Justia Washington Supreme Court Opinion Summaries

The Supreme Court of the State of Washington found that the initiation fees charged by Royal Oaks Country Club, a nonprofit corporation, are fully deductible from the business and occupation (B&O) tax under RCW 82.04.4282. The statute permits taxpayers to deduct "bona fide" initiation fees, among other things, from their B&O tax. The court held that these initiation fees were "bona fide" as they were paid solely for the privilege of membership, and did not automatically entitle a member to use any service or facility of the club. The court differentiated between dues and initiation fees, noting that the statute treats these two terms separately. The court rejected the Washington Department of Revenue's argument that a portion of the initiation fee was for access to facilities and thus not subject to the exemption, stating that there is a difference between access and use. The court affirmed the Court of Appeals' decision that Royal Oaks' initiation fees qualify as bona fide initiation fees and are therefore wholly deductible. View "Royal Oaks Country Club v. Dep't of Revenue" on Justia Law

The State of Washington brought multiple claims alleging that TVI Inc., doing business as Value Village, used deceptive advertising and marketing in violation of the Washington Consumer Protection Act (CPA), ch. 19.86 RCW. TVI operated about 20 for-profit thrift stores in Washington under the name Value Village. Approximately 93 percent of Value Village’s retail inventory consisted of used goods donated by the community. To source these community donations, TVI contracted with third-party nonprofit organizations, which TVI called its “‘charity partners.’” By working with charity partners, TVI obtained inventory at a lower price than it would pay a for-profit supplier. The charity partners, in turn, received a predictable source of unrestricted funding, as well as publicity from TVI’s marketing. In 2013, the Consumer Protection Division of the Attorney General’s (AG’s) Office received a complaint from a Washington resident that TVI’s marketing gives the false impression that Value Village is a nonprofit. The AG wrote to TVI in November 2014, instructing it to register as a commercial fundraiser pursuant to the CSA. The AG’s November 2014 letter raised additional concerns that TVI’s “solicitations for charitable contributions and advertisements for its retail stores” were “misleading or deceptive” in violation of the CPA. By the summer of 2015, TVI had posted signs in its stores disclosing its status as a for-profit commercial fundraiser in its stores. Following three years of investigation, the State filed this lawsuit. TVI argued the State's claims infringed on its First Amendment right to solicit charitable contributions on behalf of nonprofit organizations. The Supreme Court agreed with TVI, and remanded this case to the trial court for dismissal of the State’s claims. View "Washington v. TVI, Inc." on Justia Law

The issue in this case was whether the Washington legislature extended a privilege or immunity to religious and other nonprofit, secular employers and whether, in providing the privilege or immunity, the legislature affected a fundamental right without a reasonable basis for doing so. Lawmakers enacted Washington’s Law Against Discrimination (WLAD) to protect citizens from discrimination in employment, and exempted religious nonprofits from the definition of “employer.” In enacting WLAD, the legislature created a statutory right for employees to be free from discrimination in the workplace while allowing employers to retain their constitutional right, as constrained by state and federal case law, to choose workers who reflect the employers’ beliefs when hiring ministers. Matthew Woods brought an employment discrimination action against Seattle’s Union Gospel Mission (SUGM). At trial, SUGM successfully moved for summary judgment pursuant to RCW 49.60.040(11)’s religious employer exemption. Woods appealed to the Washington Supreme Court, contesting the constitutionality of the statute. SUGM argued RCW 49.60.040(11)’s exemption applied to its hiring decisions because its employees were expected to minister to their clients. Under Our Lady of Guadalupe School v. Morrissey-Berru, 140 S. Ct. 2049 (2020), plaintiff’s employment discrimination claim must yield in a few limited circumstances, including where the employee in question was a minister. Whether ministerial responsibilities and functions discussed in Our Lady of Guadalupe were present in Woods’ case was not decided below. The Supreme Court determined RCW 49.60.040(11) was constitutional but could be constitutionally invalid as applied to Woods. Accordingly, judgment was reversed and the case remanded to the trial court to determine whether SUGM met the ministerial exception. View "Woods v. Seattle's Union Gospel Mission" on Justia Law

The Freedom Foundation was a nonprofit organization that describes itself as committed to “advanc[ing] individual liberty, free enterprise and limited, accountable government in the Evergreen State.” The Foundation brought citizen’s actions against Teamsters Local 117; Service Employees International Union Political Education and Action Fund (SEIU PEAF); and Governor Inslee, the Department of Social and Health Services, and Service Employees International Union 775 for various alleged violations of Washington’s Fair Campaign Practices Act (FCPA). In consolidated appeals, the issue common to all was whether the Freedom Foundation satisfied the FCPA’s prerequisites before filing their citizen’s actions. In each case, the superior courts ruled the Foundation failed to meet a 10-day deadline required by the FCPA and, accordingly, entered judgment for respondents. After review, the Washington Supreme Court agreed and affirmed. With respect to the Foundation's suit against the Teamsters Local 117, the Supreme Court determined that though the superior court erred by granting judgment on the pleadings to the union, the court’s entry of judgment would have been proper as summary judgment, and was thus affirmed. This result precluded the Foundation’s other challenges to the superior court’s rulings, which were therefore not addressed. As to the union's cross-appeal of its counterclaim against the Foundation under 42 U.S.C. 1983, the Foundation was not a state actor, was not wielding powers traditionally and exclusively reserved to the State, and therefore was not subject to suit under section 1983. View "Freedom Found. v. Teamsters Local 117" on Justia Law

At issue in this case was whether a certain governmental charge imposed on Indian tribes was a tax. After the legislature amended a statute to expand the types of tribal property that were eligible for a property tax: exemption, the Muckleshoot Indian Tribe applied for and received an exemption on its Salish Lodge property pursuant to the amendment. As required by statute, the tribe negotiated and paid an amount to the county in lieu of taxes. The issue before the Washington Supreme Court centered on the constitutionality of this payment in lieu of tax (PILT). The Court found that the PILT was not a tax at all but, rather, a charge that tribes pay to compensate municipalities for public services provided to the exempt property. View "City of Snoqualmie v. King County Exec. Constantine" on Justia Law

An employee of a nonprofit serving disabled adult clients used her position to embezzle more than half a million dollars held by the nonprofit for its clients. After the embezzlement was discovered, Travelers Casualty & Surety Company, the nonprofit's insurance company, made the nonprofit whole. Travelers then sought contribution from the bank in federal court. By submitting certified questions of Washington law, that court has asked the Washington Supreme Court to decide, among other things, whether a nonpayee's signature on the back of a check was an indorsement. Furthermore, the Court was also asked whether claims based on unauthorized indorsements that are not discovered and reported to a bank within one year of being made available to the customer are time barred. The Supreme Court answered yes to both questions. View "Travelers Cas. & Sur. Co. v. Wash. Trust Bank" on Justia Law

This case concerned Washington Constitution article II, section 40’s refund provision. Specifically at issue is the legislature’s statutory refund program, which places one percent of fuel tax revenues into a special fund to benefit off-road vehicle (ORV), nonmotorized, and nonhighway road recreational users for fuel consumed on nonhighway roads. In 2009, the legislature appropriated a portion of this special fund for the Parks and Recreation Commission’s (Parks) general budget. The Washington Off Highway Vehicle Alliance (WOHVA), Northwest Motorcycle Association (NMA), and four individuals representing ORV users, contended that the Court of Appeals erred in holding that the appropriation was a refund within the meaning of article II, section 40. WOHVA argued that the appropriation was not sufficiently targeted to affected taxpayers to constitute a refund despite legislative findings to the contrary. Finding no error with the appellate court's analysis of the refund provision, the Supreme Court affirmed its judgment. View "Wash. Off Highway Vehicle Alliance v. Washington" on Justia Law

This case centered on whether the recreational use immunity statute, RCW 4.24.200-.210, applied under the circumstances where a landowner, who otherwise operates an admission fee-based camp, allows a group access for no charge. During the group’s stay at the camp, plaintiff was injured when riding a slide on the property. The camp asserted recreational use immunity as a defense to the claim. On summary judgment, the trial court ruled that the camp was not immune from liability under the statute because it normally charged fees for the recreational use. This interlocutory appeal was certified after the trial court found there was likely a substantial ground for difference of opinion. Upon review, the Supreme Court affirmed and held that recreational use immunity is not available under these circumstances because the property was not open to the general public. View "Cregan v. Fourth Mem'l Church" on Justia Law

King County sought ways to provide legal defense services to indigent criminal defendants. The County settled on a system of using nonprofit corporations to provide services funded through and monitored by the County's Office of the Public Defender (OPD). Over time, the County took steps to improve and make these nonprofit organizations more accountable to the County. In so doing, it asserted more control over the groups that provided defender services. Respondents are employees of the defender organizations who sued the County for state employee benefits. They argued the County's funding and control over their "independent" organizations essentially made them state employees for the purposes of participating in the Public Employees Retirement System (PERS). Applying the pertinent statues and common law principles, the Supreme Court agreed that employees of the defender organizations are "employees" under state law, and, as such, are entitled to be enrolled in the PERS. View "Dolan v. King County" on Justia Law