United States District Court, W.D. Washington, Seattle
C. COUGHENOUR, UNITED STATES DISTRICT JUDGE.
matter comes before the Court on Plaintiff's motion to
amend her complaint and remand to state court (Dkt. No. 16).
Having thoroughly considered the parties' briefing and
the relevant record, the Court finds oral argument
unnecessary and hereby GRANTS the motion for the reasons
early 2015, Helen McCullough's (“McCullough”)
house began to settle around her two-story fireplace. (Dkt.
No. 17 at 7.) At all relevant times, McCullough had a
homeowner's insurance policy issued by Travelers Home and
Marine Insurance Company (“Travelers”). (Dkt. No.
1-2 at 2.) After an initial inspection, Travelers determined
that the settling damage was a loss covered by
McCullough's policy (Dkt. No. 17 at 8.)
hired an independent consultant, Done Right Construction
(“Done Right”), to prepare a repair estimate for
McCullough's home. (Id.) Done Right provided
Travelers with an initial scope of repair estimate totaling
$57, 437.65. (Dkt. No. 17 at 16.) Travelers accepted the
estimate and issued payment to McCullough. (Id.)
McCullough subsequently hired Done Right to be the general
contractor for the repair of her house. (Id.)
the outset, McCullough experienced construction delays that
appeared to be caused by Done Right. (Id. at 7, 16.)
McCullough, Travelers, and Done Right repeatedly exchanged
correspondence to determine the progress of the repairs.
(See generally Id. at 46-53.) In December 2016, Done
Right submitted an updated scope of work estimate totaling
$144, 122.14 (Id. at 17.) Travelers accepted the
estimate and issued payment to McCullough. (Id.)
eventually terminated Done Right after she made several
attempts to get the company to finish the repairs to her
house. (Id. at 17-18.) In May 2017, McCullough filed
suit against Travelers in Snohomish County Superior Court
alleging the company had breached its contract, violated the
Washington Consumer Protection Act, and acted in bad faith.
(Dkt. No. 1-2 at 3-5.) Travelers removed the case to this
Court on August 15, 2017. (Dkt. No. 1.)
filing suit, McCullough hired a third-party contractor to
provide an updated scope of repair estimate. (Dkt. No. 17 at
18.) The contractor provided an estimate totaling $291,
165.90-an amount well above McCullough's policy limit for
structural damage. (Id.) In light of that estimate,
McCullough requested that Travelers pay her the policy limit.
(Id.) Travelers declined. (Id.) McCullough
subsequently filed notice with Travelers and the Washington
Insurance Commission that alleged Travelers violated the
Washington Insurance Fair Conduct Act (“IFCA”),
Revised Code of Washington § 48.30.015. (Id. at
now moves the Court for three things: (1) leave to amend her
complaint to add a claim against Travelers for violation of
IFCA; (2) leave to amend her complaint to join Done Right as
a defendant and assert claims of breach of contract,
conversion, and violation of the Consumer Protection Act; and
(3) assuming the Court joins Done Right, to remand the case
to Snohomish County Superior Court because there would no
longer be complete diversity of citizenship. (Dkt. No. 16 at
1.) The Court addresses these issues in turn.
Amendment to Add IFCA Claim
courts are afforded discretion to grant leave to amend and
“should freely give leave when justice so
requires.” Fed.R.Civ.P. 15(a)(2). The generosity in
granting leave to amend is “to be applied with extreme
liberality.” Eminence Capital, LLC v. Aspeon,
Inc., 316 F.3d 1048, 1051-52 (9th Cir. 2003). Courts are
to consider five factors in granting leave to amend: (1) bad
faith, (2) undue delay, (3) prejudice to the opposing party,
(4) futility of amendment, and (5) whether the pleading has
previously been amended. See United States v. Corinthian
Colleges, 655 F.3d 984, 995 (9th Cir. 2011).
above factors weigh in favor of granting McCullough leave to
amend her complaint to add an IFCA claim against Travelers.
McCullough does not seek to amend in bad faith: she wants to
add this claim based on Traveler's denial of her request
for the policy limit, which occurred after she filed her
lawsuit. (Dkt. No. 17 at 18.) She did not act with undue
delay: her amendment comes less than two months after she
gave statutorily-required notice to Travelers that she
planned to file an IFCA claim and less than a month after
Travelers refused to settle the claim. (Id. at
7-11.) Travelers is not prejudiced by the amendment:
McCullough provided notice that she intended to file the
claim and it arises out of the same insurance dispute as her
other claims. McCullough has not previously amended her
complaint and her IFCA claim would not be futile.
raises a single objection to McCullough's amendment. The
IFCA states that “Twenty days prior to filing an action
based on this section, a first party claimant must provide
written notice of the basis for the cause of action to the
insurer and office of the insurance commissioner.” Rev.
Code of Wash. § 48.30.015(8)(a). Because McCullough
filed her lawsuit months before she filed her IFCA notice,
Travelers argues that her claim is untimely. The Court
disagrees with Travelers' narrow reading of the statute.
The statute requires a party to provide timely notice of the
basis for bringing an IFCA claim-whether the 20-day notice
occurs before a ...