United States District Court, W.D. Washington, Seattle
S. Zilly United States District Judge.
MATTER comes before the Court following entry of a verdict
reached by the jury, docket no. 201. In light of the
jury's factual findings and damage awards, the Court
enters the following order.
declaratory judgment action, plaintiff IDS Property and
Casualty Insurance Company ("IDS") seeks a ruling
that, under a homeowners' policy issued to defendant
Charles H. Fellows and his ex-wife, Michaela Osborne, which
was in effect from May 10, 2015, through May 10, 2016, it
does not owe coverage for the following losses: (i) damage to
the residence located at 10021 SE 192nd Place in Renton,
Washington, which was caused sometime prior to August 31,
2015, when Fellows was entitled to take possession of the
dwelling after dissolution proceedings had concluded, (ii)
additional living expenses ("ALE") necessarily
incurred to reside elsewhere while the dwelling was
uninhabitable; and (iii) removal from the home of
Fellows's personal property, including business attire
and formal wear. Fellows brought six counterclaims, two of
which (for constructive fraud and negligence) were dismissed
with prejudice on IDS's oral motion pursuant to Federal
Rule of Civil Procedure 50(a). See, Minute Order
(docket no. 198). The jury reached a verdict in favor of
Fellows on the remaining four counterclaims for (i) breach of
contract, (ii) violation of the Insurance Fair Conduct Act
("IFCA"), (iii) violation of Washington's
Consumer Protection Act ("CPA"), and (iv) insurance
bad faith. The Court now declares "the rights and other
legal relations" of the parties pursuant to 28 U.S.C.
§ 2201, and addresses the issue of increased or treble
damages under the CPA and the IFCA.
Washington law, a coverage determination is a two-step
process. Diamaco, Inc. v. Aetna Cas. & Sur. Co.,
97 Wn.App. 335, 337, 983 P.2d 707 (1999). First, the insured
must show that the loss falls within the scope of the
policy's insured perils or losses. See id The
burden then switches to the insurer to prove that the loss
"is excluded by specific policy language." See
McDonald v. State Farm Fire & Cas. Co., 119Wn.2d
724, 731, 837 P.2d 1000 (1992); Diamaco, 97 Wn.App.
policy at issue is a "named-peril" policy as to
personal property and an "all-risk" policy as to
the residence. See Ex. 1 to Compl. (docket no. 1-1
at 16); see also Fisher Commc 'ns, Inc. v. Travelers
Prop. Cas. Co. of Am., 2012 WL 12883115 at *2 (W.D.
Wash. Sep. 4, 2012) (discussing the distinction between
"named-peril" and "all- risk" policies).
The Court has previously concluded that Fellows did not carry
his initial burden of proving that the loss of his personal
property, including business attire and formal wear, was
within the scope of a named peril. See, Minute Order
at ¶ 1(c) (docket no. 198). As to the loss of personal
property, the Court will enter declaratory judgment in favor
of IDS and against Fellows, indicating that coverage is not
owed under the policy at issue for the items identified in
Trial Exhibit 17.
respect to the damage to the home and the related ALE, the
parties do not dispute that such loss is within the scope of
the risks insured by the policy. Indeed, the policy covers
"direct physical loss to property insured under the
Dwelling and Other Structures Coverages except for losses
excluded elsewhere, " and in the event that a covered
loss makes the residence uninhabitable, "the reasonable
increase in your living expenses necessary to maintain your
normal standard of living while you live elsewhere." Ex.
1 to Compl. (docket no. 1-1 at 15 & 16). IDS seeks to
avoid coverage by relying on the following exclusion:
Intentional loss, meaning any loss arising out of any act an
insured person commits or conspired to commit with the intent
to cause a loss. . . .
[T]his exclusion will not apply to deny an insured
person's claim for an otherwise covered property loss
under this policy if such a loss is caused by an act of
domestic violence by another insured person under this policy
and the insured person claiming the property loss:
a) did not cooperate in or contribute to the creation of the
b) cooperates in any investigation relating to the loss.
Exclusions at ¶ 9 (docket no. 1-1 at 18). The
above-quoted "domestic violence" exception to the
"intentional loss" exclusion is required by