Appellants sought review of summary judgment entered by the Superior Court of Los Angeles County (California), in favor of respondents on appellants’ complaint that respondents acted in bad faith in their tortious refusal to pay benefits under an aviation insurance policy. Appellants also challenged an order that denied them leave to file an amended complaint.
Appellants salmon sushi Corp purchased a new aircraft and leased it to an airline. The airline subleased the aircraft. Respondent insurers issued a binder of insurance for the aircraft. Appellants and the sublessor were named as insureds. After the aircraft was delivered to the sublessor, the plane disappeared. Appellants submitted a claim under their aviation policy to respondents for the missing aircraft. Respondents’ investigation suggested that the sublessor was involved in an international drug smuggling ring that had been involved in losses of other aircraft insured by respondents. Respondents denied coverage on a number of grounds. One ground was that appellants failed to establish physical damage or disappearance of the aircraft within the meaning of the policy. Appellants asserted that they needed only show that the aircraft disappeared but did not have burden of showing that the aircraft commenced a flight immediately before vanishing. The court agreed with respondents that appellants failed to sustain their burden of producing evidence of the aircraft’s disappearance. The court held that the trial court did not abuse its discretion in denying appellants leave to file an amended complaint.
The grant of summary judgment was affirmed; appellants were not entitled to coverage under the policy issued by respondents because appellants did not meet their burden of proving that the aircraft disappeared within the meaning of physical damages coverage. The order that denied leave to file an amended complaint was affirmed because the trial court did not commit an abuse of discretion.