O'Neill v. Farmers Ins. Co. of Washington

• Decision Date: 06 December 2004
• Docket Number: No. 52378-3-I.,52378-3-I.
• Citation: 124 Wn. App. 516,125 P.3d 134
• Parties: John and Claudia O'NEILL, Appellants, v. FARMERS INSURANCE COMPANY OF WASHINGTON dba Farmers Insurance Group, a Washington corporation, Respondents.
• Court: Washington Supreme Court

Page 134

125 P.3d 134

124 Wn. App. 516

John and Claudia O'NEILL, Appellants, v. FARMERS INSURANCE COMPANY OF WASHINGTON dba Farmers Insurance Group, a Washington corporation, Respondents.

No. 52378-3-I.

Court of Appeals of Washington, Division 1.

November 1, 2004.

Publication Ordered December 6, 2004.

Guy William Beckett, Seattle, for Appellants.

Pellegrino L. Certa, Seattle, for Respondents.

APPELWICK, J.

NATURE OF CASE

¶ 1 The O'Neills appeal the summary judgment dismissal of their claim under a homeowner's insurance policy against Farmers Insurance Company (Farmers). The O'Neills filed a summons and complaint against Farmers, alleging breach of contract, bad faith, and violation of the Consumer Protection Act (CPA). The O'Neills served the secretary of Farmers' attorney, but did not serve Farmers itself. Farmers filed a motion for summary judgment, alleging affirmative defenses including insufficiency of service. The trial court granted Farmer's motion for summary judgment. The O'Neills appeal. We affirm in part and reverse in part.

FACTS

¶ 2 Farmers Insurance Company of Washington d/b/a Farmers Insurance Group (Farmers) is a domestic insurance company. John and Claudia O'Neill insured their home under Farmers. This litigation arose from a claim the O'Neills brought against Farmers under their homeowner's insurance policy.

¶ 3 On or about September 15, 2001, the O'Neills discovered a water leak in their residence, notified Farmers of it, and filed a claim for coverage against their homeowner's policy. Farmers retained Flare Corporation (Flare) to prepare a scope of work and submit a bid to repair the damages caused by the leak. Flare estimated that the repairs would total $23,557.10. Although Flare prepared the scope of work, the O'Neills retained AACE Contracting (AACE) to do the repair work. Farmers agreed to pay AACE, and on December 6, 2001, the O'Neills entered into a contract with AACE. AACE began the repair process in January 2002. The O'Neills allege that Farmers "required the water remediation company to try to dry [the walls] by forcing warm air through the cavities of the O'Neills' home." They further alleged that this practice, along with other cost-saving measures authorized by Farmers, damaged their home. Farmers paid AACE a total of $84,751.14 for its work.

¶ 4 After AACE ceased its repair work on the O'Neills' home, the O'Neills hired Tim Wickstrom of Changing Lives to provide a repair bid on damages associated with AACE's workmanship. Changing Lives' repair estimate totaled $24,948.60. Farmers issued a check for $25,000 made out to Changing Lives and the O'Neills. Changing Lives, however, never began work because of a dispute between the O'Neills and Changing Lives.

¶ 5 On September 13, 2002, the O'Neills' counsel filed a summons and complaint against Farmers in King County Superior Court. In their complaint, the O'Neills stated that they had made a claim against Farmers under their homeowner's insurance policy for water damage to their home, that the repair work had not been completed within a reasonable time, and that Farmer's delay and defective work caused "the retention of excess moisture, and attendant decay and mold growth." They alleged breach of contract, bad faith insurance practices, and violation of Washington's Consumer Protection Act. The O'Neills stated that the date of loss was September 15, 2001, the date on which they discovered the water leak. The O'Neills policy provided:

12. Suit Against Us. We may not be sued unless there has been full compliance with all the terms of this policy. Suit on or arising out of this policy must be brought within one year after the loss.

¶ 6 On September 13, 2002, the O'Neills attorney delivered copies of the complaint to the secretary of Farmer's legal counsel, Pellegrino Certa, (Certa) at his office. Copies of the complaint were not personally delivered to either Farmers or to Certa, on September 13th, or thereafter. In its October 31, 2002 answer, Farmers listed insufficiency of service of process among its affirmative defenses. Farmers later propounded discovery requests upon the O'Neills.

¶ 7 On March 27, 2003, Farmers filed a motion for summary judgment alleging that the O'Neills' case should be dismissed because they had not served Farmers within 90 days of filing their summons and complaint. On April 17, 2003, the O'Neills filed a motion to amend their claim. Farmers' motion for summary judgment and the O'Neill's motion to amend their claim were both set to be heard on April 25, 2003. The trial court granted Farmers' motion for summary judgment, and did not consider the O'Neills' motion to amend. The O'Neills appeal.

ANALYSIS

I. Supplemental Declaration

¶ 8 The O'Neills' assert that the trial court erred in failing to consider their supplemental declaration of Claudia O'Neill.

¶ 9 Farmers filed its motion for summary judgment on March 27, 2003, and a hearing date was set for April 25, 2003. On April 22, 2003, three days prior to the summary judgment hearing, the O'Neills' filed a supplemental declaration by Claudia O'Neill. Farmers filed a motion to strike as untimely and not based on personal knowledge. The court interlineated on its summary judgment order that it "did not consider the supplemental declaration of C[laudia] O'Neill as it was untimely."

¶ 10 Pursuant to CR 56(c), "[t]he adverse party may file and serve opposing affidavits, [ ... ] not later than 11 calendar days before the hearing." Whether to accept or reject untimely filed affidavits is within the trial court's discretion. See Brown v. Peoples Mortgage Co., 48 Wash.App. 554, 559-60, 739 P.2d 1188 (1987) (citing KCLR 56(c)(1)(B), the court found no abuse of discretion when a trial court struck a supplemental affidavit filed on the same day as a scheduled summary judgment proceeding) (citing Jobe v. Weyerhaeuser Co., 37 Wash.App. 718, 684 P.2d 719 (1984)). Here, the O'Neills filed their supplemental declarations three days prior to the summary judgment hearing. It was within the trial court's discretion to refuse to consider them timely filed.

¶ 11 Although the O'Neills acknowledge that they filed their supplemental declarations after the 11-day period prescribed in CR 56(c), they rely on Meridian Minerals Co. v. King County, 61 Wash.App. 195, 202-03, 810 P.2d 31, rev. denied, 117 Wash.2d 1017, 818 P.2d 1099 (1991) to assert that they are entitled to submit additional evidence in opposition to a motion for summary judgment at any time before the court enters a formal order. Meridian is inapposite because it concerned additional evidence submitted in support of a motion for reconsideration.

¶ 12 Because the trial court acted within its discretion in striking the O'Neills' supplemental declarations as untimely filed, the declarations are not within the scope of this record on review. The record before this court thus consists of the evidence that the trial court relied upon in entering its summary judgment.

II. Standard of Review

¶ 13 This Court reviews a grant of summary judgment de novo, engaging in the same inquiry as the trial court. Youngblood v. Schireman, 53 Wash.App. 95, 99, 765 P.2d 1312 (1988). Summary judgment is appropriate "if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." CR 56(c). "The facts and all reasonable inferences therefrom must be considered in the light most favorable to the nonmoving party." Nivens v. 7-11 Hoagy's Corner, 133 Wash.2d 192, 197-98, 943 P.2d 286 (1997). Questions of law are reviewed de novo. Rivett v. City of Tacoma, 123 Wash.2d 573, 578, 870 P.2d 299 (1994).

III. Sufficiency of Service of Process

A. Actual Process

¶ 14 The O'Neills contend that they properly served Farmers.

¶ 15 RCW 4.16.170 governs service of process, and states:

For the purpose of tolling any statute of limitations an action shall be deemed commenced when the complaint is filed or summons is served whichever occurs first. If service has not been had on the defendant prior to the filing of the complaint, the plaintiff shall cause one or more of the defendants to be served personally, or commence service by publication within ninety days from the date of filing the complaint. If the action is commenced by service on one or more of the defendants or by publication, the plaintiff shall file the summons and complaint within ninety days from the date of service. If following service the complaint is not so filed, or following filing, service is not so made, the action shall be deemed to not have been commenced for purposes of tolling the statute of limitations.

Washington courts have repeatedly held that the filing of a complaint does not constitute the commencement of an action for the purposes of tolling the statute of limitations. It is still necessary for the plaintiff to serve a defendant within ninety days of the date of filing in order for the commencement to be complete. Collins v. Lomas & Nettleton Co., 29 Wash.App. 415, 628 P.2d 855 (1981); Adkinson v. Digby, Inc., 99 Wash.2d 206, 660 P.2d 756 (1983); Sidis v. Brodie/Dohrmann, Inc., 117 Wash.2d 325, 815 P.2d 781 (1991).

¶ 16 The O'Neills discovered their loss on September 15, 2001, and immediately reported it to Farmers. The O'Neills' insurance policy provides that "[s]uit on or arising out of this policy must be brought within one year after the loss." They filed their action against Farmers on September 13, 2002. Pursuant to RCW 4.16.170, they needed to have served Farmers by December 12, 2002. The O'Neills delivered the papers to the secretary of Farmer's attorney on September 13, 2002. Their delivery did not constitute actual service on Farmers. Farmers has never been served.

B. Substantial Compliance with Service

¶ 17 Farmers argues that because the O'Neills failed...