Woody's Olympia Lumber, Inc. v. Roney

• Decision Date: 27 August 1973
• Docket Number: No. 2099--I,2099--I
• Parties: WOODY'S OLYMPIA LUMBER, INC., a Washington corporation, Petitioner, v. Henry V. RONEY and Elizabeth Roney, husband and wife, Respondents. Central Components Corporation et al., Defendants.
• Court: Washington Court of Appeals

Page 626

9 Wn.App. 626

513 P.2d 849

WOODY'S OLYMPIA LUMBER, INC., a Washington corporation, Petitioner, v. Henry V. RONEY and Elizabeth Roney, husband and wife, Respondents.

Central Components Corporation et al., Defendants.

No. 2099--I.

Court of Appeals of Washington, Division 1.

Aug. 27, 1973.

Jennings P. Felix & Associates, Jennings P. Felix, Nels A. Hansen, Seattle, for petitioner.

Martin, Niemi, Burch & Mentele, Ronald H. Mentele, Seattle, for respondents, Roney.

Barnett, Robben, Blauert & Pease, W. Merchant Pease, Seattle, for Central Components and Roney.

Donald A. Dawson, Seattle, for Queen City.

Guttormsen, Scholfield & Stafford, John A. Hamill, Seattle, for Morris and Galbraith.

Williams, Lanza, Kastner & Gibbs, Joseph J. Lanza, Seattle, for Brown.

SWANSON, Chief Judge.

A question unresolved by existing Washington case law is presented by this litigation: Is an unliquidated tort claim subject to attachment or execution? We granted certiorari to review a trial court order quashing the sheriff's levy of execution upon respondents' tort action entitled Roney v. Brown, King County Cause No. 739825.

Woody's Olympia Lumber, Inc., hereinafter referred to as 'Olympia Lumber,' obtained a judgment upon an unpaid promissory note against Henry V. Roney and wife, hereinafter referred to as 'Roney,' for $15,400 plus costs, attorney's fees and interest. Olympia Lumber being unable to obtain satisfaction of its judgment caused a writ of execution to issue, and levied upon Roney's claim for damages in Roney v. Brown, Supra, a tort action based upon alleged medical malpractice.

The trial court quashed the levy of execution, and thereafter we issued the writ to review the trial court's order.

Under common law, a writ of execution could not be levied against a mere contractual right or a chose of action. Johnson v. Dahlquist, 130 Wash. 29, 225 P. 817 (1924). As most states have done, we have abrogated that common law by statute. We did so when we enacted what is now RCW 6.04.060: 'All property, real and personal, of the judgment debtor, not exempted by law, shall be liable to execution.' It cannot be disputed that our state legislature may subject or except any type of property right to a levy of attachment or execution. Olympia Lumber argues that if Roney's claim is 'property' contemplated by RCW 6.04.060, and not exempted by law, it is subject to a levy of execution notwithstanding the general rule throughout the country that uncertain on contingent claims cannot be reached by the attachment or garnishment process. 6 Am.Jur.2d Attachment and Garnishment § 127 (1963). Clearly, tort claims fall within such general rules as enunciated in 6 Am.Jur.2d Attachment and Garnishment § 132 at 654 (1963):

Claims for damages in tort, which are necessarily unliquidated before they have been compromised or settled or have been reduced to judgment, have generally been decided to be outside the purview of the attachment or garnishment statutes of the various states, and therefore not subject to such process.

Our Supreme Court, in United Pac. Ins. Co. v. Lundstrom, 77 Wash.2d 162 at page 172, 459 P.2d 930 at page 936 (1969), also recognized the general rule that claims for unliquidated damages are not attachable or garnishable, and gave the reason:

The basis for the rule is that such claims are contingent or uncertain and therefore the amount to become due on the claim cannot be determined until it is reduced to judgment.

As to the availability of the remedy of garnishment to an unliquidated claim, it is well settled in this state that such a claim is not subject to garnishment. Sundberg v. Boeing Airplane Co., 52 Wash.2d 734, 328 P.2d 692 (1958); Bassett v. McCarty, 3 Wash.2d 488, 101 P.2d 575 (1940); Boundary Dam Constr's v. Lawco Contr's, Inc. 9 Wash.App. 21, 510 P.2d 1176 (1973). Even though unliquidated claims are not subject to garnishment, this does not mean such claims may not be reached through other statutory provisions. In Johnson v. Dahlquist, Supra, an unliquidated claim for indebtedness was held to be property, and therefore subject to execution. The defendants in Johnson were awarded costs on appeal when a judgment entered against them was reversed. In order to collect their judgment for costs against the plaintiffs, defendants levied on the undetermined and unliquidated claim of indebtedness against themselves. In discussing Rem.Comp.Stat. § 518 which was reenacted verbatim in 1925 and is now codified in RCW 6.04.060, the court described the statute as all-inclusive, and said that there can be no doubt that a claim of indebtedness is property. In responding to the contention that the defendant should not be permitted to levy upon that which they, themselves, owe to the judgment debtor, the court said in Johnson, 130 Wash. at 33, 225 P. at 818:

But why not? It is property. It is capable of being transferred. It is capable of being converted into a judgment which is subject to execution. It is an asset of the judgment debtor, and why should not his assets, whatever their nature, be taken to satisfy a judgment? We cannot see any logical reason why such property should not be levied on.

From this, petitioner argues that if an unliquidated and undetermined claim of an indebtedness is property subject to execution, why should an undetermined and unliquidated claim for damages be treated differently simply because it arises from a claim sounding in tort rather than in contract? Olympia Lumber points out that the statutory language of RCW 6.04.060 is without limitation, for it states 'all property, real and personal,' which must, of necessity, include an alleged medical malpractice claim.

Our Supreme Court, in Swanson v. Olympic Peninsula Motor Coach Co., 190 Wash. 35, 66 P.2d 842 (1937), rejected an opportunity to settle the issue of whether or not an unliquidated claim sounding in tort may be levied upon and sold under execution. It instead decided the case on the procedural ground that insufficient notice had been given to effect constructive possession of the cause of action by the sheriff, and sustained the superior court's order vacating the execution. But there is language in the opinion which indicates that if the proper procedure had been followed, the court would have refused to vacate the execution and recognize an unliquidated tort claim as property. The court, in Swanson, held that service of a copy of the writ of execution upon the clerk of the court in which the claim was pending was an invalid levy. The court said, 190 Wash. at 41, 66 P.2d at 845 Doubtless the method followed in the case of Johnson v. Dahlquist, Supra, and approved by this court, to wit, the taking of the property, consisting of a cause of action, under the officer's dominion--into his constructive possession--by giving notice to the owner of the property that it is levid upon and will be sold, would be sufficient, as such property, by its nature, would probably be susceptible of reduction to possession in no other way. The judgment creditor in the case cited could subject his debtor's cause of action to his judgment only by execution and levy. . . .

* * *

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Respondent was in possession of his cause of action, and the sheriff could levy execution thereon and reduce the same to his possession only after some notice to respondent.

This holding in the Swanson case prompted the writer of an article on creditors' rights, 36 Wash.L.Rev. 121, 132 n. 31 (1961), to observe:

This appears to the writer as a tacit recognition of the availability of the execution process as to claims sounding in tort.

In the most recent Washington decision discussing this subject, United Pac. Ins. Co. v. Lundstrom, Supra, the court noted the holding in Johnson v. Dahlquist, Supra, that an unliquidated claim of indebtedness is property and subject to execution, but refused to extend the rule of Johnson to include an attachment and subsequent levy upon a cause of action which remained uncertain and contingent even after it was reduced to judgment. In the United Pac. Ins. Co. case, the insurance company brought suit and recovered judgment against both defendants Lundstrom and Milmanco Corporation. The insurance company levied a writ of attachment upon Lundstrom's cause of action against Milmanco before the trial court entered judgment upon the claim. Thereafter, the lien of United Pacific's writ of attachment was specifically reserved in the judgment. The sheriff's subsequent attempt to comply with the order of sale was quashed by the superior court.

In discussing the validity of the attachment and the attempted execution sale, the court distinguished the holding in Johnson v. Dahlquist, Supra, and stated, 77 Wash.2d at 172, 459 P.2d at 936:

At the time of this attachment it was uncertain whether a sum of money would ever be due from Milmanco to Lundstrom. . . . But whereas in Johnson the value of the attached cause of action would be mathematically ascertainable when judgment was rendered on the claim, that was not...