Saluteen-Maschersky v. COUNTRYWIDE FUNDING

• Decision Date: 19 March 2001
• Docket Number: No. 45519-2-I.,45519-2-I.
• Citation: 22 P.3d 804,105 Wash.App. 846
• Court: Washington Court of Appeals
• Parties: Peter A. SALUTEEN-MASCHERSKY, Appellant, v. COUNTRYWIDE FUNDING CORPORATION, and H & L Services, Inc., Respondents.

22 P.3d 804

105 Wash.App. 846

Peter A. SALUTEEN-MASCHERSKY, Appellant, v. COUNTRYWIDE FUNDING CORPORATION, and H & L Services, Inc., Respondents.

No. 45519-2-I.

Court of Appeals of Washington, Division 1.

March 19, 2001.

Publication Ordered April 30, 2001.

Jean Marie Schiedler-Brown, Seattle, for Appellant.

John James Watson, Michael Barr King, Lane Powell Spears Lubersky, Seattle, for Respondents.

APPELWICK, J.

Paul Saluteen-Maschersky (Saluteen) appeals a trial court order dismissing his claims against Countrywide Funding Corporation (Countrywide) on summary judgment, as well as the trial court's decision to strike additional causes of action. The primary issue is whether Saluteen presented sufficient evidence of the existence of an oral contract between the parties. Because Saluteen offers, in effect, no more than his bare assertion that the contract existed, summary judgment was appropriate. Finding no other error, we affirm.

FACTS

In June 1993, Saluteen obtained a deed of trust to secure an adjustable rate note on his personal residence. Countrywide was appointed the servicing agent for the note and deed of trust.

Saluteen's August and September 1995 payments on the loan were late. Saluteen failed to make an October payment. By letter dated November 7, 1995, Countrywide notified Saluteen that he had failed to pay the loan in a timely manner and that his credit standing was in jeopardy.

Saluteen spoke with a Countrywide loan counselor on the telephone on November 13, 1995. According to Countrywide, Saluteen "offered to pay $1,000 per week until he was `caught up,' promised he would make his first payment by November 20, 1995, and stated he would `call back' with a date by which he could make a total cure." Countrywide acknowledges receiving this proposal, but claims that "no employee of Countrywide ever agreed to accept Saluteen's proposal, extend credit, or forbear from enforcing the terms of repayment of his promissory note." Further, according to Countrywide, its collection protocol requires that supervisory review and written approval be generated to memorialize a new agreement. This never took place. But Saluteen claims that he and Countrywide reached an oral agreement, with the same terms as those he specified in his offer.

Saluteen sent Countrywide a check for $1,000, which Countrywide acknowledges receiving on November 22, 1995. Saluteen sent another check in the amount of $1,000, which Countrywide received in early December; Countrywide returned the check to Saluteen. In a letter dated December 5, which accompanied the returned check, Countrywide informed Saluteen that it was returning the funds because the amount remitted did not represent the total amount then due, $8,761.92.

Countrywide's records reflect that it again contacted Saluteen by telephone on December 1, 1995. Saluteen confirmed to the Countrywide representative on the telephone that he was unable to reinstate his loan due to financial hardship. He stated that he would continue to send $1,000 until his loan was current. According to Countrywide's telephone log, Saluteen was informed that this proposal was unacceptable.

In a letter dated February 2, 1996, Countrywide sent Saluteen a notice of default. The letter credited only the sum of $379.90 to Saluteen's account, not the full $1,000 that he had paid in late November.

In May 1996, Saluteen filed for bankruptcy relief under Chapter 13. That case was dismissed in August 1997.

After dismissal of the bankruptcy, Countrywide initiated foreclosure in October 1997. On the eve of foreclosure, Saluteen filed suit against Countrywide, followed by a motion for preliminary injunction to stop the foreclosure sale. Saluteen's complaint alleged the following causes of action: (1) breach of contract; (2) "Sale on Deed of trust noted in violation of RCW Title 61;" (3) negligent breach of duty to account for payments received; (4) violation of federal unfair billing practices act; and (5) defamation.

The trial court granted Saluteen an order restraining the scheduled trustee's sale, on condition that Saluteen pay $2,952.04 per month into the registry of the court, which represented the monthly mortgage payment. Saluteen failed to make the required payments. The court consequently entered an order dissolving the stay of the trustee's sale.

Countrywide moved for summary judgment dismissal of all of Saluteen's claims. Saluteen's response to Countrywide's motion for summary judgment raised, for the first time, three new substantive claims: (1) equitable estoppel; (2) negligent misrepresentation; and (3) Title 15 U.S.C. section 1601 (Truth in Lending Act) violations. Countrywide filed a motion to strike these new causes of action. On June 18, 1999, after hearing oral argument, the trial court granted the motion to strike. On that date, the court also granted Countrywide's motion for summary judgment, dismissing all of Saluteen's claims with prejudice. Saluteen appeals.

I. SUMMARY JUDGMENT

Saluteen first contests the trial court's summary judgment order. A trial court's order granting summary judgment is reviewed de novo on the record before the trial court at the time of the order. Trimble v. Washington State Univ., 140 Wash.2d 88, 92, 993 P.2d 259 (2000). Summary judgment is appropriate if there is no genuine issue of material fact and the moving party is entitled to judgment as a matter of law. Trimble, 140 Wash.2d at 93, 993 P.2d 259; CR 56(c). All facts and reasonable inferences from them are to be considered in the light most favorable to the nonmoving party. Trimble, 140 Wash.2d at 93,993 P.2d 259. The motion should be granted if, from all the evidence, reasonable persons could reach but one conclusion. Trimble, 140 Wash.2d at 93,993 P.2d 259.

A. Oral Contract

Saluteen argues that the trial court erred in granting Countrywide summary judgment dismissal of his claims of breach of contract, negligent breach of duty of good faith, and defamation.¹ In essence, all of these claims depend upon Saluteen's assertion that an oral contract existed between the parties, and that Countrywide breached that contract. According to Saluteen, under the contract, he was to pay Countrywide $1,000 per week until his loan was caught up, and Countrywide was to forbear from finding him in default.

The dispositive issue is whether the parties mutually assented to the terms of the purported contract. For a contract to exist, there must be a mutual intention or "meeting of the minds" on the essential terms of the agreement. McEachern v. Sherwood & Roberts, Inc., 36 Wash.App. 576, 579, 675 P.2d 1266 (1984). "Mutual assent generally takes the form of an offer and an acceptance." Pacific Cascade Corp. v. Nimmer, 25 Wash. App. 552, 556, 608 P.2d 266 (1980). The burden of proving a contract, whether express or implied, is on the party asserting it, and he must prove each essential fact, including the existence of a mutual intention. Cahn v. Foster & Marshall, Inc., 33 Wash.App. 838, 840, 658 P.2d 42 (1983).

Generally, the trier of fact in a trial setting should make the final determination with respect to the existence of an oral contract; disputes about oral contracts should not be decided by summary judgment. Duckworth v. Langland, 95 Wash.App. 1, 7, 988 P.2d 967 (1998). This is because resolution of disputes over the existence of oral contracts depends on the credibility of witnesses. Crown Plaza Corp. v. Synapse Software Sys., Inc., 87 Wash.App. 495, 500-01, 962 P.2d 824 (1997). Nonetheless, the general rule still applies: bare assertions of ultimate facts and conclusions of fact are alone insufficient to defeat summary judgment. See Grimwood v. University of Puget Sound, Inc., 110 Wash.2d 355, 359-60, 753 P.2d 517 (1988).

Saluteen first claims that Countrywide made him an offer to enter an agreement allowing him to catch up on his loan payments. He claims that Countrywide made the offer in its letter dated November 7, 1995. In that letter, Countrywide notified Saluteen that his loan payments were untimely. The letter also stated, "Since your Countrywide credit standing is affected by how promptly you make your payments, please contact our office to reach a mutual arrangement or mail $6,662.28 today to bring your account to a current status."

In order to satisfy the offer element of mutual assent, Saluteen must show that Countrywide offered "a promise to render a stated performance in exchange for a return promise being given." Pacific Cascade Corp., 25 Wash.App. at 556, 608 P.2d 266. Saluteen has failed to meet this burden. In the November 7 letter, Countrywide did not promise to render a stated performance in exchange for a return promise. No contract terms were specified. The November 7 letter did not constitute an offer to enter an agreement.

Saluteen next asserts that the parties formed an oral contract through a series of telephone conversations. As evidence of mutual assent, he relies on Countrywide's telephone logs and his own declarations.

Countrywide's telephone logs do not help Saluteen. The first relevant telephone conversation occurred on November 13, 1995. The log states verbatim:

MR CLLD BACK SD HE IS NT GOING TO B ABLE TO AFFORD ANY MORE PMT ADJUSTMENTS.. .... SD CN SND $1000.00 PER WEEK UNTIL HE IS CAUGHT UP ... WLL SND A PMT BY 11/20 ... MR WLL CLL BACK W/ TOTAL CURE DATE ... MR WAS ILL 4-2 MONTHS PRIOR .....

According to the log, Saluteen proposed to pay off the loan arrears by sending $1,000 per week. But he was also to call back with an acceptable date by which he could bring the loan current. Thus, all of the essential terms of an agreement were not specified at this point.

The next telephone conversation occurred on December 1, 1995. The phone log states verbatim:

MR CLLD SD HE WLL CONTINUE TO SEND $1000. UNTL LN IS CURRENT... ADVSD NT ACCEPTABLE ... MR SD THATS THE BEST HE CAN DO ... WLL HVE LN CURRENT BY EOM ...

The telephone log plainly states that the Countrywide...