Katherine Rosenberg-Wohl had a homeowners insurance policy with defendant Respondent State Farm Fire and Casualty Company, providing coverage on her home in San Francisco.

The policy contains a provision entitled “Suit Against Us” that states: “No action shall be brought unless there has been compliance with the policy provisions. The action must be started within one year after the date of loss or damage.”

In late 2018 or early 2019, Katherine Rosenberg-Wohl noticed that on two occasions an elderly neighbor stumbled and fell as she descended her outside staircase, and learned that the pitch of the stairs had changed and that to make the stairs safe the staircase needed to be replaced.

In late April 2019, she authorized the work and contacted State Farm, and on August 9, she submitted a claim for the money she had spent. On August 26, State Farm denied the claim. Among other things Lee said that it if the claimed loss were “to be covered,” something “sudden” had to have happened. And what plaintiff claimed coverage for, Lee said, was just “preventative.”

Sometime later, her husband, attorney David Rosenberg-Wohl, reached out to State Farm “to see if anything could be done,” and in August 2020 a State Farm adjuster, Rita Lee,said it had reopened the claim. And a few days later denied it.

In October 2020, represented by her husband, plaintiff filed two lawsuits against State Farm in San Francisco Superior Court., some 18 months after she had replaced the staircase, 14 months after State Farm had denied her claim the first time, and nearly six months after the one-year limitation period of the policy had expired.

One alleged two causes of action, for breach of the policy and for bad faith. That lawsuit was removed to federal court, and was resolved against plaintiff on a motion to dismiss based on the one-year limitation provision. It is currently on appeal in the Ninth Circuit.

The other action, the one now before the California Court of Appeal, purports to allege a claim for violation of California’s unfair competition law and was designated as a “class action.” This case was also resolved against plaintiff, also based on the limitation provision. When the trial court sustained a demurrer to the second amended complaint without leave to amend. Plaintiff appealed, asserting two arguments: (1) the one-year limitation provision does not apply to her unfair competition claim, and (2) even if it does, State Farm waived the limitation provision

The California Court of Appeal affirmed the trial court in the published case of Rosenberg-Wohl v. State Farm Fire and Casualty Co., -A163848.PDF (July, 2023).

The one-year limitation provision in the State Farm policy is there because ” insurance policies providing fire insurance on California property must include the standard form provisions contained in Insurance Code section 2071 or provisions that are at least their substantial equivalent.”

Insurance Code 2071 specifically states that “2071. (a) “The following is adopted as the standard form of fire insurance policy for this state:” …. “No suit or action on this policy for the recovery of any claim shall be sustainable in any court of law or equity unless all the requirements of this policy shall have been complied with, and unless commenced within 12 months next after inception of the loss. If the loss is related to a state of emergency, as defined in subdivision (b) of Section 8558 of the Government Code, the time limit to bring suit is extended to 24 months after inception of the loss.”

State Farm asserts “the Legislature has expressly endorsed” the provision under Insurance Code section 2071, and argues that because the allegations here all concern how it handled plaintiff’s claim, the suit is subject to the policy limitation period under applicable law.

In her brief plaintiff conceded that “there is . . . no doubt that an insured cannot plead around the one-year limitations provision by labeling her cause of action something different than breach of contract,” But then went on to argue “where damages are not sought but rather the relief sought is change of an unfair policy that affects not just the insured but the public at large, the insurer’s policy promise to the insured is not at issue,”

Plaintiff’s brief makes another concession, that “Simply alleging a claim under the UCL, of course, is no different from one alleging breach of the covenant of good faith and fair dealing or any other claim in which the point is to recover money for breach of contract. [Citations.]”

And plaintiff’s argument concludes with this: “here the UCL claim about practice and procedure is not a contract claim – the conduct is unfair even though it is not required under the policy, and it is unfair regardless of whether it leads to payment under the policy or no. And plaintiff asserts, she seeks “only injunctive relief . . . and that is why the four-year UCL statutory period applies,” going on to cite five cases in claimed support.

The Court of Appeal then discussed at length numerous cases, including many of those cited by the parties here, after all of which it made its analysis and conclusion.

In rejecting plaintiff’s effort to circumvent the one year statute of limitations the Court of Appeals concluded that “In sum, the crux of plaintiff’s claim (Jang, supra, 80 Cal.App.4th at p. 1303) is ‘grounded upon a failure to pay policy benefits.’ (Sullivan, supra, 964 F.Supp. at p. 1414.) That claim necessarily arises ‘out of the contractual relationship.’ (Lawrence, supra, 204 Cal.App.3d at p. 575.)”