Tingey v. Haisch
| Decision Date | 15 February 2007 |
| Docket Number | No. 77689-0.,77689-0. |
| Citation | 159 Wn.2d 652,152 P.3d 1020 |
| Parties | David L. TINGEY, Petitioner, v. Lloyd HAISCH and Lucy Haisch, husband and wife, and the marital community composed thereof, Respondents. |
| Court | Washington Supreme Court |
David L. Tingey, Law Office of David L. Tingey, Renton, for Petitioner.
Harold J. Moberg, Moses Lake, for Respondents.
¶ 1 Petitioner attorney David Tingey performed legal services for respondents Lloyd and Lucy Haisch (hereinafter Haisch) on an hourly fee basis without a written fee agreement. Tingey challenges a Court of Appeals decision holding that his action to collect those fees is not governed by the RCW 4.16.040(2) six-year limitation for "an account receivable incurred in the ordinary course of business."1 Tingey argues that the term "account receivable" has a plain meaning in Washington law and that the Court of Appeals, after improperly finding the term to be ambiguous, derived for the term an inappropriately narrow meaning that excluded his action. Haisch argues that the applicable statute of limitation for Tingey's action is the RCW 4.16.080(3) three-year limitation for oral contracts.2
¶ 2 We hold that the plain meaning of "account receivable" as used in RCW 4.16.040(2) is an amount due a business on account from a customer who has bought merchandise or received services. This meaning encompasses a balance owed by a client to an attorney for legal services performed on behalf of the client on an hourly fee basis without a written fee agreement. Thus the six-year limitation for "[a]n action upon an account receivable incurred in the ordinary course of business" applies to Tingey's action to collect attorney fees from Haisch. RCW 4.16.040(2). We reverse the Court of Appeals and reinstate the trial court's ruling on summary judgment that the six-year limitation applies.
¶ 3 Neither Tingey nor Haisch disputes the material facts of this case. In 1994 Tingey represented Haisch in a Grant County Superior Court lawsuit. They did not enter into a written fee agreement. Tingey regularly invoiced Haisch for legal services on an hourly fee basis and Haisch paid the invoices through June 1994. Tingey completed legal representation of Haisch in December 1994.
¶ 4 More than three years later, Tingey initiated a collection action against Haisch, alleging Haisch owed him in excess of $20,000 for legal services rendered plus interest accrued.3 The trial court denied Haisch's motion to dismiss the action as time-barred by the three-year oral contract limitation of RCW 4.16.080(3). The trial court granted partial summary judgment to Tingey, ruling that the applicable statute of limitation for the action was six years. After Tingey prevailed on the merits in a bench trial, Haisch appealed the summary judgment ruling only.
¶ 5 The Court of Appeals Division Three reversed. Tingey v. Haisch, 129 Wash.App. 109, 117 P.3d 1189 (2005). After finding the term "account receivable" to be ambiguous, the Court of Appeals held that "`account receivable' in RCW 4.16.040(2) refers to an `open account,' that is `[a]n account that is left open for ongoing debit and credit entries by two parties and that has a fluctuating balance until either party finds it convenient to settle and close.'" Tingey, 129 Wash.App. at 117, ¶ 18, 117 P.3d 1189 (). Based on this definition, the Court of Appeals held that the six-year limitation for accounts receivable did not apply to Tingey's claim for attorney fees. Id. We granted Tingey's petition for review. Tingey v. Haisch, 156 Wash.2d 1035, 134 P.3d 1171 (2006).
¶ 6 Does the RCW 4.16.040(2) six-year limitation for an "action upon an account receivable incurred in the ordinary course of business" provide the limitation in an action to collect a balance owed by a client to an attorney for legal services performed on behalf of the client on an hourly fee basis without a written fee agreement?
¶ 7 The trial court ruled on summary judgment that the RCW 4.16.040(2) six-year account receivable limitation governed Tingey's action to recover attorney fees. This court reviews rulings on summary judgment de novo. Berrocal v. Fernandez, 155 Wash.2d 585, 590, ¶ 5, 121 P.3d 82 (2005). To resolve this matter we must ascertain the meaning of "account receivable" as used in RCW 4.16.040(2). We also review issues of statutory interpretation de novo. Berrocal, 155 Wash.2d at 590, ¶ 5, 121 P.3d 82.
¶ 8 A court's objective in construing a statute is to determine the legislature's intent. State v. Jacobs, 154 Wash.2d 596, 600, ¶ 7, 115 P.3d 281 (2005). "`[I]f the statute's meaning is plain on its face, then the court must give effect to that plain meaning as an expression of legislative intent.'" Id. (quoting Dep't of Ecology v. Campbell & Gwinn, L.L.C., 146 Wash.2d 1, 9-10, 43 P.3d 4 (2002)). A statutory provision's plain meaning is to be discerned from the ordinary meaning of the language at issue, the context of the statute in which that provision is found, related provisions, and the statutory scheme as a whole. Id. A provision that remains susceptible to more than one reasonable interpretation after such an inquiry is ambiguous and a court may then appropriately employ tools of statutory construction, including legislative history, to discern its meaning. Campbell & Gwinn, 146 Wash.2d at 12, 43 P.3d 4.
¶ 9 Prior to 1989, an action upon an oral contract was subject to the former RCW 4.16.080(3) (1937) three-year statute of limitations.4 This limitation encompassed a claim for attorney fees where there was no written fee agreement. Hart v. Day, 17 Wash.App. 407, 413, 563 P.2d 227 (1977). In 1989 the legislature amended RCW 4.16.040, the six-year statute of limitations, adding as a new category, "action[s] upon an account receivable incurred in the ordinary course of business."5 Laws of 1989, ch. 38, § 1. The legislature simultaneously amended RCW 4.16.080(3), creating an exception to the three-year limitation on oral contracts for actions upon accounts receivable.6 Laws of 1989, ch. 38, § 2. In making these changes the legislature did not define "account receivable."7
¶ 10 When a term has a well-accepted, ordinary meaning, a regular dictionary may be consulted to ascertain the term's definition. City of Spokane ex rel. Wastewater Mgmt. Dep't v. Dep't of Revenue, 145 Wash.2d 445, 454, 38 P.3d 1010 (2002). When a technical term is used in its technical field, the term should be given its technical meaning by using a "technical rather than a general purpose dictionary" to resolve the term's definition. City of Spokane, 145 Wash.2d at 454, 38 P.3d 1010.
¶ 11 The legislature modified account receivable with "incurred in the ordinary course of business." RCW 4.16.040(2). This statutory context suggests that the legislature intended to use the term in a technical business sense. Used as a term of art in the accounting and finance sectors, "accounts receivable" means "amounts due [a business] on account from customers who have bought merchandise or received services." JOEL G. SEIGEL & JAE K. SHIM, DICTIONARY OF ACCOUNTING TERMS 11 (3d ed.2000). Consistent with the legislature's usage, the Dictionary of Accounting Terms' technical definition of "accounts receivable" is likewise restricted to a business setting.
¶ 12 The term "account receivable" appears elsewhere in the Revised Code of Washington more than 10 times and is nowhere defined.8 The legislature makes it apparent through this pattern of use that it considers the term "account receivable" to have a plain meaning. Obtaining the definition of "account receivable" from a technical business dictionary is consistent with plain meaning analysis. The technical definition for "account receivable," as "an amount due a business on account from a customer who has bought merchandise or received services," is the appropriate definition to read into RCW 4.16.040(2). The attorney fees owed to Tingey, for which he regularly invoiced Haisch, satisfy this meaning of "account receivable."
¶ 13 The dissent states that under our definition "all oral contracts for goods and services in the ordinary course of business have a six-year statute of limitation." Dissent at 1028. The dissent suggests, therefore, that our definition renders the term account receivable superfluous, contrary to established principles of statutory interpretation. Id. However, our definition of "account receivable" is considerably more narrow than the dissent represents. Our definition identifies the parties to the contract (a customer and a business) and the character of the transaction (a purchase by the customer). It requires the business to have completed performance (customer has bought or received the merchandise or services). It specifies the monetary nature of the remaining obligation (an amount due). Only oral contracts exhibiting all of these characteristics garner the account receivable six-year limitation.9
¶ 14 Both the Court of Appeals and the dissent deem the term "account receivable" to be ambiguous. Tingey, 129 Wash.App. at 114-15, ¶ 11, 117 P.3d 1189; dissent at 1028. The Court of Appeals based its determination in part on the fact that "account receivable" appears in a variety of contexts, from which it concluded that the term "has different meanings depending upon the context."10 Tingey, 129 Wash.App. at 114, ¶ 10, 117 P.3d 1189. However, while "account receivable" is used in a wide variety of settings, close examination reveals that our definition encompasses the meaning of the term in those contexts.11 Moreover, the use of "account receivable" in a broad range of business-related contexts supports the term having...
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