Sign-O-Lite Signs, Inc. v. DeLaurenti Florists, Inc.

• Court: Washington Court of Appeals
• Writing for the Court: COLEMAN; AGID; SCHOLFIELD
• Citation: Sign-O-Lite Signs, Inc. v. DeLaurenti Florists, Inc., 825 P.2d 714, 64 Wn.App. 553 (Wash. App. 1992)
• Decision Date: 21 January 1992
• Docket Number: SIGN-O-LITE,No. 27926-2-I
• Parties: SIGNS, INC., a Washington corporation, Appellant, v. DeLAURENTI FLORISTS, INC., a Washington corporation, and Ann E. DeLaurenti, Respondents.

Page 553

64 Wn.App. 553

825 P.2d 714

SIGN-O-LITE SIGNS, INC., a Washington corporation, Appellant, v. DeLAURENTI FLORISTS, INC., a Washington corporation, and Ann E. DeLaurenti, Respondents.

No. 27926-2-I.

Court of Appeals of Washington Division 1.

Jan. 21, 1992.

Motion to Publish Granted,

Reconsideration Denied March 4, 1992.

Jeffrey Smyth, Randall Moeller, and Adolph & Smyth, P.S., Seattle, for appellant.

Edward R. Coulson, Douglas H. Ogden, and Foster Pepper & Shefelman, Seattle, for respondents.

COLEMAN, Judge.

Sign-O-Lite ("Sign") ¹ appeals the trial court's judgment on the verdict that Sign violated the Consumer Protection Act ("CPA") and the court's award of treble damages, attorney fees, and costs under the CPA to DeLaurenti and DeLaurenti Florists, Inc. (collectively "DeLaurenti"). Sign also appeals the court's refusal to give a proposed jury instruction regarding unjust enrichment. DeLaurenti cross-appeals the trial court's refusal to submit to the jury the issue of DeLaurenti's actual damages. We affirm in part and reverse in part.

Ann DeLaurenti owns and operates DeLaurenti Florists, Inc., a floral shop located in the Eastgate Shopping Plaza. In April 1986, DeLaurenti learned that the Plaza would be requiring the tenants to display "Channelume" signs to advertise their respective stores. Realizing that she would have to replace her nonconforming wooden sign, DeLaurenti sought bids from manufacturers for the construction of a Channelume sign. One manufacturer estimated the cost to be $4,100.

In addition, Chuck Kelly, a representative of Sign, solicited DeLaurenti at her store and offered to provide her with a bid for a Channelume sign to meet the Plaza's new criteria. DeLaurenti indicated she was interested in a bid, and Kelly later contacted her by phone. According to DeLaurenti, Kelly told her that she could lease a sign for $91.04 per month for 6 years plus tax and optional maintenance costs, or she could purchase the sign for $2,901.60. Because Sign's bid was lower than the other companies, DeLaurenti gave the job to Sign.

On September 10, 1986, Kelly arrived at DeLaurenti's shop and presented her with a document to sign. DeLaurenti told Kelly that she did not have her reading glasses with her that day, but Kelly explained that her signature would merely authorize Sign to begin work on her order. In her capacity as president of the corporation and in her personal capacity, DeLaurenti signed what she remembered as being a two-page document. She also initialed a space on the document which, according to Kelly, indicated that she did not want extraordinary maintenance for the sign. ² DeLaurenti did not see Kelly fill in any blanks on the document except to sign his name.

On the same day that she signed the document, DeLaurenti gave Kelly a check made payable to Sign in the amount of $497.42. The Plaza also contributed $1,000 toward the cost of the Channelume sign. DeLaurenti believed that those two checks amounted to half the total purchase price of the sign and that she could either pay the balance when the sign was installed or she could make monthly installment payments of $91.04 under the arrangement Kelly had described in their earlier phone conversation. DeLaurenti did not recall any discussion about how the $1,497.42 had been calculated. She did not receive a copy of the document she signed or any other written indication from Sign about the terms of the lease or the purchase price. DeLaurenti testified that when she signed the form Kelly gave her, she had been relying upon the representations Kelly had made to her over the phone.

In mid-December 1986 Sign installed the completed Channelume sign above DeLaurenti's storefront. Shortly thereafter, Sign sent DeLaurenti an invoice for $445.97 for the rental cost of the sign for the latter half of Decemberand all of the following January. However, because the sign was not properly lit, DeLaurenti did not pay Sign.

Once the sign was working properly, DeLaurenti called Sign's main office and requested her balance due so she could pay it in full. She received a computer printout from Sign indicating that she would owe $21,958.56 which was the total cost of leasing the sign at $305 per month for 6 years. ³ DeLaurenti informed Sign that she had not agreed to those terms and would not abide by them but, instead, would pay them the difference between the purchase price as Kelly had represented it (approximately $2,900) and what Sign had already received for the sign ($1,497.42). DeLaurenti also requested a copy of the documents that she had signed.

When she received a copy of the Display Rental Agreement, DeLaurenti saw that she had signed a four-page document whose terms indicated that she agreed to pay Sign $297.42 plus tax for monthly rental of the sign "for the Term of the number of days the Display operates during the month of installation, plus 72 months thereafter ... plus 5 months[.]" The monthly rental amount had been written in a blank spot by Kelly. Sign continued to send monthly invoices which DeLaurenti did not pay.

In July 1988 Sign filed a collection action against DeLaurenti, alleging breach of contract and unjust enrichment and seeking damages exceeding $22,000 plus attorney fees and costs pursuant to the terms of the rental agreement. DeLaurenti's answer presented several affirmative defenses as well as two counterclaims alleging fraud and violation of the CPA (RCW 19.86.090). ⁴ DeLaurenti sought dismissal of the complaint, exemplary damages pursuant to the CPA, and attorney fees and costs.

At trial, Sign presented the court with a supplemental jury instruction regarding unjust enrichment. Although the trial court refused to give the instruction, it later concluded that Sign was in fact entitled to damages for unjust enrichment. The court determined that the only evidence in the record of the fair market value of the sign was $160 per month and that DeLaurenti had use of the sign for 48 months.

In addition, the court refused to send the issue of DeLaurenti's actual damages to the jury because the evidence of such damages was insufficient. DeLaurenti had proposed a damage instruction for the jury to use if it found Sign liable for fraud, but the court did not read it to the jury. Instead, the trial court gave a modified instruction that explained the elements of a CPA violation. ⁵

The jury completed the following questions on the verdict form:

A. Is the written contract for the lease of a sign unenforceable because of lack of opportunity to review, ambiguity, or understandability?

YES

B. Did plaintiff commit fraud to induce defendants to sign the written contract for the lease of a sign?

NO

C. Did plaintiff violate the Consumer Protection Act to induce the defendants to sign the written contract for the lease of a sign?

YES

. . . . .

D. Did plaintiff enter into an oral agreement for defendants to purchase a sign?

NO

. . . . .

* * *

E. Did plaintiff enter into an oral agreement for defendants to lease the sign?

NO

The trial court subsequently denied Sign's motion for a new trial and concluded in part as follows:

2. Plaintiff 342 Inc. is awarded $7,680.00 against defendants for its claim of unjust enrichment for the reasonable rental value of the sign, less the amount of $1,497.42 previously paid to plaintiff by defendants, for a judgment of $6,182.58;

3. Defendants and counterclaimants DeLaurenti [Floral] Company, Inc. and Ann E. DeLaurenti are awarded judgment for treble damages against plaintiff 342 Inc. in the amount of $10,000, based upon the fact of damage that inheres in the attorneys' fees incurred in defense against a contract found by the jury to violate RCW 19.86;

4. Defendants and counterclaimants ... are awarded judgment for reasonable attorneys' fees in the amount of $24,291.00;

5. Defendants and counterclaimants ... are awarded judgment for costs incurred in the amount of $1,119.15;

6. The net amount of judgment in favor of plaintiff and judgment in favor of defendants is a net judgment in favor of defendants in the amount of $3,817.42. This amount, plus attorneys' fees and costs awarded to defendants, in the total amount of $29,227.57, shall bear interest at the rate of 12% per annum from the date of this judgment until satisfied.

On appeal, Sign challenges the trial court's judgment on the verdict that Sign violated the CPA, the court's award of treble damages, attorney fees, and costs, and the court's refusal to instruct the jury according to the proposed unjust enrichment instruction. DeLaurenti appeals the court's refusal to instruct the jury as to DeLaurenti's actual damages.

The CPA Violation

At the outset, we must determine whether the trial court erred by submitting the CPA claim to the jury. Sign contends that it was error to do so because the evidence was insufficient to prove four of the five elements of a CPA violation and because the trial court improperly delegated a question of law to the trier of fact.

Whether a particular action gives rise to a violation of the CPA is reviewable as a question of law. Keyes v. Bollinger, 31 Wash.App. 286, 289, 640 P.2d 1077 (1982). In contrast, whether a party committed a particular act is reviewable under the substantial evidence test. Keyes at 289, 640 P.2d 1077. Substantial evidence exists if the evidence is sufficient "to persuade a fair-minded, rational person of the truth of the declared premise." Beeson v. Atlantic-Richfield Co., 88 Wash.2d 499, 503, 563 P.2d 822 (1977). Further, an issue is properly kept from the jury if "there is no evidence or reasonable inferences therefrom which would sustain a jury verdict in favor of the nonmoving party." Schmidt v. Cornerstone Invs., Inc., 115 Wash.2d 148, 165, 795 P.2d 1143 (1990).

The five criteria for determining whether a party has violated the CPA are:

(1) Is the action complained of an unfair or deceptive act or practice? (2) Did the action occur in the conduct of trade or...