Jason Gates And Amanda Gates, V. Homesite Insurance Company

CourtCourt of Appeals of Washington
DecidedOctober 30, 2023
Docket84448-2
StatusPublished

This text of Jason Gates And Amanda Gates, V. Homesite Insurance Company (Jason Gates And Amanda Gates, V. Homesite Insurance Company) is published on Counsel Stack Legal Research, covering Court of Appeals of Washington primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Jason Gates And Amanda Gates, V. Homesite Insurance Company, (Wash. Ct. App. 2023).

Opinion

NOTICE: SLIP OPINION (not the court’s final written decision)

The opinion that begins on the next page is a slip opinion. Slip opinions are the written opinions that are originally filed by the court. A slip opinion is not necessarily the court’s final written decision. Slip opinions can be changed by subsequent court orders. For example, a court may issue an order making substantive changes to a slip opinion or publishing for precedential purposes a previously “unpublished” opinion. Additionally, nonsubstantive edits (for style, grammar, citation, format, punctuation, etc.) are made before the opinions that have precedential value are published in the official reports of court decisions: the Washington Reports 2d and the Washington Appellate Reports. An opinion in the official reports replaces the slip opinion as the official opinion of the court. The slip opinion that begins on the next page is for a published opinion, and it has since been revised for publication in the printed official reports. The official text of the court’s opinion is found in the advance sheets and the bound volumes of the official reports. Also, an electronic version (intended to mirror the language found in the official reports) of the revised opinion can be found, free of charge, at this website: https://www.lexisnexis.com/clients/wareports. For more information about precedential (published) opinions, nonprecedential (unpublished) opinions, slip opinions, and the official reports, see https://www.courts.wa.gov/opinions and the information that is linked there. For the current opinion, go to https://www.lexisnexis.com/clients/wareports/.

IN THE COURT OF APPEALS OF THE STATE OF WASHINGTON DIVISION ONE

JASON GATES and AMANDA GATES, No. 84448-2-I husband and wife,

Appellants, ORDER GRANTING MOTION v. TO PUBLISH

HOMESITE INSURANCE COMPANY, a foreign insurance company,

Respondent.

Nonparty Shangri-La LLC filed a motion to publish the opinion filed on

September 18, 2023 in this case. Appellants Jason and Amanda Gates filed an

answer to the motion. A majority of the panel has determined that the motion

should be granted. Now, therefore, it is hereby

ORDERED that the motion to publish the opinion is granted.

FOR THE COURT:

Judge For the current opinion, go to https://www.lexisnexis.com/clients/wareports/.

IN THE COURT OF APPEALS OF THE STATE OF WASHINGTON

JASON GATES and AMANDA GATES, No. 84448-2-I husband and wife, DIVISION ONE Appellants,

v. UNPUBLISHED OPINION HOMESITE INSURANCE COMPANY, a foreign insurance company,

BOWMAN, J. — Jason and Amanda Gates obtained default judgments

against Homesite Insurance Company after Homesite failed to appear or respond

to their lawsuit for breach of contract and violation of the Insurance Fair Conduct

Act (IFCA), RCW 48.30.010 to .015. More than a year later, Homesite moved to

vacate the judgments. The court granted the motion under CR 60(b)(5) and

dismissed the Gates’ claims at summary judgment. The Gates appeal. Because

Homesite was not entitled to relief from the default judgments under CR 60(b)(1),

(4), (5), or (11), we reverse, vacate the orders of dismissal, and remand for the

trial court to reinstate the default judgments.

FACTS

In 2018, the Gates bought a home in Maple Valley. They closed on the

property on April 4 and moved in immediately. The Gates insured the home

through Homesite. Homesite issued the Gates a policy effective April 4, 2018 to

April 4, 2019. For the current opinion, go to https://www.lexisnexis.com/clients/wareports/. No. 84448-2-I/2

Shortly after moving in, the Gates learned that the previous occupants

used drugs in the home. They “promptly” arranged for sampling to determine

whether the home contained harmful residues. The sampling showed

methamphetamine residue that exceeded Washington State clean-up guidelines.

The Gates made a claim to Homesite for loss of personal property and

structural damage, but Homesite denied the claim. In a letter dated April 23,

2018, Homesite told the Gates that their policy did not cover “discharge or

release of pollutants or chemicals” or “loss prior to the policy period.”

The Gates hired an attorney to pursue the claim. On May 8, 2018, their

attorney e-mailed Homesite a letter, acknowledging that “[we] understand that

the activities resulting [in] the methamphetamine contamination occurred before

the Homesite policy took effect, and that damage to the structure is therefore not

covered.” But the attorney explained that the Gates were still seeking coverage

for their personal property losses, “which occurred when the family moved their

possessions into the home and exposed them to the chemical residue during the

policy period.”

Ultimately, Homesite paid the Gates for their damaged personal property.

It mailed them a check for $11,552.62 on September 17, 2018. But Homesite

maintained its denial of coverage for the Gates’ structural damage.

On January 28, 2019, the Gates sued Homesite. They alleged breach of

contract and violation of the IFCA, seeking compensation for their structural

damage, attorney fees, and costs. The Gates served the Office of the Insurance

2 For the current opinion, go to https://www.lexisnexis.com/clients/wareports/. No. 84448-2-I/3

Commissioner (OIC) with a summons and complaint.1 But they did not give

Homesite 20 days’ notice of their lawsuit as required under the IFCA.2 The OIC

accepted service on January 29, 2019. It forwarded the summons and complaint

to Homesite the next day. But the Homesite employee who received the

summons did not inform others in the company about the lawsuit. Homesite did

not appear or respond to the complaint.

In March 2019, the Gates obtained an order of default and default

judgment for their remediation costs, totaling $87,913.92 plus interest. Because

the Gates alleged Homesite unreasonably denied their claim, the court doubled

the award.3 The court also awarded $260.39 in costs, for a total judgment of

$176,088.03. On August 5, 2019, the Gates obtained a supplemental judgment

for attorney fees and costs for $16,935.28 plus interest. Homesite did not pay

the judgments.

One year later on August 5, 2020, the Gates contacted Homesite. They

sought to collect on the judgments, which had been accruing interest, for a total

payoff amount of $224,989.04. Homesite then filed a notice of appearance with

the trial court, and on December 28, 2020, moved to set aside the judgments.

The court scheduled a hearing on Homesite’s motion for January 11, 2021

without oral argument.4

1 The OIC is a statutorily designated registered agent for Homesite under RCW 48.05.200. 2 RCW 48.30.015(8)(a). 3 RCW 48.30.015(2). 4 The “Notice for Hearing” incorrectly sets the hearing date for January 11, 2020. It is clear from the record this was a scrivener’s error, and the correct hearing date was January 11, 2021.

3 For the current opinion, go to https://www.lexisnexis.com/clients/wareports/. No. 84448-2-I/4

Homesite argued that the court should set aside the default judgments for

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