On November 4, 2013, the Washington Court of Appeals, Div. I, following argument by attorney F.J. Maloney, issued a favorable ruling in support of MLR’s client upholding the trial court’s grant of summary judgment. The case involved a claim for UIM property damage to a car under policy language that limited recovery to the amount necessary to repair the car to its “preloss condition.” Citing the Washington Supreme Court’s ruling in Moeller v. Farmers Ins. Co. of Wash., the Court made it clear that “stigma damages” and “diminished value” damages are not synonymous. The Court held that by using the term “preloss condition,” the insurer had contractually limited its damages to physical damage, and excluded intangible damages such as “stigma damage”: “We conclude that [the insurer] intentionally used the word ‘value’ to mean what the car was worth on the market before the accident and that [the insurer] intentionally used the word ‘condition’ to mean the physical state that the car was in before the accident.” The Court of Appeals also upheld the trial court’s dismissal of plaintiff’s extra-contractual claims under the Consumer Protection Act (CPA) and for insurance bad faith claims, which were predicated on alleged violations of the Washington Administrative Code (WAC). The Court of Appeals determined the trial court’s ruling was proper because the insurer was correct in its coverage position and reasonably justified in denying the claim.
A copy of the Court Appeals, Div. I, published opinion is available here: Ibrahim v. AIU Insurance Co., Wash. Ct. of App., Div. I, Case No. 69554-1-I. Feel free to contact us with any additional questions about the opinion.