Reeves v. Mason Cnty.

• Decision Date: 17 May 2022
• Docket Number: 38548-5-III
• Parties: Tammy REEVES, Respondent, v. MASON COUNTY, a political subdivision of the state of Washington, Appellant.
• Court: Washington Court of Appeals

509 P.3d 859

Tammy REEVES, Respondent,

v.MASON COUNTY, a political subdivision of the state of Washington, Appellant.

No. 38548-5-III

Court of Appeals of Washington, Division 3.

FILED MAY 17, 2022

Suzanne Kelly Michael, Fisher & Phillips LLP, 1700 7th Ave. Ste. 2200, Seattle, WA, 98101-4416, Philip Albert Talmadge, Talmadge/Fitzpatrick, 2775 Harbor Ave. Sw, Third Floor Ste. C, Seattle, WA, 98126-2138, for Appellant.

Julie Anne Oberbillig, Oberbillig Law, P.S., 2430 Columbia St. Sw, Olympia, WA, 98501-2846, Hugh Joseph McGavick, The Law Office of Hugh J. McGavick PS, 855 Trosper Rd Sw #108-298, Tumwater, WA, 98512, for Respondent.

PUBLISHED OPINION

Fearing, J. ¶ 1 RCW 49.48.030 affords an employee reasonable attorney fees and costs against her employer when recovering wages. We must decide whether to dismiss, on res judicata or collateral estoppel grounds, a standalone suit seeking recovery of fees and costs, under RCW 49.48.030, when the employee recovered wages in the course of an earlier administrative proceeding. We decline to apply collateral estoppel because of a difference in issues in the respective suits. We also decline to apply either of the two bars because operation of the related doctrines, under our circumstances, fails to fulfill their purposes. We further demur because of a strong Washington public policy favoring employees owed wages. We thereby affirm the superior court's award of reasonable attorney fees and costs to Tammy Reeves for attorney services incurred when seeking relief against Mason County for whistleblower retaliation before the Office of Administrative Hearings (OAH) and appeals of OAH rulings to the superior court.

FACTS

¶ 2 Mason County Sheriff's Office Corrections Officer Tammy Reeves claims she lost a promotion because of whistleblowing activity. The claim underwent numerous hearings before OAH and appeals of OAH rulings to the superior court. Reeves filed the present suit after the conclusion of proceedings before OAH.

¶ 3 On February 24, 2014, during her tenure as a correctional officer with the Mason County Sheriff's Office, Reeves submitted a complaint with the Mason County human resources manager. She alleged that the sheriff office's management subjected employees to verbal abuse, denied officers training opportunities, and ignored pervasive problems at the jail.

¶ 4 Later in 2014, Tammy Reeves applied for one of four open positions for corporal at the Mason County Sheriff's Office. The Mason County sheriff decided who to promote. He did not promote Reeves. Reeves believed that the sheriff denied her the promotion because of her human resources complaint.

¶ 5 On September 26, 2014, Tammy Reeves filed a complaint with Mason County's Prosecuting Attorney's Office that alleged a wrongful denial of a promotion in violation of the Local Government Whistleblower Protection Act, chapter 42.41 RCW. On October 24, 2014, Reeves requested that Mason County refer her complaint to OAH for an evidentiary hearing. Pursuant to RCW 42.41.040, the county complied with Reeves’ request.

¶ 6 In March 2015, OAH Administrative Law Judge (ALJ) Jeffrey Friedman conducted an evidentiary hearing to address Tammy Reeves’ complaint. On April 15, 2015, ALJ Friedman entered an order that concluded Mason County had retaliated against Reeves. In addition to other relief, ALJ Friedman awarded Reeves attorney fees and costs incurred through April 15, 2015, in the amount of $32,745.03 pursuant to RCW 42.41.040(7). The statute allows the ALJ, at the judge's discretion, to "award costs and reasonable attorney’ fees to the prevailing party."

¶ 7 Mason County appealed ALJ Jeffrey Friedman's ruling to the Thurston County Superior Court. The superior court ruled that the evidence supported the ALJ's findings of fact, but the ALJ had applied an erroneous legal test. The superior court remanded for additional findings.

¶ 8 On remand, OAH assigned the rehearing to ALJ Lisa Dublin. ALJ Dublin issued new findings of fact and concluded that the evidence failed to establish that the Mason County sheriff knew that Tammy Reeves had complained about the sheriff's office. Therefore, ALJ Dublin ruled in favor of Mason County.

¶ 9 Tammy Reeves appealed ALJ Lisa Dublin's order to the superior court. The superior court ruled that, because it previously upheld ALJ Jeffrey Friedman's findings of fact, ALJ Dublin erred by entering findings contrary to those of ALJ Friedman. The court reversed ALJ Dublin's order and remanded for another hearing before an ALJ other than Lisa Dublin.

¶ 10 On the second remand, OAH assigned the case to ALJ Johnette Sullivan. On March 19, 2020, ALJ Sullivan entered a final order concluding that Mason County retaliated against Tammy Reeves in violation of the county's whistleblower policy. ALJ Sullivan awarded Reeves monetary relief in the amount of $7,462.80. ALJ Sullivan also reinstated Reeves’ original award of attorney fees and costs in the amount of $32,745.03, which expenses she incurred through April 15, 2015. ALJ Sullivan also awarded reasonable attorney fees and costs incurred by Reeves during the second remand proceedings before Sullivan. ALJ Johnette Sullivan concluded, however, that she lacked authority to award reasonable attorney fees to Reeves for services performed by Reeves’ counsel during judicial review by the Thurston County Superior Court and during remand proceedings before ALJ Lisa Dublin. ALJ Sullivan did not explain why she lacked authority to grant Reeves attorney fees incurred on judicial review and before ALJ Lisa Dublin.

¶ 11 ALJ Johnette Sullivan's final order informed Tammy Reeves that she could move for reconsideration of the order within ten days or seek judicial review of her decision with the superior court. ALJ Sullivan also instructed Reeves to submit an accounting for costs and attorney fees incurred after September 7, 2018, the date on which the superior court ordered the second remand. ALJ Sullivan ultimately granted Reeves an additional $6,550 in attorney fees and costs incurred between June 24, 2019 and December 18, 2019, dates during which the case was on remand before ALJ Sullivan.

¶ 12 On March 27, 2020, Tammy Reeves’ counsel e-mailed Mason County a letter demanding that the county pay Reeves $136,725.59 in attorney fees and costs by March 31, 2020. Counsel announced Reeves’ intent to file suit against Mason County if the county refused to pay a full recovery of fees and costs under RCW 49.48.030. During OAH proceedings, Reeves had only requested reasonable attorney fees and costs pursuant to RCW 42.41.040.

¶ 13 On April 2, 2020, Tammy Reeves’ counsel sent Mason County a second e-mail with an attached motion for reconsideration that counsel alleged would soon be filed. The motion argued that ALJ Johnette Sullivan incorrectly claimed that she lacked authority to award Reeves attorney fees and costs other than from September 7, 2018 to December 19, 2019. Reeves never filed this motion for reconsideration or filed an appeal to the superior court.

PROCEDURE

¶ 14 On August 3, 2020, more than four months after ALJ Johnette Sullivan's final order awarding Tammy Reeves part of her attorney fees and costs, Reeves filed this collateral suit in Thurston County Superior Court. Reeves seeks recovery, under RCW 49.48.030, of those attorney fees denied her by ALJ Sullivan.

¶ 15 Mason County filed a motion seeking summary judgment and sanctions against Tammy Reeves pursuant to CR 11. The county argued that Reeves’ complaint constituted an untimely appeal of ALJ Johnette Sullivan's final order, and thus the superior court lacked jurisdiction to hear the complaint. The county further argued that, as a collateral suit, res judicata and collateral estoppel barred Reeves’ complaint. The county attached, to its motion, a copy of Reeves’ counsel's e-mail transmission from March 27, 2020. The county labeled the document " ER 408 Communication." Clerk's Papers (CP) at 51.

¶ 16 In her response to Mason County's motion for summary judgment, Tammy Reeves objected to the county's filing of her counsel's March 27, 2020 e-mail communication. She argued that, as a settlement proposal, the document was inadmissible pursuant to ER 408.

¶ 17 The superior court denied Mason County's motions. Thereafter, Tammy Reeves filed a motion seeking recovery of attorney fees incurred in her whistleblower proceeding, but not awarded by ALJ Johnette Sullivan. In response to this motion, the superior court concluded that RCW 49.48.030 allowed Reeves to appeal ALJ Johnette Sullivan's order or bring a separate suit. The superior court also determined that res judicata and collateral estoppel did not bar Reeves’ collateral suit. The superior court never addressed Reeves’ motion to strike the demand e-mail. The superior court awarded Reeves reasonable attorney fees and costs totaling $161,415.

LAW AND ANALYSIS

¶ 18 On appeal, Mason County repeats its justifiable arguments that res judicata and collateral estoppel bar Tammy Reeves’ separate action in superior court for recovery of reasonable attorney fees and costs since she could have appealed ALJ Johnette Sullivan's ruling denying in part her fees and costs. Mason County impliedly, if not expressly, concedes that ALJ Sullivan erroneously denied an award of fees for services performed by Reeves’ counsel before the superior court and before ALJ Lisa Dublin. The county does not object to the amount of fees awarded by the superior court as unreasonable.

¶ 19 As she did before the superior court, Tammy Reeves asks that this court strike from the record her counsel's March 27, 2020 correspondence to Mason County. She contends that ER 408 bars the admission and consideration of a settlement demand letter. Because we deem the letter unimportant to our ruling, we repeat the superior court's wise disregard of the request.

¶ 20 Mason County's appeal demands extended rumination about the purposes behind the related doctrines of collateral estoppel and res judicata and commands a brief...