Park Meridian Condominium Association v. State Farm Fire & Casualty Company et al, No. 2:2018cv01645 - Document 24 (W.D. Wash. 2019)
Court Description: ORDER denying Defendant State Farm Fire & Casualty Company's 10 Motion for Partial Summary Judgment. The Court reached this decision without reference to the excerpts in the declarations supporting Plaintiff's response (Dkt. No. 18 ) disputed in Defendant's motion to strike. (See Dkt. No. 22 at 14.) Therefore, Defendant's motion to strike is DENIED. Signed by U.S. District Judge John C Coughenour.(MW)
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Park Meridian Condominium Association v. State Farm Fire & Casualty Company et al Doc. 24 THE HONORABLE JOHN C. COUGHENOUR 1 2 3 4 5 6 UNITED STATES DISTRICT COURT WESTERN DISTRICT OF WASHINGTON AT SEATTLE 7 8 9 10 PARK MERIDIAN CONDOMINIUM ASSOCIATION, CASE NO. C18-1645-JCC ORDER Plaintiff, 11 v. 12 13 STATE FARM FIRE & CASUALTY COMPANY, 14 Defendant. 15 This matter comes before the Court on Defendant State Farm Fire & Casualty Company’s 16 17 motion for partial summary judgment (Dkt. No. 10). Having thoroughly considered the parties’ 18 briefing and the relevant record, the Court finds oral argument unnecessary and hereby DENIES 19 the motion for the reasons explained herein. 20 I. BACKGROUND Plaintiff maintains the Park Meridian condominium complex, which consists of nine 21 22 buildings and 77 condo units (the “Complex”). (Dkt. No. 1 at 1–2.) The ground-floor condo units 23 have concrete patios, while the second- and third-floor condo units have wood decks. (Dkt. No. 24 18 at 6.) Defendant sold insurance policies covering the Complex to Plaintiff, effective from 25 May 15, 1987 to May 15, 2006, subject to a series of renewals (the “Policy”). (See Dkt. No. 1 at 26 2–3.) ORDER C18-1645-JCC PAGE - 1 Dockets.Justia.com 1 Records of the 1987 to 1990 policy provisions are unavailable. (See Dkt. No. 19-7 at 3.) 2 As of May 1990, the Policy enumerated a number of losses caused by water that were not 3 covered, including “continuous or repeated seepage or leakage of water that occurs over a period 4 of time; . . . [and] collapse, except as provided in the Extensions of Coverage.” (Dkt. No. 12 at 5 49–51.) From May 1990 to May 1998, the Policy’s Extension of Coverage for Collapse provided 6 that “[Defendant] will pay for any accidental direct physical loss to covered property involving 7 collapse of a building or any part of a building caused only by . . . hidden decay[] . . . .” (Dkt. 8 No. 19-7 at 4–5.) The 1998 Policy renewal included Amendatory Collapse Endorsement, FE- 9 6551, which provided that: 10 11 12 13 14 [Defendant] insure[s] only for direct physical loss to covered property involving the sudden, entire collapse of a building or any part of a building. Collapse means actually fallen down or fallen into pieces. It does not include settling, cracking, shrinking, bulging, expansion, sagging or bowing. The collapse must be directly and immediately caused only by . . . hidden decay of a supporting or weight-bearing structural member of the building[] . . . . (Id. at 5–6.) 15 In July 1998, Plaintiff submitted a claim to Defendant for coverage of decay occurring in 16 decks of various units of the Complex (the “1998 Claim”). (See Dkt. Nos. 10 at 3–4, 19-1, 19-2.) 17 Defendant retained Pacific Engineering to investigate the 1998 Claim. (Dkt. Nos. 10 at 3, 19-3, 18 19-4.) Based on Pacific Engineering’s reports, Defendant decided that some, but not all, of the 19 decay would be covered under the Policy’s Extension of Coverage for Collapse (collectively, the 20 “1998–99 Decisions”). (See Dkt. Nos. 10 at 2–4, 12 at 47–112.) Defendant paid $275,448.17 for 21 coverage of the 1998 Claim. (Dkt. No. 19-7 at 2.) 22 Defendant’s 2002 Policy renewal included Amendatory Collapse Endorsement, FE-6573, 23 which “removed hidden decay as a covered cause of collapse loss under the Extension of 24 Coverage for Collapse.” (Id. at 6.) 25 26 In September 2017, Plaintiff hired J2 Building Consultants (“J2”) to investigate the Complex for decay or damage. (See Dkt. No. 1 at 3.) J2 issued a Findings Report “detail[ing] ORDER C18-1645-JCC PAGE - 2 1 water damage to exterior wall sheathing and framing as well as hidden damage to decks 2 throughout the [Complex]” (the “J2 Report”). (Id.; see also Dkt. No. 20-1.) In October 2017, 3 Plaintiff submitted a claim to Defendant “for hidden damage detailed in the J2 [R]eport,” seeking 4 coverage for losses due to “wind-driven rain and/or collapse” (the “2017 Claim”). (Dkt. Nos. 10 5 at 3, 21-4 at 2.) Defendant retained Jim Perrault of JRP Engineering to investigate the 2017 6 Claim, and Mr. Perrault issued a report on June 29, 2018 detailing his findings (the “Perrault 7 Report”). (Dkt. No. 19-7 at 2–3.) 8 9 Defendant alleges that it did not evaluate potential coverage under Policy terms effective from May 15, 1987 to May 15, 1990 because it failed to locate the Policy in effect at that time. 10 (Dkt. No. 19-7 at 3.) Plaintiff alleges that “[Defendant] was aware that [] from 1987-1990 special 11 form 3 policy covered because it did not exclude damage from water intrusion, but refused to 12 inform [Plaintiff] of this coverage . . . .” (Dkt. No. 1 at 4.) Plaintiff believes that “special form 3” 13 describes Defendant’s all-risk coverage form. (Id. at 3.) Plaintiff states that “[o]n information and 14 belief the loss or damage to the [Complex] was incremental and progressive. New damage 15 commenced during each year of the [Policy].” (Id. at 4.) However, according to the Perrault 16 Report, the decay discovered in 2017 did not result from damage occurring between May 15, 17 1998 and May 15, 2002. (See Dkt. No. 21-5.) 18 Based on the Perrault Report, on July 12, 2018 Defendant denied coverage of the 2017 19 Claim under the Policy terms effective from May 15, 1990 to May 15, 2006 (the “2018 Decision 20 Letter”). (Dkt. Nos. 10 at 3, 19-7 at 9.) Plaintiff filed suit on November 13, 2018, seeking 21 declaratory relief and alleging state law claims for breach of contract, bad faith, and violation of 22 the Washington Consumer Protection Act (“CPA”). (See Dkt. No. 1.) Defendant moves for 23 partial summary judgment, asserting that “Plaintiff’s [2017 Claim] relating to [Defendant’s 24 1998–99 Decisions] [is] now barred by applicable statutes of limitations.” (Dkt. Nos. 8, 10 at 6.) 25 Defendant does not address Plaintiff’s claim for declaratory relief in its motion. (See Dkt. Nos. 26 10, 22.) ORDER C18-1645-JCC PAGE - 3 1 II. DISCUSSION 2 A. Summary Judgment Legal Standard 3 Summary judgment is proper “if the movant shows that there is no genuine dispute as to 4 any material fact and the movant is entitled to judgment as a matter of law.” Fed. R. Civ. P. 5 56(a). The movant has the initial burden of showing the absence of a genuine dispute of material 6 fact, supported by materials such as the pleadings, depositions, admissions on file, and any 7 affidavits. Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986); Fed. R. Civ. P. 56(c). If the 8 movant meets this burden, then the nonmovant must demonstrate, from more than the pleadings 9 alone, a genuine dispute of material fact. Celotex, 477 U.S. at 324; see Fed. R. Civ. P. 56(c). 10 Facts are considered material if they “might affect the outcome of the suit under the 11 governing law.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). A factual dispute is 12 “genuine” if the evidence could lead a reasonable jury to return a verdict for the nonmovant. Id. 13 The Court must view the facts and reasonable inferences to be drawn therefrom in the light most 14 favorable to the nonmovant. Id. at 255. 15 B. Statute of Limitations 16 A limitations period generally commences when a party has a right to seek relief in the 17 courts—when the party can establish each element of an action. See Bush v. Safeco Ins. Co., 596 18 P.2d 1357, 1358 (Wash. Ct. App. 1979); see also Shepard v. Holmes, 345 P.3d 786, 790 (Wash. 19 Ct. App. 2014). Although Defendant couches its motion in terms of the statutes of limitations, 20 the crux of the motion is that the 2017 Claim is identical to the 1998 Claim, and thus any 21 arguments about improper denials of coverage from the 1998 Claim are time-barred. (See 22 generally Dkt. No. 10.) Plaintiff responds that the 2017 Claim is distinct from the 1998 Claim, in 23 part because the damaged property is different and because the observed decay on the decks 24 occurred post-2000. (See Dkt. No. 18 at 11–13.) 25 C. 26 Defendant’s investigation of the 1998 Claim uncovered decay in carports, decks, and ORDER C18-1645-JCC PAGE - 4 Claim Comparisons 1 adjoining walls of the Complex. (Dkt. No. 22 at 5–6.) Defendant’s 1998–99 Decisions extended 2 coverage for decay occurring at: some of the decks at certain Complex units; the Building 7, Unit 3 202 deck and closet walls; the Building 6, Unit 301 deck and closet walls; the Building 8, Unit 4 301 deck and closet walls; the Building 3, Units 202 and 203 decks; the Unit 202 stair landing; 5 the “[s]outh wall of the stair tower for the 03 stack of units”; and various carport structures. (See 6 Dkt. No. 12 at 47–48, 62, 68, 86–87, 104–05.) The 1998–99 Decisions also denied coverage for 7 decay at some of the decks and carports. (Id. at 54–56, 93–94.) 8 9 Plaintiff relied on the J2 Report when it submitted the 2017 Claim, in which it seeks coverage of damage to exterior walls of the Complex. (See Dkt. No. 21-4.) The J2 Report 10 contains findings of decay on decks, carports, windows, sheathing, and wall framing. (See Dkt. 11 No. 20-1 at 4–13.) There are some similarities between the damage observations underlying the 12 1998 Claim and the 2017 Claim. For example, the J2 Report indicates that decay was primarily 13 observed “at deck integrations and deck fascia.” (Dkt. No. 21-4 at 2.) However, the J2 Report 14 identifies specific instances of decay that were not addressed in the 1998 Claim, such as decay in 15 wall framing and surrounding various windows. (Compare Dkt. No. 20-1 at 9–13, with Dkt. No. 16 12 at 47–48, 54–56, 62, 68, 86–87, 93–94, 104–05; see also Dkt. No. 21-5 at 5–7 (providing a 17 building number key)). 18 Defendant relied on the Perrault Report when it denied coverage of the 2017 Claim. (See 19 Dkt. No. 19-7.) The Perrault Report identifies decay in decks, windows, and wall framing. (Dkt. 20 No. 21-5.) Again, although there are similarities between the damage observations underlying 21 the 1998 Claim and the 2017 Claim, the Perrault Report identifies instances of decay that were 22 not addressed in the 1998 Claim, such as decay in the wall framing surrounding greenhouse 23 windows. (Compare id. at 4–7, with Dkt. No. 12 at 47–48, 54–56, 62, 68, 86–87, 104–05.) 1 24 25 26 1 Defendant argues that the claims are the same because a number of the greenhouse windows are located next to the decks. (Dkt. No. 22 at 5.) However, this proximity argument does not prove that the claims are identical. ORDER C18-1645-JCC PAGE - 5 1 Based on the J2 Report and Perrault Report’s observations of decay that were not at issue 2 in the 1998 Claim, and Plaintiff’s argument that deck decay observed in 2017 resulted from new 3 post-2000 damage, a reasonable jury could determine that the 1998 Claim and the 2017 Claim 4 are different. See Anderson, 477 U.S. at 248. Therefore, there is a genuine dispute about whether 5 the 1998 Claim and the 2017 Claim are the same. 6 III. 7 8 CONCLUSION For the foregoing reasons, Defendant’s motion for partial summary judgment (Dkt. No. 10) is DENIED. 2 9 DATED this 13th day of August 2019. 12 A 13 John C. Coughenour UNITED STATES DISTRICT JUDGE 10 11 14 15 16 17 18 19 20 21 22 23 24 25 26 2 The Court reached this decision without reference to the excerpts in the declarations supporting Plaintiff’s response (Dkt. No. 18) disputed in Defendant’s motion to strike. (See Dkt. No. 22 at 1–4.) Therefore, Defendant’s motion to strike is DENIED. ORDER C18-1645-JCC PAGE - 6
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