Seattle-First Nat. Bank v. Brommers

Decision Date27 October 1977
Docket NumberNos. 44577,44578,SEATTLE-FIRST,s. 44577
Citation89 Wn.2d 190,570 P.2d 1035
CourtWashington Supreme Court
PartiesNATIONAL, BANK, Guardian of the Estate of Henry F. Bottiger, Incompetent, Respondent, v. Gene J. BROMMERS and Jean Brommers, his wife, doing business as Brommers Logging and Brommers Logging & Construction Company, Appellants, Ella Bottiger and United Pacific Insurance Company, Defendants.NATIONAL BANK, Guardian of the Estate of Henry F. Bottiger, Incompetent, Respondent, v. Gene J. BROMMERS and Jean Brommers, his wife, doing business as Brommers Logging and Brommers Logging & Construction Company, and United Pacific Insurance Company, Defendants, Ella M. Bottiger, Appellant.

Boynton O. Kamb, Mount Vernon, Asmundson, Rhea & Atwood, David E. Rhea, Bellingham, for appellants.

Graham, McCord, Dunn, Moen, Johnston & Rosenquist, Ben J. Gantt, Jr., Stephen A. Crary, Seattle, Downes & Muir, Michael D. Muir, Bellingham, for respondent.

HAMILTON, Associate Justice.

These two appeals arose out of the same trial. Appellants Gene J. and Jean Brommers, doing business as Brommers Logging and Brommers Logging and Construction Company, and appellant, Ella Bottiger, separately appealed from the trial court's judgment for respondent, Seattle-First National Bank, as successor-guardian of the estate of Henry F. Bottiger, an incompetent. The appeals concern the liability of the three appellants to the guardianship estate. We affirm the judgment of the trial court.

The findings of fact are largely undisputed. Henry and Ella Bottiger were married on November 11, 1953. Mr. Bottiger was injured in a logging accident on January 31, 1963, and since that accident has been mentally incompetent. Mrs. Bottiger was appointed guardian of his estate on April 9, 1963, and continued to serve as such until her resignation was accepted by the Whatcom County Superior Court on March 9, 1969. Respondent, Seattle-First National Bank, was appointed successor-guardian.

The guardianship estate was composed of Mr. Bottiger's separate property and Mr. and Mrs. Bottigers' community property. Included in this property were three parcels of unimproved real property containing standing timber, two of which were acquired by Mr. Bottiger prior to his marriage to Mrs. Bottiger, and one of which was acquired after the marriage. These three parcels of land were designated tree farms for selective cutting by Mr. Bottiger prior to his accident and were registered as such with the Industrial Forestry Association.

In the summer of 1965, feeling that she deserved some trips, Mrs. Bottiger decided to sell all merchantable timber on the three tree farms. On several prior occasions she had consulted with her attorney concerning the sale or lease of the guardianship property and was aware that court approval was needed to dispose of such property. When she called upon her attorney regarding the sale of the timber, however, she did not seek permission to sell all merchantable timber as was her intention, because she feared he would not approve. In response to her visit, her attorney prepared a petition for authority to log and sell the alder, maple, and cottonwood on the three parcels. Mrs. Bottiger represented to the court in this petition that the alder, maple, and the cottonwood had reached an age that required logging to prevent these species from rotting. In accordance with this petition, the court entered an order on September 15, 1965, which authorized Mrs. Bottiger to enter into an agreement with her brother, appellant Gene Brommers, to log the alder, maple, and cottonwood, at 40 percent stumpage within 8 months of the court order. At the same time, the court entered an order authorizing Mrs. Bottiger to sell certain logging equipment to Mr. Brommers.

Mrs. Bottiger and Mr. Brommers then executed a written agreement for logging in accordance with the court order. 1 In spite of this written agreement, Mrs. Bottiger and Mr. Brommers entered into an oral agreement for Mr. Brommers to log all merchantable timber of every species, including poles, without a time limitation at 40 percent stumpage to the estate. Mr. Brommers commenced logging operations in the fall of 1965.

While the logging operations were continuing, Mrs. Bottiger told Mr. and Mrs. Brommers she would just as soon have some of the stumpage payments in cash, so that she would not have to report the receipt of this money to the court. She made this request, even though her attorney had advised her to keep accurate records of all income and expenses for use in preparing her reports to the court. Mrs. Brommers, although aware of Mrs. Bottiger's status as guardian and of the reason the cash was desired, nevertheless paid Mrs. Bottiger in cash whenever requested to do so. Mrs. Bottiger received $10,349.18 in cash from the Brommers from the sale of the guardianship timber. Mrs. Bottiger kept no records of the receipt or disbursement of this cash and failed to report its receipt in her guardian's biannual report to the court. Mrs. Bottiger also received an additional $7,090.82 from the Brommers as payments on a note made in connection with the sale of the guardianship logging equipment, which she never reported to the court.

It was Mrs. Bottiger's impression at the trial that she used the above funds in part to finance a trip to Vasa, Finland, with her daughter by a previous marriage, which cost approximately $7,000; to purchase a Chrysler Imperial Automobile in 1966 at a cost of $6,000; to finance a trip to Hawaii in 1968 which cost approximately $2,000; and to purchase a new Oldsmobile automobile in 1969, which cost approximately $4,000 with the trade-in of the Chrysler Imperial. In addition, Mrs. Bottiger sold various guardianship motor vehicles without prior approval of the court and without reporting their sale to the court, and invested the sum of $795 in mining stock and made cash loans to her children by a former marriage, $2,780.85 of which was not repaid.

Mr. Brommers completed his logging operations on the three tree farms sometime in 1968, patently past the 8-month time limitation in the court order. Contrary to the written agreement authorized by the court, but in accordance with his oral agreement with Mrs. Bottiger, Mr. Brommers had removed all merchantable timber of every species, including poles, from the three parcels of land. The Brommers realized a net profit in excess of $30,000 from their logging operations.

Prior to trial, the parties stipulated that the fair market value of the standing timber logged by Mr. Brommers was $59,045.51. The trial court found the value to the guardianship of the timber lawfully logged to be $9,728.10, i. e., the value of the alder, maple, and cottonwood logged within 8 months from the date of the court order. The trial court also found the Brommers had paid $59,169.13 to Mrs. Bottiger for all timber logged, of which $9,728.10 was paid for timber lawfully logged. The balance, $49,441.03, was the amount the Brommers paid Mrs. Bottiger for timber unlawfully logged.

Using the above figures, the trial court concluded the Brommers had logged $49,317.41 worth of timber from the guardianship property without lawful authority. Pursuant to RCW 64.12.030, 2 the trial court assessed treble damages against the Brommers in the amount of $147,952.23. Against these damages, the court set off $49,441.03, which was paid by the Brommers to Mrs. Bottiger for the unlawfully logged timber and entered judgment against the Brommers for $98,511.20. In assessing the treble damages against the Brommers, the trial court found the Brommers did not have probable cause to believe Mrs. Bottiger had authority to authorize the logging of all merchantable timber and thus were not entitled to rely on RCW 64.12.040, 3 which mandates single damages only when certain mitigating circumstances are found to exist by the trier of fact.

As for Mrs. Bottiger, the trial court found her liable to the guardianship estate for the cash she received from the sale of the timber ($10,349.18) and for the money she received from the sale of the logging equipment ($7,090.82) and the sale of various guardianship motor vehicles ($3,575.85), all of which she never accounted for in her reports to the court. The court entered judgment against Mrs. Bottiger for $21,015.85. The trial court also found that Mrs. Bottiger's actions in authorizing the logging of all merchantable timber without regard to market conditions then existing and without court authority constituted commissive waste of guardianship real property. The court found the damages to the guardianship real property for the waste committed thereon to be the value of the standing timber which was removed without court authority, i. e., $49,317.41. Pursuant to RCW 64.12.020, 4 the court trebled this figure and assessed damages against Mrs. Bottiger in the amount of $147,952.23. Set off against this amount was the sum of $49,441.03, which Mrs. Bottiger received from the Brommers. Accordingly, judgment was entered against Mrs. Bottiger in the amount of $98,511.20. The trial court also awarded respondent $10,500 in attorney fees against Mrs. Bottiger in accordance with RCW 64.12.020.

On appeal, appellants Brommers' numerous assignments of error can be set forth in two categories: (1) The court erred in finding that Mr. Brommers had entered into a written contract with Mrs. Bottiger in accordance with the court order authorizing such an agreement and in admitting Exhibit 16 (Mrs. Bottiger's attorney's conformed office copy of the original agreement); and (2) the court erred in finding that the Brommers did not have lawful authority to log all merchantable timber and did not have probable cause to believe Mrs. Bottiger had court approval to authorize the logging of all merchantable timber so that single damages only should have been assessed against the Brommers under RCW 64.12.040.

Appellant Bottiger has...

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