Elizabeth Settles, V. Dustin Gnewuch And Jamie Gnewuch ( 2023 )

IN THE COURT OF APPEALS OF THE STATE OF WASHINGTON
ELIZABETH SETTLES, an individual,
No. 84431-8-I
Respondent,
DIVISION ONE
v.
UNPUBLISHED OPINION
DUSTIN GNEWUCH and JAMIE
GNEWUCH, husband and wife,
Appellants.
HAZELRIGG, A.C.J. — Dustin and Jamie Gnewuch appeal from a judgment
entered against them on claims of bailment, conversion, replevin, and
negligence/negligent destruction of personal property. The Gnewuchs broadly
challenge the findings of fact and conclusions of law related to the bailment
relationship and resulting liability, as well as the award of attorney fees and costs
to Elizabeth Settles. Because they fail to demonstrate error, we affirm.
FACTS
In 2007, Dr. Elizabeth Settles purchased a home in Blaine, Washington,
which she filled with family heirlooms, antique furniture, unique artwork, and other
belongings. Settles, a licensed veterinarian, also maintained several farm animals
as pets on the one-acre property—one cat, five goats, six alpacas, and two pot-
bellied pigs. In 2014, Settles purchased two veterinary practices, one in California
No. 84431-8-I/2
and the other in New Mexico, that she planned to visit on a monthly basis. Around
that time, Settles also left her position with her employer in Washington and
separated from her partner, Richard Gnewuch, with whom she had been living.
Because the out-of-state veterinary practices required more in-person work than
Settles had initially expected, she decided to move to California and live on the
property she had purchased there.
The move to California was not intended to be permanent and Settles
planned to eventually return to the Blaine house. Before relocating, she came to
an oral agreement with Dustin 1 and Jamie Gnewuch in which the parties agreed
that the Gnewuchs 2 would lease the Blaine home for $850 per month while Settles
was gone. Settles left most of her personal property in the house and paid for a
storage unit that the Gnewuchs could use for anything of hers that they did not
wish to keep in the home. The farm animals also remained on the property; Settles
paid for their food and medical needs and the Gnewuchs agreed to care for them.
In the summer of 2015, Settles moved out of the Blaine house and the
Gnewuchs moved in with their three children. The following year, Settles began
to have financial difficulties and she filed for bankruptcy in 2017. In 2018, Settles
visited the Blaine home and discovered that seven of her farm animals—five
alpacas and two goats—had died. The Gnewuchs had not informed her of this.
After the bankruptcy closed, Settles took a job in Connecticut and sold the Blaine
1 Dustin is Richard’s nephew who had previously lived with Settles and Richard at the
Blaine house for approximately one year.
2 Because several involved parties share the same last name, we refer to them by their
first names as needed for clarity. No disrespect is intended.
We use “the Gnewuchs” to refer to the appellants collectively, but this does not include
Dustin’s uncle, who is not a party to this case.
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house to the Whatcom Land Trust (WLT). Settles informed WLT that she was
renting the property to the Gnewuchs and WLT allowed them to continue to reside
there after the sale.
Once the sale closed, Settles created a list of her personal property in the
Blaine house that was to be tagged and shipped to her new home in Connecticut.
A representative of WLT went to the Blaine home to help tag items for moving and
the Gnewuchs directed her as to which items were to be tagged for removal and
which would remain. When the WLT representative arrived at the home, many
items had already been packed and placed in the front yard. Settles was not at
the Blaine house on the moving day, but she hired professional movers and her
friend was also present to assist as he was familiar with her personal property.
Ultimately, the moving truck was filled with significant amounts of garbage and
items that were broken and/or did not belong to Settles, but had been tagged as if
they were her property. Further, many of Settles’ personal items were not
returned.
In June 2019, Settles filed a complaint against the Gnewuchs in which she
presented causes of action for bailment, 3 conversion, replevin, and
negligence/negligent destruction of personal property and farm animals. She
subsequently filed a motion for a preliminary injunction and sought an order
compelling the Gnewuchs to produce numerous listed items of personal property
that had not been returned. The trial court granted the motion for preliminary
3 Though Settles made no express bailment claim in the initial complaint, the elements of
bailment were pleaded and the trial court granted her later motion to conform the complaint to the
evidence presented at trial.
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injunction, ordered the Gnewuchs to confirm the personal property that was still in
their possession by December 2, 2019, and enjoined them from selling and/or
destroying any of the items listed in the order until ownership had been determined.
After the Gnewuchs failed to comply with the preliminary injunction, Settles filed a
motion for contempt, which the trial court granted. The trial court again ordered
production of the personal property at issue and required that any disputed items
be placed into storage until ownership was determined.
The case proceeded to a bench trial; the evidence was heard on June 1
and 2, 2022, and the parties made closing arguments on June 6. The trial court
found Settles had satisfied her burden of proof for each cause of action with the
exception of negligence and bailment to the extent they concerned the farm
animals. Accordingly, the court entered judgment against the Gnewuchs and in
favor of Settles. The court also awarded attorney fees and costs to Settles
pursuant to the replevin statute, RCW 7.64.035, on the basis that the replevin claim
was not segregable from the others.
The Gnewuchs timely appealed.
ANALYSIS
I. Standard of Review and RAP 10.3
“When the trial court has weighed the evidence, our review is limited to
determining whether the court’s findings are supported by substantial evidence
and, if so, whether the findings support the court’s conclusions of law and
judgment.” Panorama Vill. Homeowners Ass’n v. Golden Rule Roofing, Inc., 102
Wn. App. 422, 425, 10 P.3d 417 (2000). “The party challenging the finding bears
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the burden of showing that it is not supported by substantial evidence,” i.e.,
“evidence in sufficient quantum to persuade a fair-minded person of the truth of
the declared premise.” Brin v. Stutzman, 89 Wn. App. 809, 824, 951 P.2d 291(1998); Holland v. Boeing Co., 90 Wn.2d 384, 391, 583 P.2d 621 (1978). “This is
a deferential standard, which views reasonable inferences in the light most
favorable to the prevailing party.” Scott’s Excavating Vancouver, LLC v. Winlock
Props., LLC, 176 Wn. App. 335, 342, 308 P.3d 791 (2013). “We also defer to the
trial court on issues of conflicting evidence, witness credibility, and persuasiveness
of the evidence.” Id. Questions and conclusions of law are reviewed de novo.
Sunnyside Valley Irrig. Dist. v. Dickie, 149 Wn.2d 873, 880, 73 P.3d 369 (2003).
“Unchallenged findings are verities on appeal.” In re Est. of Haviland, 162
Wn. App. 548, 563, 255 P.3d 854 (2011). Pursuant to RAP 10.3(g), “[a] separate
assignment of error for each finding of fact a party contends was improperly made
must be included with reference to the finding by number” and we “will only review
a claimed error which is included in an assignment of error or clearly disclosed in
the associated issue pertaining thereto.” Thus, “[i]t is incumbent on counsel to
present the court with argument as to why specific findings of the trial court are not
supported by the evidence and to cite to the record to support that argument.” In
re Est. of Lint, 135 Wn.2d 518, 532, 957 P.2d 755 (1998). Along with any
unchallenged findings, those that are improperly or inadequately challenged will
also be considered verities on appeal. Id. at 533. Though the Gnewuchs’ opening
brief contains an assignment of error section, there are no specific findings
challenged therein. Rather than complying with RAP 10.3, the Gnewuchs broadly
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seek review of all of the trial court’s findings of fact and conclusions of law without
specification or supporting argument, as required by the RAPs and controlling case
law. We will only review the findings that the Gnewuchs specifically challenge with
relevant citations to the record in support of those alleged errors—the rest are
verities. See id. at 532-33.
II. Entry of Judgment in Favor of Settles
The Gnewuchs assign error to the trial court’s entry of judgment on two
bases; first, they allege that “Settles failed to establish that defendants owed her a
duty of care,” and second, argue that “the record had no direct evidence that
defendants harmed” Settles. Neither ground holds merit.
A. Bailment and Duty of Care
The Gnewuchs argue that Settles failed to prove the parties were engaged
in a bailment relationship with regard to Settles’ personal property such that the
Gnewuchs owed her a duty of care. According to the Gnewuchs, the trial court
erroneously concluded that an implied bailment for mutual benefit was established
when the Gnewuchs moved into Settles’ furnished home in Blaine.
“A bailment arises generally when [personal property] is delivered to
another for some particular purpose with an express or implied contract to redeliver
when the purpose has been fulfilled.” Freeman v. Metro Transmission, Inc., 12
Wn. App. 930, 932, 533 P.2d 130 (1975). “Before a consensual bailment of
personal property may be said to arise, there must be a change of possession and
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No. 84431-8-I/7
an assumption or acceptance of possession by the person claimed to be a bailee.”
Collins v. Boeing Co., 4 Wn. App. 705, 711, 483 P.2d 1282 (1971).
Gratuitous bailments are those in which the bailor receives the sole benefit;
in such cases, the bailee is only obligated to exercise slight care toward the bailed
property. Maitlen v. Hazen, 9 Wn.2d 113, 123, 113 P.2d 1008 (1941).
Nongratuitous bailments, i.e., bailments for mutual benefit, “arise when both
parties to the contract receive a benefit flowing from the bailment.” Am. Nursery
Prods., Inc. v. Indian Wells Orchards, 115 Wn.2d 217, 232, 797 P.2d 477 (1990).
When the bailment is mutually beneficial, the bailee is held to the standard of
“ordinary care under the circumstances.” Chaloupka v. Cyr, 63 Wn.2d 463, 465-
66, 387 P.2d 740 (1963). However, when personal property is “‘delivered to a
bailee in good condition, and is not returned or is returned damaged, a
presumption arises of negligence on the part of the bailee and casts upon [them]
the burden of showing the exercise of ordinary care.’” Id. at 466 (quoting Jones v.
Warner, 57 Wn.2d 647, 648, 359 P.2d 160 (1961)).
To determine whether the bailee received a benefit, “the inquiry is not
directed to the character or certainty of the benefit or profit; it is whether the
bailment was accepted for the purpose of deriving the one or the other.” White v.
Burke, 31 Wn.2d 573, 579, 197 P.2d 1008 (1948). In other words, a bailment is of
mutual benefit so long as it was entered into with consideration “‘of some value,
though slight, or of a nature which may inure to the benefit of the party making the
promise.’” Id. (quoting Newhall v. Paige, 76 Mass. 366, 368 (1858)). “The benefit
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No. 84431-8-I/8
to the bailee need not be in the form of cash.” Am. Nursery Prods., 115 Wn.2d at
232.
In briefing, the Gnewuchs claim that “Settles simply left belongings behind
when she moved out” and insist that any bailment was gratuitous as they received
“no benefit.” The record shows otherwise. The following findings of fact are
unchallenged and are thus verities on appeal:
g. Plaintiff agreed to allow Defendants Dustin Gnewuch and Jamie
Gnewuch to rent the Blaine Home while Plaintiff was out-of-the
state running her veterinary clinics in California and New Mexico.
h. Defendants agreed to pay $850 in rent per month, which is less
than Defendants were paying at their prior residence.
i. Defendants were also not responsible for paying utilities while
living in the Blaine Home. Defendants had been charged utilities
at their prior residence.
...
l. ...
1. Plaintiff owned the Personal Property before Defendants
moved into the Real Property. The Personal Property has
significant sentimental value to Plaintiff. Plaintiff never
intended to relinquish ownership of the Personal Property
to Defendants.
...
q. Prior to moving into the Blaine Home, Plaintiff and Mr. Gnewuch
discussed the terms of the agreement for Defendants to lease the
Blaine Home. In that discussion, Plaintiff told Mr. Gnewuch that
she could move all her personal property out of the Blaine Home
or Defendants could use her personal property while they were
living in the Blaine Home. Mr. Gnewuch wanted to use Plaintiff’s
personal property during their tenancy, but expressed concern
that his children may damage some pieces of Plaintiff’s property.
Plaintiff agreed to rent a storage unit to which Defendants could
move items they did not want to use or thought would be
damaged by their children.
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No. 84431-8-I/9
r. Upon moving into the Blaine Home, Defendants chose to move a
portion of Plaintiff’s personal property to storage, thereby
benefitting from the use of the remaining property left in their care.
...
w. Both parties received a benefit when Defendants moved into the
Blaine Home: Defendants paid less for rent and were not
responsible to pay utilities at the two-story Blaine Home located
on one acre of land. Plaintiff charged Defendants a reduced rent
and paid the utilities in exchange for Defendants caring for the
Farm Animals and caring for the personal property left in
Defendants’ sole custody, control, and possession.
As bailees in mutual benefit bailments have a duty to exercise ordinary care,
Chaloupka, 63 Wn.2d at 465-66, and the trial court applied that standard of care
here, phrased in its findings and conclusions as “reasonable care,” the only
question is whether the unchallenged findings support the conclusion that an
implied bailment for mutual benefit was established when the Gnewuchs moved
into the Blaine home. They do. Accordingly, the trial court did not err.
B. Proof of Damages
The Gnewuchs challenge the trial court’s conclusion of law that
“Defendants’ failure to use reasonable care proximately caused damages to
Plaintiff” for which they are liable. According to the Gnewuchs, “Settles presented
a case with no real evidence that supported her claims” and “[t]he record contains
no evidence that the Gnewuchs damaged Settles’ property.” We disagree.
As established, the parties entered into a mutual benefit bailment with
regard to Settles’ personal property. The rule in Washington as to the “burden of
proof in bailment cases where property is lost or damaged while in the bailee’s
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No. 84431-8-I/10
possession, is that a prima facie case, or presumption, is raised when the bailor
shows non-return, loss, damage or destruction to bailed property.” Chaloupka, 63
Wn.2d at 466. Thus, when personal property is delivered to a bailee and is either
returned to the bailor damaged, or not returned at all, courts presume that the
bailee was negligent, which means there is a presumption that the bailee breached
the duty of care owed to the bailor and proximately caused the damages. 4 See id.While the Gnewuchs appear to contest three underlying findings of fact
related to the issue of whether they failed to exercise reasonable care and
proximately caused the damages to Settles’ personal property, they do not
challenge any of the following findings, which are now verities on appeal:
oo. Defendants failed to properly pack fragile items before the
movers arrived on Moving Day.
...
qq. Defendants tagged items to be moved that were broken and
unusable, such as an old greenhouse frame and a broken
wheelbarrow.
rr. Defendants also tagged trash for moving, including an old
bathtub, TVs Plaintiff did not own, and a dirty mattress, among
other items.
ss. Defendants also refused to release certain items on Plaintiffs
Property List, such as the outdoor teak furniture set.
tt. Plaintiff purchased the outdoor teak furniture set prior to 2014
and prior to the date Defendants moved into the Blaine Home.
...
ccc. Numerous items of Plaintiff’s personal property, which were left
in the home when she moved out, were damaged or destroyed
4 The elements of negligence include “the existence of a duty to the plaintiff, breach of the
duty, and injury to plaintiff proximately caused by the breach.” Hertog, ex rel. S.A.H. v. City of
Seattle, 138 Wn.2d 265, 275, 979 P.2d 400 (1999).
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No. 84431-8-I/11
when the items were carelessly packed by Defendants. These
items were in Defendants’ sole custody, control, and
possession when the personal property was damaged.
ddd. Defendants packed fragile glassware and other fragile items in
boxes without additional protective packing, on or before
moving day, for a cross-country delivery.
eee. No reasonable person would pack fragile glassware and other
fragile items in a box for a cross-country delivery without
additional protective packing.
fff. Numerous items of Plaintiff’s personal property, which were left
in the home when she moved out, were either lost or not
returned by Defendants. These items were in Defendants’ sole
custody, control, and possession when they were lost or not
returned.
...
iii. Defendants identified no specific item of Plaintiff’s property that
Richard may have removed from the Blaine Home while
Defendants were in the custody, control, and possession of
Plaintiff’s property.
jjj. The personal property and Farm Animals left by Plaintiff when
Defendants moved into the Blaine Home were severely
neglected, misused, damaged, or lost.
kkk. Defendants failed to properly care for Ms. Settles’ personal
property and Farm Animals while Defendants were in the
custody, control, and possession of this property during the
time Defendants rented the Blaine Home from 2015-2019.
Ill. Defendants failed to use reasonable care, or even slight care,
as to the use, possession, and protection of Plaintiff’s personal
property at the Blaine Home while the property was in the
custody, control, and possession of Defendants.
Even if we were to ignore the express findings that the Gnewuchs failed to
exercise reasonable care when they packed Settles’ personal property that
resulted in the damages, which establishes both breach and proximate cause, the
remaining findings are still sufficient for a presumption of negligence on the part of
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No. 84431-8-I/12
the Gnewuchs to arise. See Chaloupka, 63 Wn.2d at 466. Because Settles’
personal property was delivered to the Gnewuchs when they moved into her fully
furnished home, and numerous items were damaged and/or not returned to
Settles, there is a presumption of negligence and the burden of proof shifts to the
Gnewuchs to show that they exercised due care or that “the loss was caused by
burglary, larceny, fire, or other causes which of themselves do not point to
negligence on the part of the bailee.” Id. at 467. It appears the Gnewuchs
misunderstand the burden shifting that operates within this procedural framework.
Rather than attempting to rebut the presumption, they simply attack the evidence
offered by Settles. 5 Because the unchallenged findings support the trial court’s
conclusion that the Gnewuchs’ failure to exercise reasonable care proximately
caused the damages to Settles’ personal property, the trial court did not err when
it entered judgment in favor of Settles.
5 In briefing, the Gnewuchs consistently cite Jamie’s testimony as contradicting the judge’s
findings. However, we do not reweigh the evidence from the trial court. City of Sunnyside v.
Gonzalez, 188 Wn.2d 600, 612, 398 P.3d 1078 (2017).
Additionally, the relevant test on appeal is to determine whether the findings made by the
trial court are properly supported by the evidence, not whether the evidence could support different
findings. “Even if there are several reasonable interpretations of the evidence, it is substantial if it
reasonably supports the finding.” Rogers Potato Serv., LLC v. Countrywide Potato, LLC, 152
Wn.2d 387, 391, 97 P.3d 745 (2004).
More critically, we will not revisit the trial court’s credibility determinations. Scott’s
Excavating, 176 Wn. App. at 342. The trial court expressly found “the testimony of other witnesses,
particularly Plaintiff Settles, to carry greater weight than the testimony of Codefendant [Jamie]
Gnewuch.” Accordingly, argument regarding Jamie’s testimony is unavailing in light of the
credibility determination of the trial court and the standard of review on appeal.
Finally, while the Gnewuchs assert in their second assignment of error that there existed
“no direct evidence that defendants had harmed the plaintiff,” they cite no authority to support their
contention that direct evidence was required for Settles to prevail in her claims. Not only can
circumstantial evidence prove a fact, “circumstantial evidence is as good as direct evidence.”
Rogers Potato, 152 Wn.2d at 391; see also Presnell v. Safeway Stores, Inc., 60 Wn.2d 671, 673,
374 P.2d 939 (1962).
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III. Attorney Fees
A. Trial Court Award of Fees and Costs
The Gnewuchs also assign error to the trial court’s award of attorney fees
to Settles on the basis that the amount was disproportionate to the damages and
included an award on a cause of action that is not permitted by law.
“The general rule in Washington, commonly referred to as the ‘American
rule,’ is that each party in a civil action will pay its own attorney fees and costs.”
Berryman v. Metcalf, 177 Wn. App. 644, 656, 312 P.3d 745 (2013) (quoting
Cosmo. Eng’g Grp., Inc. v. Ondeo Degremont, Inc., 159 Wn.2d 292, 296, 149 P.3d
666 (2006)). However, “trial courts may award attorney fees when authorized ‘by
contract, statute, or a recognized ground in equity.’” Id. (quoting Cosmo. Eng’g,
159 Wn.2d at 297). “The court should discount hours spent on unsuccessful
claims, duplicated or wasted effort, or otherwise unproductive time.” Chuong Van
Pham v. Seattle City Light, 159 Wn.2d 527, 538, 151 P.3d 976 (2007). “In order
to reverse an attorney fee award, an appellate court must find the trial court
manifestly abused its discretion.” Id. Such an abuse occurs when the trial court
has “exercised its discretion on untenable grounds or for untenable reasons.” Id.Here, the trial court found that Settles was entitled to attorney fees and costs
pursuant to the replevin statute, RCW 7.64.035(3). Under that provision, trial
courts may award “damages, court costs, reasonable attorneys’ fees, and costs of
recovery.” RCW 7.64.035(3). “If, as in this case, an attorney fees recovery is
authorized for only some of the claims, the attorney fees award must properly
reflect a segregation of the time spent on issues for which attorney fees are
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authorized from time spent on other issues.” Hume v. Am. Disposal Co., 124
Wn.2d 656, 672, 880 P.2d 988 (1994). However, if “the trial court finds the claims
to be so related that no reasonable segregation of successful and unsuccessful
claims can be made, there need be no segregation of attorney fees.” Id. at 673.
As all of Settles’ claims relate to the same fact pattern, the trial court expressly
found that her cause of action for replevin was not segregable from her other
claims. 6
Based upon Settles’ motion for attorney fees and costs along with the
supporting declarations, the trial court found that she incurred $110,932.50 in
attorney fees and $4,987.81 in costs. It further determined that the attorney fees
were objectively reasonable pursuant to its own calculations under the lodestar
method, considering the hourly rates of the attorneys in light of their experience
and expertise, and upon consideration of the invoices submitted by the attorneys
that showed the hours they worked. Accordingly, the trial court awarded
$110,932.50 in attorney fees and $4,947.81 in costs to Settles.
“A determination of reasonable attorney fees begins with a calculation of
the ‘lodestar,’ which is the number of hours reasonably expended on the litigation
multiplied by a reasonable hourly rate.” Berryman, 177 Wn. App. at 660 (quoting
Mahler v. Szucs, 135 Wn.2d 398, 433-34, 957 P.2d 632 (1998)). “A lodestar fee
must comply with the ethical rules for attorneys, including the general rule that a
6 The Gnewuchs offer no argument to address the trial court’s finding that the award of
attorney fees under the replevin statute was not segregable from the other claims. Accordingly,
we do not consider their bald assertion that the “statute cannot serve as a basis for an award of all
fees in this case.” See Norcon Builders, LLC v. GMP Homes VG, LLC, 161 Wn. App. 474, 486,
254 P.3d 835 (2011) (“We will not consider an inadequately briefed argument.”).
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No. 84431-8-I/15
lawyer shall not charge an unreasonable fee.” Id. at 660 (citing RPC 1.5). As our
Supreme Court has explained, “the lodestar calculation is presumptively
reasonable.” Chuong Van Pham, 159 Wn.2d at 541 (citing City of Burlington v.
Dague, 505 U.S. 557, 559, 112 S. Ct. 2638, 120 L. Ed. 2d 449 (1992)).
Here, the Gnewuchs only challenge the award of attorney fees on the
ground that it was “multiple times more than the amount requested in damages.”
They then assert that the award was “clearly excessive” and request that we
“reduce the fee award based on that disparity.” However, the Gnewuchs offer no
citation to the record or specific argument as to how the amount awarded here was
unreasonable under the circumstances. “Passing treatment of an issue or lack of
reasoned argument is insufficient to merit judicial consideration.” Holland v. City
of Tacoma, 90 Wn. App. 533, 538, 954 P.2d 290 (1998). It is also worth noting
that the trial court awarded Settles $15,474.96 in attorney fees based upon pretrial
conduct of the Gnewuchs which was deemed to be in violation of the preliminary
injunction and ultimately resulted in the trial court finding them in contempt. The
Gnewuchs do not address this aspect of the trial proceedings in their challenge to
the attorney fee award. We decline to further consider this inadequately briefed
issue and conclude that the trial court’s award of attorney fees to Settles was not
in error.
B. Attorney Fees on Appeal
Settles requests reasonable attorney fees and costs on appeal pursuant to
RCW 7.64.035(3), RAP 18.1, and RAP 18.9. Under RAP 18.9, this court “may
order a party or counsel . . . who uses these rules for the purpose of delay, [or]
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files a frivolous appeal . . . to pay terms or compensatory damages to any other
party who has been harmed by the delay.” RAP 18.9(a). “[A]n appeal is frivolous
if there are no debatable issues upon which reasonable minds might differ, and it
is so totally devoid of merit that there was no reasonable possibility of reversal.”
Streater v. White, 26 Wn. App. 430, 435, 613 P.2d 187 (1980). While the
Gnewuchs do not prevail, their appeal was not so devoid of merit as to be frivolous
and we decline to award fees on that basis. However, contingent upon compliance
with RAP 18.1, Settles is entitled to reasonable attorney fees and costs as the
prevailing party.
Affirmed.
WE CONCUR:
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