Court Opinion

ID: 9620107
Source: CourtListenerOpinion
Date Created: 2023-08-22 05:38:31.207759+00
Date Added: 2024-06-11T13:07:28.203419
License: Public Domain

Thompson, J.
(dissenting) — We are reviewing a judgment in a bench trial wherein the court granted a dismissal at the close of plaintiff's case. CR 41(b)(3). Our review requires a determination of whether plaintiff presented sufficient evidence to establish a prima facie case or whether the credible evidence established facts which precluded plaintiff's recovexy. Since the evidence established (a) a prima facie case entitling plaintiff to damages, (b) Farmers' failure to comply with the Washington Administrative Code (WAC) regarding the settlement of claims, and (c) Farmers' dilatory actions contributed to plaintiff's difficulty in proving damages, I would reverse and remand for trial.
In early March 1987, Mr. McLanahan submitted a claim to Farmers for theft of his vehicle while it was on consignment for sale in the Los Angeles area. Farmers undertook to adjust the claim. In the meantime, through the insured's efforts, the car was located and returned to the Tri-Cities area from Los Angeles. The car had sustained extensive damage, and in early April, at Farmers' request, Mr. Mc-Lanahan brought the vehicle to Farmers' drive-in claims office for inspection. He was told to get repair estimates.
*42On May 19, 1987, Mr. McLanahan obtained an estimate of $35,000 to $40,000 from the mechanic who serviced the car before its theft. He submitted the estimate to Farmers, but its agent told him the estimate was beyond his authority and would have to be forwarded to a supervisor.
Hearing nothing further from Farmers, Mr. McLanahan's attorney called Farmers, then wrote a letter dated June 2 requesting an expedited adjustment. Not only did Farmers not respond promptly to his attorney's letter, but by letter dated June 12, advised Mr. McLanahan the insurance on his vehicle would not be renewed. On June 19, Mr. McLanahan's attorney wrote another letter to Farmers requesting a response to his earlier letter.
Coverage on the vehicle expired July 3. The vehicle had been in storage. After coverage expired, Mr. McLanahan moved the car to his home because a fire in an adjacent storage unit raised concerns regarding the safety of the vehicle.
On August 10, more than 2 months after Mr. McLanahan's attorney requested an expedited adjustment, and 4 months after the claim for damages was filed, Farmers made additional inspection demands and for the first time raised an issue regarding coverage. On August 21, Mr. McLanahan's attorney responded, stating coverage had been admitted by Farmers; the claim had been pending since February (correct date, March); Farmers had received an estimate from the only qualified mechanic in the Northwest; Farmers had been given an opportunity to mitigate the damages by virtue of an available sale, which it rejected; the repair work alone could take a year; and because Farmers had canceled coverage, it would have to arrange for coverage dining transportation to the places of inspection.
On September 3, Farmers' attorney responded that arrangements had been made to fly in an exotic car specialist from Portland to inspect the car. No mention was made of providing coverage until the inspection was completed. Several weeks later, frustrated by the delays and *43concerned that something might happen to the vehicle, Mr. McLanahan accepted an offer of $77,000 for the vehicle. Evidence was provided that the average Blue Book value on the vehicle without damage in 1987 was $94,000.
Based on this evidence, the trial court concluded Mr. McLanahan breached his duty as an insured to make the vehicle available for inspection and appraisal, a duty which was not excused by Farmers' inordinate delay in inspection and payment of the claim (conclusion of law 3).
RCW 48.01.030 requires insurers to act in good faith in dealing with their insureds. WAC 284-30-370 sets forth standards for prompt investigation of claims. It requires every insurer to complete investigation of a claim within 30 days after notification, unless such investigation cannot reasonably be completed within such time. WAC 284-30-380 states an insurer has 15 working days to settle claims or give reasons why more time is needed.
Depending on the circumstances, a CR 41(b)(3) motion may be granted on the merits or as a matter of law. N. Fiorito Co. v. State, 69 Wn.2d 616, 618, 419 P.2d 586 (1966). In ruling as a matter of law, a trial court
must accept the plaintiff's evidence as true, and then determine whether or not the plaintiff has made a prima facie case. Roy v. Goerz, 26 Wn. App. 807, 614 P.2d 1308[, review denied, 94 Wn.2d 1018] (1980). In ruling as a matter of law, the court "does not make factual determinations or evaluate the credibility of plaintiff's evidence, except as may be incidentally necessary to favorably resolve conflicts appearing therein". N. Fiorito Co. v. State, 69 Wn.2d 616, 619-20, 419 P.2d 586 (1966).
Spring v. Department of Labor & Indus., 96 Wn.2d 914, 918, 640 P.2d 1 (1982).
In deciding a CR 41(b)(3) motion on the merits,
the trial court may weigh the evidence properly adduced in the course and in support of plaintiff's case, and make a factual determination that plaintiff has failed to establish a prima facie case by credible evidence, or that the credible evidence establishes facts which preclude plaintiff's recovery.
N. Fiorito Co., at 618.
*44Whether the trial court granted a dismissal to Farmers on the merits or as a matter of law, Mr. McLanahan presented sufficient evidence to establish a prima facie case. There was evidence of inordinate delays and failure to act in a timely manner. There was evidence regarding the value of the car before and after the damage. There was evidence of repair costs. There was substantial evidence presented that an insured loss occurred and the insured was entitled to recover for that loss.
How much Mr. McLanahan's recovery should be and the basis for granting damages may have been complicated by the sale of the vehicle. However, the evidence clearly established the insured attempted to comply with policy provisions and Farmers had over 6 months to have the damage evaluated. Placing the entire burden of the loss on the insured on the basis the sale was a breach of the insurance contract was reversible error. Mr. McLanahan did not forfeit his rights under the insurance contract (conclusion of law 4).
It is a longstanding principle in this state that forfeitures are not favored in law or equity. This principle is applicable whether or not insurance contracts are at issue. E.g., Rocha v. McClure Motors, Inc., 64 Wn.2d 942, 947, 395 P.2d 191 (1964); Moeller v. Good Hope Farms, Inc., 35 Wn.2d 777, 782, 215 P.2d 425 (1950); Shirley v. American Auto. Ins. Co., 163 Wash. 136, 144, 300 P. 155 (1931). Further, the doctrines of waiver and estoppel apply to noncooperation clauses in insurance contracts, whether the cooperation required by the insured is to attend healings and trials, give written notices of a claim, or complete some other similar act. See generally Annot., Liability Insurer's Postloss Conduct as Waiver of, or Estoppel To Assert, "No-Action" Clause, 68 A.L.R.4th 389, § 4, at 398-400 (1989). And, as set forth in 8 J. Appleman, Insurance § 4772, at 221 (1981),
[a] question of cooperation, as respects a breach of a policy cooperation clause, involves not only the good faith of the insured but the good faith of the insurer as well. And an *45automobile liability insurer must make a substantial showing of diligence before it can rely on a defense of noncooperation.
(Footnotes omitted.)
The dilatory adjusting practices of Farmers contributed to Mr. McLanahan's problem in proving damages and were in contravention of RCW 48.01.030 and WAC 284-30-370. There was sufficient evidence presented to establish estoppel or waiver of Farmers' right to assert the noncooperation clause in its policy. Mr. McLanahan presented a prima facie case of coverage as to the extent of damages to his vehicle. If he failed to get the best price available by selling wholesale, this may be a reason for reducing his recovery, not totally precluding it. To the extent the trial court made a factual determination after weighing the evidence presented, the findings are neither supported by the evidence, nor do they support the conclusions of law. The undisputed facts establish the insured did attempt to comply with Farmers' requests from the time he drove the vehicle into the drive-in claims office.
I would reverse the dismissal and remand for trial.
Review denied at 120 Wn.2d 1006 (1992).