Perez-Crisantos v. State Farm Fire & Casualty Co.
187 Wash. 2d 669
Wash.2017Background
- In 2007 Washington adopted the Insurance Fair Conduct Act (IFCA), RCW 48.30.015, creating a private cause of action for first‑party claimants "unreasonably denied a claim for coverage or payment of benefits," and authorizing treble damages and attorney fees if the insurer acted unreasonably or violated specified insurance regulations.
- In 2010 Perez‑Crisantos was injured in a car crash; State Farm paid PIP and the tortfeasor’s limits but refused portions of his underinsured motorist (UIM) claim, which went to arbitration and produced a larger recovery than State Farm’s pre‑arbitration position.
- Perez‑Crisantos sued, alleging IFCA violations based on WAC 284‑30‑330(7) (prohibiting forcing a claimant to litigate by offering substantially less than amounts ultimately recovered), CPA, bad faith, and negligence.
- The trial court granted summary judgment for State Farm, finding no evidence State Farm unreasonably handled the claim or engaged in ‘‘lowball’’ tactics; discovery requests for personnel files were denied. Perez‑Crisantos appealed.
- The Supreme Court considered whether IFCA creates an independent private cause of action based solely on regulatory violations (i.e., without an unreasonable denial under subsection (1)) and whether summary judgment was proper on the record before the trial court.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether IFCA creates an independent private cause of action for violation of the listed insurance regulations (RCW 48.30.015(5)) absent an "unreasonable denial" under subsection (1) | Perez‑Crisantos: IFCA and voter materials show intent to allow suits based on regulatory violations (e.g., WAC 284‑30‑330(7)); regulatory violations are independently actionable under IFCA | State Farm: IFCA’s plain language creates a cause of action only for unreasonable denials; subsections (2)-(5) allocate remedies contingent on findings and do not create a separate private cause of action | Held: IFCA does not create an independent cause of action for regulatory violations alone; private IFCA claims must be predicated on an unreasonable denial of coverage or payment of benefits (affirmed) |
| Whether summary judgment was improper because material facts (including State Farm’s incentive program and valuation) remained in dispute | Perez‑Crisantos: disparity between recovery and insurer’s pre‑arbitration position plus need for discovery on incentive programs creates triable issues | State Farm: no evidence of unreasonable conduct; disparity alone is insufficient; discovery request was not shown to justify continuance | Held: Summary judgment proper. Disparity alone does not establish a WAC 284‑30‑330(7) violation; trial court did not abuse discretion in denying further discovery and granting summary judgment |
| Whether a violation of WAC 284‑30‑330(7) alone supports a CPA claim here | Perez‑Crisantos: WAC violation constitutes per se unfair trade practice supporting CPA relief | State Farm: No WAC violation shown; therefore CPA claim fails | Held: CPA claim fails because plaintiff did not raise a genuine issue that State Farm violated the WAC provision |
| Whether the trial court abused discretion in limiting discovery (personnel files/incentive program) before summary judgment | Perez‑Crisantos: needed more discovery to show improper incentives and bad motive | State Farm: plaintiff failed to show why further discovery would produce evidence creating a genuine issue | Held: No abuse of discretion; plaintiff did not meet the CR 56(f) standards to postpone/expand discovery |
Key Cases Cited
- Bennett v. Hardy, 113 Wn.2d 912 (test for implying private causes of action under Washington law)
- Truck Ins. Exch. v. VanPort Homes, Inc., 147 Wn.2d 751 (discussing insurer regulatory violations and private remedies)
- Indus. Indem. Co. v. Kallevig, 114 Wn.2d 907 (WAC violations as basis for related causes of action)
- Dep’t of Ecology v. Campbell & Gwinn, LLC, 146 Wn.2d 1 (statutory interpretation principles; use of legislative history and voter materials)
- Ainsworth v. Progressive Cas. Ins. Co., 180 Wn. App. 52 (state appellate treatment of IFCA’s subsection (1) cause of action)