                                                                           FILED
                           NOT FOR PUBLICATION
                                                                           MAR 08 2016
                    UNITED STATES COURT OF APPEALS                      MOLLY C. DWYER, CLERK
                                                                         U.S. COURT OF APPEALS


                            FOR THE NINTH CIRCUIT


MICHAEL NEUMANN and                              No. 14-55275
KATHERINE NEUMANN,
                                                 D.C. No. 2:12-cv-10714-SJO-SH
              Plaintiffs - Appellants,

 v.                                              MEMORANDUM*

ALLSTATE INSURANCE COMPANY,
business entity form unknown,

              Defendant - Appellee.


                    Appeal from the United States District Court
                        for the Central District of California
                     S. James Otero, District Judge, Presiding

                      Argued and Submitted February 8, 2016
                               Pasadena, California

Before: FARRIS, CLIFTON, and BEA, Circuit Judges.

      Plaintiffs Michael and Katherine Neumann appeal the district court’s grant

of summary judgment in favor of defendant Allstate Insurance Company. We

affirm.



          *
             This disposition is not appropriate for publication and is not precedent
except as provided by 9th Cir. R. 36-3.
      With respect to the breach of contract claim, under California law, “[t]he

standard elements of a claim for breach of contract are: (1) the contract, (2)

plaintiff’s performance or excuse for nonperformance, (3) defendant’s breach, and

(4) damage to plaintiff therefrom.” Wall St. Network, Ltd. v. New York Times Co.,

80 Cal. Rptr. 3d 6, 12 (Ct. App. 2008) (citation omitted). After invoking the

insurance contract’s appraisal clause, the Neumanns were required to “appoint and

pay a qualified appraiser.” The district court concluded that the retired judge

appointed by the Neumanns was not a “qualified appraiser” within the meaning of

the contract term, and that their nonperformance barred their breach of contract

claim. We agree.

      The Neumanns contend that the retired judge was “extremely knowledgeable

in the adjudication and resolution of all types of disputes, including property

damage claims,” but serving as a judge does not qualify a person as an expert as to

each and every subject matter that might have been litigated before the judge. The

Neumanns failed to produce any evidence that he had knowledge or experience in

appraising damaged automobiles. While acting as the appointed appraiser, he did

nothing to indicate that he possessed the required expertise. Rather than appraising

the damages himself, he simply adopted the estimate prepared by Eli’s Auto Body.




                                           2
      The Neumanns also contend that whether the retired judge was a “qualified

appraiser” was a triable issue of material fact that should have been left for a jury.

Under California law, “[i]nterpretation of an insurance policy presents a question

of law governed by the general rules of contract interpretation.” Davis v. Farmers

Ins. Grp., 35 Cal. Rptr. 3d 738, 742 (Ct. App. 2005) (citation omitted). The term

in question was not actually negotiated between the parties, so there was no

relevant evidence beyond the words of the contract. Similarly, there was no

conflicting evidence offered as to the judge’s expertise. There was no genuine

dispute as to material fact for a jury to resolve.

      With respect to the claim that Allstate breached the covenant of good faith

and fair dealing, we agree with the district court that the Neumanns failed to

establish the necessary elements. Where the withholding of benefits is the basis for

an allegation of bad faith, a plaintiff must establish that (1) benefits due under the

policy were withheld, and (2) the reason for withholding benefits must have been

unreasonable or without proper cause. Love v. Fire Ins. Exch., 271 Cal. Rptr. 246,

255 (Ct. App. 1990). The Neumanns claim that Allstate’s conduct during the

appraisal process caused unreasonable delay and constituted bad faith. We

disagree.




                                            3
      The Neumanns argue that Allstate delayed the appraisal process by failing to

select its own appraiser. Even if Allstate failed to use the word “appraiser” in its

correspondence with the first person it appointed, it is undisputed that Allstate

arranged for him to prepare an estimate of the damage sustained by the automobile.

His refusal to inspect the vehicle at Eli’s may have delayed the process, but the

duration of that delay was not substantial, and the Neumanns failed to establish that

Allstate should have anticipated that problem or sought to take advantage of it. To

the contrary, Allstate worked for several weeks in an attempt to transport the

automobile at its own expense. When that effort failed, Allstate appointed a new

appraiser, who inspected the vehicle and provided his appraisal within a reasonable

time period. The substantial delay thereafter was the result of the Neumanns’

refusal to participate in the appraisal process.

      AFFIRMED.




                                            4
                                                                               FILED
Neumann v. Allstate Insurance Co., 14-55275
                                                                                MAR 08 2016
BEA, J., concurring in part and dissenting in part:                         MOLLY C. DWYER, CLERK
                                                                              U.S. COURT OF APPEALS


       I agree with the majority that the district court correctly granted summary

judgment in favor of Allstate on the Neumanns’ claim that Allstate breached the

covenant of good faith and fair dealing.

       I think the district court erred, however, in determining that the retired judge was

not qualified to serve as the Neumanns’ appraiser as a matter of law and therefore that

the Neumanns were not performing their obligations under the contract. The issue was

not whether the Neumanns’ designated appraiser was qualified to express an opinion

as an expert witness per Federal Rule of Evidence 702, which would be a preliminary

issue to be resolved by the trial judge. Rather, the sole issue here was whether the

retired judge’s qualification under the terms of the contract presents an issue of fact for

the jury. The contract requires only that each party “will appoint and pay a qualified

appraiser . . . . Each appraiser will state the actual cash value and the amount of loss.”

       Drawing all reasonable inferences in favor of the Neumanns, the non-movants,

there is a triable issue of fact as to whether the retired judge was a “qualified”

appraiser, i.e., one capable of estimating the amount of damage to the Bentley. The

word “qualified” means “having qualities or possessing accomplishments which fit

one for a certain end, office, or function.” OXFORD ENGLISH DICTIONARY (2016

Oxford University Press). The retired judge declared that he has “vast experience
with and [is] extremely knowledgeable in the adjudication and resolution of all types

of disputes, including property damage claims.” He also declared that “[f]ollowing

my agreement to serve as the appraiser . . . , I invested a substantial number of hours

in my role as an appraiser including reviewing the policy language, the various

estimates of damage prepared by Allstate and Eli’s Body Shop, the location to which

the vehicle was towed, as well as correspondence between the parties as to the amount

of the loss.” He also declared that “[a]s of mid-September 2012 . . . I . . . was ready

to submit my evaluation as to the amount of loss.”

      Since the judge’s lack of qualification was the only ground given by the district

court for rejecting the Neumanns’ breach of contract claim, I would reverse the district

court’s order granting summary judgment to Allstate on this claim.
