FILED JULY 30, 2024 In the Office of the Clerk of Court WA State Court of Appeals, Division III
IN THE COURT OF APPEALS OF THE STATE OF WASHINGTON DIVISION THREE
PAULA S. NEIS, Trustee of the Daniel L. ) NEIS Revocable Trust, and Paula S. NEIS ) No. 38877-8-III Individually, ) (Consolidated with ) No. 39064-1-III) Appellants, ) ) v. ) ) HOWARD WOOLLETT, and PETRIA ) WOOLLETT, husband and wife, ) ) UNPUBLISHED OPINION Respondents, ) ) JOHN D. FRASER and GLORIA RAE ) FRASER, Husband and wife, ) ) Appellants. )
STAAB, J. — Howard and Petria Woollett (the Woolletts) sold Paula Neis their
residence situated on Newman Lake (the property). The property was described as
including a shed and carport located near a parking area. The legal description for the
property included a non-exclusive easement over the neighboring property owned by
Gloria and John Fraser (the Frasers). In connection with the sale, the Woolletts provided
Neis a “Seller’s Disclosure Statement” “Form 17” representing that there were no
“encroachments, boundary agreements or boundary disputes” related to the property. No. 38877-8-III Neis, et al v. Woollett, et al
Shortly after moving in, Neis discovered that the shed, carport, and parking area
were located on property owned by the Frasers but for which she had an easement. Neis
sued the Woolletts for breach of contract and the torts of negligent and intentional
misrepresentation. The Woolletts then named the Frasers as third-party defendants and
sued them for adverse possession, claiming fee simple ownership of the easement area
where the shed, carport and parking area were located.
Following a bench trial, the court dismissed the Woolletts’ claims for adverse
possession against the Frasers, finding fatal defects in their claim. The court also entered
a judgment in favor of the Woolletts, concluding that Neis had failed to prove each of her
causes of action. The court ultimately awarded the Woolletts attorney fees against Neis
and denied the Frasers’ request for attorney fees against the Woolletts.
Neis and the Frasers appeal. Neis argues that the court erred when it ruled against
her on the issues of negligent and intentional misrepresentation. She also contends that
the court erred in granting the attorney fee award against her. The Frasers argue that the
court erred in denying their request for attorney fees against the Woolletts. While we
find the court’s findings and conclusions deficient, we affirm the judgment against Neis
for her misrepresentation claims.
BACKGROUND
The Woolletts purchased their property in 1985. The property is in “Lot 7”, which
contains four tax parcels. All four tax parcels abut Newman Lake on the south. All four
2 No. 38877-8-III Neis, et al v. Woollett, et al
parcels are accessed by a right of way easement located on property owned by the
Frasers. There was an existing retaining wall and shed near the driveway when the
Woolletts purchased the property and they placed a carport on the parking area sometime
in the late 1990’s. The Woolletts lived on the property year-round until they sold it to
Neis in 2017.
Clerk’s Papers (CP) at 503 (showing Lot 7). The Neis property is Tax Parcel
56034.0509, the far-right parcel, while the Fraser property is Tax Parcel 56034.0508,
shaped like a “T.” The described easement runs along the north portion of the Fraser
property from west to east (hereinafter the “easement property”). The Woolletts’ shed
and carport (not pictured) are situated either wholly or partially on that part of the
Frasers’ property that sits north of the Woolletts’ former property.
3 No. 38877-8-III Neis, et al v. Woollett, et al
At some point in time, the Frasers commissioned a survey of their property
including the easement area.1 The survey revealed that the Woolletts’ retaining wall,
carport, parking area, and shed were situated on the easement area owned by the Frasers.
After the survey was conducted, John Fraser placed stakes in the ground marking the
common boundaries between his property and the Woolletts’ property. Howard Woollett
knew the stakes were there and considered them as the Frasers’ assertion of their
common boundary. The stakes were in the ground when the Woolletts sold the property
to Neis.
Shortly before selling their property, the Woolletts offered to purchase the
easement area from the Frasers. In a 2016 letter from the Woolletts to the Frasers, the
Woolletts offered to purchase the easement area for $5,000 in addition to $1,550 worth of
repair work and maintenance Mr. Woollett had performed for the Frasers. The sale of the
easement area was never completed and following the sale of the property to Neis, the
Woolletts demanded the value of the repair work and maintenance, a total of $1,550,
back from the Frasers.
1 The witnesses agreed that there was a 2009 survey of the property but John Fraser also testified that there was a 1996 survey marking the boundary lines. Howard Woollett did not recall this survey.
4 No. 38877-8-III Neis, et al v. Woollett, et al
A. Sale to Neis
In July 2017, the Woolletts sold their property to Neis. In connection with the
transaction, the Woolletts provided Neis with Form 17 pursuant to RCW 64.06.020. In
response to the question: “Are there any encroachments, boundary agreements, or
boundary disputes?” The Woolletts answered NO. Ex. 108.
Included in the sale to Neis were the shed and the carport. Within two weeks of
purchasing the property, Neis became aware that the shed and carport were located at
least partially on the easement property owned by the Frasers.
B. Lawsuit
In 2019, Neis sued the Woolletts for breach of contract and intentional
misrepresentation/fraud.2 Neis alleged that the Woolletts represented that the property
being sold included the easement property where the parking area, shed, and carport were
located, but breached the contract by failing to deliver fee title to this property. Neis also
alleged that the Woolletts knowingly misrepresented in Form 17 that there were “‘no
encroachments, boundary agreements or boundary disputes.’” Clerk’s Papers (CP) at 4.
2 The terms intentional misrepresentation and fraud are used interchangeably here and in caselaw. E.g., Carlile v. Harbour Homes, Inc., 147 Wn. App. 193, 204-05, 194 P.3d 280 (describing the claim as “intentional misrepresentation (fraud)”); Poulsbo Group, LLC v. Talon Dev., LLC, 155 Wn. App. 339, 345-46, 229 P.3d 906 (2010) (using the term “intentional misrepresentation”); Steineke v. Russi, 145 Wn. App. 544, 563, 190 P.3d 60 (2008) (using the term “fraud”).
5 No. 38877-8-III Neis, et al v. Woollett, et al
The Woolletts admitted filling out Form 17 in their answer, but denied making
misrepresentations about the property being sold. The Woolletts then brought a third-
party complaint to quiet title against the Frasers for the entire easement area. The
Woolletts alleged that their possession of the easement area was exclusive and adverse to
other rights and that they were entitled to a decree quieting title in favor of Neis.
Prior to trial, the Frasers notified the Woolletts that their third-party complaint was
defective because, if successful, it would landlock three parcels in Lot 7, and they had
failed to name the other two parcel owners in Lot 7 who had interests in the disputed
easement area.
C. Trial
The case proceeded to bench trial. Howard Woollett testified consistent with the
facts above. He provided testimony in support of his third-party claim for adverse
possession. Woollett also testified that prior to the survey in 2009, he believed he owned
the property where he parked his vehicles and placed a carport. He also testified that
prior to selling the property he never spoke with Neis. Woollett stated that the carport
was a metal structure that sits on the ground and was part of the sale to Neis. After the
sale to Neis closed, Mr. Woollett met Neis at the property to show her around. During
this visit, he pointed to the corner of the shed and told Neis there was a stake in the
ground marking the easement boundary.
6 No. 38877-8-III Neis, et al v. Woollett, et al
John Fraser also testified about the prior surveys and the stakes in the ground. He
indicated that he believed the easement gave the Woolletts the right to park their cars on
the easement property and keep the shed on the property, but thought that the carport was
not authorized by the terms of the easement. There was no testimony of anyone ever
telling the Woolletts to move the retaining wall, carport, or shed, or advising the
Woolletts that these improvements were encroaching on the property rights of other
easement owners. Fraser admitted that he never told Neis to stop parking on the
easement property and never asked her to move the shed or the carport.
Neis testified as well. She indicated that when she read Form 17 provided by the
Woolletts she noted that there had been a prior boundary survey. She stated that she
relied on the Woolletts’ representation that there were no boundary disputes. She
testified that she would not have bought the property if she had known that the carport
was located on the easement because she planned to build a garage there. On cross-
examination Neis admitted that prior to purchasing the property no one told her that the
Woolletts owned the easement property or that the easement property was part of the
purchase. She also admitted there were no disputes over the ownership of the property
described in the purchase and sale agreement, and that the Woolletts’ representations in
Form 17 were specific to the property described in the purchase and sale agreement.
Finally, she admitted that since purchasing the property, no one has prevented her from
using the shed, carport, or parking area.
7 No. 38877-8-III Neis, et al v. Woollett, et al
Neis also presented expert testimony from Amy Chitwood, a real estate appraiser.
Chitwood testified that the value of the easement area Neis thought she was purchasing
when she bought the property was $27,800. Chitwood also testified that a property with
a boundary line dispute has diminished value, but she did not provide an opinion on how
much the value would be reduced. She did not testify about any value difference for
properties with encroachment issues.
D. Woolletts’ Claim for Adverse Possession (Woollett v. Fraser)
At trial, the Woolletts pursued their adverse possession claim against the Frasers
and after the close of evidence, Neis and the Frasers moved for dismissal of the third-
party complaint. In response, to the motion to dismiss, the Woolletts moved to amend
their third-party complaint and, pursuant to CR 15, the court orally granted amendment of
the complaint to conform to evidence.
After trial, Neis and the Frasers moved for reconsideration of the court’s denial of
their motion to dismiss the third-party complaint. The court reversed its bench ruling and
granted Neis’ and the Frasers’ motion for reconsideration. The court ruled that the
Woolletts had not moved to timely amend the third-party complaint, that they had failed
to join indispensable parties, and lacked standing to pursue a claim of adverse possession
since they no longer owned the property. The court therefore dismissed the Woolletts’
third party complaint with prejudice.
8 No. 38877-8-III Neis, et al v. Woollett, et al
E. Court’s Ruling (Neis v. Woollett)
The court also concluded that Neis had failed to prove any of her claims and
entered findings of fact and conclusions of law to support its decision. With respect to
Neis’ claim for breach of contract, the court found that Neis had failed to prove that the
Woolletts misrepresented the property being sold. Specifically, the court found that the
Woolletts and Neis did not communicate prior to the sale, and Neis did not ask the
Woolletts where the property boundaries were located. Moreover, several documents
provided to Neis before the sale included the legal description of the property being sold.
In Form 17, the Woolletts disclosed that there was a boundary survey for the property and
that the property was accessed by an easement. Neis received a copy of the plat map
showing that a portion of the Frasers’ property ran between the northern boundary of the
Woolletts’ property and the road.
Prior to the sale, Neis did not attempt to determine where the boundary lines were
located. She was not told that the area where the shed and parking area are located were
part of the property being sold. She did not hire a surveyor and did not ask to see the
boundary survey.
The court also dismissed Neis’ tort claims for misrepresentation. The court found
that the representations made in Form 17 pertained only to the property legally described
in the sale documents. The court’s conclusions are somewhat confusing, but suggest that
Neis did not ask the Woolletts where the boundary lines were located, but knew there was
9 No. 38877-8-III Neis, et al v. Woollett, et al
a plat map and prior survey and could have ascertained the property boundaries had she
attempted to do so. The court concluded that Neis had failed to establish breach of duty
or causation.
The court also found that “Neis did not prove any damages due to any actions or
inactions by [the] Woolletts.” CP at 626-27. Neis has not been prevented from using the
easement area nor has she been told to move any of the improvements.
Finally, the court noted Neis’ burden to prove each element of fraudulent
misrepresentation by clear, cogent, and convincing evidence, and generally concluded
that Neis had failed to prove “the elements for each of these claims” without specifying
which elements were not proved. CP at 628.
F. Attorney Fees
The trial court originally ordered each party to pay its own costs and attorney fees.
On the Woolletts’ motion for attorney fees, the court changed course and awarded fees
against Neis in favor of the Woolletts.
In the court’s order of dismissal of the third-party complaint, the trial court
indicated it would award attorney fees to the Frasers. The Frasers then brought a motion
for attorney fees, which the Woolletts contested. The court then reversed course and
issued an order denying the Frasers their attorney fees against the Woolletts. In doing so,
the Court noted that “there is not an entitlement to attorney fees pursuant to RCW
10 No. 38877-8-III Neis, et al v. Woollett, et al
7.28.083” and found that “[a]ttorney fees are not necessary or appropriate and would not
be equitable or just in this case.” CP at 870.
G. Appeal
The Woolletts initially appealed the trial court’s ruling dismissing the adverse
possession case brought against the Frasers but later withdrew their appeal. See Court of
Appeals Letter Ruling in Case No. 38878-8-III (July 28, 2022). Neis timely appealed the
court’s decision in her case against the Woolletts. While her appeal was pending, the
court issued its decision to award attorney fees to the Woolletts.
The Frasers timely appealed the denial of attorney fees to them against the
Woolletts.
ANALYSIS
1. TORT CLAIMS FOR MISREPRESENTATION
For purposes of our analysis below, it is import to distinguish between Neis’ claim
that the Woolletts breached the contract by misrepresenting the property being sold, and
her tort claims for making misrepresentations in Form 17. In her breach of contract
claim, Neis alleged that the Woolletts misrepresented, either directly or indirectly, that
the property being sold included fee simple title to the disputed easement area. The trial
court concluded that Neis did not prove this claim and Neis is not appealing this
conclusion. Thus, whether the Woolletts misrepresented the property being sold is not
before this court.
11 No. 38877-8-III Neis, et al v. Woollett, et al
In her tort claims, Neis claimed that the Woolletts misrepresented that there were
no encroachments, boundary agreements, or boundary disputes pertaining to the property
sold to Neis. The location of the property’s boundaries and whether there was a
boundary dispute or encroachments are two different claims.
Neis assigns error to portions of the court’s findings of facts 22 and 23 as
unsupported by the evidence, and several of the court’s conclusions of law. She also
challenges the findings generally as inadequate because they failed to address the
elements of her claims. She contends that the facts supporting her claims of
misrepresentation were undisputed and the trial court erred in concluding Neis failed to
prove these claims. She suggests that we can decide these issues as a matter of law.
While we agree that the findings and conclusions should have included more
details, we affirm the trial court’s dismissal of Neis’ tort claims. At trial, Neis had the
burden to prove her tort claims. The only way she can prevail on appeal is by
demonstrating that the evidence on every element of each of her claims is undisputed.
She fails to do so. The evidence supports the court’s findings and the findings support
the court’s conclusion that Neis failed to prove each element of misrepresentation by
clear, cogent, and convincing evidence.
A. Standard of Review
Following a bench trial, we review the trial court’s findings of fact and
conclusions of law. Unchallenged findings constitute verities on appeal. In re Estate of
12 No. 38877-8-III Neis, et al v. Woollett, et al
Jones, 152 Wn.2d 1, 8, 93 P.3d 147 (2004). Challenged findings are verities if they are
supported by substantial evidence. In re Marriage of Black, 188 Wn.2d 114, 127, 392
P.3d 1041 (2017). “Substantial evidence” requires us to determine if the evidence is
“sufficient to persuade a rational, fair-minded person of the truth of the finding.” Jones,
152 Wn.2d at 8. The evidence and all reasonable inferences are considered in a light
most favorable to the prevailing party. Real Carriage Door Co., Inc. ex. rel. Rees v.
Rees, 17 Wn. App. 2d 449, 457, 486 P.3d 955 (2021). “We do not review the trial court’s
credibility determinations or weigh conflicting evidence ‘even though we may disagree
with the trial court in either regard.’” Black, 188 Wn.2d at 127 (quoting In re Welfare of
Sego, 82 Wn.2d 736, 740, 513 P.2d 831 (1973)). We review conclusions of law de novo
and consider whether they are supported by the trial court’s findings. Littlefair v.
Schulze, 169 Wn. App. 659, 664, 278 P.3d 218 (2012).
B. Elements of Tort Claims for Misrepresentation
A plaintiff making a claim for fraud/intentional misrepresentation must prove each
of nine elements:
(1) representation of an existing fact; (2) materiality; (3) falsity; (4) the speaker’s knowledge of its falsity; (5) intent of the speaker that it should be acted upon by the plaintiff; (6) plaintiff’s ignorance of its falsity; (7) plaintiff’s reliance on the truth of the representation; (8) plaintiff’s right to rely upon it; and (9) damages suffered by the plaintiff.
Stiley v. Block, 130 Wn.2d 486, 505, 925 P.2d 194 (1996).
13 No. 38877-8-III Neis, et al v. Woollett, et al
Negligent misrepresentation has similar elements:
(1) That [the defendant] supplied information for the guidance of others in their business transactions that was false; and
(2) That [the defendant] knew or should have known that the information was supplied to guide [the plaintiff] in business transactions; and
(3) That [the defendant] was negligent in obtaining or communicating false information; and
(4) That [the plaintiff] relied on the false information supplied by [the defendant]; and
(5) That [the plaintiff’s] reliance on the false information supplied by [the defendant] was justified (that is, that reliance was reasonable under the surrounding circumstances); and
(6) That the false information was the proximate cause of damages to [the plaintiff].
Lawyers Title Ins. Corp. v. Baik, 147 Wn.2d 536, 545, 55 P.3d 619 (2002) (emphasis in
original) (alterations in original).
Both types of misrepresentation must be proved by “clear, cogent, and convincing
evidence.” RockRock Grp., LLC v. Value Logic, LLC, 194 Wn. App. 904, 915, 380 P.3d
545 (2016) (negligent misrepresentation); Stiley, 130 Wn.2d at 505 (fraudulent
misrepresentation). The burden is on the “plaintiff to prove the existence of all the
essential and necessary elements” for each claim and the absence of any element is “fatal
to a recovery.” Puget Sound Nat’l Bank v. McMahon, 53 Wn.2d 51, 54, 330 P.2d 559
(1958) (emphasis in original).
14 No. 38877-8-III Neis, et al v. Woollett, et al
C. Defenses Raised by Woolletts
As a preliminary matter, we address two defenses raised by the Woolletts. The
Woolletts contend that regardless of any representations they made in Form 17, the
integration clause in the parties’ “Residential Real Estate Purchase and Sale Agreement”
(REPSA) precluded Neis’ claims for misrepresentations made in Form 17. We disagree.
The REPSA’s integration clause provides that it “supersedes all prior or
contemporaneous understandings and representations” and represents the entire
agreement of the parties. Ex. 110. In addition, RCW 64.06.020(3) explicitly excludes
Form 17 from being considered as part of any written agreement. Thus, any claim for
breach of contract based on representations in Form 17 would fail. See Brooks v. Nord,
16 Wn. App. 2d 441, 450-51, 480 P.3d 1167 (2021).
However, the integration clause does not preclude independent tort claims. Id.
“An injury is remediable in tort if it traces back to the breach of a tort duty arising
independently of the terms of the contract.” Eastwood v. Horse Harbor Found., 170
Wn.2d 380, 392, 241 P.3d 1256 (2010). The Woolletts have a common law duty to
refrain from committing fraud. Jackowski v. Borchelt, 174 Wn.2d 720, 738, 278 P.3d
1100 (2012). The integration clause in the contract does not preclude Neis from bringing
claims based on the independent torts of misrepresentation. Brooks, 16 Wn. App. 2d at
451.
15 No. 38877-8-III Neis, et al v. Woollett, et al
We also reject the Woolletts’ claim that Neis was required to independent verify
each and every representation made in Form 17, and had no right to rely on the
representations. Generally, a buyer of real estate is entitled to rely on representations
made in the statutorily required real estate disclosure form. Jackownski, 174 Wn.2d at
738 (“[b]ecause the [sellers] represented in Form 17 that the property did not contain fill
material, the [buyers] were entitled to rely upon the representation.”). However, “[w]hen
a buyer is on notice of a defect, it must make further inquiries of the seller.” Douglas v.
Visser, 173 Wn. App. 823, 830, 295 P.3d 800 (2013), see RCW 64.06.020 (“Buyer has a
duty to pay diligent attention to any material defects that are known to Buyer or can be
known to Buyer by utilizing diligent attention and observation.”). In other words, a
buyer cannot justifiably rely on a seller’s representation if the defect is known by the
buyer or is obvious upon the buyer’s inspection. Id. at 834. Thus, Neis was entitled to
rely on the representations made in Form 17 unless she was on notice of a defect or
discrepancy.
D. Adequacy of Court’s Findings and Conclusions
Neis contends ’that the court’s findings are deficient because the court did not
address the evidence presented with respect to each element of each claim. We agree that
the findings and conclusions could have been more precise and specific.
Here, there were multiple claims and multiple parties. In addition, the evidence
and elements of the different claims tended to overlap. In drafting its findings, the trial
16 No. 38877-8-III Neis, et al v. Woollett, et al
court did not specify the elements or claims to which each finding pertained. The court’s
conclusions on negligent misrepresentation do not mirror the elements of that claim. And
the court’s generalized conclusion on fraudulent misrepresentation do not indicate which
elements had not been proved. This made review difficult.
The purpose of findings of fact is to ensure that the decisionmaker “‘has dealt
fully and properly with all the issues in the case before he decides it and so that the
parties involved’” and the appellate court “‘may be fully informed as to the bases of his
decision when it is made.’” In re Detention of LaBelle, 107 Wn.2d 196, 218-19, 728
P.2d 138 (1986) (internal quotation marks omitted) (quoting State v. Agee, 89 Wn.2d 416,
421, 573 P.2d 355 (1977)).
Nevertheless, we discern that the court ultimately concluded that Neis failed to
prove that the Woolletts made misrepresentations about boundary disputes or
encroachments on the property she was purchasing, and failed to prove any damages
from the alleged misrepresentations. Because we determine that these conclusions were
supported by the findings and the evidence, we can affirm without remanding for more
detailed findings.
E. Application
As we noted above, Neis’ tort claim for misrepresentation is distinct from her
breach of contract claim for misrepresentation. In her claim for breach of contract, Neis
asserted that the Woolletts represented that the property being sold included the area
17 No. 38877-8-III Neis, et al v. Woollett, et al
where the shed, parking area, and carport were located. While noting that Neis was
purchasing an easement to use this area, the trial court concluded that Neis failed to prove
that the Woolletts represented they were selling fee title to this area. Instead, the court
concluded that the Woolletts made no representations about the property boundaries, Neis
failed to ascertain the property boundaries on her own, and the contract clearly described
the property being sold. Neis does not assign error to the findings and conclusions
related to the court’s dismissal of her breach of contract claim and so they become
verities on appeal. Jones, 152 Wn.2d at 8. Nevertheless, throughout this appeal, Neis
conflates her claim for misrepresenting the boundary lines with her claim that the
Woolletts misrepresented that there were no boundary disputes and no encroachments on
the property she was purchasing.
Neis’ tort claims for misrepresentation are based on representations made in Form
17. She contends that the Woolletts falsely represented that there were no boundary
disputes or encroachments. Significant for purposes of this appeal is that the Woolletts
did not make any representations in Form 17 about the location of any boundary lines.
Instead, Form 17 asked whether there were any boundary disputes.
Here, there is no evidence of a dispute concerning the boundary of the property
sold to Neis. As the trial court concluded, Neis purchased exactly what was legally
described in the contract. The Frasers and the Woolletts agreed on the location of the
legally described boundaries between their properties. The Frasers placed stakes in the
18 No. 38877-8-III Neis, et al v. Woollett, et al
ground to mark the legally described boundaries. The dispute about the Woolletts’
ownership interest in the additional easement area did not affect the boundary line of the
property Neis purchased other than to possibly expand it.
Nor did the trial court err in concluding that the Woolletts did not make
misrepresentations about encroachments. An “encroachment” is “an interference with or
intrusion onto another’s property.” Black’s Law Dictionary 667 (11th ed. 2019); see
Garcia v. Henley, 190 Wn.2d 539, 415 P.3d 241 (2018). At trial and on appeal, Neis
contends that three improvements encroached on the easement area: a retaining wall, a
shed, and a carport.
In this case, whether the structures intruded on or interfered with another’s
property is a question of fact. Here, there is disputed evidence on whether the shed and
carport intruded on or interfered with the property of another. As easement owners, the
Woolletts had some property rights to the disputed area. The shed and carport were both
described as unaffixed to the ground (i.e. moveable and not permanent structures). Fraser
testified that it was his belief that the Woolletts’ easement rights granted them the right to
place their shed on the easement property.
Neis must also prove that the Woolletts knew that the shed and carport were
considered encroachments. Again, the evidence on this is disputed. Fraser testified that
he thought the Woolletts’ carport was not authorized by the easement, but there is no
evidence that his subjective belief was ever communicated to the Woolletts. Nor was
19 No. 38877-8-III Neis, et al v. Woollett, et al
there any testimony that anyone told the Woolletts that the retaining wall, carport, or shed
interfered with property rights or needed to be moved. The evidence was undisputed that
the retaining wall, shed, and carport are still in the same location and being used by Neis,
and no one has told her to move them.
The misrepresentation claim requires Neis to show that the Woolletts knew the
retaining wall, shed, or carport were interfering with or intruding on the rights of others
and then represented otherwise. At trial she failed to produce any evidence to support
this claim.
Neis’ challenge to findings 22 and 23 do not change this outcome. Neis contends
that the court’s finding that “Neis was not told by anyone that she was purchasing the real
property under the shed or parking area,” is not supported by substantial evidence because
the Woolletts impliedly represented that Neis would be purchasing the real property under
the shed and carport. CP at 733. But this finding relates to Neis’ breach of contract claim
not her tort claims. The trial court found that the Woolletts did not misrepresent the
property being sold to Neis and that Neis purchased the property described in the purchase
and sale agreement. This finding has nothing to do with whether there were
encroachments or boundary disputes concerning the property sold to Neis.
Neis also challenges the court’s finding that Neis failed to “prove any damages
due to any actions or inactions by Woolletts.” CP at 626. The measure of damages in a
misrepresentation case is usually the “benefit of the bargain.” First Church of the Open
20 No. 38877-8-III Neis, et al v. Woollett, et al
Bible v. Cline J. Dunton Realty, Inc., 19 Wn. App. 275, 280, 574 P.2d 1211 (1978). This
is “the difference between the market value of the property as represented and the market
value of the property as it actually was at the time of sale.” Id.
Neis points out that she produced an expert witness whose unrebutted testimony
was that the value of the easement property was $27,800. But these potential damages
pertain to Neis’ breach of contract claim, i.e., the value of the property with the easement
area versus the value of the property without the easement area. This testimony does not
address damages for the tort claims. The expert also testified that property with a
boundary dispute is worth less than property without a boundary dispute, but she did not
provide any figures on the difference in value. Nor did the expert or any other witness
provide testimony on whether the alleged encroachment caused a difference in value. In
essence, there is no evidence that Neis paid more than market value for her property in
light of the location of the shed and carport.
The lack of evidence on damages for any misrepresentation is fatal to Neis’ claims
of misrepresentation. While the trial court’s findings and conclusions are difficult to
parse out, the court’s findings and conclusions with respect to damages are clear. The
findings are supported by substantial evidence and in turn support the court’s conclusion
that Neis failed to prove her claims for misrepresentation.
21 No. 38877-8-III Neis, et al v. Woollett, et al
2. ATTORNEY FEES AWARDED TO THE WOOLLETTS
Neis challenges the trial court’s decision to award attorney fees against Neis in
favor of the Woolletts. Neis challenges the procedure employed by the court and
contends that the trial court abused its discretion by failing to segregate fees associated
with the Woolletts claim for adverse possession against the Frasers.
The REPSA between Neis and the Woolletts included an attorney fee provision
that stated: “[I]f Buyer or Seller institutes suit against the other concerning this
Agreement the prevailing party is entitled to reasonable attorneys’ fees and expenses.”
Ex. 1.
In its findings and conclusions following the bench trial, the court ordered each
party to pay their own costs and attorney fees. The Woolletts filed a motion for an
attorney fee award against Neis, and in their reply, the Woolletts cite to CR 54. At the
hearing on the motion, Neis argued that CR 54 did not permit the trial court to reverse its
final decision stating that each party was to pay their own attorney fees and argued that
the Woolletts needed to bring a CR 59 motion for reconsideration. Ultimately, the court
reversed its initial denial of attorney fees to either party and awarded the Woolletts
reasonable attorney fees.
As to the amount of attorney fees, Neis argued that time entries related to the
Woolletts’ unsuccessful adverse possession claim needed to be excluded from any
attorney fee award.
22 No. 38877-8-III Neis, et al v. Woollett, et al
A few days later, the court entered its findings and conclusions. The court ruled
that:
3. The hourly rate requested by the Woolletts is reasonable and consistent with the hourly rate charged in these matters by experienced counsel.
4. I have reviewed the hours requested and determined they are reasonable and were necessary for the result obtained.
5. In reviewing the work performed, I find the work involved overlapping theories and a common core of facts arising out of the claims by Plaintiff based upon the contract in this case. The work performed was necessary for the results achieved and total award is this Court’s determination based on the mixed questions and the results of trial.
CP at 866. The court concluded that “Defendants Woolletts are awarded reasonable
Attorney Fees and Cost [sic] of $50,323.18.” CP at 866.
As a threshold issue, the Woolletts argue that because Neis appealed the court’s
decision prior to the attorney fee award, she needed to file a separate notice of appeal of
the court’s decision on attorney fees. The Woolletts are incorrect. RAP 7.2(i) states that:
“A party may obtain review of a trial court decision on attorney fees, costs and litigation
expenses in the same review proceeding as that challenging the judgment without filing a
separate notice of appeal or notice for discretionary review.” Thus, Neis did not need to a
file a separate notice of appeal of the decision to award attorney fees to the Woolletts.
Neis argues that the Woolletts needed to a bring a CR 59 motion for
reconsideration instead of a CR 54 motion for attorney fees because the court denied
23 No. 38877-8-III Neis, et al v. Woollett, et al
attorney fees in its final judgment. She asserts that absent a motion under CR 59 the
court lacked jurisdiction to reconsider its earlier ruling. We disagree. Regardless of
whether the motion should have been brought under CR 54 or CR 59, Neis fails to cite
any authority in support of her contention that the failure to cite CR 59 divests the
superior court of jurisdiction to reconsider its decision. Nor does she show any prejudice
from citing the wrong court rule. A motion under either rule must be filed and served
within ten days of the decision. CR 54(d)(2), CR 59(b). The Woolletts’ motion for
attorney fees was filed within seven days of the court’s findings and conclusions.
Moreover, the Woolletts’ motion for attorney fees under CR 54 was appropriate.
The rule provides that claims for attorney fees “shall be made by motion unless the
substantive law governing the action provides for the recovery of such fees and expenses
as an element of damages to be proved at trial.” CR 54(d)(2).
Neis also challenges the amount of attorney fees awarded to the Woolletts,
asserting that the trial court abused its discretion by failing to excise fees associated with
the Woolletts’ failed defense of adverse possession.
In this case the parties’ REPSA included an attorney fees clause. Thus, the court
was required to award costs and attorney fees to the prevailing party on an action on the
contract. RCW 4.84.330. When fees are required by contract, the only discretion is the
amount to award. Crest Inc. v. Costco Wholesale Corp., 128 Wn. App. 760, 772, 115
P.3d 349 (2005). In this area, the court has broad discretion. Ethridge v. Hwang, 105
24 No. 38877-8-III Neis, et al v. Woollett, et al
Wn. App. 447, 460, 20 P.3d 958 (2001). “The ‘prevailing party’ for purposes of a
contractual provision for an award of attorney fees is usually one who receives judgment
in his or her favor.” Costco Wholesale Corp., 128 Wn. App. at 772. “When neither party
wholly prevails, the court should award fees to the substantially prevailing party, and the
identity of the substantially prevailing party depends on the extent of the relief afforded
the parties.” McLelland v. Paxton, 11 Wn. App. 2d 181, 222-23, 453 P.3d 1 (2019).
Here, a judgment was entered in favor of the Woolletts, and while they did not
prevail on their claim of adverse possession, they were still the substantially prevailing
party. And while adverse possession was inartfully raised as a claim, it was intended as a
defense to Neis’ claim for breach of contract. As the trial court noted, while the
Woolletts’ adverse possession claim was dismissed without answering the substantive
claim, the court ultimately concluded that the Woolletts transferred “whatever right title
and interest they held in the land under the parking area and shed to Neis.” CP at 627.
We find that the trial court did not abuse its discretion in failing to excise attorney fees
incurred for bringing the failed defense of adverse possession.
3. DENIAL OF ATTORNEY FEES TO THE FRASERS
The Frasers appeal the trial court’s denial of their request for attorney fees for
having to defend against the Woolletts’ third-party claim for adverse possession claim.
The Frasers argue that the trial court erred as a matter of law when it found that RCW
7.28.083 did not entitle them to attorney fees. The Frasers also argue that the court
25 No. 38877-8-III Neis, et al v. Woollett, et al
abused its discretion when it denied their request for attorney fees. It is unclear what the
court’s reasons were for denying the Frasers’ request for attorney fees. Thus, remand is
necessary.
Whether a trial court is authorized to award attorney fees is a question of law
reviewed de novo. Gander v. Yeager, 167 Wn. App. 638, 646, 282 P.3d 1100 (2012).
RCW 7.28.083 authorizes the court to award attorney fees to the prevailing party in
adverse possession lawsuits. The statute states:
The prevailing party in an action asserting title to real property by adverse possession may request the court to award costs and reasonable attorneys’ fees. The court may award all or a portion of costs and reasonable attorneys’ fees to the prevailing party if, after considering all the facts, the court determines such an award is equitable and just.
RCW 7.28.083(3) (emphasis added).
The trial court, in its order denying the Frasers’ motion for award of attorney fees,
stated: “The Court finds there is not an entitlement to attorney fees pursuant to RCW
7.28.083. Attorney fees are not necessary or appropriate and would not be equitable or
just in this case.” CP at 870.
As a threshold issue, the Woolletts argue that the Frasers cannot recover fees
pursuant to RCW 7.28.083(3) because they cannot be said to be the “prevailing party”
since the Woolletts’ adverse possession claim was dismissed with prejudice for lack of
standing and did not proceed to trial. The Woolletts do not cite any caselaw to support
26 No. 38877-8-III Neis, et al v. Woollett, et al
this position. Indeed, “[a] dismissal with prejudice constitutes a final judgment on the
merits.” Elliott Bay Adjustment Co., v. Dacumos, 200 Wn. App. 208, 213, 401 P.3d 473
(2017). Thus, the Frasers were the prevailing party as against the Woolletts.
On the other hand, the Frasers contend that the trial court erred as a matter of law
when it found that RCW 7.28.083 does not provide an entitlement to attorney fees. RCW
7.28.083(3) makes attorney fee awards in adverse possession cases discretionary,
evidenced by its use of the word “may.” In re Marriage of Kim, 179 Wn. App. 232, 250-
51, 317 P.3d 555 (2014) (“The word ‘may’ in a statute denotes discretion and is distinct
from the word ‘shall,’ which indicates a mandatory action.”). Thus, the trial court was
correct when it found that RCW 7.28.083(3) does not create an “entitlement” to attorney
fees. Instead, an attorney fee award under RCW 7.28.083(3) is discretionary.
The Frasers next argue that even if the award of fees was discretionary, the court
abused its discretion by applying a “needs” test, evidenced by its statement that attorney
fees would not be “equitable or just.” CP at 870. The Frasers are incorrect. The statute
itself states that attorney fees are only to be awarded if “after considering all the facts, the
court determines such an award is equitable and just.” RCW 7.28.083(3) (emphasis
added). There is no evidence that the court engaged in an impermissible test in declining
to award the Frasers their attorney fees.
The Frasers next argue that the court abused its discretion when it declined to
award them their attorney fees. In its denial of attorney fees to the Frasers, the court fails
27 No. 38877-8-III Neis, et al v. Woollett, et al
to explain how or why it decided that an award of attorney fees to the Frasers was not
“necessary or appropriate” or “equitable or just.” CP at 870. Further, the court’s oral
ruling does not help explain the court’s reasoning:
I don’t find, certainly, Mr. Gales and Mr. Montgomery have brought a matter that is appropriate to the Court. But I do not find under these circumstances that an award of attorney fees is necessary by statute or appropriate in the exercise of discretion of the Court. I think that at any time these parties could have done what the Court did. And so for that reason, I’m denying the motion by Frasers for attorney fees as it relates to their litigation against the Woolletts.
RP at 411. The court’s oral ruling is vague and does not explain the reasons for its
decision.
We note that the Woolletts added the Frasers as parties to this lawsuit in order to
assert a separate claim of adverse possession against the Frasers. However, at the time
the Frasers were added as third-party defendants, the Woolletts did not own the property
and did not have standing to assert a claim for adverse possession. The Woolletts argue
that their claim of adverse possession was really a defense to Neis’ breach of contract
claim. But the Woolletts could have raised a defense of adverse possession without filing
a separate claim for which they had no standing and without adding the Frasers as a
party.
Regardless, we cannot tell from the record whether the court based its decision on
tenable grounds. Thus, we remand for the court to reconsider its denial of attorney fees
28 No. 38877-8-III Neis, et al v. Woollett, et al
to the Frasers and enter more detailed findings on whether or not to award attorney fees
to the Frasers.
4. ATTORNEY FEES ON APPEAL
All three parties request attorney fees on appeal. We deny Neis her attorney fees
because she did not prevail. The Woolletts request their reasonable attorney fees and
costs pursuant to RAP 18.1. As the prevailing party, the Woolletts are entitled to their
fees against Neis under the REPSA and RCW 4.84.330.
The Frasers and the Woolletts request attorney fees on appeal against each other.
The only issue raised by the Frasers related to their request for attorney fees at trial.
Since we are remanding for more detailed findings we conclude that the Frasers prevailed
on appeal and we award the Frasers their attorney fees and costs on appeal against the
Woolletts as equitable and just under RCW 7.28.083(3). We decline the Woolletts’
request for attorney fees and costs against the Frasers.
A majority of the panel has determined this opinion will not be printed in the
Washington Appellate Reports, but it will be filed for public record pursuant to RCW
2.06.040.
_________________________________ Staab, A.C.J. I CONCUR:
_________________________________ Cooney, J.
29 No. 38877-8-III
PENNELL, J. (concurring) — I agree with the final outcome of this case. I write
separately because some of my reasoning in reaching this outcome differs from that of
the majority.
The contested issue in this case is whether Howard and Petria Woollett made false
statements on their June 2017 “Seller Disclosure Statement” (Form 17). Ex. D-108.
The Woolletts answered “no” to the question of whether there were any “encroachments,
boundary agreements, or boundary disputes.” Id. at 1. Paula Neis claims this answer
was incorrect on two fronts: (1) there was a boundary dispute because the Woolletts’
shed and carport were not contained within the property boundary lines, and (2) there
was an encroachment because the shed and carport encroached on the property of John
and Gloria Fraser and on the easement. I address each claim in turn.
With respect to the issue of a boundary dispute, the majority opinion correctly
notes that the Woolletts never misrepresented the fact that the property described in their
sales documents aligned with what was set forth in the boundary survey. But that does
not really end the matter. The position advanced by the Woolletts at trial was that,
regardless of what was stated in the sales documents and survey, the Woolletts had
actually acquired the property under the shed and carport through adverse possession.
In other words, their position was that they had acquired property beyond what was stated
in the property description or the survey. This constituted a boundary dispute that should
have been disclosed on Form 17. No. 38877-8-III Neis v. Woollett (Concurrence)
I believe Paula Neis could have prevailed on a misrepresentation claim based on
the adverse possession issue. But for whatever reason, Ms. Neis declined to pursue the
issue of adverse possession at the time of trial. This variant of the boundary dispute claim
has therefore been waived.
In addition to asking about boundary disputes, Form 17 obliged the Woolletts to
disclose whether there were any encroachments. The wording of the form made clear that
the questions on Form 17 pertained to the property being sold. Thus, the question was
whether there were any encroachments on the property being sold by the Woolletts; it
was not whether there were any encroachments on property owned by others. Here, the
shed, carport, and retaining wall were not encroaching on the property the Woolletts sold
to Paula Neis. The structures might have encroached on the Frasers’ property. And they
might have interfered (and thus encroached) on the rights of other easement holders.
But the structures did not encroach on the property sold by the Woolletts to Ms. Neis.
As to the rights of the Woolletts (and then Ms. Neis), there was no interference or
encroachment. Thus, regardless of the dispute over the shed, carport, and retaining wall,
the Woolletts’ statement that there were no encroachments on the property sold was
accurate.
I disagree with the majority’s reasoning that the Woolletts’ statement regarding
encroachments was not false because no one ever objected to the placement of the shed,
carport, and retaining wall. The easement that was held by the Woolletts (and then sold
2 No. 38877-8-III Neis v. Woollett (Concurrence)
to Ms. Neis) was for “right of way purposes.” Ex. P-005. It did not allow for the erection
of any structures. Regardless of the lack of any objection, the easement did not provide
the Woolletts (and then Ms. Neis) a vested right to maintain structures within the
boundary of the easement. Save for a claim of adverse possession, the Frasers or other
easement holders could demand removal of the structures at any time. Thus, had
Form 17 required the Woolletts to disclose whether they were selling any structures
that encroached on someone else’s property, they would have been required to answer
“yes” (save for a successful claim of adverse possession).
Regardless of any false statements on Form 17, I agree with the majority that
Paula Neis cannot prevail on a tort claim because she has not shown damages. There
was no evidence at trial indicating that the price paid by Ms. Neis for the property failed
to reflect the fact that the shed, carport, and retaining wall fell outside survey lines.
While Ms. Neis testified to emotional distress damages, she has failed to cite any
authority to support her claim that such damages are available in the current context.
I otherwise concur in the majority’s disposition.
Pennell, J.