Safeco Insurance v. Country Mutual Insurance
165 Wash. App. 1
| Wash. Ct. App. | 2011Background
- Two insurance policies with same coverage level each contain an ‘other insurance’ clause purporting to make the policy excess.
- Country Mutual insured the driver for nonowned vehicle use; Safeco insured the vehicle owner (Parishes).
- Kooistra used the Parishes’ car with their permission; Country Mutual covered nonowned-vehicle liability, Safeco covered permissive-use liability.
- Safeco paid property damage claims; Country Mutual refused to share costs pro rata.
- Safeco sued for equitable contribution; parties cross-moved for summary judgment.
- Court held both excess clauses are mutually repugnant and reversed summary judgment for Country Mutual.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Are the excess ‘other insurance’ clauses mutually repugnant? | Safeco: both policies are at same level with excess language. | Country Mutual: policy levels differ; Country Mutual excess only as to nonowned vehicle. | Yes; clauses are mutually repugnant. |
| Should the excess clauses be disregarded and pro rata sharing apply? | Safeco: both excess clauses are disregarded, pro rata applies. | Country Mutual: its clause controls as excess over Safeco. | Disregard both; pro rata sharing applies. |
| Is Safeco entitled to attorney fees under Olympic Steamship? | Safeco seeks Olympic Steamship fee recovery. | Country Mutual did not address fees; no basis argued. | Safeco not entitled to attorney fees. |
Key Cases Cited
- Polygon Nw. Co. v. Am. Nat'l Fire Ins. Co., 143 Wn. App. 753 (2008) (mutually repugnant excess clauses at same coverage level require disregard)
- Pac. Indem. Co. v. Federated Am. Ins. Co., 76 Wn.2d 249 (1969) (excess vs pro rata where conflicting clauses arise)
- Safeco Ins. Co. of Am. v. Pacific Indemnity Co., 66 Wn.2d 38 (1965) (one policy excess while the other is pro rata controls when conflict exists)
- Federated Ins. Co. v. Allendale Mut. Ins. Co., 95 Wn.2d 464 (1981) (context for excess vs pro rata when both clauses express excess)
- Olympic Steamship Co. v. Centennial Ins. Co., 117 Wn.2d 37 (1991) (equitable exception to American rule allowing fee recovery for insured who prevails to obtain coverage)
- McRory v. N. Ins. Co. of N.Y., 138 Wn.2d 550 (1999) (right to recoup attorney fees when insured’s claim leads to coverage; applicability limits)
- McGreevy v. Or. Mut. Ins. Co., 128 Wn.2d 26 (1995) (recognizes Olympic Steamship equitable fees doctrine)