Late Notice Bars Coverage for Condo Defect Damages
Division 1 not only barred coverage due to late notice in this case -- a hard enough feat under Washington's relatively liberal test for deciding whether a failure to comply with an insurance policy's notice clause will forfeit the insured's rights -- but it did so on summary judgment.
So what was the prejudice to the carrier caused by the late notice? It happened when the insured (without notice to the carrier) agreed to submit to arbitration of defect claims made by a homeowner's association. This waiver of judicial remedies, the Court said, was "significant" enough to constitute prejudice as a matter of law. Coverage denied.
Copy of decision also available here Download file
