Hudson v. Hapner

146 Wash. App. 280

• Court: Court of Appeals of Washington
• Decided: July 8, 2008
• Docket: No. 35797-6-II
• Status: Published

Opinions

Armstrong, J.

¶1 We granted discretionary review to consider whether a party who requests a trial de novo after arbitration, obtains an unfavorable judgment at trial, and then successfully appeals that judgment may, before the second trial, withdraw his request for the trial de novo. Because the policy behind Mandatory Arbitration Rule (MAR) 7.3 requires us to favor the original arbitration award over continued litigation, we hold that the party may withdraw the request; therefore, we reverse the trial court’s order striking the withdrawal of the trial de novo request and we remand for entry of judgment on Clifford Hapner’s notice of presentment.

FACTS

¶2 In 1998, Clifford Hapner drove his vehicle into the rear of Lea Hudson’s vehicle. Hudson sued Hapner, his wife, and his employer, Matthew Norton Corporation,¹ and the case went to mandatory arbitration. The arbitrator awarded Hudson $14,538 in damages, after which Hapner timely requested a trial de novo under RCW 7.06.050(1). In 2003, a jury awarded Hudson $292,298. Hapner appealed, arguing successfully that the trial court improperly excluded his expert’s testimony. We remanded for a new trial. Hudson v. Hapner, noted at 126 Wn. App. 1057, 2005 WL 834433, at *5, 2005 Wash. App. LEXIS 610.

¶3 After remand, Hapner obtained further discovery about Hudson’s ongoing medical treatment and expenses arising from the accident. He then filed a notice of voluntary withdrawal of his request for trial de novo. He also filed a notice of presentment for the court to enter judgment on the arbitration award along with (1) interest, (2) attorney fees incurred by Hudson at trial and on appeal, and (3) taxable costs. Hudson moved to strike Hapner’s withdrawal of his trial de novo request, arguing that Hapner had waived his right to withdraw his request. The trial court granted Hudson’s motion, striking Hapner’s presentation of judgment and withdrawal of request for trial de novo. We granted Hapner’s motion for discretionary review.

ANALYSIS

¶4 Any party to an arbitration proceeding may file a request for a trial de novo in the superior court within 20 days after the arbitrator files his decision. RCW 7.06-.050(1); MAR 7.1(a). If the party voluntarily withdraws his request for a trial de novo, the court may impose costs and reasonable attorney fees against him. RCW 7.06.060(1); MAR 7.3.² Hapner argues that under these rules, he had a right to unilaterally withdraw his request for a trial de novo at any time, conceding that in doing so, he must pay Hudson’s fees and costs. Interpreting the MAR is a matter of law that we review de novo. Manius v. Boyd, 111 Wn. App. 764, 766-67, 47 P.3d 145 (2002).

A. Unilateral Withdrawal

¶5 The parties first dispute whether a party who has requested a trial de novo may unilaterally withdraw that request. Hapner relies on Thomas-Kerr v. Brown, 114 Wn. App. 554, 559 n.16, 59 P.3d 120 (2002), in which Division One held that MAR 7.3 provides an implied right to unilaterally withdraw a request for a trial de novo. Hudson responds that Thomas-Kerr was erroneously decided and that a party may withdraw his request for a trial de novo only with court permission. She reasons that because a trial de novo is treated as an appeal, see Singer v. Etherington, 57 Wn. App. 542, 546, 789 P.2d 108 (1990), we should import the court permission requirement from the Rules of Appellate Procedure (RAP) and the Rules for Appeal of Decisions of Courts of Limited Jurisdiction (RALJ).³

¶6 Hudson’s argument is not persuasive. First, the RAP and RALJ apply only to those proceedings designated in RAP 1.1 and RALJ 1.1(a), respectively, and the present case does not fall within the scope of either rule. Second, had the Supreme Court and legislature intended a similar permission requirement for withdrawing a trial de novo request, they would have included such language in MAR 7.3 and RCW 7.06.060(1). See City of Kent v. Beigh, 145 Wn.2d 33, 45, 32 P.3d 258 (2001) (where the legislature uses certain statutory language in one instance and different language in another, there is a difference in legislative intent). In addition, use of the word “withdraws” in MAR 7.3, which denotes an action by a party, instead of “dismissal” (an action by the court), demonstrates that the party who initiated the trial de novo has control of its continuation.

¶7 Furthermore, allowing the requesting party to withdraw is most consistent with the legislature’s clear preference for resolving disputes through arbitration rather than through judicial proceedings. See Nevers v. Fireside, Inc., 133 Wn.2d 804, 809, 947 P.2d 721 (1997) (as with any other court rule, court construes the mandatory arbitration rules in accord with their purpose). The purpose of mandatory arbitration is to reduce court congestion of civil cases. Malted Mousse, Inc. v. Steinmetz, 150 Wn.2d 518, 526, 79 P.3d 1154 (2003). Specifically, MAR 7.3 is intended to encourage parties to accept the arbitrator’s award by penalizing unsuccessful appeals from them. Walji v. Candyco, Inc., 57 Wn. App. 284, 290, 787 P.2d 946 (1990).

¶8 As Division One stated in Du K. Do v. Farmer, 127 Wn. App. 180, 187, 110 P.3d 840 (2005), “MAR 7.3 uses both a stick and a carrot to accomplish its goal”:

First, the rule threatens mandatory attorney fees for any party who requests a trial de novo but does not improve its position. Next, it offers the party an incentive to withdraw its request, with the possibility of avoiding attorney fees at the discretion of the [trial] court. Both the stick and the carrot are directed at the party requesting the trial de novo, attempting to influence its choices in the hope of reducing court congestion.

Do, 127 Wn. App. at 187. As Hapner states, “[He] chose the ‘carrot’ ” by withdrawing his trial de novo request. Br. of Appellant at 13.

¶9 In contrast, Hudson’s proposal to nullify the original arbitration award and force a trial would accomplish the opposite of what the legislature intended: continued contribution to court congestion. Hudson does not have any right to a trial de novo merely because Hapner requested one; to the contrary, for Hudson to preserve her right to a trial de novo, she must have filed her own request within the 20-day period prescribed in MAR 7.1. Thomas-Kerr, 114 Wn. App. at 560. We hold that Hapner had a right under MAR 7.3 to unilaterally withdraw his request for a trial de novo.

B. Time Limitation

¶10 Hudson argues nonetheless that even if MAR 7.3 authorizes unilateral withdrawal of a request for a trial de novo, the rule is ambiguous as to the procedures for doing so. She urges us to interpret the rule to include a time limit on withdrawals where a trial de novo has actually occurred. Hapner responds that his right to withdraw has no time limits.⁴

¶11 We are, like the Supreme Court in Ingram v. Department of Licensing, 162 Wn.2d 514, 526, 173 P.3d 259 (2007), wary of reading into rules restrictions that are not there or promulgating additional rules under the guise of interpreting them. (Citing Cannon v. Dep’t of Licensing, 147 Wn.2d 41, 57-58, 50 P.3d 627 (2002).) We therefore will not add to or subtract from the clear language of a rule or statute, even if we believe that the legislature intended something else but did not adequately express it, unless the addition or subtraction of language is imperatively required to make the rule or statute rational. Ingram, 162 Wn.2d at 526 (quoting Cannon, 147 Wn.2d at 57).

¶12 Hudson cites general principles of fairness and efficiency for her proposal that a party may not withdraw his request for a trial de novo after “the” trial de novo has occurred. She argues that a contrary rule would allow a party to complete the trial, obtain a verdict, and then withdraw the request if he has not improved his position. This argument is flawed because it assumes that Hapner has received the benefit of his request for a trial de novo. He has not; although a trial has occurred, our reversal of the judgment returns the proceeding to the same posture as if it had not. See Weber v. Biddle, 72 Wn.2d 22, 28, 431 P.2d 705 (1967); cf. 15A Karl B. Tegland & Douglas J. Ende, Washington Practice: Civil Procedure § 67.18, at 514 (2007) (if trial court dismisses plaintiff’s case but is reversed on appeal, case simply proceeds as if it were never dismissed). Hapner therefore did not use the trial de novo to “gamble on the outcome” by obtaining a binding verdict and then withdrawing if it is less favorable than the original arbitration award. Contrast Creso v. Phillips, 97 Wn. App. 829, 831, 987 P.2d 137 (1999) (failure to file proof of service is waived unless raised before the trial de novo commences), aff’d sub nom. Haywood v. Aranda, 143 Wn.2d 231, 233, 19 P.3d 406 (2001). There is no outcome for Hapner to compare with the arbitration award because the verdict was vacated.

¶13 Nor should the fact that Hapner pursued the appeal affect his right to withdraw under MAR 7.3. Had he not prevailed, he would indeed be bound by the jury’s verdict from the first trial. But it is simply not Hapner’s fault that the first trial was tainted by a reversible error outside his control. If the error in the first trial had been Hapner’s fault, we would not have reversed. See City of Seattle v. Patu, 147 Wn.2d 717, 720, 58 P.3d 273 (2002) (doctrine of invited error prevents parties from benefiting from an error they caused at trial).

¶14 Finally, Hudson argues that Hapner should not be able to withdraw his request for a trial de novo because his decision to complete an entire trial and a lengthy appeal is contrary to the policy of MAR 7.3 to reduce delays in civil cases and waste of judicial resources. We agree that the law frowns on the use of procedural tactics to substantially delay the resolution of cases on the merits. See, e.g., CR 1 (superior court civil rules “shall be construed and administered to secure the just, speedy, and inexpensive determination of every action”); Rules of Professional Conduct 3.1, 3.2. But Hudson disregards that MAR 7.3 provides Hudson a remedy tailored precisely to the problem; it compensates Hudson for any costs arising from the delay⁵ without exacerbating that delay by forcing the parties to go to trial. Hudson justifies her proposal that the parties continue to consume judicial resources in litigation by asserting that they are “far past the point where [preventing court congestion] is served.” Br. of Resp’t at 16. We disagree; no amount of past delay justifies future delay.

C. Waiver

¶15 Hudson argues that Hapner waived his right to withdraw his request for a trial de novo, relying on Haywood, 143 Wn.2d at 240-41.

¶16 A defendant waives an affirmative defense where (1) asserting the defense is inconsistent with the defendant’s prior behavior or (2) the defendant has been dilatory in asserting the defense. Haywood, 143 Wn.2d at 239 (quoting Lybbert v. Grant County, 141 Wn.2d 29, 39, 1 (2000)). In Haywood, the defendants requested a trial de novo after arbitration, and the plaintiffs’ affirmative “defense” was the defendants’ failure to file proof of service of their request for a trial de novo under MAR 7.1(a). Haywood, 143 Wn.2d at 239. The plaintiffs knew of the defendants’ delinquency from the beginning yet waited until after the jury verdict (which was less favorable to them than the original arbitration award) to object. Haywood, 143 Wn.2d at 240. The Supreme Court held that the plaintiffs’ presentation of the case to the jury and acquiescence to the jury’s deliberation was inconsistent with their later assertion that the trial court lacked jurisdiction over the case. Haywood, 143 Wn.2d at 240. The plaintiffs could not “simply ‘sit on’ the [defense] until the jury’s verdict, and invoke such [defense] only if the verdict is less favorable than the arbitration award.” Haywood, 143 Wn.2d at 240 (quoting Creso, 97 Wn. App. at 831).

¶17 The situation here is distinguishable. First, Hapner’s right to withdraw his request for a trial de novo is not a “defense” in the postarbitration context where the defendant initiates the trial de novo proceeding. Rather, the right to withdraw the request under MAR 7.3 is a procedural right to take unilateral action. See Thomas-Kerr, 114 Wn. App. at 559 n.16. While the plaintiffs’ submission of the case to the jury in Haywood may be “inconsistent” with a belief that the court lacks jurisdiction, there is no such inconsistency here, where the applicable rules not only contemplate that the requesting party may change his mind but also encourage the party to do so. MAR 7.3; see Do, 127 Wn. App. at 187. And, to the extent that Hapner may have been “dilatory” in withdrawing the request, MAR 7.3 provides a remedy in the form of fees and costs. Hapner did not waive his right to withdraw.

D. Other Equitable Doctrines

¶18 Hudson also argues that the equitable doctrines of equitable estoppel, judicial estoppel, and laches preclude Hapner from withdrawing his request for a trial de novo.

¶19 Equitable remedies are extraordinary forms of relief, available only when an aggrieved party lacks an adequate remedy at law. Sorenson v. Pyeatt, 158 Wn.2d 523, 531, 146 P.3d 1172 (2006). Here, Hudson’s remedy under MAR 7.3 is the original arbitration award, interest, and attorney fees and costs. She does not demonstrate that this remedy is inadequate, so we need not further consider her equitable claims.

¶20 In sum, we hold that Hapner was entitled to withdraw his request for a trial de novo under MAR 7.3. We therefore reverse the trial court’s order striking Hapner’s withdrawal of his trial de novo request. And because a trial court is bound to enter judgment on an arbitration award in the absence of a request for a trial de novo, RCW 7.06-.050(2), we remand for entry of judgment on Hapner’s notice of presentment together with Hudson’s fees and costs under MAR 7.3.

E. Attorney Fees

¶21 In her brief and citing to RAP 18.1, Hudson requests attorney fees under MAR 7.3. She also requests sanctions under RAP 18.9(a), arguing that Hapner’s appeal is frivolous and “an affront to the justice system.” Br. of Resp’t at 27. Because Hudson is not the prevailing in this appeal, we deny both requests.

¶22 We reverse and remand for entry of judgment on Hapner’s notice of presentment after calculating MAR 7.3 fees and costs.

Bridgewater, J., concurs.

1 For convenience, we refer to all defendants collectively as “Hapner/

2 The applicable language in these statutes and MAR is virtually identical, so for convenience we refer only to the MAR.

3 Both RAP 18.2 and RALJ 10.2(c) provide that upon the appellant’s motion, the court may dismiss the appeal “in its discretion.”

4 Hapner relies on Walji, 57 Wn. App. 284. Walji addressed a different issue: whether a plaintiff who had lost at arbitration, requested a trial de novo, then moved for a voluntary nonsuit under CR 41(a) could avoid paying fees and costs under MAR 7.3 because it had not technically “withdraw[n]” it. Walji, 57 Wn. App. at 290. The court found “no meaningful difference between withdrawing an appeal and taking a voluntary nonsuit,” and held that depending on the circumstances, fees and costs could be appropriate because “Voluntary nonsuits may come shortly after service before discovery even starts, or may come after days of trial before a jury.” Walji, 57 Wn. App. at 290; see generally CR 41(a)(1)(B) (plaintiff entitled to dismissal without prejudice “at any time before plaintiff rests at the conclusion of his opening case”). However, Thomas-Kerr, 114 Wn. App. at 563, has since held that MAR 6.3 prohibits a plaintiff from nonsuiting a case after an arbitrator’s decision, so Walji is not helpful.

5 The dissent suggests that fees and costs under MAR 7.3 are not an adequate remedy because they are discretionary, not “guarantee[d].” Dissent at 296. This argument is not persuasive for two reasons. First, the fact that MAR 7.3 fees are discretionary does not mean that a trial court’s decision to award them may be unprincipled or would not be reviewable by this court. See Oltman v. Holland Am. Line USA, Inc., 163 Wn.2d 236, 243, 178 P.3d 981 (2008) (discretionary rulings by trial court generally reviewed under abuse of discretion standard). Second, fees, costs, and interest are guaranteed in this case because Hapner conceded his responsibility to pay them in his notice of presentment. So, contrary to the dissent’s contentions, dissent at 296, 299, Hudson will receive interest on the original arbitration award and compensation for all the fees and costs she expended in defending this trial de novo appeal.