Stephenie Lock V. American Family Insurance Company

CourtCourt of Appeals of Washington
DecidedDecember 23, 2024
Docket85844-1
StatusUnpublished

This text of Stephenie Lock V. American Family Insurance Company (Stephenie Lock V. American Family 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
Stephenie Lock V. American Family Insurance Company, (Wash. Ct. App. 2024).

Opinion

IN THE COURT OF APPEALS OF THE STATE OF WASHINGTON

STEPHENIE Y. LOCK, an individual, No. 85844-1-I Appellant, DIVISION ONE v. UNPUBLISHED OPINION AMERICAN FAMILY INSURANCE COMPANY, a Foreign Corporation, doing business in Washington,

Respondent.

COBURN, J. — This appeal follows a trial on remand in what is now a nearly

decade-long intensely litigated contest originally stemming from a motor vehicle collision

in 2013. Lock sued American Family Insurance Company for uninsured motorist (UIM)

benefits as well as extracontractual claims under the Washington Consumer Protection

Act (CPA), the Insurance Fair Conduct Act (IFCA), and common law insurance bad

faith. Lock v. Am. Fam. Ins. Co., 12 Wn. App. 2d 905, 909, 460 P.3d 683 (2020). In the

first appeal, this court, with one exception, affirmed the trial court’s dismissal of the

extracontractual claims following trial that included a $413,575 verdict on Lock’s

common law insurance bad faith claim. Id. at 925-26. This court remanded for trial on a

claim for common law insurance bad faith based on American Family’s corporate 85844-1-I/2

counsel’s conduct of directly contacting Lock pretrial.1 Id. at 924-25. In doing so, this

court did not address Lock’s claim that the trial court erred in vacating its attorney fee

award for bad faith litigation tactics and instead vacated the trial court’s order awarding

or denying attorney fees and instructed that any claims for fees should be addressed on

remand. Id. at 925 n.4. Neither party petitioned our state Supreme Court for review of

this court’s decision.

On remand, two different superior court judges denied Lock’s motion for attorney

fees based on American Family’s bad faith litigation, and the trial court rejected Lock’s

argument that she could retry all her previously dismissed bad faith insurance claims. A

jury awarded Lock $40,000 on her common law insurance bad faith claim. Lock appeals

contending (1) the trial court erroneously limited the scope of the trial on remand, (2) the

trial court wrongly denied her an evidentiary hearing on racial bias, (3) judicial bias

violated her right to due process, and (4) the trial court erroneously denied her bad-

faith-litigation award of attorney fees. American Family asks this court to affirm and only

alternatively cross-appeals.

We affirm.

FACTS

In 2013 Lock was rear-ended by an uninsured driver and diagnosed with neck

and back pain. Id. at 909.2 At the time of the collision, Lock’s American Family auto

insurance policy included personal injury protection (PIP) and UIM benefits. Id. at 910.

1 This court also remanded for the trial court to offset the jury’s $21,000 UIM award by

the amount American Family had paid under Lock’s PIP policy for her medical bills prior to trial. Lock, 12 Wn. App. 2d at 928, 930, 932. 2 Because the underlying facts are not at issue in this appeal, we cite to this court’s

previous opinion in this matter to provide factual context.

2 85844-1-I/3

After the collision, American Family paid all of Lock’s submitted medical bills. Id. at 910-

11, 914. American Family later notified Lock it would not pay for any further medical

treatment after an independent medical exam determined she did not require any

additional diagnostic testing or treatment. Id. at 910-11. Lock filed a UIM claim against

American Family in March 2015. Id. at 911. In November Lock amended her complaint

to also include extracontractual claims under the CPA, chapter 19.86 RCW; the IFCA,

RCW 48.30.015; and common law insurance bad faith. Id.

After Lock amended her complaint, American Family twice unsuccessfully tried to

remove the case to federal court. Id. at 911-12. After the first remand back to state

court, a King County Superior Court Judge denied American Family’s motion for a

summary judgment hearing on shortened time and denied American Family’s request

for a pretrial summary judgment hearing. Id. American Family then again tried to

remove the case to federal court and filed the same summary judgment motion. Id. at

912. After determining that American Family relied on its own estimate of general

damages as the basis for removal, a United States District Court Judge sanctioned

American Family and remanded the case back to state court. Id. The district court judge

found that American Family “flat-out lied to the Court” about the amount in controversy

and used “cheap trial tactics” by removing the case in an attempt to obtain summary

judgment. Id. The district court judge sanctioned American Family by awarding Lock

attorney fees in the amount of $4,153.75. Id. Once back in state court the second time,

the superior court judge set trial for May 2017 and again denied American Family’s

request to calendar its motion for summary judgment “due to its bad faith litigation

tactics.” Id.

3 85844-1-I/4

In March 2017 American Family’s corporate counsel mailed the $4,153.75

sanction check with a cover letter on American Family “Claims Legal Division”

letterhead directly to Lock’s home. Id. at 913, 916-17. The cover letter was captioned

with the case name and King County Superior Court case number and stated the

payment “represents full and final settlement of all claims in the above-captioned

matter.” Id. at 913. We refer to the sending of the check and cover letter as American

Family’s “direct contact.” See id. at 913, 923-24.

The first trial court denied Lock’s request for a jury instruction that American

Family’s direct contact was evidence of bad faith conduct, and concluded there were no

damages caused by the direct contact. Id. at 915. The jury found that American Family

had not committed an IFCA violation. Id. at 916. The jury awarded Lock a $21,000

verdict on her UIM claim, $8,500 on her CPA claim, and $413,575 on her bad faith

claim. Id. Lock moved for attorney fees based on American Family being found as

having “acted in bad faith” by a unanimous jury, the federal district court judge, and the

superior court judge who denied American Family’s request to calendar a motion for

summary judgment. The first trial court initially granted attorney fees and directed Lock

to submit a fee declaration segregating the fees incurred due to American Family’s bad

faith litigation conduct.3 Id. at 919.

3 The trial court’s initial order granting attorney fees states:

To obtain an award of those fees and costs, plaintiff shall submit a fee declaration that segregates those fees incurred due to American Family’s bad faith. Examples of such fees include: (1) fees incurred to reschedule American Family’s 30(b)(6) deposition; (2) fees incurred [to] attend and repeatedly prepare for any deposition that American Family failed to attend despite not having a protective order in place; (3) fees incurred to oppose American Family’s improper efforts to get a hearing on summary judgment after [a superior court judge] ruled she would not hear it; and (4) fees incurred to address American Family’s improper removals to federal court.

4 85844-1-I/5

The trial court also granted American Family’s motion for JNOV and dismissed

Lock’s CPA and bad faith extracontractual claims.4 Id. at 916, 918. Relevant to this

appeal, the trial court held in part that Lock’s failure to prove evidence of damages

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