Court of Appeals: Michelsen not negligent in Sleepy Hollow Fire

Feb. 7--SPOKANE -- The state Court of Appeals has upheld a 2018 decision that found Michelsen Packaging and Northwest Wholesale did not negligently cause fire to spread to Blue Bird property during the 2015 Sleepy Hollow Fire.

Three judges with the state Court of Appeals, Division III on Thursday determined that even if fire at Michelsen's warehouse caused Blue Bird's warehouse to catch fire, Michelsen was not negligent.

"Obviously, our client's very happy about it," said Michelsen attorney Scott Samuelson. He added: "We never felt they did anything wrong."

Blue Bird's insurer, Phoenix Insurance, in February 2018 filed a lawsuit in Chelan County Superior Court against Michelsen and property lessor Northwest Wholesale, claiming embers from burning pallets at Michelsen sparked a fire that destroyed a Blue Bird warehouse.

Philip Talmadge, attorney for Phoenix, called the Court of Appeals decision "disappointing."

"The Court of Appeals analysis was interesting because they believed a duty was owed by Michelsen to our clients," Talmadge said Friday.

He noted that the issue of who bears responsibility for fires hasn't been touched on very often by courts and he didn't rule out filing a petition for review with the state Supreme Court.

Judge Robert McSeveney ruled in October 2018 that Phoenix failed to prove the fire-starting embers originated at Blue Bird. Phoenix filed for appeal four weeks later.

Fire destroyed 30 homes in Wenatchee's Broadview neighborhood on June 28, 2015, and embers drifted more than a mile to the warehouse district in North Wenatchee, where four facilities were either destroyed or suffered substantial damages.

None more so than Blue Bird. President Ron Gonsalves told The Wenatchee World in 2018 that the company reported $53 million in losses, including property, plant equipment, fruit and business interruption.

In the lawsuit, Phoenix claimed the cardboard embers blew onto Blue Bird property, causing the warehouse to burn. Phoenix alleged Michelsen's storage practices were negligent and sought compensatory damages to be proven at trial.

According to the Court of Appeals opinion, Michelsen's storage practices were in compliance with International Fire Code and Wenatchee City Code, and Michelsen received and complied with the required storage permits.

In connection to the fire, a man pleaded guilty to arson in July 2018. He was sentenced to 27 months in prison, but credited for nearly 27 months of time served at Eastern State Hospital where he underwent treatment for a delusional disorder.

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