Payton O. Hoff v. Safeco Ins. Co. Of Illinois

CourtCourt of Appeals of Washington
DecidedMay 29, 2019
Docket50850-8
StatusUnpublished

This text of Payton O. Hoff v. Safeco Ins. Co. Of Illinois (Payton O. Hoff v. Safeco Ins. Co. Of Illinois) 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
Payton O. Hoff v. Safeco Ins. Co. Of Illinois, (Wash. Ct. App. 2019).

Opinion

Filed Washington State Court of Appeals Division Two

May 29, 2019 IN THE COURT OF APPEALS OF THE STATE OF WASHINGTON

DIVISION II PAYTON O. HOFF, No. 50850-8-II

Respondent, UNPUBLISHED OPINION

v.

SAFECO INSURANCE COMPANY OF ILLINOIS,

Appellant.

GLASGOW, J. — Payton Hoff was a passenger in a vehicle that was hit by a drunk driver.

She received a settlement from the at-fault driver’s insurer and personal injury protection

payments from Safeco Insurance. She then made an underinsured motorist claim with Safeco.

Hoff objected to Safeco’s low offers of settlement and eventually filed a complaint in superior

court alleging unfair claims settlement practices and bad faith.

After some discovery, Safeco removed the suit to federal district court on the basis of

diversity jurisdiction. The federal court remanded to the superior court, finding that the required

minimum amount in controversy had not been established.

On remand, Hoff argued that Safeco’s removal attempt itself supported the bad faith

claim, and she moved to compel Safeco to produce all information the company or its attorneys

possessed concerning the decision to remove her superior court lawsuit to federal court. The

superior court granted the motion to compel and ordered Safeco to produce for in camera review

all information—including attorney-client privileged materials and work product—concerning No. 50850-8-II

Safeco’s decision to remove the case to federal court. We granted Safeco’s motion for

discretionary review.

Under the facts of this case, information about Safeco’s decision to remove the case to

federal court is not discoverable under Richardson v. GEICO, a case decided after the superior

court made its ruling here. 200 Wn. App. 705, 403 P.3d 115 (2017), review denied, 190 Wn.2d

1008 (2018). In addition, under Cedell v. Farmers Insurance Co., in order to pierce the attorney-

client privilege and attorney work product protections, a party seeking protected information

must make a factual showing adequate to support a reasonable good faith belief that the party’s

conduct was fraudulent. 176 Wn.2d 686, 295 P.3d 239 (2013). This is a high bar and Hoff fails

to meet it here.

We reverse the superior court’s order compelling discovery and remand for further

proceedings.

FACTS

A. Accident and Underinsured Motorist Claim

In May 2011, a drunk driver drifted across the center line and collided head on with a

vehicle in which Hoff was a passenger. Hoff sustained multiple soft tissue injuries. The drunk

driver died. Safeco insured the vehicle and provided personal injury protection and underinsured

motorist (UIM) coverage to Hoff.

The drunk driver’s insurer settled Hoff’s bodily injury claim for the policy limit of

$25,000. Safeco also paid over $15,000 in personal injury protection benefits.1

1 Personal injury protection coverage applies regardless of fault, and provides benefits for claims involving medical and hospital expenses, wage loss, loss of services, and funeral expenses.

2 No. 50850-8-II

Hoff subsequently filed a UIM bodily injury claim with Safeco.2 The UIM bodily injury

coverage had a policy limit of $50,000.

Throughout Safeco’s claim investigation, Hoff reported ongoing neck, back, shoulder,

and hip pain. She also reported that she was experiencing emotional trauma. Hoff continued to

seek and receive chiropractic and other medical care and anticipated she would need ongoing

care into the future.

Safeco completed a bodily injury evaluation and offered Hoff $2,500 to settle her UIM

claim. Hoff rejected the offer and demanded $100,000, which was double the UIM policy limit.

Safeco replied that they would be at an impasse until Hoff countered with a more reasonable

demand.

Hoff filed a complaint in superior court. She alleged that Safeco had violated WAC 284-

30-330(a)(7), which prohibits an insurance company from forcing a claimant to litigate by

offering substantially less than the amounts ultimately recovered in the proceeding. She also

relied on RCW 48.30.010(7) and the Insurance Fair Conduct Act, chapter 48.30 RCW.3 Hoff

alleged that her damages “far exceed[ed] Safeco’s available UIM limits.” Clerk’s Papers (CP) at

4. Hoff’s prayer for relief requested “judgments for general and special damages, all in such

2 UIM coverage provides compensation when the insured is injured by another driver whose bodily injury liability coverage is insufficient to fully compensate the injured person. 3 The complaint and amended complaint cite to RCW 48.40.010(7), but that provision appears to be part of an unrelated chapter that has been repealed. RCW 48.30.010(7) prohibits insurance companies from unreasonably denying claims made by first party claimants, including people claiming they are entitled to payment as a covered person under an insurance policy. RCW 48.30.010(7), .015(4).

3 No. 50850-8-II

amounts as will be proven at time of trial herein” and “other relief as to the Court seems fair,

just, and equitable.” CP at 5.

B. Amount in Controversy

Safeco propounded its first set of discovery requests. In answering Safeco’s requests for

admission, Hoff denied that the total amount of her damages payable by Safeco exceeded

$75,000. She also denied that Safeco “[had] any exposure to pay [her] in excess of $75,000.”

CP at 69.

In her answers to Safeco’s first interrogatories and requests for production, Hoff claimed

that her special medical damages totaled at least $12,455, not including $4,733 of other medical

bills, and that she anticipated she would require future medical care. She claimed that “[g]eneral

damages are unknown at this time[,] . . . [but] the value is $75,000 exclusive of the third party

recovery.” CP at 63. When asked whether she sought a trebling or any multiplier of damages,

she responded, “Yes. Both general and special damages. The amounts will be determined by a

jury based upon the longevity of symptoms, their severity and the manner in which [Hoff’s]

claim was treated by defendant Safeco through its employees and practices.” CP at 64. Hoff

also asserted that “[i]n the event of a determination that [the Insurance Fair Conduct Act] was

violated,” she planned to “seek punitive damages in an amount a finder of fact deems

appropriate.” CP at 64.

Although the amount in controversy had the potential to exceed $75,000, Hoff

acknowledged that she was disinclined to litigate in federal court. Therefore, she offered to sign

a CR 2A stipulation that the amount in controversy did not exceed $75,000. Nevertheless, she

maintained that the jury could award her an “aggregate verdict” of far more than $75,000, but

4 No. 50850-8-II

that Safeco could not be required to pay anything greater than $75,000. CP at 1301. Safeco

proposed the following CR 2A stipulation language:

1.

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