Villa Marina Association Of Apartment Owners, V. John E. Collins, Jr.

IN THE COURT OF APPEALS OF THE STATE OF WASHINGTON
DIVISION ONE
VILLA MARINA ASSOCIATION OF ) No. 81865-1-I
APARTMENT OWNERS, a )
Washington Non-Profit Corporation, )
)
Respondent, )
)
v. )
)
JOHN E. COLLINS, JR. a/k/a JAKE E. ) UNPUBLISHED OPINION
COLLINS, JR., an individual; and JANE )
or JOHN DOE COLLINS, an individual, )
and the marital or quasi-marital )
community comprised thereof, )
)
Appellants. )
BOWMAN, J. — The Villa Marina Association of Apartment Owners
(Association) sued John Collins Jr., an Association member, seeking a money
judgment for delinquent assessments and a decree of foreclosure. Collins
contends the court erred in granting summary judgment in the Association’s favor
on reconsideration, appointing a receiver over his unit, and awarding the
Association its attorney fees and costs. We affirm the order appointing a
receiver. But because there remains a genuine issue of material fact as to the
amount of Collins’ alleged delinquency, we reverse the order granting summary
judgment. We also hold that because the trial court based the fee award at least
in part on the Association’s success in obtaining summary judgment, the court
must vacate the award, and remand for further proceedings.
Citations and pin cites are based on the Westlaw online version of the cited material.
No. 81865-1-I/2
FACTS
Collins owns unit 173 of the Villa Marina Condominium.1 As a unit owner,
Collins is subject to Villa Marina’s condominium declaration, which authorizes the
Association to collect assessments. Collins is also subject to the Association’s
“Collection Policy,” which authorizes the Association to collect late fees and
interest.
In December 2016, the Association sued Collins for allegedly delinquent
assessments (2016 Lawsuit). Collins made a $12,006.86 payment to the
Association to settle the lawsuit (Settlement Payment). The Association claimed
in a January 2017 payoff statement that this amount was the outstanding balance
on Collins’ account through February 2017. But the record contains no signed
settlement agreement, no agreement as to how the Association would apply the
funds, and no mutual releases of liability. On March 2, 2017, the trial court
entered the parties’ stipulation to dismiss the 2016 Lawsuit with prejudice.
In December 2019, the Association again sued Collins. That lawsuit is the
subject of this appeal. The Association alleged that Collins’ account had been
delinquent since September 2018 and requested a money judgment, a decree of
foreclosure, and appointment of a receiver.
In May 2020, the Association moved for summary judgment. In support of
its motion, the Association relied on a “summary ledger” prepared by its attorney,
Rachel Burkemper, to establish the amount Collins’ owed. Burkemper prepared
1 Collins does not live in the unit.
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the summary ledger “based on the debits and credits found in the Association’s
accounting records,” which the Association also submitted to the court.
Burkemper declared that the “starting point” for the summary ledger was
August 17, 2018, the last time Collins was current on assessments according to
the Association’s accounting. According to the Association, Collins had a credit
balance of $421.20 on that date. Burkemper observed that “it appeared that [the
Association’s] managing agent had applied the [Settlement P]ayment . . . in a
manner that benefitted Mr. Collins by hundreds of dollars.” But Burkemper
declared that if one were to start with a $0.00 balance as of March 1, 2017 and
track only assessments and payments from that date forward without late fees or
interest, Collins’ account was delinquent by $128.32 on August 17, 2018. Even
so, Burkemper used the $421.20 credit balance as the starting point for the
summary ledger “to minimize a dispute over how the . . . [S]ettlement [P]ayment
was applied.” The summary ledger showed that after considering the $421.20
credit balance and adding assessments, late fees, interest, and attorney fees,
Collins owed the Association $40,072.65.
Collins opposed the Association’s motion. He declared that when the
Association filed the 2016 Lawsuit, he was not behind on assessments, and that
the late fees and interest were “unjustified” because the Association imposed
them on assessments not yet due. Collins said he “never had any problems with
the Association until 2015,” when he elected to pay certain special assessments
in a lump sum instead of in monthly installments. Despite this election, the
Association charged his account for monthly installments, and then late fees and
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interest began to accrue. Collins also asserted that the Association’s records
revealed it did not credit his account for two 2016 payments and provided copies
of the cancelled checks. According to Collins, the Association also had a
practice of posting payments months after it received checks, leading to more
interest and late fees.
Collins declared that “[b]ecause of the Association’s confusing accounting,
and rather than pay attorneys’ fees, [he] made the business decision to settle”
the 2016 Lawsuit by paying the Association “what it demanded,” the $12,006.86
Settlement Payment. According to Collins, if one did not count the unjustified
late fees, interest, and attorney fees, his account had a credit balance of $11,310
after applying the Settlement Payment. In support, Collins submitted his own
accounting of assessments levied and payments made from July 1, 2014 through
the February 2017 Settlement Payment. Collins argued that summary judgment
was improper and that the court should order an accounting to “correctly identif[y]
the credit Mr. Collins had after the [2016 L]awsuit[,] as this number is directly
relevant to how much Mr. Collins owes now.”
In its reply in support of summary judgment, the Association did not
address the merits of Collins’ assertions about its accounting before settlement of
the 2016 Lawsuit. Instead, it argued that res judicata barred any argument about
amounts incurred and paid before the parties agreed to dismiss the 2016
Lawsuit. Accordingly, Collins had “the ability to dispute only the credits tracked
on the Association’s ledger from March 1, 2017 to present.”
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The Association asserted that after making the Settlement Payment,
Collins did not make another payment until May 2017, by which time another
$1,648.02 of assessments ($824.01 for April 2017 and $824.01 for May 2017)
had accrued. The Association pointed out that despite the foregoing, as of April
14, 2017, “the Association’s accounting generously only showed [Collins] as
owing $154.55; which is hundreds of dollars less than what he actually owed.”
Thus, any inaccuracy in the Association’s accounting created a “windfall” to
Collins.
In response to Collins’ assertion that the Association improperly delayed
depositing checks, it explained that rather than having a trial “over a possible
error that might have resulted in $1-200 of interest, the Association would rather
save the legal and expert fees by removing the interest that would have accrued
if we accept [Collins’] assertions as true.” So it submitted an updated summary
ledger that removed interest it charged from March 1, 2017 through August 31,
2018. The updated ledger also purported to post payments on the dates the
Association’s management company originally stamped them as received,
“further reducing the interest by several dollars.” The Association asserted that
“[t]hese adjustments fully resolve the accounting discrepancy” and that even after
the adjustments, Collins owed the Association $44,092.27, including attorney
fees, costs, late fees, and interest.
The trial court held the summary judgment hearing on July 8, 2020. It
denied the motion, stating that “the accountings are just too confusing for me to
be able to clearly determine that you have granted . . . every possible credit that
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Mr. Collins . . . may be entitled to,” and “that means . . . there’s a genuine issue
of material fact as to how this accounting has to be done.” But the trial court later
granted the Association’s motion to appoint a custodial receiver over Collins’ unit.
On July 16, 2020, the Association moved for reconsideration of the trial
court’s order denying summary judgment. The Association again argued that
there was “no lawful way for a party or trier of fact to analyze events that
transpired prior to March 1, 2017” because “[t]he parties agreed to a sum-certain
amount to bring [Collins’] assessment account current through the end of
February 2017, which resulted in dismissal of the [2016 L]awsuit.” It submitted
another summary ledger that began with a $0.00 balance as of March 1, 2017;
calculated the assessments, late fees, and interest accrued since then; and
applied Collins’ payments on the dates “most favorable” to him. According to that
ledger, Collins owed the Association $49,425.79, $5,333.52 more than the
$44,092.27 the Association requested in its earlier reply in support of summary
judgment. The Association urged the court to grant summary judgment in its
favor for $44,092.27, arguing that any inaccuracies in the Association’s earlier
ledgers amounted to “a windfall to [Collins] totaling more than $5,000.”
The trial court granted the Association’s motion for reconsideration, citing
CR 59(a)(1)(7) and (9).2 It ruled:
There is no genuine issue of material fact presented in the case as
framed by [the Association]’s motion. All of the uncertainties
created by the multiple ledgers in this case are removed by [the]
motion because the motion takes the facts most favorably to Mr.
2 These rules provide that a trial court decision may be vacated, and reconsideration
granted, if “there is no evidence or reasonable inference from the evidence to justify . . . the
decision, . . . it is contrary to law,” or if “substantial justice has not been done.” CR 59(a)(1)(7),
(9).
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Collins on every disputed point. Consequently, the resulting
judgment is the best that Collins could do if the case went to trial.
The trial court entered judgment for the Association for $44,092.27, the
amount the Association requested at summary judgment. The trial court also
entered findings of fact and conclusions of law in support of the attorney fees and
costs totaling $24,922.13, awarded as part of the total judgment. The court later
entered a supplemental judgment for another $11,415.35 in attorney fees and
costs.
Collins appeals.
ANALYSIS
Summary Judgment
Collins contends that because there remains a genuine issue of material
fact as to the amount of any delinquency owed to the Association, the trial court
erred by granting summary judgment for the Association. We agree.3
We review orders on summary judgment de novo, engaging in the same
inquiry as the trial court. Kim v. Lakeside Adult Family Home, 185 Wn.2d 532,
547, 374 P.3d 121 (2016). “Summary judgment is appropriate only if there is no
genuine issue as to any material fact and the moving party is entitled to judgment
as a matter of law.” Rublee v. Carrier Corp., 192 Wn.2d 190, 198, 428 P.3d 1207(2018). Put another way, summary judgment “should be granted only if, from all
3 Collins also assigns error to the trial court’s separate order granting reconsideration.
But because we hold that the trial court erred by granting summary judgment, we need not decide
this issue. See Hayden v. Mut. of Enumclaw Ins. Co., 141 Wn.2d 55, 68, 1 P.3d 1167 (2000)
(“ ‘[I]f resolution of an issue effectively disposes of a case, we should resolve the case on that
basis without reaching any other issues that might be presented.’ ”) (internal quotation marks
omitted) (quoting State v. Peterson, 133 Wn.2d 885, 894, 948 P.2d 381 (1997) (Talmadge, J.,
concurring)).
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the evidence, a reasonable person could reach only one conclusion.” Folsom v.
Burger King, 135 Wn.2d 658, 663, 958 P.2d 301 (1998).
“Summary judgment ‘is subject to a burden-shifting scheme.’ ” Bucci v.
Nw. Tr. Servs., Inc., 197 Wn. App. 318, 326, 387 P.3d 1139 (2016) (quoting
Ranger Ins. Co. v. Pierce County, 164 Wn.2d 545, 552, 192 P.3d 886 (2008)).
The party moving for summary judgment “bears the initial burden of
demonstrating an absence of any genuine issue of material fact and an
entitlement to judgment as a matter of law.” Schaaf v. Highfield, 127 Wn.2d 17,
21, 896 P.2d 665 (1995). “Thereafter, the nonmoving party must set forth
specific facts evidencing a genuine issue of material fact for trial.” Schaaf, 127
Wn.2d at 21. “In reviewing the evidence, the trial court must consider the
evidence and the reasonable inferences therefrom in a light most favorable to the
nonmoving party.” Schaaf, 127 Wn.2d at 21.
Here, the Association bears the ultimate burden to prove the amount of
Collins’ alleged delinquency. See Tesdahl v. Collins, 2 Wn.2d 76, 81-82, 97 P.2d
649 (1939) (“To support a mortgage, there must be a debt capable of
identification, and the amount thereof must be ascertainable.”); see also RCW
64.34.364(9) (providing that a condominium association’s lien may be foreclosed
judicially as a mortgage); Conklin v. Buckley, 19 Wash. 262, 265, 53 P. 52 (1898)
(remanding to trial court to set aside decree of foreclosure where there appeared
to be “a substantial difference between the amount . . . found [by the trial court]
and that justly due”). Accordingly, to prevail on summary judgment, the
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No. 81865-1-I/9
Association needed to establish the absence of a genuine issue of material fact
as to that amount.
The Association did not meet its initial burden to show the absence of a
genuine issue of a material fact—namely, the correct “starting point” for
calculating Collins’ alleged delinquency at summary judgment. The Association
based its entitlement to judgment as a matter of law entirely on the premise that
the 2017 Settlement Payment “zeroed out” the balance on Collins’ account as of
March 1, 2017. Thus, to prevail on summary judgment, the Association had to
prove that there was no genuine issue of material fact that the balance on
Collins’ account just before he made the Settlement Payment was at least
$12,006.86, the amount of the Settlement Payment. While the Association
submitted a declaration from its managing agent to support the summary ledgers
purporting to reconstruct the balance on Collins’ account from March 1, 2017
onward, it points to no admissible evidence in the record establishing that the
balance on Collins’ account was at least $12,006.86 before he made the
Settlement Payment.4
Furthermore, Collins declared that before the 2016 Lawsuit settled, the
Association failed to credit two payments he made and charged special
assessments (and resulting late fees and interest) monthly even though he
4The Association provided a declaration from Laura Lotz, its management company’s
community association manager, attaching and authenticating the Association’s historical
ledgers. But these ledgers date back to only September 2016, and they do not show an account
balance of $12,006.86 as of the end of February 2017. In fact, one ledger shows a credit of
$2,012.27 after receiving the Settlement Payment. Burkemper declared that her firm did not bill
the Association for some of the fees included in the January 2017 payoff statement until March
2017. But Burkemper’s declaration is not sufficient to establish the accuracy of the Association’s
underlying accounting.
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No. 81865-1-I/10
elected to pay them in a lump sum. Viewed in the light most favorable to Collins,
these assertions also raise a genuine issue of material fact as to whether the
balance on Collins’ account was $0 (or some credit balance) following application
of the Settlement Payment.5 The trial court erred by granting summary judgment.
The Association disagrees and contends, as it did below, that res judicata6
bars any dispute about its accounting before March 1, 2017 as a matter of law.7
The Association cites a single case in support of this proposition, Le Bire v.
Department of Labor & Industries, 14 Wn.2d 407, 128 P.2d 308 (1942).8 But Le
Bire is readily distinguishable. In Le Bire, the joint board of the Department of
5 For this reason, this case is readily distinguishable from the case the Association cites
in its statement of additional authority because there, the credits the lender applied to the
borrower’s account “conceded any possible contested amount.” Howard v. JP Morgan Chase
Bank, N.A., No. 81968-2-I, slip op. at 7-8 (Wash. Ct. App. Aug. 2, 2021) (unpublished),
https://www.courts.wa.gov/opinions/pdf/819682.pdf (emphasis added).
6 The term “res judicata” has been used by courts to refer both to claim preclusion and
issue preclusion. See Bunch v. Nationwide Mut. Ins. Co., 180 Wn. App. 37, 43, 321 P.3d 266(2014) (“The generic term ‘res judicata’ may include both res judicata or claim preclusion and
collateral estoppel or issue preclusion.”). It is unclear which theory the Association had in mind
here, in large part because the Association’s briefs both below and on appeal address only
whether the order dismissing the 2016 Lawsuit constituted a final judgment on the merits, a
threshold requirement under both theories. See 14A DOUGLAS J. ENDE, W ASHINGTON PRACTICE:
CIVIL PROCEDURE § 35:23, at 557-58 (“A judicial determination must generally be (1) final and (2)
on the merits to have [claim preclusive] effect.”), § 35:34, at 607 (“[T]he party asserting collateral
estoppel bears the burden of persuading the court that the prior action ended in a final judgment
on the merits.”) (3d ed. 2018). The Association did not, and does not, address the remaining
elements of either theory. Nevertheless, as we discuss below, the sole case that the Association
relies on in this appeal is unpersuasive; thus, we need not determine which theory the
Association had in mind.
7 The Association asserts that the issue of res judicata “is abandoned by Collins’s failure
to meaningfully brief” it. Because the Association bore the burden at summary judgment to
establish the absence of any genuine issue of material fact as to the correctness of its starting
point for calculating Collins’ alleged delinquency, we do not consider this issue abandoned.
8 The Association asserts that it raised additional theories and arguments below to
support its assertion that any challenge to its pre-March 2017 accounting is barred, and it tries to
incorporate those arguments by reference. But the Association briefed only res judicata below. It
invoked the voluntary payment doctrine, but only in passing, and only in footnotes. Accordingly,
we do not consider whether the voluntary payment doctrine applies here. See Holland v. City of
Tacoma, 90 Wn. App. 533, 538, 954 P.2d 290 (1998) (“Passing treatment of an issue or lack of
reasoned argument is insufficient to merit judicial consideration,” and “trial court briefs cannot be
incorporated into appellate briefs by reference.”).
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Labor and Industries (L&I) entered an order determining that Arthur Le Bire had
arthritis when he injured his knee on the job, denied liability for treatment of his
arthritis, and closed his claim for additional disability benefits based on the order.
Le Bire, 14 Wn.2d at 409, 411-12. Later, Le Bire applied to L&I to reopen his
claim, “alleging in his application that his knees had become stiff and more
painful.” Le Bire, 14 Wn.2d at 412. L&I refused, and Le Bire appealed to the
superior court, which dismissed his appeal because the joint board’s earlier order
was “res judicata of the same issues” presented in Le Bire’s appeal. Le Bire, 14
Wn.2d at 413-14.
Our Supreme Court affirmed the dismissal. Le Bire, 14 Wn.2d at 420. It
observed that the board’s earlier order “adopted the findings and
recommendations of several medical commissions” and “determined that at the
time of his injury,” Le Bire “had a preexisting disease of arthritis” and that “his
arthritic condition was not due or related to the knee injury.” Le Bire, 14 Wn.2d at
414-15. The Supreme Court held that absent a successful appeal or a showing
of “fraud or something of like nature,” “an order or judgment of the department
resting upon a finding, or findings, of fact becomes a complete and final
adjudication, binding upon both the department and the claimant.” Le Bire, 14
Wn.2d at 415. And because “the order of the joint board constituted a final
judgment upon definite issues then before it,” it barred Le Bire from reraising
those issues in a subsequent appeal, even though the judgment stemmed from a
settlement. Le Bire, 14 Wn.2d at 419.9
9 Emphasis added.
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Here, unlike in Le Bire, the relevant issue—the amount, if any, of Collins’
delinquency before the Association applied the Settlement Payment—was not a
definite issue before the court when it dismissed the 2016 Lawsuit. Instead, the
court merely stated that Collins’ account had been “settled” and dismissed the
2016 Lawsuit based on the stipulation of the parties. Le Bire does not control,
and the Association does not meet its burden to persuade us that Collins is
barred from challenging the “starting point” for the Association’s accounting in the
present lawsuit.
Appointment of Receiver
Collins contends the trial court erred by appointing a receiver over his unit.
We disagree.
The Association moved for a receiver under several statutes, including
RCW 64.34.364(10). RCW 64.34.364(10) provides that an association “shall be
entitled” to the appointment of a receiver to collect rent from the lessee of a
nonowner-occupied unit “[f]rom the time of commencement of an action by the
association to foreclose a lien for nonpayment of delinquent assessments.” It is
undisputed that Collins does not live in his unit and that the Association moved
for a receiver after it commenced this action to foreclose its lien. As a result, the
entitlement under the statute applies. Collins advances no argument or authority
to the contrary, instead relying on the same arguments he makes related to
summary judgment. Thus, we affirm the order appointing a receiver.
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Attorney Fee Award
The trial court awarded fees to the Association under RCW 64.34.364(14).
That statute provides, in relevant part:
The association shall be entitled to recover any costs and
reasonable attorneys’ fees incurred in connection with the collection
of delinquent assessments, whether or not such collection activities
result in suit being commenced or prosecuted to judgment.
RCW 64.34.364(14). Collins does not challenge the statutory basis for the fee
award. But he contends that the amount of the award was not reasonable
because it included fees for a summary judgment motion on which the
Association should not have prevailed. We agree.
We review the reasonableness of a fee award for abuse of discretion. 224
Westlake, LLC v. Engstrom Props., LLC, 169 Wn. App. 700, 734, 281 P.3d 693(2012). Here, the trial court awarded the Association attorney fees and costs
totaling $36,337.48, the full amount requested by the Association. In doing so,
the trial court expressly recognized that it must discount hours spent on
“ ‘unsuccessful claims, duplicated effort, or otherwise unproductive time.’ ” 224
Westlake, 169 Wn. App. at 734-35 (quoting Bowers v. Transamerica Title Ins.
Co., 100 Wn.2d 581, 597, 675 P.2d 193 (1983)). In other words, it is apparent
the trial court considered the Association’s ultimate success on summary
judgment in awarding the Association its fees.
We cannot know what part of the fees the Association incurred that the
trial court would have deemed reasonable had the Association not prevailed on
summary judgment. Accordingly, we vacate the trial court’s fee award without
prejudice to the Association’s ability to renew its request for fees on remand.
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No. 81865-1-I/14
Fees on Appeal
Both parties request fees on appeal. Under RAP 18.1(b), a party “must
devote a section of its opening brief to the request for the fees.” The rule
“requires argument and citation to authority to advise us of the appropriate
grounds for an award of attorney fees.” Osborne v. Seymour, 164 Wn. App. 820,
866, 265 P.3d 917 (2011). Compliance with RAP 18.1(b) is mandatory and
requires “more than a bald request for attorney fees on appeal.” Osborne, 164
Wn. App. at 866.
Collins requests fees in a single sentence at the end of his opening brief in
which he simply asks us to “award him attorney fees expended in this appeal.”
He provides neither argument nor authority to support such an award.10 We
deny Collins’ request for fees on appeal based on his failure to comply with RAP
18.1(b).
The Association requests fees under RCW 64.34.364(14), which
authorizes an award of fees to an association “if it prevails on appeal and in the
enforcement of a judgment.” Because the Association is not the prevailing party,
we decline to award it fees on appeal.
10 Collins tried to remedy these shortcomings in his reply brief. But a legal theory raised
for the first time in a reply brief comes too late to warrant consideration. See RAP 10.3(a)(6)
(requiring appellant’s opening brief to include argument and authority in support of the issues
presented for review); Duncan v. Alaska USA Fed. Credit Union, 148 Wn. App. 52, 72, 199 P.3d
991 (2008) (“Arguments first raised in a reply are generally not addressed.”).
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We affirm the order appointing the receiver, reverse the order granting
summary judgment, vacate the orders awarding the Association its attorney fees
and costs, and remand for further proceedings.
WE CONCUR:
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