Judge rules stolen pot not insurable

The plaintiffs in the unusual case are Thomas and Deborah

McDonald. She holds a valid Washington medical marijuana card and is suffering from terminal brain cancer. Ten nearly mature marijuana plants were stolen from the McDonald's residence last spring.

The couple filed a claim with Farmers Insurance for the theft under a section in their renter's policy that covers trees, shrubs, plants and lawn. The claim was rejected on the basis a person cannot have an insurable interest in property that is illegally possessed, according to court documents.

Represented by Thomas

McDonald, the Clarkston couple filed a complaint for breach of contract in Asotin County Superior Court. A Washington insurance agent, O'Keefe, was also named in the lawsuit, but he has no contractual involvement in the case and didn't write the policy. The defendants were represented by Nicoll Black and Feig, a Seattle law firm.

"We were paving a new path and we were pleased the court recognized we had some rights, but it didn't materialize in paying for our loss," Thomas McDonald told the Tribune. "We do appreciate the way Judge Acey treated us. He was very professional and put a lot of time in the decision."

Acey determined a person who has property insurance has a lawful interest in medical marijuana when it is possessed in compliance with state law. The court also recognized the time, effort and personal resources that went into the cultivation of the lost plants.

The essential element missing from the claim was a fair-market valuation of the stolen marijuana plants, according to the court documents. Because the sale of pot is still illegal under state law, no legal value for the plants can be determined. The court can find no legal authority that black market value can substitute for fair market value, nor do donations to so-called marijuana dispensaries, Acey said in his ruling.

While the McDonalds have an insurable interest in the plants, the court is bound to be just and does not have the right to make their policy more beneficial by extending the coverage, the court determined.

"People are tired of judges legislating from the bench - and rightly so," according to Acey's ruling. "This issue needs to be resolved either by legislation defining an insurable interest more specifically or by specific exclusion in insurance policies."

The insurance company's motion for summary judgment was granted. No other cases of this type have been reported in the United States, except for a U.S. District Court case in Hawaii filed earlier this year, court officials said.

"We're very pleased that Judge Acey found my wife was not a criminal and was legal under the state law and that the insurance policy did in fact cover it," McDonald said.

"Obviously, we're disappointed that we weren't awarded damages because, in his ruling, there is not a fair market value for medical marijuana. I'm not sure whether we will appeal, but there are numerous programs in King County and Spokane where price guides for medical marijuana have been established. I can appreciate his opinion - it is illegal, but anything that sells for roughly $3,000 a pound has an economic value."

Washington law allows a qualifying patient to possess up to 15 plants and up to 24 ounces of usable marijuana. McDonald, 48, said his 45-year-old wife has benefited from the use of medical marijuana as she deals with a tumor and the effects of brain surgery.

"Some studies show medical marijuana may actually help slow the growth of tumors," he said. "She's found that medical marijuana helps her establish a more even keel on her mood and has less side effects than pharmaceuticals."

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Sandaine may be contacted at kerris@lmtribune.com or (208) 848-2264.