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Mulcahy v. Farmers Insurance Company of Washington11/25/2002
Concurring: Ronald E. Cox, William W. Baker
This case raises an issue of first impression in Washington whether an insurer that has issued an automobile insurance policy in Washington, insuring a Washington-licensed automobile owned by a Washington resident under which the insurer is obligated to pay no-fault personal injury protection (PIP) benefits in a specific amount, must nevertheless pay greater PIP-type benefits than provided by the insurance policy (1) where the insured has been injured in an automobile accident in British Columbia, Canada, (2) where the insurer would have been obligated to pay the greater benefits if the insurance policy had been issued in British Columbia in accordance with the laws governing motor-vehicle insurance plans issued in that province, (3) where the insurer has filed a Power of Attorney and Undertaking (PAU) in British Columbia, thereby waiving its right to raise certain defenses as to claims, actions or proceedings brought in British Columbia that it could not raise if the insurance policy had been issued in accordance with the laws of British Columbia, and (4) where the insured files an action against the insurer in Washington, seeking to recover the greater benefits provided by British Columbia law.
Appellant Mary Mulcahy, the insured in this case, was seriously injured in a motor vehicle accident in Vancouver, British Columbia, Canada. At the time of the accident, she was a resident of Seattle, Washington and was driving her Washington-licensed automobile, which was insured by Farmers Insurance Company of Washington under a motor-vehicle insurance policy that was issued in Washington. The policy provided Ms. Mulcahy with PIP medical benefits of $10,000, which Farmers paid. Ms. Mulcahy's actual medical expenses for her injuries sustained in the accident were much higher than the PIP benefits provided under her insurance policy.
Ms. Mulcahy sued the at-fault driver, a Canadian citizen who was insured by the Insurance Corporation of British Columbia, in British Columbia. She eventually settled her claim for $375,000 (Canadian). But ICBC deducted $150,000 (Canadian) from her settlement proceeds, taking the position that Ms. Mulcahy must collect this amount from her own insurer in that Farmers Insurance Group had filed a PAU in British Columbia by which it agreed to be bound by the reciprocal laws that govern motor vehicle insurance claims in Canada. Farmers refused to pay Ms. Mulcahy $150,000 (Canadian). She thereupon filed virtually identical actions in British Columbia and Washington, seeking to enforce her rights under the PAU.
A judge of the King County Superior Court subsequently granted Farmers' motion for summary judgment, and entered an order dismissing Ms. Mulcahy's action in Washington. Ms. Mulcahy appealed that order to this court.
Farmers moved in British Columbia for dismissal of Ms. Mulcahy's suit there, contending that Ms. Mulcahy was estopped from litigating the issue in British Columbia, under the doctrine of res judicata. The British Columbia trial court denied that motion. Farmers sought and was granted leave to appeal that ruling in the British Columbia Court of Appeal. That appeal is now pending.
We affirm the King County Superior Court's summary judgment of dismissal. Based on the plain language of the PAU, Farmers agreed to be bound by British Columbia motor vehicle insurance law for purposes of actions brought against it in British Columbia, but did not agree to be so bound for purposes of actions brought against it in Washington. In so ruling, we do not purport to resolve the merits of Ms. Mulcahy's action in British Columbia. Indeed, the PAU operates as a contract between Far
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