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Norris v. Farmers Insurance Company of Washington

Court of Appeals of Washington, Division 1

April 27, 2018

JEFFREY S. NORRIS and TERRI NORRIS, Appellants,
v.
FARMERS INSURANCE COMPANY OF WASHINGTON, a Washington corporation; AMY ELIZABETH MARCH, a Washington resident; and DAN ANDERSON, a Washington resident, Respondents. JUNFANG HE, Plaintiff,
v.
JEFFREY S. NORRIS and TERRI NORRIS, and the marital community composed thereof; and JOHN DOES 1-5, Defendants. JEFFREY S. NORRIS and TERRI NORRIS, Appellants,
v.
FARMERS INSURANCE COMPANY OF WASHINGTON, a Washington corporation; AMY ELIZABETH MARCH, a Washington resident; and DAN ANDERSON, a Washington resident, Respondents.

          ORDER GRANTING MOTION TO PUBLISH

          Cox, J.

         Respondents, Farmers Insurance Company of Washington, Amy Elizabeth March, and Dan Anderson, have moved for publication of the opinion filed in this case on March 19, 2018. The Appellants do not contest this motion. The panel hearing the case has considered the motion and has determined that the motion should be granted. The court hereby

         ORDERS that the motion to publish the opinion is granted.

         - Jeffrey and Terri Norris (together "Norris") appeal the trial court's order granting summary judgment to Farmers Insurance Company of Washington and its agents Dan Anderson and Amy Elizabeth March and dismissing Norris's third party complaint with prejudice. Because there is neither any showing of a duty owed by Farmers nor any genuine issue of material fact whether a special relationship exists, summary judgment is proper. We affirm.

         The material facts are largely undisputed. Norris hit Junfang He, a pedestrian, while driving, and He sued Norris for damages that exceeded the liability limits of their auto insurance policy with Farmers Insurance. Farmers offered to settle with the pedestrian for the policy limits, but He refused this offer.

         Norris then impleaded Farmers by a third party complaint, claiming negligence. Farmers moved for summary judgment, arguing that it had no legal duty and that no genuine issue of material fact existed regarding any claimed special relationship that might have created a duty. The trial court agreed and dismissed the third party complaint with prejudice.

         Norris appeals.

         DUTY

         Norris argues that there are genuine issues of material fact whether Farmers owed a duty to Norris, an essential element of the negligence claim. Specifically, they argue that a duty arises because of a special relationship between the parties. We disagree.

         "[S]ummary judgment is appropriate where there is 'no genuine issue as to any material fact and ... the moving party is entitled to a judgment as a matter of law.'"[1] Although the evidence is viewed in the light most favorable to the nonmoving party, if that party is the plaintiff and it fails to make a factual showing sufficient to establish an element essential to its case, summary judgment is warranted.[2]

         Once the moving party shows there are no genuine issues of material fact, the nonmoving party must bring forth specific facts to rebut the moving party's contentions.[3] The nonmoving party must put forth admissible evidence showing the existence of a triable issue.[4] It cannot rely on the allegations contained in its pleadings, conclusory statements, or speculation.[5] If the "nonmoving party fails to controvert relevant facts supporting a summary judgment motion, those facts are considered to have been established."[6] Finally, "[o]n review of an order granting or denying a motion for summary judgment, the appellate court will consider only the evidence and issues called to the attention of the trial court."[7]

         "For a claim of negligence, the plaintiff must establish duty, breach, causation, and damages."[8] The "determination of whether a legal duty exists is initially a question of law for the court."[9]

         Washington law is clear-an insurance company and its agents have no duty to review or counsel an insured on the adequacy of coverage unless there is a special relationship between the insured and the agent.[10] A special relationship exists between the agent and insured if: "(1) the agent holds himself out as an insurance specialist and receives additional compensation for consulting and advice, or (2) there is a long-standing relationship, some type of interaction on the question of coverage, and the insured relied on the agent's expertise to the insured's detriment."[11] "[I]n cases where the insured never consulted with the agent about the adequacy of coverage and the agent never gave any advice, courts have held that no special relationship exits."[12]

         We review de novo a trial court's summary judgment order.[13]

         Norris fails to argue persuasively that Farmers owes any duty aside from that established by a special relationship. Any other claim would be unsupported by well-established case law in the area of insurance.

         Norris argues that there are genuine issues of material fact whether Farmers voluntarily assumed a duty to advise them about liability limits, and then breached that duty. In support, they cite non-insurance cases that recognize a duty "to exercise reasonable and ordinary care."[14] We refuse to consider this argument because Norris fails to cite any authority recognizing such a duty in the insurance context.[15]

         Norris relies on the declaration of their expert, J. Kay Thorne, to support their argument that they have raised a genuine issue of material fact whether Farmers and its Agents owed them a duty to review their coverage for gaps and inadequate liability limits. That reliance is misplaced.

         Because the existence of a duty is a question of law, Thome's statements are insufficient to raise a genuine issue of material fact as to the existence of a duty on the part of Farmers and its agents.[16]

         Norris also cites to the deposition testimony of Farmers management as support for their argument, claiming that the duty was "described and embraced by Farmers, its managers, and its agents." Again, because the existence of a duty is a question of law, the testimony of Farmers Insurance management is insufficient to raise a genuine issue of material fact whether Farmers had a duty to advise Norris about the liability limits of their insurance policy.[17]

         Special Relationship

         Thus, the question we decide is whether there are any genuine issues of material fact whether a special relationship exists under the circumstances of this insurance case. We conclude that there are no such issues.

         The claim is based on the argument that a long-standing relationship between the parties existed, the interactions between Norris and the agents on questions of coverage, and Norris's reliance on the agents' expertise. A careful review of the record shows these claims have no basis in fact.

         In support of its summary judgment motion, Farmers submitted declarations from both agents. The declarations established that neither agent ever received compensation or consideration from Norris for consultation or advice on issues involving coverage or policy limits. Norris never discussed liability coverage limits with the agents. Norris did not ask the agents either to recommend higher or lower limits with regards to their auto insurance liability or whether excess or umbrella coverage might be available until after the accident. Instead, Norris only communicated with the agents to add or remove vehicles from the policy or to discuss claims.

Farmers also submitted portions of Norris's deposition testimony where Norris acknowledged that they never paid any money to the agents for providing advice on insurance issues. Norris never discussed policy limits for liability coverage with the agents or asked them about the sufficiency of the liability policy limits. They never spoke either with them or anyone working with them about what would be an appropriate amount of liability coverage, and the agents never offered an opinion on that issue.

         In opposition to summary judgment, Norris submitted affidavits of their own as well as from Thome. They also submitted excerpts from the deposition testimony of Farmers Insurance management. But none of their submissions controvert the material facts supporting the summary judgment motion. That is because the submissions fail to show that Norris discussed their policy liability limits with the agents.[18] Even Thome admits that there was no evidence of any interaction between Norris and the agents on the issue of auto ...


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