Justia Washington Supreme Court Opinion Summaries

Desperate to save his home from foreclosure, Lawrence Jametsky sought help securing a loan. Through a series of connections, he was introduced to mortgage broker Matthew Flynn. Flynn made Jametsky an offer for a $100,000 loan that would cover Jametsky's debts, save his house, and allow him to regain financial solvency. Instead of receiving a loan, Jametsky deeded his house to Rodney Olsen for $100,000 and entered into an 18-month lease with a buy-back option. After J ametsky realized what had happened months after the fact, he sought relief under the distressed property conveyances act (DPCA), among other things. His suit was dismissed at summary judgment. The Court of Appeals affirmed, finding that Jametsky's property was not distressed at the time of the sale because no certificate of delinquency had been issued by King County. The Supreme Court reversed and remanded: a property can be distressed under RCW 61.34.020(2)(a) before a certificate of delinquency is issued and instruct the trial court to consider a variety of factors in making this factual determination. View "Jametsky v. Olsen" on Justia Law

AllianceOne Receivables Management Inc. instituted a collections action against William Carl Lewis Jr. and then voluntarily dismissed it. Lewis claimed he was entitled to attorney fees as the "prevailing party" under RCW 4.84.250 and .270 since under RCW 4.84.270 a defendant is a prevailing party when the plaintiff "recovers nothing." The district court denied Lewis' fee request, holding that there is no prevailing party for the purposes of an award of attorney fees when the plaintiff voluntarily dismisses the action. Finding no reversible error, the Supreme Court affirmed. View "AllianceOne Receivables Mgmt., Inc. v. Lewis" on Justia Law

The issue before the Supreme Court in this case was whether particular officers and employees of a bank owed a quasi-fiduciary duty to particular bank depositors. Michael and Theresa Annechino deposited a large amount of money at a bank specifically to ensure that their savings would be protected by the Federal Deposit Insurance Corporation (FDIC). The Annechinos relied on bank employees’ recommendations of how to structure their accounts to meet FDIC coverage rules. Unfortunately, the bank went into receivership, and the FDIC found that nearly $500,000 of the Annechinos’ deposits were not insured. The Annechinos alleged that individual officers and employees of the bank owed them a duty, the breach of which resulted in their loss. The trial court granted summary judgment in favor of the individual defendants, and the Court of Appeals affirmed. Upon review, the Supreme Court affirmed the Court of Appeals. The officers and employees of the bank did not owe the Annechinos a quasi-fiduciary duty. Holding the officers and employees personally liable under these facts would have contravened established law regarding liability for acts committed on behalf of a corporation or principal. View "Annechino v. Worthy" on Justia Law

The Federal District Court for the Western District of Washington has asked the Washington Supreme Court to answer three certified questions relating to two home foreclosures pending in King County. In both cases, the Mortgage Electronic Registration System Inc. (MERS), in its role as the beneficiary of the deed of trust, was informed by the loan servicers that the homeowners were delinquent on their mortgages. MERS then appointed trustees who initiated foreclosure proceedings. The primary issue was whether MERS was a lawful beneficiary with the power to appoint trustees within the deed of trust act if it did not hold the promissory notes secured by the deeds of trust. A plain reading of the applicable statute leads the Supreme Court to conclude that only the actual holder of the promissory note or other instrument evidencing the obligation may be a beneficiary with the power to appoint a trustee to proceed with a nonjudicial foreclosure on real property. "Simply put, if MERS does not hold the note, it is not a lawful beneficiary." The Court was unable to determine the "legal effect" of MERS not being a lawful beneficiary based on the record underlying these cases. Furthermore, the Court was asked to determine if a homeowner had a Consumer Protection Act (CPA), chapter 19.86 RCW, claim based upon MERS representing that it was a beneficiary. The Court concluded that a homeowner may, "but it would turn on the specific facts of each case." View "Bain v. Mortg. Elec. Registration Sys." on Justia Law

The issue before the Supreme Court concerned a dispute between Petitioners Donia Townsend and several other home purchasers and Defendant Quadrant Corporation and its parent companies over an arbitration clause in the home purchasers' individual purchase contracts. Several years after the home purchases, Townsend and the other purchasers jointly filed suit in superior court against Quadrant alleging outrage, fraud, unfair business practices, negligence, negligent misrepresentation, rescission and breach of warranty. In support of these allegations, they claimed that Quadrant knowingly engaged in shoddy workmanship in building the homes, and that this resulted in serious construction defects that caused personal injuries relating to mold, pests, and poisonous gases. They claimed that the arbitration clause in their purchase agreements was unenforceable. The superior court denied Quadrant's motion to compel arbitration. The Court of Appeals reversed. Upon review, the Supreme Court affirmed the appellate court's holding that the homeowners’ procedural unconscionability claim that pertained to the entire purchase contract, including the arbitration clause, was to be decided by an arbitrator. View "Townsend v. Quadrant Corp." on Justia Law

The trial court in this case ruled that under the Washington courts' application of "Frye v. United States," there must be general acceptance in the relevant scientific community that a particular type of in utero toxic exposure can cause a particular type of birth defect before expert testimony on causation is admissible. Plaintiff Julie Anderson worked for Akzo Nobel Coatings, Inc., from 1998 until she filed a safety complaint with the Washington State Department of Labor and Industries (L&I) and was fired. While it was not officially part of her job, Plaintiff regularly mixed paint. Employees were required by official company policy to wear respirators when mixing paint, but there was reason to believe that the policy was not rigorously enforced and may have been actively undermined by management. Plaintiff gave birth to a son in January 2000. By 2003, it was clear the child suffered from "medical abnormalities." He was diagnosed with a neuronal migration defect, congenital hemiplegia, microcephalus, and a multicystic dysplastic kidney, among other things, along with "delays in motor, communication, cognitive, and adaptive behavior." Upon review of the trial record, the Supreme Court disagreed with the trial court's interpretation and subsequent ruling on the issue. The Court held that the Frye test is not implicated if the theory and the methodology relied upon and used by the expert to reach an opinion on causation is generally accepted by the relevant scientific community. The Court affirmed the trial court's rulings on comparative fault and wrongful discharge. The case was remanded back to the trial court for further proceedings. View "Anderson v. Akzo Nobel Coatings, Inc." on Justia Law

Washington residents who were consumers of allegedly illegal debt adjustment programs filed a class action lawsuit against Defendants Global Client Solutions, LLC (GCS) and Rocky Mountain Bank and Trust (RMBT). Defendants managed and held âspecial purpose accountsâ as part of their adjustment programs. Payments to consumersâ creditors were authorized from these accounts. When enough money accumulated in a consumerâs account, Defendants would attempt to use the funds to negotiate settlement with creditors on terms favorable to the consumer. Defendants charged consumers various fees for its services. GCSâ earnings came from the fees they charged directly to the special purpose account holders. RMBT did not receive fees, but benefited by holding Plaintiffsâ money without paying interest. In 2009, the Federal Deposit Insurance Corporation (FDIC) issued a cease and desist order that required a reformation of RMBTâs banking practices. GCS subsequently stopped opening new accounts at RMBT. Later that year, Plaintiffs filed a class action lawsuit against GCS and RMBT on behalf of all consumers who has special purpose accounts. The U.S. District Court for the Eastern District of Washington certified three questions to the state Supreme Court regarding interpretation of state law in the Plaintiffsâ case. In response, the Supreme Court concluded that GCS is a âdebt adjusterâ and as such, is not exempt from liability under state law. Furthermore, the Court concluded that debt settlement companies that worked with GCS and RMBT are likely subject to the stateâs debt adjusting statute fee limits, depending on whether they are debt adjusters providing debt adjustment services.