Haselwood v. Bremerton Ice Arena, Inc.
| Citation | 137 Wn. App. 872,155 P.3d 952 |
| Decision Date | 10 April 2007 |
| Docket Number | No. 33910-2-II.,33910-2-II. |
| Court | Court of Appeals of Washington |
| Parties | Charles C. HASELWOOD and Joanne L. Haselwood, husband and wife, Respondents, v. BREMERTON ICE ARENA, INC., a Washington corporation; Gregory S. Meakin and Deborah A. Meaqin, husband and wife; Mallory Enterprises, Inc. dba Abbey Carpets, a Washington corporation; Robison Mechanical, Inc., a Washington corporation; JPL Habitability, Inc., a Washington Corporation; Consolidated Electrical Distributors, Inc. dba Stusser Electric Co/Eagle Electric, a Washington corporation; Alaska Cascade Financial Services, Inc., assignee for Sound Glass Sales, Inc., a Washington corporation; Sullivan Heating & Cooling, Inc., a Washington corporation; Stirnco Steel Structures, Inc., a Washington corporation; Eagle Electric, Inc., a Washington corporation; Hanson Sign Company, Inc., a Washington Corporation; Stripe Rite Inc., a Washington corporation, Defendants, RV Associates, Inc., a Washington corporation, Appellant, City of Bremerton, Intervenor. |
William Henry Broughton, Broughton & Singleton Inc PS, Silverdale, WA, for Petitioner.
Charles M. Granoski Jr., Attorney at Law, Betzendorfer & Granoski, Tacoma, WA, David R. Riley, Weinstein & Riley, P.S., Seattle, WA, for Defendants.
Gary Theodore Chrey, Attorney at Law, Kenneth L. Kambich, Shiers Law Firm, Port Orchard, WA, Charles Kenneth Wiggins, Shelby R. Frost Lemmel, Kenneth Wendell Masters, Wiggins & Masters PLLC, Bainbridge Island, WA, for Respondents.
David P. Horton, Law Office of David P. Horton Inc. PS, Silverdale, WA, for Respondent Intervenor.
¶1 In an action to foreclose on Chuck1 and Joanne Haselwood's deed of trust, RV Associates, Inc., claimed that its mechanic's lien had priority because RV Associates furnished equipment to the job site before the Haselwoods recorded the deed of trust. RV Associates appeals from the trial court's judgment in favor of the Haselwoods. We agree with the trial court that the mechanic's lien cannot reach the City of Bremerton's real property, but we disagree that the lien is not entitled to priority under RCW 60.04.061. We also hold that the trial court did not abuse its discretion in denying RV Associates' motion for leave to amend its pleadings. We affirm in part, reverse in part, and remand.
¶2 In April 1971, the U.S. Secretary of the Interior deeded 17.6 acres of land to the City for use as a public park and recreation area. The deed prohibited the City from leasing the land except to another government agency; however, the deed authorized the City to provide recreational facilities and services by entering into private concession agreements, subject to the approval of the Secretary of the Interior.
¶3 On August 9, 2002, the City entered into a concession agreement (the agreement) with Bremerton Ice Arena, Inc. (BIA) to construct and operate an indoor ice arena on the former federal lands. The agreement provided that BIA would not obtain fee ownership or any leasehold interest in the underlying realty, but it would own the improvements during the term of the agreement and would be entitled to possess them exclusively.
¶4 The BIA and the City designated BIA as the developer, solely responsible for obtaining financing, and referred to the project as a private works project. The agreement also noted that BIA had no authority to place liens on the City's interest in the premises. But the agreement designated the improvements and BIA's personal property on the premises as collateral and authorized BIA to pledge the collateral, as well as BIA's interest in the agreement, as security to obtain financing. Although affixed to the realty, the improvements would remain personal property and a lender realizing on the collateral would be entitled to remove the improvements, including the building facility.
¶5 The agreement was to be in effect for 10 years, with BIA retaining the option to renew the agreement for four consecutive 10-year periods. When the agreement terminated, ownership of the improvements would revert to the City. The agreement specified that it was expressly made for the sole benefit of BIA and the City with no intention to create any third party rights.
¶6 The Haselwoods agreed to provide financing for the project. In exchange for a $3,775,000 loan at 10 percent interest, BIA executed a promissory note, a commercial security agreement, and a deed of trust. The deed of trust purported to secure the loans by the real property at the ice arena location.
¶7 In addition, Gregory and Deborah Meakin, president and secretary, respectively, of BIA, executed a commercial guarantee and a hazardous substances certificate and indemnity. The Haselwoods recorded the deed of trust, and the hazardous substances certificate and indemnity on September 13, 2002.2
¶8 BIA engaged The Wootan Group to serve as construction manager and general contractor for the ice arena project. RV Associates submitted a bid for clearing, excavating, grading and backfilling the site, as well as installing drainage, water and sewer lines, and a storm system, quoting a $441,716 base bid. The Wootan Group awarded RV Associates a private works contract dated August 17, 2002, which called for RV Associates to commence work on September 9, 2002.
¶9 RV Associates delivered equipment to the site on September 6. On September 9, The Wootan Group sent a notice to proceed and intent to award the contract to RV Associates based on its bid. RV Associates and BIA executed their contract on September 20.
¶10 After construction commenced, the Wootan Group made a number of changes to the plans and specifications affecting the cost of RV Associates' work. RV Associates claimed that BIA failed to pay $101,905.30 required by the agreement. Accordingly, RV Associates recorded a mechanic's lien against BIA and the ice arena on July 14, 2003.
¶11 BIA defaulted on the Haselwoods' promissory note. The Haselwoods filed a complaint for foreclosure against BIA, the Meakins, RV Associates, and numerous other creditors with interests in the ice arena. They sought a default judgment against BIA, a declaration that its security interest was prior to all other liens on the property, and a decree of foreclosure authorizing a sale of the property.
¶12 RV Associates filed an answer, counterclaim, and cross-claim, in which it claimed its mechanic's lien was superior to all other claims and liens on the property. RV Associates claimed priority under RCW 60.04.061 because it delivered equipment to the construction site on September 6, one week before the Haselwoods recorded the deed of trust. Accordingly, RV Associates sought a judgment against BIA for $101,905.30 plus 18 percent interest, costs and attorney fees, a declaration that its mechanic's lien was superior to all other claims on the property, and a foreclosure sale.
¶13 RV Associates moved for summary judgment against BIA, declaring its lien to be senior. The Haselwoods opposed the motion, arguing that the parties disputed the extent of BIA's obligation and that the property subject to the lien was public property and therefore could not have a lien attached to it. In response, RV Associates argued that the real property could have a lien attach because the City held the land in a proprietary capacity.
¶14 The trial court granted the motion for summary judgment in part, ruling that RV Associates' lien did not attach to the underlying realty or the concession agreement, but it "may attach to certain improvements to the facility commonly known as the Bremerton Ice Arena pursuant to further Order of the Court." Clerk's Papers (CP) at 609-10.
¶15 After moving for summary judgment but before the trial court issued its order, RV Associates moved for an order allowing it to remove its improvements. In the event the mechanic's lien did not attach to the underlying realty, RV Associates claimed it had statutory authority to remove its improvements to satisfy its lien under RCW 60.04.051. The City intervened in the action and opposed the motion to remove, arguing that removal could not be accomplished without injury to the underlying realty. The Haselwoods also opposed the motion. The trial court found that there were several contested factual issues and set a hearing.
¶16 The Haselwoods then sought summary judgment on the removal issue, arguing that removal is only available to a lien claimant who has priority and that RV Associates did not have priority because its lien was not "`upon any lot or parcel of land'" as RCW 60.04.051 required. CP at 1063. The trial court ultimately granted the Haselwoods' motion for summary judgment, deciding that removal is only available to a lien claimant who has priority and that RV Associates' lien was junior to the Haselwoods' deed of trust.
¶17 RV Associates then sought leave to file an amended counterclaim and cross-claim, adding additional allegations against the Haselwoods for breach of contract, promissory estoppel, negligence, unjust enrichment, and fraudulent inducement. RV Associates also wanted to add claims against the City as a third party beneficiary of the concession agreement and for its failing to require a bond and retainage. Both the Haselwoods and the City opposed the motion, arguing that amendment would be prejudicial and that the proposed amendments would be futile. The trial court denied RV Associates' motion for leave to amend.
¶18 The trial court entered a judgment and final decree of foreclosure in favor of the Haselwoods in September 2005. We granted RV Associates' motion for discretionary review.
To continue reading
Request your trial
-
Gull Indus., Inc. v. Granite State Ins. Co.
...a complaint will not be disturbed on appeal unless the decision was a manifest abuse of discretion. Haselwood v. Bremerton Ice Arena, Inc., 137 Wash. App. 872, 889, 155 P.3d 952 (2007), aff'd, 166 Wash.2d 489, 210 P.3d 308 (2009). A trial court abuses its discretion when its decision rests ......
-
R.N. v. Kiwanis Int'l
...A court abuses its discretion when its decision is not based on tenable grounds or tenable reasons. Haselwood v. Bremerton Ice Arena, Inc. , 137 Wash. App. 872, 889–90, 155 P.3d 952 (2007), aff'd , 166 Wash.2d 489, 210 P.3d 308 (2009). ¶ 62 "A party may amend the party's pleading only by le......
-
Washington Constr. Inc. v. Sterling Sav. Bank
...A court abuses its discretion if its decision is not based on tenable grounds or tenable reasons. Haselwood v. Bremerton Ice Arena, Inc., 137 Wn. App. 872, 889, 155 P.3d 952 (2007), aff'd, 166 Wn.2d 489, 210 P.3d 308 (2009). A trial court's failure to explain its reason for denying leave to......
- 224 Westlake, LLC v. Engstrom Props., LLC