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ORDER – 1

UNITED STATES DISTRICT COURT

WESTERN DISTRICT OF WASHINGTON

AT TACOMA

MACLEAN TOWNHOMES, LLC, a

Washington limited liability company, as

assignee of American Heritage Builders, a

Washington corporation,

Plaintiff,

v.

CHARTER OAK FIRE INSURANCE

CO., a foreign insurance company,

Defendant and Third-Party

Plaintiff,

 v.

FIRST SPECIALTY INSURANCE

COMPANY, a foreign insurance

company,

 Third-Party Defendant.

CASE NO. C06-1093BHS

ORDER GRANTING THIRDPARTY DEFENDANT’S

MOTION FOR SUMMARY

JUDGMENT TO DISMISS

THIRD-PARTY COMPLAINT,

GRANTING DEFENDANT’S

MOTION TO STRIKE

PLAINTIFF’S RESPONSE, AND

DENYING DEFENDANT’S

MOTION TO STRIKE THE

TESTIMONY OF MARK

LAWLESS

This matter comes before the Court on Third-Party Defendant’s Motion for

Summary Judgment to Dismiss Third-Party Complaint (Dkt. 123) and Defendant’s

motions to strike (Dkts. 141 and 153). The Court has considered the pleadings filed in

support of and in opposition to the motions and the remainder of the file and hereby

grants Third-Party Defendant’s motion, grants Defendant’s motion to strike Plaintiff’s
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ORDER – 2

response, and denies Defendant’s motion to strike the testimony of Mark Lawless for the

reasons stated herein.

I. PROCEDURAL AND FACTUAL BACKGROUND

On August 3, 2006, Plaintiff MacLean Townhomes, LLC filed a complaint for

declaratory relief and monetary damages against Defendant Charter Oak Fire Insurance

Co. Dkt. 1. Plaintiff’s claims are based on the assignment of an insurance contract

between assignor American Heritage Builders (AHB) and Defendant Charter Oak. Dkt.

56 at 1. On November 27, 2007, Defendant filed an amended answer that included a

third-party complaint against Third-Party Defendant First Specialty Insurance Company. 

Dkt. 52.

It is uncontested that Third-Party Defendant settled with both Plaintiff and

assignor AHB. See Dkt. 122-2 at 2-9. As part of that settlement, Plaintiff agreed to

defend and indemnify Third-Party Defendant against claims of third parties and ThirdParty Defendant agreed not to assert claims against other insurers. Id. at 5-6 (¶¶ 3.2(b)

and 3.3).

On June 11, 2008, Third-Party Defendant filed a Motion for Summary Judgment to

Dismiss Third Party Complaint. Dkt. 123. On July 7, 2008, Third-Party Plaintiff

responded (Dkt. 141) and Plaintiff responded (Dkt. 144). In its response, Defendant

included a motion to strike the testimony of Mark Lawless. Dkt. 141 at 2-6. On July 11,

2008, Defendant moved to strike Plaintiff’s response (Dkt. 153) and Third-Party

Defendant replied to its motion (Dkt. 155).

II. DISCUSSION

A. Defendant’s Motion to Strike Plaintiff’s Response

Defendant moves to strike Plaintiff’s response to Third-Party Plaintiff’s Motion for

Summary Judgment (Dkt. 144) because Defendant claims that it is an untimely

dispositive motion and that it is incorrectly noted. Dkt. 153. In its pleading, Plaintiff
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ORDER – 3

requests that the Court “dismiss [Defendant’s] derivative contribution claim against

MacLean/AHB.” Dkt. 144 at 6. This is a request for partial summary judgment. The

Court ordered that all dispositive motions shall be filed by June 11, 2008. Dkt. 130. 

Moreover, Plaintiff improperly noted its motion pursuant to Local Rule 7(d). Therefore,

Defendant’s Motion to Strike Plaintiff’s pleading is granted.

B. Defendant’s Motion to Strike the Testimony of Mark Lawless

Defendant moves to strike the testimony of Mark Lawless because it is not

competent. Dkt. 141 at 2. Mr. Lawless declared as follows:

The defects in this siding installation would have begun trapping

water behind the buildings' envelopes after AHB and its subcontractor

completed these phases. As a result, damage to the underlying wood

framing and sheathing likely began in early 2000 for phase 2, and fall 2000

for phase 3, and progressed continuously until it was repaired.

Dkt. 58, ¶ 13. Defendant argues that Mr. Lawless’s opinion does not comply with either

Rule 702 of the Federal Rules of Evidence or Daubert v. Merrell Dow Pharmaceuticals,

Inc., 509 U.S. 579, 589 (1993).

For the purposes of this motion, the Court does not rely on this evidence. 

Therefore, the Court denies Defendant’s motion to strike.

C. Third-Party Defendant’s Summary Judgment Motion

Third-Party Defendant moves for summary judgment and requests dismissal of

Third-Party Plaintiff’s claim for contribution. Dkt. 123 at 12.

1. Summary Judgment Standard

Summary judgment is proper only if the pleadings, the discovery and disclosure

materials on file, and any affidavits show that there is no genuine issue as to any material

fact and that the movant is entitled to judgment as a matter of law. Fed. R. Civ. P. 56(c).

The moving party is entitled to judgment as a matter of law when the nonmoving party

fails to make a sufficient showing on an essential element of a claim in the case on which

the nonmoving party has the burden of proof. Celotex Corp. v. Catrett, 477 U.S. 317, 323

(1985). There is no genuine issue of fact for trial where the record, taken as a whole,
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ORDER – 4

could not lead a rational trier of fact to find for the nonmoving party. Matsushita Elec.

Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586 (1986) (nonmoving party must

present specific, significant probative evidence, not simply “some metaphysical doubt.”).

See also Fed. R. Civ. P. 56(e). Conversely, a genuine dispute over a material fact exists if

there is sufficient evidence supporting the claimed factual dispute, requiring a judge or

jury to resolve the differing versions of the truth. Anderson v. Liberty Lobby, Inc., 477

U.S. 242, 253 (1986); T.W. Elec. Serv., Inc. v. Pac. Elec. Contractors Ass’n, 809 F.2d

626, 630 (9th Cir. 1987).

The determination of the existence of a material fact is often a close question. The

Court must consider the substantive evidentiary burden that the nonmoving party must

meet at trial – e.g., a preponderance of the evidence in most civil cases. Anderson, 477

U.S. at 254; T.W. Elec. Serv., Inc., 809 F.2d at 630. The Court must resolve any factual

issues of controversy in favor of the nonmoving party only when the facts specifically

attested by that party contradict facts specifically attested by the moving party. The

nonmoving party may not merely state that it will discredit the moving party’s evidence at

trial, in the hopes that evidence can be developed at trial to support the claim. T.W. Elec.

Serv., Inc., 809 F.2d at 630 (relying on Anderson, supra). Conclusory, nonspecific

statements in affidavits are not sufficient, and missing facts will not be presumed. Lujan

v. Nat’l Wildlife Fed’n, 497 U.S. 871, 888-89 (1990).

2. Issues of Fact

Third-Party Defendant argues that it is entitled to summary judgment because

Third-Party Plaintiff “has not raised any question of fact” regarding the issue presented. 

Dkt. 155 at 6. The Court, however, may only grant summary judgment if there is no

genuine issue as to any material fact and that the movant is entitled to judgment as a

matter of law. See supra. Therefore, the absence of any issue of fact is not dispositive.

3. Contribution Claim
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ORDER – 5

Washington public policy strongly favors the settlement of disputes. See e.g., City

of Seattle v. Blume, 134 Wn.2d 243, 258-259 (1997); Seafirst Center Ltd. Partnership v.

Erickson, 127 Wn.2d 355, 365 (1995); Kirk v. Moe, 114 Wn.2d 550, 554-55 (1990).

Federal courts also have a strong interest in facilitating settlement before trial; “Since it

obviously eases crowded court dockets and results in savings to the litigants and the

judicial system, settlement should be facilitated at as early a stage of the litigation as

possible.” Fed. R. Civ. P. 16(c), Advisory Committee Notes.

The Washington Court of Appeals recently upheld a trial court’s entry of a bar to

any claim of contribution from settling defendants. See Puget Sound Energy v. Certain

Underwriters at Lloyd's, London, 134 Wn. App. 228 (2006). The court stated that

“[w]hile Washington case law is silent on the issues surrounding the contribution bar

order issued in this case, other courts, including the Ninth Circuit, have addressed similar

issues in applying federal law and have endorsed the practice of issuing contribution bar

orders in multiparty, complex litigation contexts.” Id. at 250. “However, the question

still remains: In the event that the contribution bar order is issued, how are the rights of

the non-settling insurers such as [defendant] to be adequately protected?” Id. at 250. The

court concluded that the non-settling defendant is protected by establishing at trial an

“offset” to the remaining claims. Id. The court noted that “quantifying the unquantifiable

and allocating what is not yet able to be allocated is an impossible task, but it is one the

[Washington] Supreme Court has assigned to insurers such as [defendant] as an incentive

for them to settle their claims.” Id. at 247.

In this case, an issue before the Court is Third-Party Defendant’s failure to

condition its settlement upon the state trial court’s entry of a claim bar order. See Dkt.

123 at 3. Third-Party Plaintiff argues that Third-Party Defendant sufficiently “protected

itself with the indemnity and hold harmless” portions of the settlement agreement. Dkt.

141 at 9. Third-Party Defendant counters that “[i]t should not be fatal to the finality of

[its] settlement that it did not take the extra step of obtaining a claim bar order in 2005.” 
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ORDER – 6

Dkt. 123 at 10. While it seems that a claim bar and an “indemnity and hold harmless”

agreement are functionally equivalent, the Court is unaware of any law stating that they

are procedurally equivalent. Nonetheless, the facts of this case warrant dismissal of

Third-Party Defendant because a settlement should render finality and the settling party

should avoid the costs and risks of further litigation. The entry of a bar order is wholly

within the realm of the court’s authority to encourage settlement. See, e.g., Franklin v.

Kaypro Corp., 884 F.2d 1222, 1225, 1229 (9th Cir. 1989). 

Third-Party Plaintiff argues that Third-Party Defendant may be liable for “a single

continuous occurrence” that started during Third-Party Plaintiff’s policy period and

continued into Third-Party Defendant’s policy period. This hypothetical situation,

however, is specifically excluded by Third-Party Defendant’s policy. Dkt. 122 at 9

(exclusion for property damage that occurred or was in the process of occurring prior to

inception date of policy). Thus, Third-Party Defendant is only liable for damage that

occurred after Third-Party Plaintiff’s policy had expired. Third-Party Plaintiff’s

argument is without merit.

Finally, Third-Party Plaintiff argues that “claim bars are not granted without

protecting the rights of the non-settling insurers . . . .” Dkt. 141 at 9. Third-Party

Plaintiff is entitled to its day in court and may prove its share of liability relative to the

settling defendant. As the trial court in Puget Sound stated “it will await another order to

determine whether plaintiff or non-settling defendant[], or a combination of the two will

absorb any loss from an inadequate settlement.” 134 Wn. App. at 249. Third-Party

Plaintiff’s interest are sufficiently protected by its ability to prove proportionate liability

at trial. Therefore, the Court grants Third-Party Defendant’s motion for summary

judgment dismissing Third-Party Plaintiff’s complaint.

III. ORDER

Therefore, it is hereby
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ORDER – 7

ORDERED that Third-Party Defendant’s Motion for Summary Judgment to

Dismiss Third-Party Complaint (Dkt. 123) is GRANTED and Third-Party Plaintiff’s

claim is dismissed. Defendant’s Motion to Strike the Testimony of Mark Lawless (Dkt.

141) is DENIED. Defendant’s Motion to Strike Plaintiff’s response (Dkt. 153) is

GRANTED.

DATED this 18th day of August, 2008.

A 

BENJAMIN H. SETTLE

United States District Judge