Fisher v. Parkview Properties, Inc.
| Decision Date | 13 October 1993 |
| Docket Number | No. 14946-0-II,14946-0-II |
| Citation | 859 P.2d 77,71 Wn.App. 468 |
| Parties | Lawrence E. FISHER and Lori Fisher, husband and wife, Appellants/Cross-Respondents, v. PARKVIEW PROPERTIES, INC., a Washington corporation; Steve W. Lewis and "Jane Doe" Lewis, husband and wife; and Roy Ovist and "Jane Doe" Ovist, husband and wife, and their agents and employees, Respondents/Cross-Appellants. Division 2 |
| Court | Washington Court of Appeals |
Bradley B. Jones, Gordon, Thomas, Honeywell, Malanca, Peterson & Daheim, Tacoma, for appellants.
George S. Kelley, Tacoma, for respondents.
"Normandy on the Heights" is a residential subdivision situated on a cliff in Gig Harbor. It looks out over the Tacoma Narrows Bridge, Point Defiance, Vashon Island, Mt. Rainier and the Cascade Mountains.
The lots in Normandy are subject to protective covenants. These covenants allow fences and other improvements that do not unreasonably or significantly interfere with another owner's view.
Article V of the covenants establishes a three-member architectural control committee. It states, "[N]o improvement or alteration of a previously approved improvement shall be commenced until complete plans and specifications for the same have been submitted and approved in writing by the Committee." 1 It also states, 2
The original members of the architectural control committee were the Normandy developers, Steve Lewis, Roy Ovist, and Richard Kelley. They were also its members during the events giving rise to this case.
In 1989, Dr. Lawrence Fisher owned and lived in a house built on lot 7 of Normandy. To enjoy the view to the northeast, he had to look across Lot 6.
In 1989, Lewis and Ovist owned Lot 6. However, they had contracted to build a house on it, and to sell both the lot and the house to Dr. Jerry Markussen for a price of $315,000. The sale was to close on August 25, but in no event later than August 31.
The contract between Lewis, Ovist and Markussen called for Lewis and Ovist to construct a fence around Lot 6 prior to closing. Acting in their capacity as members of the architectural control committee, Lewis and Ovist examined various types of fences and decided that a 4-foot high, wrought-iron fence would be suitable.
Construction of the fence began shortly before August 25. Fisher immediately objected that the fence would interfere with his view. Lewis thought the sale to Markussen could be finalized without completion of the fence, so he stopped construction.
Markussen arrived at Normandy on August 25 and noted the missing fence. After explaining that Fisher had objected to the proposed fence, Lewis suggested that Markussen call Fisher and discuss Fisher's concerns. When Markussen did that, Fisher asserted that the fence would have an adverse effect on his view and property value, and he threatened to obtain an injunction to stop further construction of the fence.
That same day, several meetings were held among various people involved in the sale. The outcome was that Markussen told Lewis he no longer wished to purchase Lot 6. Lewis then told Fisher the sale had collapsed.
Apparently after further consideration, Lewis and Ovist decided that they wanted to compel Markussen to specifically perform the sale of Lot 6. They believed they could do this only if they completed construction of the fence by August 31. They informed Fisher of their intent to complete the fence, and he objected.
On August 29, Fisher filed a complaint for damages and a temporary restraining order. In an accompanying affidavit, he incorrectly swore:
I am a member of the "Architectural Control Committee", which is specifically to review and approve any fence, wall or hedge prior to its erection. No such request for review and approval has been brought to the committee, nor has my participation as a voting member in a decision by the committee been sought. 3
He attached to the affidavit §§ 6.9-6.13 of Normandy's protective covenants, which vest the architectural control committee with authority to determine when a proposed fence "unreasonably or significantly interfere[s] with or obstruct[s]" a view, but he omitted to attach Article V, describing the membership and procedures of the architectural control committee.
Later on August 29, Fisher presented his complaint and affidavit to a court commissioner, who issued a temporary restraining order prohibiting construction of the fence. The commissioner set a $1,000 injunction bond and scheduled a show cause hearing for September 11. Obeying the restraining order, Lewis and Ovist did not construct the fence.
At the show cause hearing on September 11, the commissioner enjoined, pending trial, any further construction of a fence on Lot 6. Lewis and Ovist asked the commissioner to raise the injunction bond to $75,000, but after hearing argument, he raised the bond only to $10,000.
Also on September 11, Lewis and Ovist counterclaimed against Fisher for damages. They alleged that Fisher had wrongfully obtained the restraining order and preliminary injunction, and that Fisher had tortiously interfered in their contractual relationship with Markussen.
In April 1990, Lewis and Ovist sold the house on Lot 6 to another buyer. The house and lot were sold without a fence, and for $24,400 more than Markussen had agreed to pay.
In December 1990, a bench trial was held on Lewis and Ovist's counterclaims for wrongful issuance of a restraining order and tortious interference with a contractual relationship. Fisher's original claim was moot because Lot 6 had been sold without a fence.
The trial court awarded damages of $10,000 on the wrongful issuance claim. In its oral decision, it stated:
I find that the architectural control committee found that the fence as proposed did not unreasonably or significantly interfere with or obstruct [Fisher's] views.
. . . . .
The [Fishers] do not have the right to prevent the construction of a fence. Their rights as set forth in the covenants were to ensure that the architectural control committee approved the fence prior to its construction, and that in fact was done. The actions of the architectural control committee were reasonable in light of the circumstances and taken in good faith.
I find the architectural control committee properly followed the covenants in authorizing the construction and placement of the wrought iron fence.
The [Fishers] did not have a legal right to prevent the installation of the wrought iron fence, as the architectural control committee did in fact follow the requirements as set forth in the [covenants]. 4
In its written findings and conclusions, the court also stated:
Had the Court Commissioner on August 29, 1989 had all the relevant facts which have been presented as part of this trial, the Temporary Restraining Order would not have issued. Therefore, the issuance of said Temporary Restraining Order was wrongful. 5
Also in its written findings and conclusions, the court stated that because the temporary restraining order had prevented Lewis and Ovist from completing the fence on Lot 6, it had proximately caused them to lose their sale of Lot 6 to Markussen. That loss caused an 8-month delay in selling Lot 6, and during that 8 months, Lewis and Ovist had paid $3,000 per month in construction loan interest that would not have accrued but for loss of the sale to Markussen. Also, Lewis and Ovist had had to make certain changes in the home to improve its marketability, 6 and they had been hampered in obtaining construction loans on other lots because of the unpaid construction loan on Lot 6. The court ultimately ruled, "[I]t is clear that defendants were damaged in an amount in excess of the $10,000 bond ordered by this court", 7 but "[d]efendant's recovery for wrongful issuance of a restraining order is limited to the amount of the bond [$10,000]...." 8
Although the court awarded damages on the wrongful issuance claim, it rejected the tortious interference claim. It found, "Steve Lewis was advised and knew on August 25 that Markussens no longer wished to purchase the home and Steve Lewis so advised Dr. Fisher on that same day." 9 It further found, "At the time the restraining order was obtained Dr. Fisher believed that the Lewis-Markussen contract had failed." 10 It concluded, "Because Dr. Fisher believed that the Markussen-Lewis contract had failed he cannot be held responsible for having interfered tortiously with that contract." 11
Fisher appeals, and Lewis and Ovist cross-appeal. We discuss the wrongful issuance claim first, and the tortious interference claim second.
The parties raise four issues involving the wrongful issuance claim. (A) Did the trial court err when it determined that the temporary restraining order and preliminary injunction were wrongfully issued? (B) Did the trial court err when it determined that the temporary restraining order and preliminary injunction were a proximate cause of damage to Ovist and Lewis? (C) Did the trial court err when it limited Ovist's and Lewis's recovery to the face amount of the injunction bond? And (D) did the trial court err when it set the amount of the injunction bond at only $10,000?
A temporary restraining order is an order entered without notice, or after informal notice. CR 65(b). It operates for a period not to exceed 14 days unless extended for good cause. CR 65(b). In contrast, a preliminary injunction is an order entered after formal notice to the opposing party. CR 65(a). It operates from issuance until trial. See CR 65(a). Here, the commissioner entered a temporary restraining order on August 29 and a preliminary injunction on September 11.
Not surprisingly, the...
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