Banowsky v. Backstrom

Decision Date25 July 2019
Docket NumberNO. 96200-6,96200-6
Citation193 Wash.2d 724,445 P.3d 543
CourtWashington Supreme Court
Parties Teresa BANOWSKY, Petitioner, v. GUY BACKSTROM, DC, d/b/a Bear Creek Chiropractic Center, Respondent.

James R. Banowsky, Han Santos, PLLC, 500 Union Street, Suite 800, Seattle, WA 98101-4051, Paul Fogarty, Fogarty Law Group PLLC, 1001 4th Avenue, Suite 3200, Seattle, WA 98154-1003, for Petitioner.

Jennifer D. Koh, Eron Zachary Cannon, Mark Brandon Melter, Fain Anderson Vanderhoef, Rosendahl O'Hal, 701 5th Avenue, Suite 4750, Seattle, WA 98104-7089, for Respondent.

GORDON McCLOUD, J.

¶1 Washington’s superior courts are courts of general jurisdiction—most claims, on most subjects, valued at most any amount, can be decided there. Washington’s district courts are courts of limited jurisdiction—only a subset of claims, on a subset of subjects, with $100,000 or less in controversy for civil cases, can be decided there.

¶2 Teresa Banowsky filed her claim for medical malpractice in district court on the last day of the statute of limitations. She sought over $100,000. District courts can exercise jurisdiction over medical malpractice claims, but they cannot exercise jurisdiction over claims seeking over $100,000. CRLJ 14A(b), however, directs district courts to "remove[ ]," or transfer, a case to superior court when "any party" "asserts a claim in an amount in excess of the jurisdiction of the district court or seeks a remedy beyond the jurisdiction of the district court." This case is about the meaning and validity of that rule.

¶3 We hold that CRLJ 14A(b) validly and unambiguously required the district court to transfer Banowsky’s case to superior court. We therefore reverse the decision of the Court of Appeals.

I. FACTUAL AND PROCEDURAL BACKGROUND
A. Proceedings in District Court

¶4 On the final day of the statute of limitations, Banowsky, acting pro se, filed a medical malpractice claim against her chiropractor, Guy Backstrom, in King County District Court. Clerk’s Papers (CP) at 105-07. Banowsky sought "actual compensatory damages in an amount exceeding $100,000.00, together with attorney’s fees, court costs, and whatever other damages deemed appropriate by the Court." Id. at 107.

¶5 A month and a half later, an attorney appeared on Banowsky’s behalf and moved to transfer the case to superior court. Id. at 101, 95-96. Through counsel, Banowsky alleged that she had been unaware of the $100,000 "limitation of damages in District Court." Id. at 95. She argued that "[b]ecause the error was made in good faith, [the] case should be transferred to Superior Court pursuant to Rule CRLJ 14A(b)." Id. at 96.

¶6 CRLJ 14A(b) states, "When any party in good faith asserts a claim in an amount in excess of the jurisdiction of the district court or seeks a remedy beyond the jurisdiction of the district court, the district court shall order the entire case removed to superior court."

¶7 Backstrom opposed transfer. Id. at 45-52. He did not dispute Banowsky’s good faith. Instead, he argued that "the District Court has no authority to grant Plaintiff’s motion and enter an Order of Transfer because it lacks subject matter jurisdiction over this claim." Id. at 47.

¶8 To explain CRLJ 14A(b) ’s function, Backstrom pointed to the drafters’ comment to the proposal that amended the rule into its current form. The comment states in part:

Plaintiffs can file in the district court knowing that if a basis for claiming damages in excess of the jurisdictional limit of the district court should arise after they have filed their complaint, then they will have the opportunity to transfer their case to the superior court.

Proposed amendment to CRLJ 14A(b), 150 Wn.2d Proposed-13 (Official Advance Sheet No. 7, Jan. 6, 2004). On the basis of that comment, Backstrom concluded that "if ... Plaintiff believed her damages were $50,000 at the time of filing, but later learned they were much more, CRLJ 14A would allow her to remove the claim to Superior Court to seek damages in excess of the jurisdictional limit." CP at 51. But because Banowsky’s claim exceeded the jurisdictional limit from the start, Backstrom urged the court to dismiss. Id. at 52.

¶9 Banowsky countered that CRLJ 14A(b) ’s history was immaterial to its interpretation given the lack of any ambiguity in its text, and the text required "remov[al]" or transfer. Id. at 31-32. She continued that CRLJ 14A(b) ’s history really supported her position, not Backstrom’s. She pointed out that the comment on which Backstrom relied actually referenced a prior version of the drafters’ proposed amendment to the rule. Id .; see Bd. for Judicial Admin., Meeting Minutes (Jan. 24, 2003) at 3 [https://perma.cc/7VMW-FV3C]. The drafters did not update the comment when they formally submitted a different version of the proposed amendment—the one that ultimately became CRLJ 14A(b) as it exists today—to this court.

¶10 Following briefing on those matters, the district court heard argument, denied Banowsky’s motion, and dismissed the case.1 CP at 25-26, 121-37.

B. Proceedings in Superior Court

¶11 Banowsky appealed, renewing the same arguments. Id. at 111-20. Likewise, Backstrom reiterated his previous arguments. Id. at 146-67. But Backstrom cited an additional source of authority in support of those arguments: CRLJ 12(h)(3). That rule states, "Whenever it appears ... that the court lacks jurisdiction of the subject matter, the court shall dismiss the action."

¶12 The superior court heard argument and affirmed the district court’s dismissal. Verbatim Report of Proceedings (VRP) at 1-19; CP at 170-71.

C. Proceedings in the Court of Appeals

¶13 Banowsky moved the Court of Appeals for discretionary review. That court granted limited review "to address the issues raised by CRLJ 14A(b) and its relationship with other rules and statutes, including CRLJ 12(h)(3) and CRLJ 82." Notation Ruling, No. 76360-1-1, at 3 (Wash. Ct. App. May 31, 2017).

¶14 The Court of Appeals then affirmed. Banowsky v. Backstrom , 4 Wash. App. 2d 338, 421 P.3d 1030 (2018). That court emphasized that the Washington Constitution gives the legislature responsibility for determining the jurisdiction of district courts and that the legislature has confined that jurisdiction to claims seeking $100,000 or less. Id. at 344-46, 421 P.3d 1030. It explained, "Because the amount demanded exceeded the constitutionally based amount-in-controversy limitation for district court, the district court lacked subject matter jurisdiction and its only permissible action was dismissal." Id. at 346, 421 P.3d 1030. In that court’s view, the opposite conclusion "would greatly undercut the [constitution’s] intentional divide [between district courts and superior courts] to allow a plaintiff to ignore the district court amount-in-controversy limitation and force a transfer even though she demanded an amount over the district court limit." Id. at 347, 421 P.3d 1030.

¶15 But the Court of Appeals nonetheless reconciled CRLJ 14A(b) and CRLJ 12(h)(3) to sometimes give effect to CRLJ 14A(b) and sometimes permit transfer. "Where a plaintiff properly invokes the subject matter jurisdiction of the district court by demanding relief that is within the amount-in-controversy limit of the court, CRLJ 14A(b) can afterward be applied to direct a transfer of the case to superior court. For example, a plaintiff may later seek to remove the case to superior court on the good faith belief that although her damages initially were below the limit, they now appear to exceed the subject matter jurisdiction of the district court." Id. at 349, 421 P.3d 1030. Thus, the Court of Appeals adopted Backstrom’s interpretation of the rule.

¶16 We granted review. Banowsky v. Backstrom, 192 Wash.2d 1001, 430 P.3d 255 (2018).

II. DISCUSSION
A. Standard of Review

¶17 This case involves issues of subject matter jurisdiction, rule interpretation, and constitutional interpretation. We review each of these legal issues de novo.2

B. We Assume That the District Court Lacked Subject Matter Jurisdiction over Banowsky’s Claim

¶18 " ‘Subject matter jurisdiction’ refers to a court’s ability to entertain a type of case ...." In re Marriage of Buecking, 179 Wash.2d 438, 448, 316 P.3d 999 (2013) (citing ZDI Gaming, Inc. v. Wash. State Gambling Comm’n, 173 Wash.2d 608, 618, 268 P.3d 929 (2012) ). It "is the power of a court to hear and determine a case." State v. Lane, 112 Wash.2d 464, 468, 771 P.2d 1150 (1989) (citing State v. Hampson, 9 Wash.2d 278, 281, 114 P.2d 992 (1941) ; 20 AM. JUR. 2D Courts § 88, at 449 (1965) ). "A tribunal lacks subject matter jurisdiction when it attempts to decide a type of controversy over which it has no authority to adjudicate." Marley v. Dep’t of Labor & Indus., 125 Wash.2d 533, 539, 886 P.2d 189 (1994). "A lack of subject matter jurisdiction implies that [the tribunal] has no authority to decide the claim at all, let alone order a particular kind of relief." Id.

¶19 Backstrom argues that the district court lacked subject matter jurisdiction over Banowsky’s claim. He relies on article IV, section 10 of the Washington Constitution, which provides that "[t]he legislature ... shall prescribe by law the powers, duties and jurisdiction [of the district courts]."3 Under this provision, the legislature has "sole authority to determine the jurisdiction and powers of the district court." State v. Hastings , 115 Wash.2d 42, 49, 793 P.2d 956 (1990) ; see also Young v. Konz , 91 Wash.2d 532, 542, 588 P.2d 1360 (1979) (stating that "the people, through our constitution, have ... authorized only the legislature ... to prescribe the powers, duties and jurisdiction of [district] courts"). To that end, the legislature enacted RCW 3.66.020. That statute states that "the district court shall have jurisdiction and cognizance" of certain types of civil actions—of which Banowsky’s medical malpractice claim is one—but only "[i]f, for each claimant, the value of the claim or the amount at issue does not exceed one hundred thousand...

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