When Does the ”Proximate Efficient Cause” Doctrine Apply ?

Moreover, the proximate efficient cause doctrine applies only when two or more conceptually distinct perils combine to cause the loss. (De Bruyn v. Superior Court (2008) 158 Cal.App.4th 1213, 1223; Finn v. Continental Ins. Co. (1990) 218 Cal.App.3d 69, 72 (Finn).)

"When, however, the evidence shows the loss was in fact occasioned by only a single cause, albeit one susceptible to various characterizations, the efficient proximate cause analysis has no application." (Chadwick v. Fire Ins. Exchange (1993) 17 Cal.App.4th 1112, 1117.)

In Finn v. Continental Ins. Co. (1990) 218 Cal.App.3d 69, water leaking from a broken sewer pipe caused foundation damage and coverage was denied under an exclusion for seepage or leakage. The insured argued the break in the pipe was the "efficient predominating cause" of the damage, with the leakage being merely an intermediate cause. (Finn, supra, 218 Cal.App.3d at p. 72.)

Finn disagreed, explaining, "The Sabella analysis has no application here because leakage and broken pipes are not two distinct or separate perils. In Sabella . . ., the two perils were conceptually distinct: that is, they could each, under some circumstances, have occurred independently of the other and caused damage. In the present case there are not two conceptually distinct perils. Leakage or seepage cannot occur without a rupture or incomplete joining of the pipes. This case involved not multiple causes but only one, a leaking pipe." (Id. at p. 72.)

Similarly in Chadwick v. Fire Ins. Exchange, supra, 17 Cal.App.4th 1112, deficient framing techniques in construction caused cracks in the walls. The insurance policy excluded coverage for damage caused by latent defects in construction.

The plaintiffs argued negligent construction, a nonexcluded peril, was the efficient proximate cause of the damages. Rejecting the contention, Chadwick stated, "An insured may not avoid a contractual exclusion merely by affixing an additional label or separate characterization to the act or event causing the loss." (Id. at p. 1117.)

The court concluded, "Whether characterized as negligent, intentional or innocently inadvertent, the peril itself--the defective framing--is one and the same. To say builder negligence 'caused' the defective framing is, in this context, to indulge in misleading wordplay . . . ." (Id. at p. 1118; see also Pieper v. Commercial Underwriters Ins. Co. (1997) 59 Cal.App.4th 1008, 1020 rejecting application of efficient proximate cause doctrine where arson fire damaged home insured under policy containing exclusion for damage caused by brush fire because "'under the single causation analysis, it is irrelevant what caused the fire as the crucial and undisputed fact is that the loss was caused by a brush fire sweeping across seven miles of brush land and destroying everything contained thereon before causing the loss'".)