Condo Sues State Farm Too Late Due To Water Damage

Gold Creek Condo sues a unit of State Farm Insurance Co. due to water damage. The condominium filed the suit almost 30 years too late according to a federal appeals court. The federal appeals court ruling affirmed a lower court ruling.

Coverage Denied

Gold Creek Condominium Association is a condominium built in Tacoma, Washington. The Phase I Association of Apartment Owners was a 72-unit complex completed in 1982. However,  in 2018, the owners association learned there was water damage to the complex.

In the past, State Farm issued an all-risk insurance policy on the complex. This was effective from October 1, 1989, to October 1, 1990. The Travelers Cos. Inc. units insured the condominium of Gold Creek between October 1991 and 1996. They were covered under all-risk policies.

However, the insurers denied Gold Creek the coverage. As a result, the condo sues State Farm Insurance Co.

Condo Sues State Farm Too Late

The Tacoma U.S. District Court dismissed the case by granting them summary judgment. It was affirmed by an appeals court panel made up of three judges.

State Farm policy’s plain text was unambiguous. It required that Gold Creek bring a suit within one year of rain events during the policy’s period. This means they should have done it within one year from 1989 to 1990. However, Gold Creek filed a suit almost 30 years later. As a result, the policy bars claims against State Farm. This is the panel’s ruling.

Moreover, it affirmed Travelers’ dismissal. It said that a reasonable juror wouldn’t conclude that, during the policy period, the damage exceeded the deductible.

Michale Rogers, a shareholder with Reed McClure in Seattle and State Farm attorney, released a statement. He said that the decision was consistent with the parties’ expectations at the time of the policy’s issuance. Moreover, he stated that it may give guidance to several cases within the federal district court. However, the condominium’s attorneys gave no response when asked to comment.