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Original Joe's2/7/2002
NOT TO BE PUBLISHED IN OFFICIAL REPORTS
California Rules of Court, rule 977(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 977(b). This opinion has not been certified for publication or ordered published for purposes of rule 977.
Appellant Original Joe's, Inc., appeals from a summary judgment entered in favor of respondent Golden Eagle Insurance Corporation. It contends that the trial court erred in ruling that respondent had no duty to defend it in the underlying action for violation of California's disabled access statutes, Civil Code section 54 et seq. We conclude that appellant's contention has merit and therefore reverse.
FACTUAL BACKGROUND
In April 1999, George S. Louie, who is disabled and confined to a wheelchair, filed a complaint against appellant alleging that he was unable to access appellant's restroom facilities because appellant failed to bring its facilities into compliance with the law regarding equal access for persons with disabilities. Louie alleged that as a result of the denial of access, he suffered damages resulting from physical discomfort and pain, mental and emotional shock, emotional distress, embarrassment and humiliation.
Appellant tendered the complaint to respondent under its commercial liability policy. Respondent denied coverage, concluding that there was no "occurrence" under the policy and that Louie's alleged statutory violations did not constitute "bodily injury " under the policy.
Appellant filed the instant action against respondent on June 27, 2000, alleging breach of contract and breach of the implied covenant of good faith and fair dealing. The complaint also alleged a cause of action seeking a judicial declaration of the rights of the parties under the policy. Respondent denied the allegations of the complaint and moved for summary judgment. It contended that it had no duty to defend appellant under the policy because the underlying complaint did not allege damages resulting from a bodily injury caused by an occurrence as required by the policy. The trial court granted the motion and entered judgment in favor of respondent.
DISCUSSION
Appellant contends that respondent had a duty to defend it on Louie's claim for damages under Civil Code section 54.3. We conclude that this contention is meritorious.
" liability insurer owes a broad duty to defend its insured against claims that create a potential for indemnity. [Citation.] . . . ` he carrier must defend a suit which potentially seeks damages within the coverage of the policy.' [Citation.] Implicit in this rule is the principle that the duty to defend is broader than the duty to indemnify . . . ." (Horace Mann Ins. Co. v. Barbara B. (1993) 4 Cal.4th 1076, 1081.) The duty to defend " `may exist even where coverage is in doubt and ultimately does not develop.' [Citation.]" (Saylin v. California Ins. Guarantee Assn. (1986) 179 Cal.App.3d 256, 263.)
In order to prevail in an action seeking declaratory relief on the issue of the duty to defend, "the insured must prove the existence of a potential for coverage, while the insurer must establish the absence of any such potential. In other words, the insured need only show that the underlying claim may fall within policy coverage; the insurer must prove it cannot." (Montrose Chemical Corp. v. Superior Court (1993) 6 Cal.4th 287, 300.) An insurer's duty to defend is determined in the first instance by comparing the allegations of the complaint with the terms of the policy. (Horace Mann Ins. Co. v. Barbara B., supra, 4 Cal.4th at p. 1081.) "Facts ex
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