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Marchinek v. Safeco Insurance Company of America

United States District Court, D. Montana, Billings Division

January 26, 2018

MARILYN MARCHINEK, Plaintiff,
v.
SAFECO INSURANCE COMPANY OF AMERICA, Defendant.

          FINDINGS AND RECOMMENDATIONS OF UNITED STATES MAGISTRATE JUDGE

          TIMOTHY J. CAVAN, UNITED STATES MAGISTRATE JUDGE.

         Before the Court is Defendant Safeco Insurance Company of America's (“Safeco”) Rule 56 Motion for Summary Judgment (the “Motion”). (Doc. 19.) Having reviewed the parties' briefs and attendant exhibits, and for the reasons set forth below, the Court makes the following findings and recommendations.

         I. Pertinent Facts

         A hail storm damaged Plaintiff's house on May 21, 2016. (Doc. 23 at 1.) Safeco covered Plaintiff under Homeowners Policy No. OM2546915 (the “Policy”), which provided insurance coverage for the hail damage. (Id. at 2.) Plaintiff filed a claim for the hail damage, and Safeco issued a payment of $8, 017.07 on June 2, 2016, representing Safeco's initial estimate of the loss, less Plaintiff's deductible and depreciation. (Id.; Doc. 21-2 at 2-3.)

         Plaintiff hired Big Sky Contractors (“Big Sky”) to complete repairs to her home. Big Sky provided a number of increasing estimates to Safeco between June, 2016, and January, 2017, which ranged from $49, 741.29 on June 24, 2016, to a final estimate of $83, 615.57 on January 18, 2017. (Id. at 2-3; Doc. 21-2 at 3, 5.) Though Safeco refused to accept Big Sky's estimates in full, it conducted additional inspections of the property, and issued several supplemental payments to Plaintiff, ultimately totaling $29, 600.07. (Id. at 4; Doc. 21-2 at 4-5)

         After receiving Plaintiff's final estimate on January 18, 2017, Safeco invoked an appraisal clause (the “Appraisal Clause”) in the Policy on January 27, 2017. The Appraisal Clause provides:

7. Appraisal. If you and we do not agree on the amount of the loss, including the amount of actual cash value or replacement cost, then, on the written demand of either, each shall select a competent and disinterested appraiser and notify the other of the appraiser selected within 20 days of such demand. The appraisers shall first select a competent and disinterested umpire; and failing for 15 days to agree upon such umpire, then, on request of you or the company, such umpire shall be selected by a judge of a court of record in the state in which the property covered is located. The appraisers shall then resolve the issues surrounding the loss, appraise the loss, stating separately the actual cash value or replacement cost of each item, and, failing to agree, shall submit their differences, only, to the umpire. An aware in writing, so itemized, of any two of these three, when filed with the company shall determine the amount of loss.
Each party will:
a. pay its own appraiser; and b. bear the other expenses of the appraisal and umpire equally.

(Doc. 21-1 at 29 (emphasis in original).) The Policy has an additional provision that “[n]o action shall be brought against us unless there has been compliance with the policy provisions and the action is started within one year after the inception of loss or damage.” (Id.; the “No Action Clause.”)

         Though there is some dispute between the parties as to why Plaintiff refused to comply with the Appraisal Clause, there is no dispute that she communicated to Safeco her refusal to comply, and initiated this suit prior to any appraisal. (Doc. 23 at 6.)

         Plaintiff filed this action on March 28, 2017 in Montana Thirteenth Judicial District Court. (Doc. 7.) Safeco removed the action on May 25, 2017, citing this Court's jurisdiction pursuant to 28 U.S.C. § 1332. (Doc. 1.) Plaintiff then filed her Second Amended Complaint (“the Complaint”) on July 25, 2017. (Doc. 15.)

         Count I of the Complaint alleges a claim for breach of contract based on the Safeco insurance policy issued to the Plaintiff. Count II asserts a claim for alleged violations of Montana's Unfair Trade Practices Act (“UTPA”), Mont Code Ann. § 33-18-101, et seq. Safeco now moves for summary judgment as to both counts of the Complaint.

         II. ...


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