Kaintz v. PLG, INC.

197 P.3d 710
Court of Appeals of Washington·Decided December 15, 2008·No. 61333-2-I·Published·Cited by 45 cases

Opinion

197 P.3d 710 (2008)

Timothy J. KAINTZ and Kerri Kaintz, Husband and Wife, and their Marital Community, and Kelmark, LLC, Respondents,
v.
PLG, INC., a Washington corporation, Appellant.

No. 61333-2-I.

Court of Appeals of Washington, Division 1.

December 15, 2008.

*711 Darren Anthony Feider, Daniel W. Ferm, Williams Kastner & Gibbs PLLC, Seattle, WA, for Appellant.

George Alfred Purdy, Attorney at Law, Seattle, WA, for Respondents.

¶ DWYER, A.C.J.

¶ 1 Mutuality of remedy is an equitable principle, recognized in the case law of Washington, that can support the award of attorney fees to the prevailing party in an action brought on a contract. Today we explicitly hold that this equitable principle can support such an award even in circumstances in which the party that prevailed did so by establishing that the contract at issue was unenforceable or inapplicable. Accordingly, we affirm the trial court's order awarding attorney fees herein.

I

¶ 2 Timothy and Kerri Kaintz and Kelmark, LLC, are the respective owners of two separate parcels of commercial property, each of which was leased to Draper Enterprises, Inc. Each lease contained a bilateral attorney fee provision. The lease between the Kaintzes and Draper provided:

All costs, expenses and reasonable attorney fees that may be incurred or paid by either party in enforcing the provisions of this lease shall be recovered by the prevailing party from the other.

The lease between Kelmark and Draper provided:

If an attorney is retained or a lawsuit is instituted to enforce any provision contained herein the non-breaching party shall be paid by the breaching party its costs and attorney's fees incurred to enforce the lease.

¶ 3 PLG, Inc. took over Draper's business, but neither PLG nor Draper obtained the *712 landlords' consent to the assignment of the leases from Draper to PLG. After the landlords and PLG were unable to negotiate a new lease agreement, the landlords filed this unlawful detainer action seeking a writ of restitution and an award of both money damages and attorney fees pursuant to the lease provisions.

¶ 4 PLG answered, denying the landlords' claims and counterclaiming that it was entitled to retain possession of the premises on the theory that the landlords either had consented to Draper's assignment of the leases or were estopped from asserting such a lack of consent. Specifically, PLG sought a declaratory judgment and injunctive relief, contending that the landlords had breached both the terms of the leases and each lease's implied covenant of quiet enjoyment. PLG argued that it had detrimentally relied on the landlords' actions and that the landlords had been unjustly enriched by PLG's tenancy. Finally, PLG prayed for an award of attorney fees "under the terms of the leases and any other legal or equitable basis." However, in August 2007, before the scheduled trial date, PLG abandoned the premises.

¶ 5 In January 2008, the landlords moved for summary judgment dismissal of PLG's counterclaims and for an award of attorney fees. In opposition to the landlords' motion, PLG argued that no basis existed authorizing an award of attorney fees because there was no contract between the parties. PLG also argued that attorney fees should not be awarded because the landlords had not prevailed, given that PLG abandoned the properties while still asserting a counterclaim for unjust enrichment.

¶ 6 The trial court granted the landlords' motion, awarding them attorney fees based upon the lease provisions and dismissing PLG's counterclaims with prejudice, finding that those related to possession had become moot and that those unrelated to possession lacked support. The trial court denied PLG's subsequent motion for reconsideration. PLG appeals from the order awarding attorney fees, contending that the order was entered without statutory or other authority.

II

¶ 7 In Washington, attorney fees may be awarded when authorized by a contract, a statute, or a recognized ground in equity. Fisher Props., Inc. v. Arden-Mayfair, Inc., 106 Wash.2d 826, 849-50, 726 P.2d 8 (1986). Whether a specific statute, contractual provision, or recognized ground in equity authorizes an award of fees is a question of law and is reviewed de novo. Tradewell Group, Inc. v. Mavis, 71 Wash.App. 120, 126, 857 P.2d 1053 (1993).

III

¶ 8 PLG first contends that the trial court erred by relying on RCW 4.84.330 as authorization for the award of attorney fees.[1] This is so, PLG asserts, because the landlords were not "prevailing parties" within the meaning of the statute. We agree that RCW 4.84.330 does not authorize an award of attorney fees in this case, but so hold for an entirely different reason.

¶ 9 RCW 4.84.330 provides:

In any action on a contract or lease ... where such contract or lease specifically provides that attorneys fees and costs, which are incurred to enforce the provisions of such contract or lease, shall be awarded to one of the parties, the prevailing party, whether he is the party specified in the contract or lease or not, shall be entitled to reasonable attorneys fees in addition to costs and necessary disbursements.
Attorneys fees provided for by this section shall not be subject to waiver by the parties to any contract or lease.... Any provision in any such contract or lease which provides for a waiver of attorneys fees is void.
*713 As used in this section prevailing party means the party in whose favor final judgment is rendered.

¶ 10 By its terms, RCW 4.84.330 applies only to contracts with unilateral attorney fee provisions. As we have previously noted, "where, as here, the agreement already contains a bilateral attorneys' fee provision, RCW 4.84.330 is generally inapplicable." Hawk v. Branjes, 97 Wash.App. 776, 780, 986 P.2d 841 (1999); accord Walji v. Candyco, Inc., 57 Wash.App. 284, 288, 787 P.2d 946 (1990) (where contract at issue contains a bilateral attorney fee clause, the statutory "prevailing party" provision of RCW 4.84.330 does not control over the contract's plain language). Because the leases at issue herein contained bilateral attorney fee clauses, RCW 4.84.330 does not apply.

IV

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Kaintz v. PLG, INC., 197 P.3d 710 (Wash. Ct. App. 2008).

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