Maxwell Williams v. Travelers Home & Marine Ins Co ( 2018 )

FILED
NOT FOR PUBLICATION
OCT 17 2018
UNITED STATES COURT OF APPEALS MOLLY C. DWYER, CLERK
U.S. COURT OF APPEALS
FOR THE NINTH CIRCUIT
MAXWELL B. WILLIAMS and CLAIRE No. 17-17368
N. WILLIAMS,
D.C. No.
Plaintiffs-Appellants, 2:16-cv-01856-APG-CWH
v.
MEMORANDUM*
TRAVELERS HOME AND MARINE
INSURANCE COMPANY and
TRAVELERS INDEMNITY COMPANY,
Defendants-Appellees.
Appeal from the United States District Court
for the District of Nevada
Andrew P. Gordon, District Judge, Presiding
Submitted October 12, 2018**
Seattle, Washington
Before: BLACK,*** TALLMAN, and BEA, Circuit Judges.
*
This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
**
The panel unanimously concludes this case is suitable for decision
without oral argument. See Fed. R. App. P. 34(a)(2).
***
The Honorable Susan H. Black, United States Circuit Judge for the
U.S. Court of Appeals for the Eleventh Circuit, sitting by designation.
Maxwell and Claire Williams brought a diversity insurance coverage action
seeking coverage under their homeowners’ policy after suffering a water loss at
their residence in Las Vegas, Nevada. The Williamses appeal the district court’s
grant of summary judgment in favor of Travelers Home and Marine Insurance
Company (“Travelers”). We have jurisdiction under 28 U.S.C. § 1291, and we
affirm.
First, the district court properly granted summary judgment on the
Williamses’ claims for bad faith and violations of Nev. Rev. Stat. § 686A.310. In
Nevada, a claim for bad faith must be filed within four years of the triggering
event. Nev. Rev. Stat. § 11.190(2)(c). A claim based on violation of Nev. Rev.
Stat. § 686A.310 must be filed within three years of the triggering event. Nev.
Rev. Stat. § 11.190(3)(a). Under Nevada law, an insured’s limitations period does
not begin to run until the insurer “formally denies” liability or additional benefits.
See Clark v. Truck Ins. Exch., 598 P.2d 628, 629 (Nev. 1979). No magic words are
necessary to constitute a denial of further benefits; rather the limitations period is
triggered by “notif[ication] that [the] carrier has failed to fulfill its promise to pay a
claim.” Grayson v. State Farm Mut. Auto. Ins., 971 P.2d 798, 800 (Nev. 1998); see
also Walker v. Am. Bankers Ins. Grp., 836 P.2d 59, 62!63 (Nev. 1992) (statement
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that insurer was “closing out” its file constituted formal denial of liability for
further payments).
Here, the limitations period was triggered by Travelers’ October 5, 2011
letter, which stated that Travelers was closing the claim file because the Williamses
had failed to cooperate with Travelers’ previous two requests for inspection of the
property and additional information in support of the claim. The letter (1) notified
the Williamses that Travelers was “closing [its] file,” and (2) referred the
Williamses to their insurance policy’s “Suit Against Us” provision, which set forth
a two-year limitation period for breach of the policy. The letter put the Williamses
on notice that Travelers would not make further payments on the claim.
The only evidence the Williamses offered of any post-closure activity is
Travelers’ July 7, 2012 letter, which advised the Williamses that Travelers did not
have a record of the check it issued to them on May 26, 2011 being cashed. The
letter did not indicate that any further consideration had been or would be given to
the Williamses’ claim or that Travelers contemplated further payment.
The Williamses filed suit on June 17, 2016—well over four years after the
limitations period was triggered by the October 5, 2011 letter. Accordingly, the
Williamses’ claims for bad faith and violations of Nev. Rev. Stat. § 686A.310 were
barred by the applicable statutes of limitation.
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Second, the district court properly granted summary judgment on the
Williamses’ claim for breach of contract. Nevada has a six-year limitation period
for general breach of contract actions. Nev. Rev. Stat. § 11.190(1)(b). However,
the Policy contains a two-year suit limitation provision. Suit limitation provisions
are enforceable in Nevada so long as the period provided in the contract is a
“reasonable balance between the insurer’s interest in prompt commencement of
action and the insured’s need for adequate time to bring suit.” Clark, 598 P.2d at
629; see also Queensridge Towers LLC v. Allianz Glob. Risks US Ins. Co., No.
15-15128, 2016 WL 7384054, at *1 (9th Cir. Dec. 21, 2016) (enforcing a
twelve-month suit limitation provision in an insurance policy and holding that an
insured’s breach of contract claim against the insurer was time-barred).
As noted above, the Williamses filed suit on June 17, 2016—over four and a
half years after the limitations period was triggered by the October 5, 2011 letter.
The Williamses’ breach of contract claim was barred by the two-year suit
limitation provision.
AFFIRMED.
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