Christie-Lambert Van & Storage Co., Inc. v. McLeod

• Decision Date: 24 December 1984
• Docket Number: No. 12172-3-I,CHRISTIE-LAMBERT,12172-3-I
• Citation: 39 Wn.App. 298,693 P.2d 161
• Court: Washington Court of Appeals
• Parties: VAN & STORAGE COMPANY, INC., a Washington corporation, Appellant, v. Malcolm S. McLEOD, Respondent, Harriette McLean Nolan and John Doe Nolan, her husband, and the marital community composed thereof, Defendants.

Page 298

39 Wn.App. 298

693 P.2d 161

CHRISTIE-LAMBERT VAN & STORAGE COMPANY, INC., a Washington

corporation, Appellant, v. Malcolm S. McLEOD, Respondent, Harriette McLean Nolan and John Doe Nolan, her husband, and the marital community composed thereof, Defendants.

No. 12172-3-I.

Court of Appeals of Washington,

Division 1.

Dec. 24, 1984.

Short & Cressman, Mabry Chambliss De Buys, Seattle, for appellant.

Donald A. McLeod, Seattle, for respondent.

SWANSON, Judge.

Christie-Lambert Van and Storage Company, Inc., (Christie-Lambert) appeals a superior court judgment denying an attorney fee award pursuant to MAR Christie-Lambert furnished packing, moving, and storage services for the defendant, Harriette McLean Nolan (Nolan), upon the unauthorized, though good faith, assurances of her attorney, defendant Malcolm S. McLeod (McLeod), that these services were to be performed. Further, at Nolan's request and at $928.18 cost to her, Christie-Lambert subsequently delivered her stored household goods to specified locations.

                7.3 and RCW 7.06.060 in a trial de novo on appeal from a mandatory arbitration award under RCW 7.06.   We reverse and remand for entry of a judgment awarding Christie-Lambert attorney fees of $3,000 plus costs
                

Christie-Lambert's action to recover $4,019.14 plus interest for services performed was set for mandatory arbitration pursuant to MAR 1.2. The arbitration award was for Christie-Lambert (1) against the defendant Nolan for $961.72 plus $120.15 interest, (2) against the defendant McLeod for $3,045.42 plus $453.05 interest, and (3) against the defendants Nolan and McLeod jointly for costs and attorney fees. The arbitrator stated that he had no jurisdiction to give the defendant McLeod an award against the defendant Nolan on his cross-claim because the defendant Nolan had not been served with the cross-claim.

The defendant McLeod appealed the arbitration award to the superior court in a trial de novo pursuant to MAR 7.1. The trial court awarded Christie-Lambert judgment (1) against the defendant McLeod for $3,090.96 plus $521.30 interest and (2) against the defendant Nolan for $928.18 plus $164.88 interest.

Further, the court awarded the defendant McLeod a $2,090.96 judgment against the defendant Nolan on his cross-claim and awarded the defendant Nolan a $1,000 judgment against the defendant McLeod. The trial court had found that since the family home had been sold, the defendant Nolan would have had to incur the moving costs at some time. However, the court further found that the defendant Nolan might have done some of the packing herself, thus reducing the charges by $1,000.

The trial court denied Christie-Lambert's request for The issues are (1) whether MAR 7.3 authorizes assessing attorney fees against the appellant from a mandatory arbitration award who does not improve his position as to an arbitrated claim although his overall position is improved on appeal in a trial de novo solely because of a cross-claim that was served only after the arbitration, and (2) whether an attorney fee award to Christie-Lambert would unconstitutionally restrict the respondent's jury trial right.

attorney fees pursuant to MAR 7.3 on the grounds that the defendant McLeod had improved his overall position in the trial de novo on appeal from the arbitration award.

ATTORNEY FEE AWARD

In Washington, attorney fees may be recovered only when authorized by the private agreement of the parties, a statute, or a recognized ground of equity. Mellor v. Chamberlin, 100 Wash.2d 643, 649, 673 P.2d 610 (1983). In this case the asserted statutory basis for Christie-Lambert's recovery of attorney fees is RCW 7.06.060. Thus if Christie-Lambert is to recover attorney fees, such recovery must be authorized by this statute.

RCW 7.06 (the act) provides for a county's authorization of mandatory arbitration of civil actions brought in the superior court where the sole relief sought is a money judgment and no claim exceeds $10,000 or, upon a county's superior court approval, $15,000, exclusive of interest and costs, RCW 7.06.020. RCW 7.06.060 states:

The supreme court may by rule provide for costs and reasonable attorney's fees that may be assessed against a party appealing from the [mandatory arbitration] award who fails to improve his position on the trial de novo.

MAR 7.3 specifies the conditions for awarding attorney fees in an appeal from a mandatory arbitration award:

The court shall assess costs and reasonable attorney fees against a party who appeals the award and fails to improve the party's position on the trial de novo. The court may assess costs and reasonable attorney fees against a party who voluntarily withdraws a request for a trial de novo.

The primary objective of statutory construction is to carry out the intent of the Legislature. Bellevue Fire Fighters Local 1604 v. Bellevue, 100 Wash.2d 748, 751, 675 P.2d 592 (1984). The intent must be determined primarily from the statutory language itself. Department of Transp. v. State Employees' Ins. Bd., 97 Wash.2d 454, 458, 645 P.2d 1076 (1982). Where, however, the intent is not clear from the language of the statute, the legislative history may be considered. Bellevue, supra.

The purpose of RCW 7.06 authorizing mandatory arbitration in certain civil cases is primarily to alleviate the court congestion and reduce the delay in hearing civil cases. Senate Journal, 46th Legislature (1979), at 1016-1017. The purpose of MAR 7.3's second provision regarding assessing costs and attorney fees upon the withdrawal of a trial de novo request is to deter such requests made solely to delay enforcement of the award. Judicial Council Comment, MAR 7.3.

In the absence of an explicit statement in the statute or the legislative history as to the purpose of RCW 7.06.060, upon which MAR 7.3's first provision is based, other statutes dealing with the same subject may be considered in the statutory construction. See Department of Transp., supra at 458, 645 P.2d 1076.

Under RCW 7.06.060 and MAR 7.3's first provision, attorney fees may be assessed only against an appellant from a mandatory arbitration award who does not improve his position in the trial de novo. RCW 4.84.290, which authorizes the award of reasonable appellate attorney fees to the prevailing party on appeal in civil actions for damages of $5,000 or less, exclusive of costs, is designed "to encourage out-of-court settlement of small claims, and to penalize parties who unjsutifiably pursue or resist the claims." Harold Meyer Drug v. Hurd, 23 Wash.App. 683, 687, 598 P.2d 404 (1979).

To discourage meritless appeals, a federal local rule providing for compulsory, nonbinding arbitration in certain civil actions imposed upon the party who sought a trial de Moreover, the restriction of an award of attorney fees under RCW 7.06.060 and MAR 7.3 only to the successful appellee, not the successful appellant, reflects a policy decision favoring arbitration in certain cases in order for mandatory arbitration effectively to relieve court congestion. See Smith Case, 381 Pa. 223, 112 A.2d 625, 629, appeal dismissed sub nom. Smith v. Wissler, 350 U.S. 858, 76 S.Ct. 105, 100 L.Ed. 762 (1955); cf. Davy v. Moss, 19 Wash.App. 32, 34, 573 P.2d 826 (1978) (RCW 4.84's settlement scheme is designed to promote nonjudicial determination of court actions and discourage resistance to small just claims for damages). The Pennsylvania Supreme Court stated that the statutory requirement that the appellant from a mandatory arbitration award pay the arbitrators' fees was

                novo and failed to obtain a more favorable judgment the amount of the arbitration fees and, in addition, imposed upon a defendant who unsuccessfully appealed the arbitration award interest on the award.   Kimbrough v. Holiday Inn, 478 F.Supp. 566, 575 (E.D.Pa., 1979).   Here the attorney fee award under RCW 7.06.060 and MAR 7.3 when the appellant from a mandatory arbitration award does not improve his position in the trial de novo similarly serves the purpose of discouraging meritless appeals
                

obviously designed to serve as a brake or deterrent on the taking of frivolous and wholly unjustified appeals; if there were not such a provision the defeated party would be likely to appeal in nearly all instances and the arbitration proceedings would tend to become a mere nullity and waste of time.

Smith, 112 A.2d at 630-31.

The interpretation of RCW 7.06.060 and MAR 7.3 that will give effect to the provision's purpose to deter meritless appeals and the act's purpose to favor arbitration in certain cases as a means of reducing court congestion is that costs and attorney fees shall be assessed against an appellant from a mandatory arbitration award who does not improve his position in the trial de novo as to a party whose claim was arbitrated. Interpreting RCW 7.06.060 Moreover, it is inherently unfair to deny an attorney fee award to a party that has borne the cost of mandatory arbitration and a trial de novo without a change in results where the denial is based upon the appellant's improving his overall position in the trial de novo solely because of a new claim brought for the first time on appeal. This is particularly so where, as in this case, the appellant might have brought a separate action on the new claim. The respondent argues, however, that because he is entitled to a trial de novo as to all issues and all parties, Christie-Lambert should bear the cost of litigation although it obtained the same results in arbitration and at trial.

                and MAR 7.3 as not authorizing an attorney fee award where an appellant improves his overall position in the trial de novo solely because of a new claim brought for the first time at trial, as McLeod argues, would be counter to the statutory purpose of deterring meritless appeals from mandatory arbitration awards.   In fact, such an interpretation would reward bringing a new claim in a trial de novo after the arbitration
                

Nevertheless,...