Crossroads Management, Respondent/cross-app V. Carl & Suzan Lewis, Appellants/cross-resp

CourtCourt of Appeals of Washington
DecidedSeptember 7, 2022
Docket55641-3
StatusUnpublished

This text of Crossroads Management, Respondent/cross-app V. Carl & Suzan Lewis, Appellants/cross-resp (Crossroads Management, Respondent/cross-app V. Carl & Suzan Lewis, Appellants/cross-resp) is published on Counsel Stack Legal Research, covering Court of Appeals of Washington primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Crossroads Management, Respondent/cross-app V. Carl & Suzan Lewis, Appellants/cross-resp, (Wash. Ct. App. 2022).

Opinion

Filed Washington State Court of Appeals Division Two

September 7, 2022 IN THE COURT OF APPEALS OF THE STATE OF WASHINGTON

DIVISION II CROSSROADS MANAGEMENT, LLC, No. 55641-3-II (consolidated with No. 56315-1-II Plaintiff,

v.

LACY K. RIDGWAY (formerly LACY UNPUBLISHED OPINION CALDWELL) and MATTHEW RIDGWAY, husband and wife,

Respondent/Cross-Appellant,

CARL and SUZAN LEWIS, husband and wife,

Appellant/Cross-Respondent.

GLASGOW, C.J.—After tenants Carl and Suzan Lewis moved out of a rental property owned

by Lacy and Matthew Ridgway, the parties disagreed about the amount of security deposit that

should be returned to the Lewises. Because the Lewises demanded a full refund of their deposit

and the Ridgways insisted that most of the deposit be put toward repairing damage to the property,

the property management company, Crossroads Management LLC, filed an interpleader action

and placed the $1,695 security deposit in the court’s registry.

The Lewises filed a cross claim against the Ridgways, arguing in part that they were

entitled to attorney fees and double damages under RCW 59.18.280(2) because the Ridgways

intentionally withheld the full refund due in violation of RCW 59.18.280(1). The Ridgways filed

a motion for partial summary judgment on this issue, arguing RCW 59.18.280(1) only requires the

landlord to mail a statement of damages and/or a refund within 21 days and they complied with No. 55641-3-II

this requirement. The trial court agreed that RCW 59.18.280 requires timely communication, not

necessarily an accurate return of the deposit owed, and granted the partial summary judgment

motion. We denied a motion for discretionary review of this decision.

The Ridgways made multiple settlement offers, including one that exceeded the amount of

the full security deposit by over $1,000. The Lewises refused all offers of settlement, and the

parties proceeded to mandatory arbitration under chapter 7.06 RCW. The arbitrator awarded the

Lewises their full $1,695 security deposit but awarded the Ridgways $14,386 in attorney fees

under chapter 4.84 RCW, which establishes a risk-shifting mechanism for cases with under

$10,000 in controversy where the defendant offered more to settle the case than the plaintiff

ultimately recovered.

The Lewises then filed a request for trial de novo. The Ridgways moved to strike the

request because it was not signed by the Lewises themselves, as required by RCW 7.60.050(1) and

SCCAR 7.1(b). The trial court found that the Lewises had substantially complied with statutory

and court rule requirements and denied the Ridgways’ motion, as well as a motion for

reconsideration.

At the trial de novo, a jury determined that the Lewises were entitled to a full refund of

their security deposit. But the trial court maintained the $14,386 attorney fee award from the

arbitrator and awarded the Ridgways an additional approximately $13,000 in attorney fees based

on the Lewises’ failure to improve their position on the trial de novo.

The Lewises appeal the trial court’s order granting the Ridgways’ motion for partial

summary judgment and the attorney fee awards. They also appeal an order disbursing the funds

2 No. 55641-3-II

held in the court registry to the Ridgways. The Ridgways appeal the trial court order denying their

motion to strike the trial de novo request and the order denying their motion for reconsideration.

We hold the trial court erred when it found that the Lewises substantially complied with

the requirements for requesting trial de novo and denied the Ridgways’ motions to strike and for

reconsideration. Following Division One, we conclude the plain language of both RCW

7.60.050(1) and SCCAR 7.1(b) required the aggrieved party’s signature on the request for trial de

novo. The Lewises failed to meet this requirement.

We therefore reverse the trial court’s order denying the Ridgways’ motion to strike the

Lewises’ trial de novo request, affirm the amended arbitration award, and remand for further

proceedings consistent with this opinion. Because review of adverse rulings in mandatory

arbitration proceedings must occur by trial de novo, the failure to properly seek trial de novo should

have ended the proceeding, and we do not review the merits of the Lewises’ claims on appeal. On

remand, the trial court must determine the proper amount of attorney fees to be awarded to the

Ridgways for proceedings in the trial court in light of this opinion. We award the Ridgways

reasonable attorney fees on appeal in an amount to be determined by a commissioner of this court.

FACTS

I. BACKGROUND

The Lewises moved into a single family home owned by the Ridgways in May 2015. They

paid a refundable security deposit of $1,695 and completed a checklist noting the condition of the

property when they moved in. The lease stated that after “deductions for cleaning and repairs

necessary to restore the premises to its original condition (less allowance for reasonable wear and

tear), . . . the balance of the security fee shall be refunded,” provided there is no evidence of

3 No. 55641-3-II

unapproved pets or unauthorized smoking and “all grounds are cleared.” Clerk’s Papers (CP) at

16. The Lewises were permitted to have pets.

Crossroads managed the Ridgways’ rental property. As part of its responsibilities,

Crossroads was required to manage security deposits. It held the Lewises’ $1,695 deposit in a trust

account.

On May 22, 2018, the Lewises moved out. Carl Lewis did a final walk-through of the

property with a representative from Crossroads, Calvin Smith, who remarked that the condition of

the property was the same as when the Lewises moved in, except for one issue with light fixtures.

Smith noted this on a copy of the move-in checklist, and both he and Carl Lewis signed the

checklist. The carpets had just been cleaned, and there were no odors of smoke or stains. Suzan

Lewis took pictures upon moving out of the home, which are in our record and which show newly

cleaned carpets. The Lewises handed over their keys, and Smith told them their full security

deposit would be returned. He classified any issues with the wall paint as “normal wear-and-tear.”

CP at 240.

A few days later, on May 26, the Ridgways visited the property and alleged that they

discovered “a heavy lingering smell of cigarette smoke,” “a few cigarette butts . . . inside on the

floor,” “smoke stains on the walls and animal urine stains on the carpets, which did not appear to

have been cleaned.” CP at 66. Lacy Ridgway said the Lewises were “openly admitted smokers”

and had two dogs. CP at 279. Ridgway also complained that the Lewises tore a toilet paper holder

from the wall, installed satellite dishes and failed to remove them, and left the yard overgrown and

with garbage in it. And “the move-out checklist did not reflect any of these issues.” Id.

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Crossroads Management, Respondent/cross-app V. Carl & Suzan Lewis, Appellants/cross-resp, Counsel Stack Legal Research, https://law.counselstack.com/opinion/crossroads-management-respondentcross-app-v-carl-suzan-lewis-washctapp-2022.