F. Feri LLC v. Roy Street Holdings, Inc., No. 53339-8-I (WA 4/18/2005)

• Decision Date: 18 April 2005
• Docket Number: No. 53339-8-I,53339-8-I
• Court: Washington Supreme Court
• Parties: F. FERI LLC, Appellant, v. ROY STREET HOLDINGS, INC.; RMB PROPERTIES LLC; RONALD P. ISAACS and HEATHER ISAACS, husband and wife; CHINN CONSTRUCTION LLC; and CIVILTECH CORPORATION, Respondents.

Page 1

Unpublished Opinion

F. FERI LLC, Appellant, v. ROY STREET HOLDINGS, INC.; RMB PROPERTIES LLC; RONALD P. ISAACS and HEATHER ISAACS, husband and wife; CHINN CONSTRUCTION LLC; and CIVILTECH CORPORATION, Respondents.

No. 53339-8-I

Court of Appeals of Washington, Division One.

Filed: April 18, 2005

Appeal from Superior Court of King County. Docket No: 01-2-26815-5. Judgment or order under review. Date filed: 10/21/2003. Judge signing: Hon. Mary I Yu.

Counsel for Appellant(s), Randall C. Jr Johnson, Badgley Mullins Law Group PLLC, 701 5th Ave Ste 4750, Seattle, WA 98104.

Mark Jeffrey Wilson, Badgley-Mullins Law Group PLLC, 701 5th Ave Ste 4750, Seattle, WA 98104-7097.

Counsel for Respondent(s), Dennis John McGlothin, McGlothin Myhre PLLP, 1221 E Pike St Ste 205, Seattle, WA 98122-3930.

Jeffrey Bruce Wells, Attorney at Law, 500 Union St Ste 927, Seattle, WA 98101-2320.

Ronald P Isaacs (Appearing Pro Se), 5275 Gulf Place, West Vancouver, BC BC V7W2V9.

COX, C.J.

At issue in this appeal is whether the trial court abused its discretion in denying F. Feri LLC's (Feri) motion to amend its complaint; whether the challenged findings are supported by substantial evidence; and whether the trial court improperly awarded attorney fees to RMB Holdings (RMB). We hold there was no abuse of discretion in denying the motion to amend made on the first day of trial. The findings are supported by substantial evidence. But the statutes and case law do not support the award of fees to RMB in this case. We affirm in part and reverse in part.

RMB's property is downhill from Feri's property. The Feri and RMB properties are separated by a 20 foot retaining wall, comprised of two sections. One section of the wall was cantilevered, the other was braced. Feri's property contained a parking lot on top of the fill soil of the retaining wall. In 1996, the parking lot was replaced. At that time, W.G. Clark Construction excavated 1 to 2 feet of the existing poor fill soil and replaced it with structural fill. Clark then poured the parking lot on top of the structural fill.

In 1997, the downhill property was demolished. The demolition removed most of the bracing for the braced retaining wall. After demolition, Feri claims that the parking deck on its property began to sink and crack.

In July 2000, RMB's engineers recommended and added additional bracing for the top of the braced wall. RMB offered to fix Feri's parking lot, but Feri declined the assistance and instead sued RMB for negligence and/or strict liability, waste and trespass to real property, breach of contract and removal of lateral support for the damage to its parking lot. On the first day of trial, the court denied Feri's motion to amend its complaint. A defense verdict followed a bench trial.

The trial court later awarded fees to RMB under RCW 4.84.250 and denied Feri's motion to reconsider the fee award.

Feri appeals.

AMENDMENT OF PLEADINGS

Feri argues that the court abused its discretion when it denied Feri leave to amend its complaint with a claim under RCW 4.24.630. We disagree.

A party may amend its pleading by leave of the court and leave shall be freely given when justice so requires.¹ The "touchstone for the denial of a motion to amend is the prejudice such an amendment would cause to the nonmoving party."² A trial court's denial of a motion to amend pleadings is reviewed for an abuse of discretion.³

On the first day of trial, Feri sought to add a claim under RCW 4.24.630. That allows a landowner a cause of action against any person "who . wrongfully causes waste or injury to the land, or wrongfully injures personal property or improvements to real estate on the land.." An act is wrongful "if the person intentionally and unreasonably commits the act or acts while knowing, or having reason to know, that he or she lacks authorization to so act."⁴

Here, the amendment would have prejudiced RMB. The cause of action under RCW 4.24.630 would have added an entirely new claim into the case that would have introduced an added element of willfulness. The motion was made the morning of trial. Accordingly, RMB had no time to prepare a defense or argue that its actions did not willfully or intentionally cause waste or damage to Feri's land, property, or improvements on the land.

The trial court did not abuse its discretion when it denied the motion to amend the complaint.

SUBSTANTIAL EVIDENCE

Feri argues that the trial court erred because substantial evidence did not support the trial court's findings of fact on which the conclusions of law are based. We disagree.

Appellate review is limited to determining whether substantial evidence supports the findings of fact and, if so, whether the findings support the conclusions of law.⁵ Substantial evidence is "evidence sufficient to persuade a fair-minded, rational person of the truth of the declared premise."⁶ Upon a challenge to the findings following a bench trial, the "respondent is entitled to the benefit of all evidence and reasonable inference therefrom in support of the findings of fact entered by the trial court."⁷ Unchallenged findings are verities on appeal.⁸ We review conclusions of law de novo.⁹

Findings of Fact

Feri first challenges findings of fact 1¹⁰ and 2,¹¹ concerning the burden of proof for its claims and the cause of the cracking of Feri's concrete slab. However, upon review of the record there was substantial evidence that the concrete slab on the Feri property would have cracked independently of the deflection, if any, of the retaining wall.

Feri next challenges findings of fact 5,¹² 7,¹³ and 10.¹⁴ It claims the soil used as fill was erroneously characterized as "poor" and that the parking structure was placed where the poor soils were used to fill in. But, at trial, witnesses testified that, the soil below the structural fill was moisture sensitive, insufficient to support a load, and would continue to settle. Because the underlying fill would continue to settle, cracking would occur along the transition zone between the firm native soil and the poor fill soil.

Feri next argues finding 11¹⁵ concerning the development of the downhill property is inaccurate and not supported by substantial evidence. But testimony from Ron Isaacs, who owned the RMB property, confirms that demolition began in 1997. Further, Minoru Fuji, Feri's managing member, testified in a deposition that was admitted and published at trial, that the parking lot was not damaged prior to September 10, 1999.

Feri next assigns error to finding 15.¹⁶ This finding is supported by substantial evidence. There was testimony at trial that the cantilevered retaining wall had not moved at all.

Feri assigns error to finding 18¹⁷ regarding settlement offers, claiming it is inaccurate and not supported by substantial evidence. The record indicates that as early as March 1999, Ron Isaacs, a developer of the property, offered to repair any damage that occurred on "adjoining properties, whether it was a result of our activities or not."

Feri assigns error to finding 19¹⁸ claiming the plaintiff's proposed remedy would not place it in a better position prior than existed prior to RMB's construction activities and that RMB must take Feri as they found it. Testimony in the record indicates that proposed repairs would place Feri in a better position than that which existed prior to RMB's demolition or construction activities.

Feri also assigns error to finding 21,¹⁹ complaining that the proposed remedy is not supported by substantial evidence. However, there is evidence in the record that filling the cracks would be an appropriate repair that would cost $9,953.03 and would restore Feri to a position at least as good as that before RMB's activities on the downhill property. Feri next assigns error to finding 22.²⁰ Nonetheless, testimony in the record indicated there would have been less or no settlement of the soils had the original native soils been present instead of the fill soil used when the retaining wall was constructed.

Feri also assigns error to finding 23,²¹ claiming that it is not consistent with the court's conclusions. But there is evidence in the record that the fill soil beneath the Feri parking slab was poor. And the finding does support the conclusion.

Next, Feri assigns error to finding 24²² and 25,²³ claiming that there was no substantial evidence to find that the demolition and construction activities on the RMB property were not the sole cause, and not the cause in fact of the cracking in the parking lot of the Feri property. However, at trial, witnesses for both sides pointed to a multitude of possible causes of the cracking.

Similarly, Feri assigns error to finding 26²⁴ arguing that the testimony of Tim Hoover, a senior manager of the company that installed the Feri slab, did not support a finding that the cracking was linked to settling soils. Hoover testified that the slab and structural fill was only as good as the fill underneath it and that the fill underneath the structural fill was moisture sensitive and insufficient to support the load of the existing slab.

In sum, the challenged findings of fact were supported by substantial evidence.

Conclusions of Law

Feri claims conclusions of law 1, 5, and 6 pertaining to RMB's alleged breach of duty and causation are not supported by the court's findings of fact.²⁵ We disagree.

Appellate review of a conclusion of law, based upon findings of fact, is limited to determining whether a trial court's findings are supported by substantial evidence, and if so, whether those findings support the conclusion of law.²⁶ We review conclusions of law de novo.²⁷

The court's findings support its conclusions of law. Here, Feri failed to prove that RMB's conduct was the proximate cause of its injuries. The trial court concluded that the cracks in Feri's parking lot were caused by transitions in soil underlying the lot. At trial, Feri failed to show that the weight of improvements and...