Sundquist Homes, Inc. v. PUD

• Decision Date: 27 April 2000
• Docket Number: No. 67715-8.,67715-8.
• Citation: 997 P.2d 915,140 Wash.2d 403
• Parties: SUNDQUIST HOMES, INC., a Washington corporation; Echelbarger Development, Inc., a Washington corporation; Simmie Energy, Inc., a Delaware corporation; Phoenix Development, a Washington corporation; Alfred Mus; and Donald Saunders, Petitioners, v. SNOHOMISH COUNTY PUBLIC UTILITY DISTRICT NO. 1, a Washington municipality, Respondent.
• Court: Washington Supreme Court

997 P.2d 915

140 Wash.2d 403

SUNDQUIST HOMES, INC., a Washington corporation; Echelbarger Development, Inc., a Washington corporation; Simmie Energy, Inc., a Delaware corporation; Phoenix Development, a Washington corporation; Alfred Mus; and Donald Saunders, Petitioners, v. SNOHOMISH COUNTY PUBLIC UTILITY DISTRICT NO. 1, a Washington municipality, Respondent.

No. 67715-8.

Supreme Court of Washington, En Banc.

Argued October 12, 1999.

Decided April 27, 2000.

Robert C. Rowley, Kirkland, James J. Klauser, Seattle, for Petitioner.

James Deno, Everett, for Respondent.

Stephen Overstreet, Olympia, for Amicus Curiae on Behalf of Building Industry Association of Washington.

Richard Stephens, Bellevue, for Amicus Curiae on Behalf of Washington Association of Realtors.

ALEXANDER, J.

The principal issue before us is whether a public utility district may charge a real estate developer for costs the district incurs in relocating electrical transmission facilities, when the relocation is a necessary condition of the developer's project. We answer that question in the affirmative and, thus, affirm the Court of Appeals.

Sundquist Homes, Inc.¹ purchases large tracts of undeveloped land in Snohomish County and subdivides it into residential building lots. Snohomish County regularly conditions approval of Sundquist's plats on improvements to county roads adjacent to the proposed developments. Often, this requires relocation of electrical utility facilities, such as poles and transmission lines. Consequently, on 17 occasions between 1988 and May of 1995, Sundquist asked the respondent, Snohomish County Public Utility District No. 1 (PUD), the owner of electrical utility facilities in Snohomish County, to relocate such facilities. Each time the PUD agreed to do so, it entered into an agreement with Sundquist, which provided that the PUD would relocate the facilities and Sundquist would bear the actual expenses associated with the relocation. These agreements were consistent with a policy set forth in PUD Resolution 2751, which was enacted in 1983. It stated that the PUD "will not bear the cost of relocation when ... [t]he relocation primarily is for the convenience of or benefits a private interest, even if it bestows a secondary public benefit." Clerk's Papers at 106. On each of the occasions that the PUD moved electrical facilities at Sundquist's request, Sundquist paid the costs of relocation. These costs totaled more than $125,000.

Sundquist later questioned the PUD's authority to impose the costs and, in May 1996, it filed suit against the PUD, seeking a declaratory judgment, recission, injunctive relief, and damages. It claimed in its suit that the PUD should refund to it the amount it paid the PUD for the costs of the relocations. In support of its claim Sundquist advanced three theories, all of which were based on its assertion that the charges assessed by the PUD were contrary to law. The PUD moved for summary judgment, contending that Sundquist's suit should be dismissed. Sundquist also moved for summary judgment. The trial court granted the PUD's motion and denied Sundquist's. The Court of Appeals affirmed the trial court. We granted Sundquist's petition for review.

I.

Sundquist asserts that there is a disputed issue of material fact that makes dismissal on summary judgment inappropriate. Review of a summary judgment is, of course, guided by familiar principles. Fundamentally, summary judgment is proper only when "there is no genuine issue as to any material fact and ... the moving party is entitled to a judgment as a matter of law." CR 56(c). In ruling on a motion for summary judgment, a court must consider "[a]ll facts and reasonable inferences ... in the light most favorable to the nonmoving party, and all questions of law are reviewed de novo." Mountain Park Homeowners Ass'n v. Tydings, 125 Wash.2d 337, 341, 883 P.2d 1383 (1994) (citations omitted). Resolution of disputed factual issues can be sustained when reasonable minds could reach but one conclusion from the evidence accompanying a summary judgment motion. Central Wash. Bank v. Mendelson-Zeller, Inc., 113 Wash.2d 346, 353, 779 P.2d 697 (1989).

Sundquist contends that it is not clear from the record whether the PUD's relocation of electrical utility facilities was primarily for the benefit of Sundquist. Thus, it argues that the propriety of the imposition of the charges on Sundquist, pursuant to PUD Resolution 2751, cannot be determined. This argument is quite apart from its assertion that Resolution 2751 is contrary to state law. We note, at the outset, that this purported factual issue was never raised at the trial court. Although the failure to raise the issue below does not preclude Sundquist from raising it on appeal, its failure does suggest that the existence of a dispute of material fact was not readily apparent to Sundquist at summary judgment. That is understandable because, in our view, the trial court and the Court of Appeals properly held, after viewing the submissions in a light most favorable to Sundquist, that Sundquist was the primary beneficiary of the relocations at issue. The case was, therefore, ripe for summary judgment.

Our conclusion finds support in the submissions on summary judgment, and is contradicted by none of them. For example, the declaration of Michael Brown, Sundquist's land development manager, contains the statement that Sundquist requested the relocations; that the relocations were necessitated by Sundquist's plans for improvements; and that Sundquist agreed to pay for each of the relocations. Not surprisingly, Sundquist's counsel conceded at oral argument at the Court of Appeals "that all the improvements that necessitated moving utility lines were made to roads adjacent to their developments." Sundquist Homes, Inc. v. Snohomish County Pub. Util. Dist. No. 1, 92 Wash. App. 950, 956-57, 965 P.2d 1148 (1998), review granted, 138 Wash.2d 1001, 984 P.2d 1034 (1999).

At this stage, Sundquist's only argument on the issue is that "[t]he record is absolutely void of any evidence that the relocation of these facilities had anything to do with providing power service to Sundquist or future home buyers." Pet'rs' Supplemental Br. at 16. As noted above, the record belies this assertion. It also contains receipts submitted by Sundquist that make clear that the relocation of facilities was just one of several services the PUD performed for Sundquist, and that Sundquist paid the PUD's bill on each occasion.² Like the other services, each of the utility facility relocations was necessitated by Sundquist's development plans. To rebut the PUD's submissions, Sundquist cites no specific facts and, thus, is unable to establish the existence of genuine issue of material fact. See Mackey v. Graham, 99 Wash.2d 572, 663 P.2d 490 (1983)

. In sum, we are in accord with the Court of Appeals conclusion that "[t]he main benefit was that Sundquist became entitled to proceed with its plats." Sundquist, 92 Wash.App. at 957,

965 P.2d 1148.

II.

The primary issue in this case is whether RCW 36.55.060 prohibits the PUD from passing off to Sundquist the costs of relocating its utility facilities. That statute, in pertinent part, reads as follows:

The facilities of the holder of any such franchise shall be removed at the expense of the holder thereof, to some other location on such county road in the event it is to be constructed, altered, or improved or becomes a primary state highway and such removal is reasonably necessary for the construction, alteration, or improvement thereof.

RCW 36.55.060(4).

Sundquist contends that, because the PUD holds the franchise and owns the electrical utility facilities that were relocated, "all costs related to situating or relocating the franchise facilities must be paid by the franchisee." Appellant's Revised Br. at 20. The "plain language" of this section, Sundquist argues, requires that franchisees bear all costs of facility relocation when a county road is improved.³

The flaw in Sundquist's reasoning is that the above-quoted section has to be read in light of the entire chapter within which it is located, RCW 36.55. Although every provision of that chapter regulates some aspect of the relationship between the County and its franchisees, no provision in the chapter pertains to the relationship between franchisees and third parties. That relationship is regulated by other chapters of the Code and the common law, as we discuss below. Thus, when RCW 36.55.060(4) is read in context it can be understood only to prohibit the County from assuming these costs as between the County and the franchisee. The statute does not, however, apply to the present controversy, as it does not address the issue of whether a relocation expense can be passed on to a third party.

Furthermore, as Sundquist points out, "[s]tatutes are to be construed to effect their purposes, and to avoid an unlikely or strained consequence." State v. Mierz, 127 Wash.2d 460, 480, 901 P.2d 286, 50 A.L.R.5th 921 (1995) (citing Ski Acres, Inc. v. Kittitas County, 118 Wash.2d 852, 857, 827 P.2d 1000 (1992)). If the "at the expense of the holder" language of RCW 36.55.060(4) prohibited the imposition of all costs of relocation on third parties, as suggested by Sundquist, then franchisees would also be prohibited from passing on these charges in rate increases to its rate-paying customers. Sundquist's "plain meaning" interpretation would, in short, lead to the absurd consequence that a nonprofit, municipal corporation, like a public utility district, would have no funds with which to pay for the relocations of facilities at the request of developers. This absurd, and we believe unintended, consequence is avoided by simply reading the statute in a commonsense manner.

III.

Sundquist also contends that the PUD was without authority to pass on relocation costs to it. Although we agree with Sundquist that mere passage of PUD Resolution 2751 would not...