Former Gig Harbor Le Bistro owner wants insurer to pay for fire loss of restaurant [The News Tribune (Tacoma, Wash.)]

April 22--The former owner of Le Bistro is going before a federal appeals court to try to force her insurer to pay a claim filed after an arson fire gutted the Gig Harbor restaurant in 2010.

The lawyer for plaintiff Debi McAlpine will make the case May 10 in Seattle before a three-judge panel for the 9th U.S. District Court of Appeals. A ruling isn't expected for several months.

The lawyer, Gary Williams, will argue that a federal trial judge in Tacoma made errors before a jury concluded last year that State Farm did not breach its contract with McAlpine for refusing to pay the claim. Williams is seeking a retrial.

The century-old house where McAlpine and her late husband, Ken, had operated Le Bistro for two decades erupted in flames the night of Feb. 10, 2010. They had owned the building for the last decade.

The crime remains unsolved. Investigators determined gasoline and other accelerants were used to start the fire, court papers say. No suspects were identified or arrested. The investigation has been suspended, pending any new leads, Gig Harbor police Lt. Kelly Busey told The News Tribune.

State Farm investigators found the couple was deeply in debt and might have been motivated to burn down their business to collect the insurance money. A lawyer representing State Farm declined comment.

The couple contacted the insurer to file the claim immediately after the fire.

Ken McAlpine died in June 2010 after battling terminal liver cancer. Debi McAlpine and her late husband's estate sued for nonpayment later that year. State Farm denied the claim in 2011. The policy would have paid up to $525,000 for the building, personal belongings and lost business income, court records say.

McAlpine, who now works at Costco providing samples to customers, is pursuing the appeal to get the insurer to pay up and "clear her name," her attorney told The News Tribune.

In the appeal, Williams argued the trial judge erred when he instructed the jury that the failure to cooperate with an investigation is a basis for denial of an insurance claim. The insurer's denial letter to the McAlpines did not cite noncooperation as a basis for the denial, Williams said, and its appearance at the end of the trial harmed McAlpine's case.

Williams also argued the trial judge erred when he ruled the jury would not decide whether the McAlpines were entitled to the claim for lost business income.

"The case got cut up pretty badly during the course of the trial, and probably didn't make a lot of sense of the jury by the time it got to them," Williams said.

State Farm argued during the trial that the McAlpines' claim gave incorrect information about the financial condition of the business and made other misrepresentations during its investigation that voided the claim.

The insurer said McAlpine inflated the value of the building, the loss of the business income and even the cost of a mural painted on a wall of the restaurant. McAlpine told State Farm the artist estimated the mural's value at $10,000, but the artist later told the insurer he had not heard from McAlpine and that the artwork could be replaced for $1,200.

Williams noted in his trial brief that the artist told McAlpine he was "high on marijuana" when asked about his conflicting estimates.

In finding State Farm didn't breach its contract, the jury also concluded the McAlpines did not intentionally misrepresent or conceal information important to the investigation.

Williams argued State Farm used McAlpine's failure to run a profitable business while she cared for her dying husband as an excuse to suspect her of arson and deny the claim. The McAlpines' good neighbor, referring to State Farm's jingle, had "gone bad," he wrote.

McAlpine sold the building for $300,000 in late 2011. The building has been repaired and will reopen as a hamburger stand in several weeks.

Christian Hill: 253-274-7390

[email protected]

@TNTchill

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