THE HONORABLE JOHN C. COUGHENOUR 1 2 3 4 5 6 UNITED STATES DISTRICT COURT 7 WESTERN DISTRICT OF WASHINGTON 8 AT SEATTLE 9 DUANE MOORE, CASE NO. C20-5874-JCC-JRC 10 Plaintiff, ORDER 11 v. 12 ALLSTATE INDEMNITY COMPANY, 13 Defendant. 14
15 This matter comes before the Court on Defendant Allstate Indemnity Company’s 16 Objections (Dkt. No. 42) to the Report and Recommendation (“R&R”) of the Honorable J. 17 Richard Creatura, U.S. Magistrate Judge, (Dkt. No. 41). Having thoroughly considered the R&R, 18 the parties’ briefing, and the relevant record, the Court hereby OVERRULES Allstate’s 19 objections, ADOPTS the R&R, and thus DENIES the motion for summary judgment. 20 I. BACKGROUND 21 On August 16, 2019, a fire destroyed a residential property (“Property”) owned by 22 Plaintiff Duane Moore. (See Dkt. No. 27-4 at 2, 6–7.) At issue is what caused the fire: Dr. 23 Moore’s policy with Allstate insures the Property for “sudden and accidental” loss, but it 24 excludes coverage for losses resulting from vandalism. (Dkt. No. 29-1 at 17, 24, 28.) 25 Available evidence suggests the fire began in the Property’s basement, in a storage closet 26 1 under a stairway. (Dkt. No. 28 at 2–3.) Various people have weighed in with various degrees of 2 confidence about what did or did not cause the fire, or whether finding the cause is even 3 possible. 4 The Olympia Fire Department’s incident report says the cause of ignition was 5 “undetermined after investigation.” (Dkt. Nos. 27-4 at 6, 27-5 at 3.) Allstate’s claims investigator 6 writes that the fire “appears to be due to an electrical failure but [there is] no way to prove this.” 7 (Dkt. No. 34-1.) Dale Mann, Allstate’s fire investigation expert,1 rules out weather, nature, 8 electrical malfunction, or other “non-human accidental cause[s]” as potential culprits. (Dkt. No. 9 28 at 5–6.) Having eliminated those candidates, and because he found the remnants of a gasoline 10 container, a stack of magazines, and some boxes near the suspected fire origin, along with an 11 open basement window, Mann thinks it is more likely than not that a trespasser set the fire 12 deliberately. (Id. at 6–7.) Mann ultimately concludes, however, that under industry standards for 13 fire investigations, “the specific cause for this fire is undetermined.” (Dkt. No. 28-2 at 26.) 14 Plaintiff’s fire investigation expert, John Lentini, also concludes the cause is 15 “undetermined.” (Dkt. No. 35 at 17.) Plaintiff’s mechanical engineering expert, Gerard Schaefer, 16 concurs. (Dkt. No. 36 at 15.) 17 II. DISCUSSION 18 A. Legal Standard 19 The Court reviews de novo any part of the magistrate judge’s report and recommendation 20 that a party specifically objects to in writing. Fed. R. Civ. P. 72(b); United States v. Reyna-Tapia, 21 328 F.3d 1114, 1121 (9th Cir. 2003). “[T]he court may accept, reject, or modify, in whole or in 22 part, the findings or recommendations made by the magistrate judge.” 28 U.S.C. § 636(b)(1). 23 24 1 Dr. Moore objects on Daubert grounds to Mann’s opinion evidence. (Dkt. No. 43 at 2–3.) The 25 Court does not address that issue, because even assuming Mann’s testimony (or any of the opinion evidence in the record, for that matter) is admissible, that would not change the Court’s 26 decision on Allstate’s objections to the R&R. 1 Summary judgment is proper if “there is no genuine dispute as to any material fact and 2 the movant is entitled to judgment as a matter of law.” Fed. R. Civ. P. 56(a). The Court views 3 facts in the light most favorable to the nonmoving party and resolves ambiguity in that party’s 4 favor, but it must not make credibility determinations or weigh evidence. See Anderson v. 5 Liberty Lobby, Inc., 477 U.S. 242, 248–49, 255 (1986); Bator v. Hawaii, 39 F.3d 1021, 1026 (9th 6 Cir. 1994). The moving party has the initial burden to show the lack of a genuine issue for trial. 7 Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). If that party succeeds, the burden shifts to 8 the nonmoving party to demonstrate there is an issue for trial. See Celotex, 477 U.S. at 323–24. If 9 the movant fails, the nonmovant need not present any evidence, even if it has the ultimate burden 10 at trial. See Nissan Fire & Marine Ins. Co. v. Fritz Cos., Inc., 210 F.3d 1099, 1102–03 (9th Cir. 11 2000). 12 B. Insurance Coverage 13 Dr. Moore’s policy with Allstate covers “sudden and accidental direct physical loss” to 14 the Property. (Dkt. No. 29-1 at 28.) But the Policy does not cover losses “caused by fire resulting 15 from vandalism” if the Property “is vacant or unoccupied for more than 90 consecutive days 16 immediately prior to the vandalism.” (Id. at 17.) 17 Under Washington law, an insured must show that the policy covers the loss, and the 18 burden then shifts to the insurer to show that an exclusion bars coverage. Wright v. Safeco Ins. 19 Co. of Am., 109 P.3d 1, 5 (Wash. Ct. App. 2004). Thus, Dr. Moore will have the burden at trial to 20 show that the fire was a “sudden and accidental direct physical loss.” (Dkt. No. 42 at 4 (citing 21 Eagle W. Ins. Co. v. SAT, 2400, LLC, 187 F. Supp. 3d 1231, 1235 (W.D. Wash. 2016).) But as 22 the moving party on summary judgment, it is Allstate who must establish that Dr. Moore’s 23 evidence is insufficient. See Celotex, 477 U.S. at 323–24; Nissan Fire, 210 F.3d at 1102–03. 24 Allstate argues that Dr. Moore’s evidence is mere speculation about possible causes from 25 which no reasonable factfinder could find the fire was “sudden and accidental.” Regardless, 26 1 Allstate argues, based on its own evidence, there is no genuine dispute that the vandalism 2 exclusion applies. 3 1. Sudden and Accidental Loss 4 The Washington courts have defined an “accident” for insurance purposes in various 5 ways. An accident is an “unusual, unexpected, and unforeseen happening.” Grange Ins. Co. v. 6 Brosseau, 776 P.2d 123, 125 (Wash. 1989). Said another way, an accident is “an unexpected, 7 unforeseen, or undesigned happening or consequence from either a known or an unknown 8 cause.” Yakima Cement Prods. Co. v. Great Am. Ins. Co., 608 P.2d 254, 257 (Wash. 1980). 9 Regardless of the exact wording, the point is that “[i]njuries will not be deemed caused by an 10 accident where the injuries are intentionally inflicted,” which “would be against public policy to 11 insure.” Detweiler v. J.C. Penney Cas. Ins. Co., 751 P.2d 282, 285 (Wash. 1988). 12 Allstate argues that Dr. Moore “offered no evidence that the fire was ‘a sudden and 13 accidental direct physical loss’” because Dr. Moore’s affirmative evidence suggests that the 14 cause of the fire cannot be determined. (Dkt. No. 42 at 4.) According to Allstate, evidence 15 merely suggesting various possible causes is insufficient to create a factual issue unless it points 16 to a cause that was actually responsible for the fire. (Dkt. No. 42 at 4–8.) 17 Allstate is wrong.
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THE HONORABLE JOHN C. COUGHENOUR 1 2 3 4 5 6 UNITED STATES DISTRICT COURT 7 WESTERN DISTRICT OF WASHINGTON 8 AT SEATTLE 9 DUANE MOORE, CASE NO. C20-5874-JCC-JRC 10 Plaintiff, ORDER 11 v. 12 ALLSTATE INDEMNITY COMPANY, 13 Defendant. 14
15 This matter comes before the Court on Defendant Allstate Indemnity Company’s 16 Objections (Dkt. No. 42) to the Report and Recommendation (“R&R”) of the Honorable J. 17 Richard Creatura, U.S. Magistrate Judge, (Dkt. No. 41). Having thoroughly considered the R&R, 18 the parties’ briefing, and the relevant record, the Court hereby OVERRULES Allstate’s 19 objections, ADOPTS the R&R, and thus DENIES the motion for summary judgment. 20 I. BACKGROUND 21 On August 16, 2019, a fire destroyed a residential property (“Property”) owned by 22 Plaintiff Duane Moore. (See Dkt. No. 27-4 at 2, 6–7.) At issue is what caused the fire: Dr. 23 Moore’s policy with Allstate insures the Property for “sudden and accidental” loss, but it 24 excludes coverage for losses resulting from vandalism. (Dkt. No. 29-1 at 17, 24, 28.) 25 Available evidence suggests the fire began in the Property’s basement, in a storage closet 26 1 under a stairway. (Dkt. No. 28 at 2–3.) Various people have weighed in with various degrees of 2 confidence about what did or did not cause the fire, or whether finding the cause is even 3 possible. 4 The Olympia Fire Department’s incident report says the cause of ignition was 5 “undetermined after investigation.” (Dkt. Nos. 27-4 at 6, 27-5 at 3.) Allstate’s claims investigator 6 writes that the fire “appears to be due to an electrical failure but [there is] no way to prove this.” 7 (Dkt. No. 34-1.) Dale Mann, Allstate’s fire investigation expert,1 rules out weather, nature, 8 electrical malfunction, or other “non-human accidental cause[s]” as potential culprits. (Dkt. No. 9 28 at 5–6.) Having eliminated those candidates, and because he found the remnants of a gasoline 10 container, a stack of magazines, and some boxes near the suspected fire origin, along with an 11 open basement window, Mann thinks it is more likely than not that a trespasser set the fire 12 deliberately. (Id. at 6–7.) Mann ultimately concludes, however, that under industry standards for 13 fire investigations, “the specific cause for this fire is undetermined.” (Dkt. No. 28-2 at 26.) 14 Plaintiff’s fire investigation expert, John Lentini, also concludes the cause is 15 “undetermined.” (Dkt. No. 35 at 17.) Plaintiff’s mechanical engineering expert, Gerard Schaefer, 16 concurs. (Dkt. No. 36 at 15.) 17 II. DISCUSSION 18 A. Legal Standard 19 The Court reviews de novo any part of the magistrate judge’s report and recommendation 20 that a party specifically objects to in writing. Fed. R. Civ. P. 72(b); United States v. Reyna-Tapia, 21 328 F.3d 1114, 1121 (9th Cir. 2003). “[T]he court may accept, reject, or modify, in whole or in 22 part, the findings or recommendations made by the magistrate judge.” 28 U.S.C. § 636(b)(1). 23 24 1 Dr. Moore objects on Daubert grounds to Mann’s opinion evidence. (Dkt. No. 43 at 2–3.) The 25 Court does not address that issue, because even assuming Mann’s testimony (or any of the opinion evidence in the record, for that matter) is admissible, that would not change the Court’s 26 decision on Allstate’s objections to the R&R. 1 Summary judgment is proper if “there is no genuine dispute as to any material fact and 2 the movant is entitled to judgment as a matter of law.” Fed. R. Civ. P. 56(a). The Court views 3 facts in the light most favorable to the nonmoving party and resolves ambiguity in that party’s 4 favor, but it must not make credibility determinations or weigh evidence. See Anderson v. 5 Liberty Lobby, Inc., 477 U.S. 242, 248–49, 255 (1986); Bator v. Hawaii, 39 F.3d 1021, 1026 (9th 6 Cir. 1994). The moving party has the initial burden to show the lack of a genuine issue for trial. 7 Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). If that party succeeds, the burden shifts to 8 the nonmoving party to demonstrate there is an issue for trial. See Celotex, 477 U.S. at 323–24. If 9 the movant fails, the nonmovant need not present any evidence, even if it has the ultimate burden 10 at trial. See Nissan Fire & Marine Ins. Co. v. Fritz Cos., Inc., 210 F.3d 1099, 1102–03 (9th Cir. 11 2000). 12 B. Insurance Coverage 13 Dr. Moore’s policy with Allstate covers “sudden and accidental direct physical loss” to 14 the Property. (Dkt. No. 29-1 at 28.) But the Policy does not cover losses “caused by fire resulting 15 from vandalism” if the Property “is vacant or unoccupied for more than 90 consecutive days 16 immediately prior to the vandalism.” (Id. at 17.) 17 Under Washington law, an insured must show that the policy covers the loss, and the 18 burden then shifts to the insurer to show that an exclusion bars coverage. Wright v. Safeco Ins. 19 Co. of Am., 109 P.3d 1, 5 (Wash. Ct. App. 2004). Thus, Dr. Moore will have the burden at trial to 20 show that the fire was a “sudden and accidental direct physical loss.” (Dkt. No. 42 at 4 (citing 21 Eagle W. Ins. Co. v. SAT, 2400, LLC, 187 F. Supp. 3d 1231, 1235 (W.D. Wash. 2016).) But as 22 the moving party on summary judgment, it is Allstate who must establish that Dr. Moore’s 23 evidence is insufficient. See Celotex, 477 U.S. at 323–24; Nissan Fire, 210 F.3d at 1102–03. 24 Allstate argues that Dr. Moore’s evidence is mere speculation about possible causes from 25 which no reasonable factfinder could find the fire was “sudden and accidental.” Regardless, 26 1 Allstate argues, based on its own evidence, there is no genuine dispute that the vandalism 2 exclusion applies. 3 1. Sudden and Accidental Loss 4 The Washington courts have defined an “accident” for insurance purposes in various 5 ways. An accident is an “unusual, unexpected, and unforeseen happening.” Grange Ins. Co. v. 6 Brosseau, 776 P.2d 123, 125 (Wash. 1989). Said another way, an accident is “an unexpected, 7 unforeseen, or undesigned happening or consequence from either a known or an unknown 8 cause.” Yakima Cement Prods. Co. v. Great Am. Ins. Co., 608 P.2d 254, 257 (Wash. 1980). 9 Regardless of the exact wording, the point is that “[i]njuries will not be deemed caused by an 10 accident where the injuries are intentionally inflicted,” which “would be against public policy to 11 insure.” Detweiler v. J.C. Penney Cas. Ins. Co., 751 P.2d 282, 285 (Wash. 1988). 12 Allstate argues that Dr. Moore “offered no evidence that the fire was ‘a sudden and 13 accidental direct physical loss’” because Dr. Moore’s affirmative evidence suggests that the 14 cause of the fire cannot be determined. (Dkt. No. 42 at 4.) According to Allstate, evidence 15 merely suggesting various possible causes is insufficient to create a factual issue unless it points 16 to a cause that was actually responsible for the fire. (Dkt. No. 42 at 4–8.) 17 Allstate is wrong. Evidence that the fire’s cause is undetermined is evidence from which 18 a trier of fact could find that the fire was sudden and accidental. Because an “accident” is an 19 unexpected, unusual, or unforeseeable happening, regardless of cause, Dr. Moore’s evidence that 20 various causes cannot be ruled out affirmatively tends to show that the fire was accidental. 21 Indeed, one thing witnesses seemingly agree on is that finding “the” cause of the fire may not be 22 possible. (See Dkt. No. 27-2 at 5 (Dr. Moore’s Answer to Interrogatory 8: “I do not know the 23 cause of the fire, or how or precisely where it started.”); Dkt. No. 27-5 at 3 (Olympia Fire 24 Department: “The cause of the fire was undetermined.”); Dkt. No. 28-2 at 26 (Dale Mann expert 25 report: “[T]he specific cause for this fire is undetermined.”); Dkt. No. 35 at 17 (John Lentini 26 1 expert opinion: “I classify this fire on a more probable than not basis as undetermined.” 2 (emphasis original)); accord Dkt. No. 36 at 15 (expert opinion of Gerard Schaefer).) 3 This is not to say that any loss is automatically presumed to be an accident or that an 4 insured need not offer evidence to show that a loss was accidental. Rather, Dr. Moore makes an 5 affirmative showing that the fire’s cause cannot be determined, and from which the trier of fact 6 could reasonably find it was accidental. 7 Moreover, assigning a “true” cause to this fire is a credibility contest among various 8 witnesses, which the Court cannot resolve on summary judgment. (See Dkt. No. 41 at 8 (R&R: 9 “[I]f the factfinder is presented with a choice between the fire being accidentally or deliberately 10 set and disbelieves defendant’s experts . . . the factfinder could reasonably then infer that the fire 11 was started accidentally (i.e., not deliberately).”).) 12 By asserting that Dr. Moore must provide affirmative evidence of a particular cause, 13 Allstate essentially tries to change the plaintiff’s burden by making him rule out vandalism. But 14 that is not what is required to show a “sudden and accidental” loss under Allstate’s policy. Thus, 15 the Magistrate Judge correctly concluded that Allstate failed to show an absence of genuine 16 factual issues about whether the fire was accidental. 17 2. Vandalism exclusion 18 Allstate argues that the R&R incorrectly rejected its argument that the vandalism 19 exclusion bars coverage. (Dkt. No. 42 at 10–11.) The vandalism exclusion applies to a loss that 20 results from vandalism if the property is vacant for more than 90 days straight immediately 21 before the vandalism. (Dkt. No. 29-1 at 17.) There is no dispute about vacancy; the only issue is 22 vandalism. 23 Dr. Moore’s policy with Allstate defines “vandalism” as “willful or malicious conduct 24 resulting in damage or destruction of property.” (Dkt. No. 29-1 at 24.) To demonstrate this, 25 Allstate points to circumstantial evidence suggesting a human cause for the fire, including a 26 history of trespassers at the Property, the scrap of gasoline container, the open window, which 1 was apparently supposed to have been closed, and other items found at the scene. (See Dkt. No. 2 42 at 10–11.) This evidence can be viewed—and Allstate views it—as both establishing 3 vandalism and rebutting Dr. Moore’s assertion that the fire was sudden and accidental. 4 The trouble is, while this evidence may point to a trespasser, it does not suggest the 5 trespasser knew, should have known, or intended that the fire would damage the Property (versus 6 light a cigarette, for example). Even if a person lit the fire, the loss could still be an accident. See 7 State Farm Fire & Cas. Co. v. Ham & Rye, L.L.C., 174 P.3d 1175, 1179–81 (Wash. Ct. App. 8 2007) (an “accident” can result from intentional, volitional conduct so long as the resulting 9 consequence was not foreseeable or intended). 10 This evidence also does not establish that Allstate’s trespasser acted “willfully and 11 maliciously,” as the vandalism exclusion requires. Though Washington courts do not appear to 12 have articulated a precise definition for “willful and malicious” conduct, it seems clear that such 13 conduct involves a desire to cause harm or at least some awareness that the conduct is wrongful. 14 See Ham & Rye, L.L.C., 174 P.3d 1175, 1181–82 (Wash. Ct. App. 2007). Allstate presents no 15 evidence that a person who started the fire acted with such a mental state. 16 One could make various arguments from the evidence for why vandalism did or did not 17 cause the fire, but the venue for testing those theories is trial. At this stage, Allstate’s evidence 18 hinting at a human cause contradicts Dr. Moore’s evidence that the cause is undetermined. The 19 R&R properly recommends denying Allstate’s summary judgment motion. 20 III. CONCLUSION 21 For the foregoing reasons, the Court OVERRULES Allstate’s Objections (Dkt. No. 42), 22 ADOPTS the R&R (Dkt. No. 41), and DENIES Allstate’s summary judgment motion. (Dkt. No. 23 26). 24 // 25 // 26 // 1 DATED this 21st day of September 2021. A 2 3 4 John C. Coughenour 5 UNITED STATES DISTRICT JUDGE
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