispute over coverage to refuse settlement”]; Croskey et al., Cal. Practice Guide: Insurance Litigation (The Rutter Group 2012) ][ 12:618, p. 12B-104 (rev. # 1, 2011) [“[t]he extent to which the ‘genuine dispute’ doctrine may apply in third party cases is presently unclear” (italics omitted)].) 20 (See Harbison v. American Motorists Ins.

2013Co. (9th Cir. 2012) 697 F.3d 753, 758 [collecting cases and concluding that whether the genuine dispute doctrine applies to duty to settle third party claims under California law is “unsettled”]; Howard v. American National Fire Ins.

2013Co. (9th Cir. 2012) 697 F.3d 753, 758 [collecting cases and concluding that whether the genuine dispute doctrine applies to duty to settle third party claims under Cal. law is “unsettled”]; Howard v. American National Fire Ins.

2007Exchange (1990) 221 Cal. App.3d 1136, 1151, 1153 , 271 Cal.Rptr. 246 .) That issue will have to be resolved by application of the principles we have already discussed with respect to bad faith and the genuine dispute doctrine as applied to the dispute over the existence of actual coverage.

2007Exchange (1990) 221 Cal. App.3d 1136, 1151, 1153 , 271 Cal.Rptr. 246 .) That issue will have to be resolved by application of the principles we have already discussed with respect to bad faith and the genuine dispute doctrine as applied to the dispute over the existence of actual coverage.

2017Co. (2000) 81 Cal.App.4th 1282 , 1292, 97 Cal.Rptr.2d 386 .) "As the Fraley court emphasized, where an insurer, for example, is relying on the advice and opinions of independent experts, then a basis may exist for invoking the doctrine and summarily adjudicating a bad faith claim in the insurer's favor. [Citations.]" ( Chateau Chamberay , supra , 90 Cal.App.4th at p. 348 , 108 Cal.Rptr.2d 776 .) Still, under the genuine dispute doctrine, an expert's testimony will not automatically insulate an insurer from a bad faith claim. ( Ibid . ) Case-by-case analysis is required. 2.

2017Co. (2000) 81 Cal.App.4th 1282 , 1292, 97 Cal.Rptr.2d 386 .) "As the Fraley court emphasized, where an insurer, for example, is relying on the advice and opinions of independent experts, then a basis may exist for invoking the doctrine and summarily adjudicating a bad faith claim in the insurer's favor. [Citations.]" ( Chateau Chamberay , supra , 90 Cal.App.4th at p. 348 , 108 Cal.Rptr.2d 776 .) Still, under the genuine dispute doctrine, an expert's testimony will not automatically insulate an insurer from a bad faith claim. ( Ibid . ) Case-by-case analysis is required. 2.

2013Co. (2009) 171 Cal.App.4th 785, 792-793 .) The genuine dispute rule, however, does not relieve Lexington from its obligation to thoroughly and fairly investigate, process and evaluate the insured's claim.

2011Co. (2009) 171 Cal.App.4th 785, 792 [ 90 Cal.Rptr.3d 74 ] [the genuine dispute doctrine is “subsumed within the concept of what is reasonable and unreasonable”].) As the prompt payment statutes involve the bona tides of a legal dispute, the law would appear to require an objective standard.

2022Co. (2011) 193 Cal.App.4th 477, 493 [where insurer granted judgment as a matter of law on breach of contract claim, bad faith claim also fails].) Therefore, it is unnecessary to address Kapnisis’s remaining argument that the genuine dispute doctrine cannot support the summary adjudication of the implied covenant of good faith and fair dealing cause of action.

2016(See Wood v. Jamison (2008) 167 Cal.App.4th 156, 164-165 [ 83 Cal.Rptr.3d 877 ] [elder’s attorney engaged in financial abuse by improperly accepting as fee certain funds to which elder was entitled through loan]; *657 Bonfigli v. Strachan (2011) 192 Cal.App.4th 1302, 1307, 1315-1316 [ 122 Cal.Rptr.3d 447 ] [plaintiffs stated elder abuse claim based on defendant’s exercise of contract-based power of attorney and failure to pay funds admittedly owed under contract].) Traute’s elder abuse claim presents a question of statutory interpretation regarding the term “wrongful use.” As explained above,

2016(See Wood v. Jamison (2008) 167 Cal.App.4th 156, 164-165 [ 83 Cal.Rptr.3d 877 ] [elder’s attorney engaged in financial abuse by improperly accepting as fee certain funds to which elder was entitled through loan]; *657 Bonfigli v. Strachan (2011) 192 Cal.App.4th 1302, 1307, 1315-1316 [ 122 Cal.Rptr.3d 447 ] [plaintiffs stated elder abuse claim based on defendant’s exercise of contract-based power of attorney and failure to pay funds admittedly owed under contract].) Traute’s elder abuse claim presents a question of statutory interpretation regarding the term “wrongful use.” As explained above,

2016(See Wood v. Jamison (2008) 167 Cal.App.4th 156, 164-165 [ 83 Cal.Rptr.3d 877 ] [elder’s attorney engaged in financial abuse by improperly accepting as fee certain funds to which elder was entitled through loan]; *657 Bonfigli v. Strachan (2011) 192 Cal.App.4th 1302, 1307, 1315-1316 [ 122 Cal.Rptr.3d 447 ] [plaintiffs stated elder abuse claim based on defendant’s exercise of contract-based power of attorney and failure to pay funds admittedly owed under contract].) Traute’s elder abuse claim presents a question of statutory interpretation regarding the term “wrongful use.” As explained above,

2016(See Wood v. Jamison (2008) 167 Cal.App.4th 156, 164-165 [ 83 Cal.Rptr.3d 877 ] [elder’s attorney engaged in financial abuse by improperly accepting as fee certain funds to which elder was entitled through loan]; *657 Bonfigli v. Strachan (2011) 192 Cal.App.4th 1302, 1307, 1315-1316 [ 122 Cal.Rptr.3d 447 ] [plaintiffs stated elder abuse claim based on defendant’s exercise of contract-based power of attorney and failure to pay funds admittedly owed under contract].) Traute’s elder abuse claim presents a question of statutory interpretation regarding the term “wrongful use.” As explained above,

2013Co., supra, 148 Cal.App.4th at p. 1072 [summary judgment was improper where there were factual issues regarding the reasonableness of the insurer’s limited investigation].) Here, National relied solely on the accident report by Officer Oberlander and the medical report by an emergency room physician, without further investigation, to deny Avetisyan’s claim.

2013Co., supra, 148 Cal.App.4th at p. 1072 .) Whether an insurer’s investigation was reasonable depends on the circumstances.

2013Co. (2007) 42 Cal.4th 713, 723 [genuine dispute rule is a “close corollary” of the principle that “an insurer’s denial of or delay in paying benefits gives rise to tort damages only if the insured shows the denial or delay was unreasonable”]; FEI Enterprises, Inc. v. Yoon (2011) 194 Cal.App.4th 790, 804 [“the genuine dispute doctrine is ‘subsumed within the concept of what is reasonable and unreasonable’”]; Croskey et al., Cal. Practice Guide: Insurance Litigation (The Rutter Group 2012) ¶¶ 12:837, 12:837.1, pp. 12C-8, 12C-9 (rev. #1 2013) [“[g]enuine dispute doctrine” is “[p]art of ‘reasonabl

2013Co. (E.D.Cal. 2011) 776 F.Supp.2d 1101, 1125 [“the Court must respectfully disagree with Harbison’s conclusion that the ‘genuine dispute doctrine’ cannot apply in all bad faith duty to defend cases”]; Croskey et al., Cal. Practice Guide: Insurance Litigation, supra, H 12:618.5 to 12:618.10, pp. 12B-105 to 12B-106 (rev. # 1, 2012) [suggesting that whether the existence of a genuine dispute as to coverage precludes bad faith liability for refusing to provide a defense depends on whether the dispute is factual or legal].) 21 This evidence came from evidentiary admissions in Mt.