Justia Washington Supreme Court Opinion Summaries

Plaintiffs sued their neighbors, arguing, among other things, that the noise, smoke, fumes, and traffic associated with a small motor repair shop was in effect a nuisance in fact and that their neighbors are subject to nuisance per se liability because the business lacked required permits. The trial judge entered detailed findings of fact on the plaintiffs' nuisance in fact claims; found that the alleged noise, smoke, fumes, and traffic related to the business did not injure the plaintiffs' property, unreasonably detract from the plaintiffs' enjoyment of their property, or cause cognizable damages; and dismissed the case. The Court of Appeals reversed in part, concluding the trial court erred by not deciding whether the business was required to obtain any more permits. Finding that the plaintiffs did not establish that the business was a nuisance per se, the Supreme Court reinstated the trial court's judgment. View "Moore v. Steve's Outboard Serv." on Justia Law

In the 1980s, Charles Spencer and George Livingston formed a partnership to develop and sell property in rural Lincoln County near the confluence of Lake Roosevelt and the Spokane River. Over the next 20 years, the partnership and its successors built the Deer Meadows Golf Course Complex (including a golf course, restaurant, hotel, store, and club), platted several nearby parcels of property into subdivisions, and sold lots to private land owners for homes and vacation properties. A plat identifying the golf course was recorded. A local newspaper quoted Spencer as saying he built the golf course complex "so it would help sell the residential lots around here," and the lots were advertised accordingly. Ownership of the unsold lots and the golf course changed forms and hands over time. After Spencer passed away and after most of the lots were sold, Livingston closed down the golf course complex and began the process of platting the course into new residential lots. Many of those who had bought homes in the various subdivisions developed by Spencer and Livingston believed they had been promised that the golf course complex would remain a permanent fixture of their community, and relied on that promise when they made the decision to purchase their respective homes. Some of those homeowners formed the Riverview Community Group, which filed this lawsuit seeking to bar the defendants from selling off the former golf course as individual homes. Riverview sought to impose an equitable servitude on the golf course property that would limit its use to a golf course or, if that was untenable, for other equitable relief. It also sought injunctive relief. The trial judge issued a memorandum decision granting the Livingstons' motion under CR 12(b )(7) for failure to join indispensable parties. The following month, the trial court issued an order stating that "the legal issue of whether an equitable servitude can be created by implication is a question of first impression in the State of Washington" and granted summary judgment in favor of the defendants to expedite review. The Court of Appeals largely reversed the trial court's legal rulings, finding that Riverview had organizational standing and the individual property owners were not essential parties, and concluding that Washington recognized equitable covenants. However, it affirmed summary judgment on the grounds that it would be "irrational to require the defendants to rebuild and operate a failing business." The Washington Supreme Court granted Riverview's petition for review, affirming most of the Court of Appeals' legal rulings but finding dismissal was based on facts not found in the record. The Court therefore affirmed in part, reversed in part, and remanded to the trial court for further proceedings. View "Riverview Cmty. Grp. v. Spencer & Livingston" on Justia Law

In August 2007, Winnie Lyons signed a promissory note secured by a deed of trust encumbering her real property in Burien. The property served as Lyons' primary residence and was also where she operated an adult family home (AFH). Wells Fargo Bank NA was the lender and beneficiary; Northwest Trustee Services LLC (NWTS) was the trustee. In October 2009, an employee of Wells Fargo executed a beneficiary declaration identifying Wells Fargo as trustee for Soundview Home Loan Trust 2006. In June 2010, another beneficiary declaration was executed by an employee of Wells Fargo naming Wells Fargo Bank as the actual holder of the promissory note or other obligation evidencing the above-referenced loan "or has requisite authority under RCW 62A.3-301 to enforce said obligation." In 2011, Lyons filed bankruptcy, and in January 2012 she applied for a loan modification with Wells Fargo. While Lyons was waiting for a response regarding her application for a modification, she received a notice of trustee's sale from NWTS informing her that her property was scheduled to be sold. Wells Fargo told Lyons' attorney that the modification had been approved, the terms of which were that Lyons had to pay $10,000 by a set deadline. Wells Fargo informed Lyons they would discontinue the sale upon receipt of this payment. Lyons made the payment as requested, however, Wells Fargo had sold Lyons' loan to U.S. Bank National Association as trustee for Stanwich Mortgage Loan Trust Series 2012-3 with Carrington Mortgage Services LLC as the new servicer of the loan (to be effective May 1, 2012). NWTS received notice of the sale and service release; Lyons received notice of this sale. Lyons' attorney was informed that Wells Fargo no longer had any beneficial interest in the loan after the sale, Lyons had received a loan modification, so she was no longer in default. Lyons' attorney again called NWTS to inform them of the loan modification and the sale of the loan. A NWTS employee informed her that Carrington had directed NWTS to continue with the foreclosure sale as scheduled. Lyons' attorney called Carrington and an employee indicated that Carrington did not show the property in foreclosure status. Another employee further indicated that Carrington had not told NWTS to go forward with the sale. Lyons' attorney then sent a cease and desist letter to NWTS and Carrington. Lyons' attorney followed up with NWTS; NWTS acknowledged receipt and informed her the sale was still on but that the matter had been referred to an attorney. Lyons' attorney again spoke with NWTS' attorney, who refused to discontinue the sale. Lyons' attorney filed the complaint. NWTS then executed and recorded a notice of discontinuance of the trustee's sale. Lyons alleged that this situation the foreclosure sale created had serious emotional and economic impacts on her. In addition to the sense of humiliation Lyons felt, Lyons alleged she lost business as a result of the foreclosure process. Lyons asserted that she experienced constant nausea from the stress and continuously worried about losing her business and the subsequent homelessness of herself, her son, and the elderly clients she cared for. NWTS moved for summary judgment. After argument, the court granted the motion for summary judgment as to all claims against NWTS. Subsequently, Lyons and the remaining defendants (Stanwich, Carrington, and Wells Fargo) entered a stipulated order of dismissal. Lyons' motion for reconsideration of the order of summary judgment was denied. We granted Lyons' petition for direct review. After its review, the Supreme Court affirmed the trial court's grant of summary judgment on the alleged violations of the deed of trust act (DTA) and the intentional infliction of emotional distress claims, but the Court reversed and remanded as to Lyons' Consumer Protection Act (CPA) claim. View "Lyons v. U.S. Bank Nat'l Ass'n" on Justia Law

This case centered on the interpretation of a state tax deduction statute. Former RCW 82.04.4292 (1980) provided that in computing their business and occupation (B&O) tax, banks and financial institutions could deduct from their income "amounts derived from interest received on investments or loans primarily secured by first mortgages or trust deeds on nontransient residential properties." Between 2004 and 2007, petitioner Cashmere Valley Bank invested in mortgage-backed securities known as real estate mortgage investment conduits (REMICs) and collateralized mortgage obligations (CMOs). Cashmere claimed that interest earned on these investments was deductible under RCW 82.04.4292. Upon further review, the Supreme Court concluded Cashmere could not claim the deduction because its investments in REMICs and CMOs were not "primarily secured" by first mortgages or trust deeds. The ultimate source of cash flow was mortgage payments. However, Cashmere's investments were not backed by any encumbrance on property nor did Cashmere have any legal recourse to the underlying trust assets in the event of default. Thus, Cashmere's investments were not "primarily secured" by mortgages or trust deeds. View "Cashmere Valley Bank v. Dep't of Revenue" on Justia Law

The United States District Court for the Western District of Washington certified a question of Washington law to the Washington Supreme Court. The issue centered on whether Washington law recognized a cause of action for monetary damages where a plaintiff alleges violations of the deeds of trust act (DTA), chapter 61.24 RCW, but no foreclosure sale has been completed. The Supreme Court was also asked to articulate the principles that would apply to such a claim under the DTA and the Consumer Protection Act (CPA), chapter 19.86 RCW. The Court held that the DTA does not create an independent cause of action for monetary damages based on alleged violations of its provisions where no foreclosure sale has been completed. The answer to the first certified question was no-at least not pursuant to the DT A itself. Furthermore, the Court found that under appropriate factual circumstances, DTA violations may be actionable under the CPA, even where no foreclosure sale has been completed. The answer to the second certified question was that the same principles that govern CPA claims generally apply to CPA claims based on alleged DTA violations. View "Frias v. Asset Foreclosure Servs., Inc." on Justia Law

Daniel Pashniak, purchaser of two condominiums at a foreclosure sale, wanted to withdraw his bids. The judgment creditor, Sixty-01 Association of Apartment Owners, wanted to confirm the sales. RCW 6.21.11 0(2) states, "The judgment creditor or successful purchaser at the sheriffs sale is entitled to an order confirming the sale." The issue this case presented was whether a successful purchaser has a right to withdraw his or her bid prior to confirmation or if a judgment creditor is entitled to confirmation of the sale absent substantial irregularities, even if the purchaser no longer wishes to purchase the property. The Supreme Court held that a third party purchaser does not have a unilateral right to withdraw a successful bid before confirmation. Either the purchaser or the judgment creditor can move for confirmation, and the sale should be confirmed by the court unless a debtor or a nondefaulting party who received notice proves there were substantial irregularities in the proceedings. "[W]hile a court may invalidate a sale based on equitable considerations, this situation does not merit such a remedy." View "Sixty-01 Ass'n of Apt. Owners v. Parsons" on Justia Law

Ignacio Encarnacion and Norma Karla Farias were sued for unlawful detainer even though they had a valid lease and did nothing to warrant eviction. The case settled. They moved to amend the Superior Court Management Information System (SCOMIS) indices to replace their full names with their initials in order to hide the fact that they were defendants to the unlawful detainer action. Encarnacion and Farias argued that even though the unlawful detainer action was meritless, they could not obtain sufficient rental housing after prospective landlords learned that they had an unlawful detainer action filed against them. The superior court granted their motion and ordered that the indices be changed to show only their initials. The King County Superior Court Office of Judicial Administration objected and appealed the order. The Court of Appeals reversed. The Supreme Court reversed: "[a]lthough we sympathize with Encarnacion and Farias, and other renters in similar situations . . .[t]he public's interest in the open administration of justice prohibits the redaction of the indices in this case." View "Hundtofte v. Encarnacion" on Justia Law

Jeanne Lewis purchased a condominium with a $277,000 loan from Bank of America. The condominium association recorded its declaration in 2006. Bank of America recorded its deed of trust in 2007. Lewis defaulted on her condominium assessments in 2008. In 2009, the condominium association initiated a judicial foreclosure proceeding under chapter 64.34 RCW. Michael Fulbright bought the condominium at the trustee's sale for less than $15,000, which under the statute would extinguish Bank of America's lien. Bank of America attempted to redeem the condominium under the redemption statute, RCW 6.23.010. Because Bank of America recorded its deed of trust before Lewis defaulted on her assessments, the trial court and Court of Appeals held that Bank of America did not record its mortgage "subsequent in time" to the condominium's lien and therefore under RCW 6.23.010, Bank of America did not have a statutory right of redemption. The Supreme Court reversed the Court of Appeals, holding that a condominium association establishes its priority to collect unpaid condominium assessments at the time the condominium declaration is recorded, even though it is not enforceable until the unit owner defaults on his or her assessments. The Condominium Act creates an exception to the recording act and can alter the established priorities. Here, the effect of the foreclosure lawsuit was to give the Condominium Association's lien priority over Bank of America's interest, bringing Bank of America within the redemption statute provisions. View "BAC Home Loans Servicing, LP v. Fulbright" on Justia Law

Chiwawa Communities Association appealed the trial court's grant of summary judgment to owners of homes in the Chiwawa River Pines community. Respondents Ross and Cindy Wilkinson asked the trial court to invalidate a 2011 amendment to the community covenants prohibiting rental of their homes for less than 30 days. The issue this case presented for the Supreme Court was whether short-term vacation rentals conflicted with the covenants in place prior to 2011, if the Association validly amended the covenants to prohibit them, and if the trial court erred by striking portions of the offered evidence. Upon review, the Court concluded that short-term rentals did not violate the covenants barring commercial use of the property or restricting lots to single-family residential use. Furthermore, the Court held the Association exceeded its power to amend the covenants when it prohibited short-term vacation rentals in 2011, and the trial court did not err by granting in part motions brought by the Wilkinsons to strike evidence. View "Wilkinson v. Chiwawa Cmtys. Ass'n" on Justia Law

Steve and Karen Donatelli hired D.R. Strong Consulting Engineers Inc. to help the Donatellis develop their real property. Before development could be completed, the Donatellis suffered substantial financial losses and lost the property in foreclosure. The Donatellis sued D.R. Strong for breach of contract, violation of the Consumer Protection Act (CPA), negligence, and negligent misrepresentation. D.R. Strong moved for partial summary judgment on the CPA and negligence claims. D.R. Strong argued that the negligence claims should have been dismissed under the economic loss rule because the relationship between the parties was governed by contract and the damages claimed by the Donatellis were purely economic. The trial court and Court of Appeals held that as a matter of law, the Donatellis' negligence claims were not barred. Finding no error in that analysis, the Supreme Court affirmed. View "Donatelli v. D.R. Strong Consulting Eng'rs, Inc." on Justia Law