Woods View Ii, Llc, Apps./cross-res. v. Kitsap County, Res./cross-appellants

• Court: Court of Appeals of Washington
• Decided: April 14, 2015
• Docket: 44404-6
• Status: Unpublished

Opinion

HHLEO COURT OF APPEALS DIVISION

2015 APR 114

STATE B

IN THE COURT OF APPEALS OF THE STATE OF WASHINGTON

DIVISION II

WOODS VIEW II, LLC, a Washington limited No. 44404 -6 -II liability company; and DARLENE A. PIPER, a single woman,

Appellant and Cross -Respondent,

v.

KITSAP COUNTY, a Washington UNPUBLISHED OPINION municipality,

Respondent and Cross -Appellant.

JOHANSON, C. J. — Appellants Woods View II, LLC ( WVII) and Darlene Piper appeal

from the superior court' s grant of summary judgment in Kitsap County' s ( the County) favor on

WVII' s claims of negligence, tortious interference, and takings. These claims arise from the

alleged delay of several permits and governmental decisions required for a project of WVII. WVII

and Piper argue that ( 1) their claims are not barred by the statute of limitations, ( 2) Piper has

individual standing, (3) the County' s communications were not immunized as petitioning activity,

4) the County negligently delayed processing their development permit, ( 5) the County tortiously

interfered with the various permitting processes involved in the project, and ( 6) the County' s

actions constituted a taking. On cross appeal, the County argues that ( 7) the Land Use Petition

Act ( LUPA), ch. 36. 70C RCW, barred WVII' s claims. Although we agree with WVII that its No. 44404 -6 -II

claims are not barred by the statute of limitations, the trial court' s summary dismissal of WVII' s

claims is affirmed.

FACTS

This case involves a failed residential development, four decisions concerning the real

property, and the timeliness of these decisions. Because this case is factually complex with a

voluminous record, we begin by 'establishing the basic factual background and explaining the

applicable administrative framework. Then, we discuss the facts that give rise to WVII' s claims.

Finally, we discuss the procedural history.

I. BACKGROUND: THE WOODS VIEW PROJECT

The appellants are WVII and its managing member, sole owner, and agent Piper. WVII

intended to build a residential development called " Woods View" on 19. 76 acres in small " legacy

lots "1 in south Kitsap County. Piper was personally invested in the project: she was the sole owner

of the construction company that would have served as the general contractor, she personally

funded $ 350, 000 in development expenses, and she personally guaranteed a $ 2, 927, 000 loan to

WVII.

The Woods View project was highly controversial in the community. The county

commissioners received many complaints about the development. Concerned citizens wrote to the

County to complain about the project. One constituent characterized the development as a " mobile

home park." Clerk' s Papers ( CP) at 445. The Woods View project was subjected to scrutiny by

1 Each lot measures approximately 40 feet wide and 100 feet deep, that is, 1 / 10th of an acre. They are called " legacy lots" because they were platted in 1909 and are not compliant with current regulations development to a density of one unit per five acres. An owner is which restrict

permitted to develop legacy lots, subject to certain restrictions.

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not only the county commissioners, but also the governor' s office, state legislators, and state

agencies.

The County was sensitive to these concerns because it had faced frequent criticism for its

land use decisions in the past. CP at 1265 ( County commissioner noted in his deposition, "[ T] he

County gets picked on more than any other county in terms of any of the land use actions that it

takes. "). In fact, it had very recently been challenged before the Growth Management Hearings

Board for failing to regulate " urban service" in rural areas. 2 See Harless v. Kitsap County, No. 07- 3 -0032, 2007 WL 4181033 ( Cent. Puget Sound Growth Mgmt. Hr' gs Bd. Nov. 15, 2007).

In an e- mail to a constituent who was upset about Woods View, County Commissioner

Steve Bauer indicated that " the County staff and elected officials believe that they have actively

worked to find ways within the law to deny this project. . I don' t think anyone can look at this

project and conclude that it is either good for the area or consistent with current land use

standards." CP at 436 ( emphasis added).

II. BACKGROUND AND HISTORY

At issue are four decisions regarding ( 1) a " Site Development Activity Permit" ( SDAP),

2) a State Environmental Policy Act ( SEPA), ch. 43. 21C RCW, review, ( 3) state approval of a

Large On -Site Sewer System" ( LOSS), and ( 4) a modification to the LOSS decision. All four

decisions were made in WVII' s favor and WVII does not challenge the decisions themselves.

Rather, WVII alleges that the permits or decisions were granted too slowly as a direct and indirect

result of the County' s actions. We briefly explain the pertinent history below.

2 The challenge was not successful. Harless v. Kitsap County, No. 07 -3 - 0032, 2007 WL 4181033, at * 5 ( Cent. Puget Sound Growth Mgmt. Hr' gs Bd. Nov. 15, 2007).

3 No. 44404 -6 -II

A. SITE DEVELOPMENT ACTIVITY PERMIT ( SDAP) AND STATE ENVIRONMENTAL POLICY ACT ( SEPA): 2006 -2007

The Woods View project required the County Department of Community Development

DCD) to issue a SDAP. Kitsap County Code ( KCC) 12. 10. 030. Similarly, local government is

obliged to carry out a SEPA review and issue a determination of significance ( DS), a determination

of nonsignificance ( DNS), or a mitigated determination of nonsignificance ( MDNS). City ofFed.

Way v. Town & Country Real Estate, LLC, 161 Wn. App. 17, 53, 252 P. 3d 382 ( 2011) ( citing Moss

v. City of Bellingham, 109 Wn. App. 6, 15, 31 P. 3d 703 ( 2001), review denied, 146 Wn.2d 1017

2002)); WAC 197- 11- 310( 5)( a), ( b), - 340, - 350( 3); RCW 43. 21C. 030. Under the existing County

ordinances, the County was required to provide a final decision within 78 days of the date it 3 deemed the application complete. Former KCC 21. 04. 110( A) (1998). 4

WVII completed its SEPA " application" on April 14, 2006, and its SDAP application on

5 May 5, 2006. The County issued a MDNS on January 4, 2007. The SDAP was issued on

December 10, 2007. Community groups appealed both decisions to the hearing examiner and the 6 Kitsap County Superior Court, but their appeals were rejected. According to WVII, the hearing

3 As we further discuss in the statute of limitations section, the time limit is tolled when the County requires the applicant to " correct plans, perform studies, or provide additional information." Former KCC 21. 04. 110( A)(4)( a) ( 1998).

4 This ordinance was repealed by Kitsap County Ordinance No. 490 ( 2012).

5 This would make the County' s action on the SEPA application due 78 days from April 14, and action on the SDAP application due 78 days from May 5— excepting periods during which the applicant was required to submit additional information. However, WVII complains only that the SDAP was issued late.

6 WVII relied on the County' s delay in its argument against these appeals, stating that " the County was doing a good and careful job." CP at 1360.

4 No. 44404 -6 -II

examiner was also tardy, hearing argument on March 20, 2008, and filing a decision on June 6,

2008. 7

B. ORIGINAL LOSS PROPOSAL: 2006 -2008

A LOSS is a type of waste treatment system that serves multiple lots. Unlike the SDAP

and SEPA review, the LOSS was not absolutely necessary for the project to move forward, but it

would have allowed Woods View to double its density. With the LOSS, Woods View could

support 78 single - family homes. Without the LOSS, Woods View could support only 39 homes

using individual septic systems.

The state Department of Health ( DOH) is responsible for evaluating LOSS applications.

WAC 246 -272B- 02150. The County has no direct authority to approve or disapprove a LOSS

system. Nevertheless, the then -existing administrative code required a LOSS to comply with local 8 land use standards. See former WAC 246 -272B- 08001( 2)( a)( ii) (2003). Accordingly, while the

DOH always had primary responsibility for passing on a LOSS application, it communicated with

the County regarding WVII' s application for a LOSS permit, as we explain further below.

At the relevant time, the DOH rules imposed requirements on the LOSS system' s

management depending on how the land serviced by the LOSS would be used. Where the lots

were individually owned, a LOSS could only be managed by a public entity or a private operator

guaranteed by a public entity. Former WAC 246 -272B- 08001( 2)( a)( vi)(A)(I) (2003). But if the

7 WVII asserts that a former county ordinance, in effect during the relevant time period, required hearing examiners to make a decision within 14 days of hearing argument. The current version imposes no such deadline. KCC 21. 04. 080.

8 This section of the Washington Administrative Code has since been repealed by Wash. St. Reg. 11 - 12 -050 ( Jul. 1, 2011). No. 44404 -6 -II

lots were under single ownership, either a public entity or a private entity could manage the LOSS.

Former WAC 246- 272B- 08001( 2)( a)( vi)( A)(II) (2003). One such public entity was the Karcher

Creek Sewer District (KCSD). WVII initially approached KCSD to manage the LOSS for Woods

View, and on September 29, 2006, KCSD issued a " Binding Sewer Availability" letter good for

one year. But on December 1, 2006, WVII indicated that it had decided to use a " DOH approved

private management entity" instead. CP at 135.

WVII requested a LOSS permit at some time in 2006. DOH granted the LOSS permit on

March 19, 2008, conditioned on the Woods View lots being held by a single owner. At first, WVII

agreed to the condition and recorded a " Covenant to Retain Single Ownership" on the same day.

But WVII soon found the single -owner condition a barrier to financing: it approached the Legacy

Group ( Legacy) for a business loan, but Legacy " liked the project as depicted with an individual

owner model" and found DOH' s conditions made the project a " non- starter." CP at 125. As such,

WVII decided to petition DOH for a modification to its LOSS permit that would allow the lots to

9 be sold individually.

C. MODIFIED LOSS PROPOSAL ( 2009 -2010)

WVII submitted all necessary documents for its modified LOSS proposal in November

2009. Richard Benson, the DOH engineer who initially worked on the Woods View permit,

indicated that DOH could make the change " in a matter of a week to two weeks except that if the

county had objections to it, he said, quote -unquote, ` I' m going to have to dot my i' s and cross my

9 Specifically, the new LOSS proposal involved management by a private entity guaranteed by a public entity. This would bring the LOSS under former WAC 246 -272B- 08001( 2)( a)( vi)(A)(I) and allow individual ownership of the lots.

6 No. 44404 -6 -I1

is and we' ll have to go through the full process and it could take up to six months to a year.'" CP

at 1846. The modified LOSS was not approved until August 24, 2010.

III. ALLEGED WRONGFUL ACTIONS BY THE COUNTY

WVII alleges that the County caused the aforementioned delays as part of a deliberate plan

to undermine the Woods View project. While WVII points to many instances of the County' s

alleged intermeddling, its facts can be reduced to three main courses of conduct: communications

with DOH, communications with third parties, and internal delays. We explore these courses of

conduct in turn.

A. COMMUNICATIONS WITH DOH

In an internal County e -mail, a deputy prosecutor proposed " a `loop' with the state to ensure

that the county is not allowing urban development in a rural area." CP at 433. Specifically, the

County' s attorney told her colleagues that

even though [ the Woods View project] is " vested" it is not conforming to our current plan. Thus, if the state were to inquire of DCD whether this meets our plan DCD could say no, and the state would have to deny it.

CP at 433.

As described above, the state did not deny the LOSS permit. Still, the record indicates that

the " issue of compliance with current land use standards" was a " significant issue that [ DOH was

grappling with" and was a " relatively important issue in the final approval." CP at 1631. During

the pendency of both of WVII' s LOSS applications, the County remained in contact with DOH.

On November 14, 2007, the deputy prosecutor e- mailed DOH a Growth Management Hearings

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Board decision, which Benson understood to mean " they all want me to enforce [ the County' s land

use standards] directly. "10 CP at 663.

In a letter dated December 3, 2007, the director of the county DCD referenced the same

Growth Management Hearings Board decision, which explained that land -use densities as

determined by the County in its GMA Land Use Plan and zoning are the controlling factor in any

review for septic systems, even if review is conducted by the state. He told DOH that WVII did

not meet current designations, but was a legal nonconforming use because the proposed LOSS was

to serve lots that, while legally created prior to the enactment of the GMA, did not meet current

county comprehensive plan or zoning designations for the area. DCD closed the letter by stating

that it was merely informing DOH as to the Growth Management Hearings Board' s decision, but

that it was not advocating any specific action, leaving that to the state' s discretion.

Then, when DOH was " near approval after a lengthy review process" ( CP at 343), county

representatives met with DOH on March 12, 2008. The County told DOH that the Woods View

project should not be approved

because the over -all development is not consistent with the County' s and GMA' s land use designations. They assert this violates the State' s duty to ensure projects are consistent with local planning. However, the County sees that it has no authority to deny the project.

CP at 340. The County did request that DOH condition the LOSS permit on single ownership of

the Woods View lots.

10 As Benson later clarified at deposition, he understood the e -mail to mean that he should not approve the LOSS because it did not conform with the County' s land use requirements.

8 No. 44404 -6 -II

As described above, DOH issued WVII' s LOSS permit with the requested single -

ownership condition a week after the meeting.

When WVII made its modified LOSS proposal, the County' s attorney sent the Attorney

General' s Office a series of e -mails between September 3 and September 10, 2009, expressing

concern about the amendments. The County' s attorney believed that WVII' s requested permitting

change was an ' after the fact' change, outside the public process, and is [ sic] essentially is

circumventing the law. We feel it cannot be approved and are hereby lodging our objections." CP

at351.

On September 3, 2009, Benson e- mailed the county DCD to check if WVII would be " a

violation of county code" and confirm whether DCD would oppose the development. CP at 417.

DCD e- mailed back on September 15 to state that " urban levels of service are being provided

outside an urban growth area, which is inconsistent with the County' s comprehensive plan and the

Growth Management Act." CP at 417. That same month, DOH required WVII to submit renewed

proof that it was in compliance with local land use standards. In March 2010, DOH transferred

WVII' s LOSS application from Benson to a different examiner who was not aware ofthe County' s

objections. It was this second examiner who ultimately approved the revised LOSS five months

later.

B. COMMUNICATIONS WITH THIRD PARTIES

In September of 2007, KCSD did not renew its agreement to manage the Woods View

LOSS. WVII alleges that this nonrenewal occurred because the County intimidated KCSD.

Specifically, on June 7, 2007, county representatives met with KCSD and opined that KCSD was

9 No. 44404 -6 -II

not permitted to own or operate a LOSS in a rural area. The County was concerned about being

sued by neighboring property owners. KCSD disagreed with the County' s legal position.

The County indicated that " if the District decided to own and /or operate the LOSS, Kitsap

County could not tell KCSD not to." CP at 835. But the County then declared a moratorium to

preclude the use of a LOSS in rural areas, thereby preventing entities like KCSD from participating

in projects like Woods View. KCSD determined that it "did not wish to own or operate the LOSS

for Woods View if Kitsap County had an ordinance prohibiting it." CP at 835. KCSD' s

withdrawal left WVII without a public operator for its LOSS.

Furthermore, WVII argues that it would have received development loan financing from

Legacy but for the County' s actions. Legacy had committed to a loan but had second thoughts

when, as part of its due diligence, Legacy had a conference call with county officials. The County

told Legacy that " the ownership change was a ` big change of use' and that it could necessitate

hearings and delay timelines." CP at 124. But the County did not know what DOH was going to

do. On the other hand, Legacy also indicated that

t]he County did not give us assurances of how the DCD process would play out we did not feel as though the County actors tried to discourage our consideration of loaning to Woods View II LLC and did not perceive the County as trying to inject itself into our business relationship with Woods View II LLC or Ms. Piper.

CP at 124 -25. Following the call with the County, Legacy declined to fund the loan.

C. COUNTY' S INTERNAL DELAY

WVII alleges that the County was purposely slow to issue its SDAP permit, but points to

only one specific act by the County. On October 13, 2006, Kitsap County Administrator Cris

Gears sent the state Department of Commerce, Trade, and Economic Development (CTED) a letter

expressing concern whether the WVII LOSS would be a "' public sewer system ' pursuant to WAC

10 No. 44404 -6 -II

242 -272 -01001 [ sic], and whether it would allow " the development of urban densities outside an

urban growth area in violation of RCW 36. 70A. 110( 4) and RCW 57. 16. 010( 6)." CP at 322.

Pending a response to that letter, the County allegedly suspended the processing of WVII' s SDAP

application. CTED responded to Gears' s letter on November 3, 2006. 11

IV. PROCEDURAL HISTORY

But for the aforementioned delays, WVII asserts that the Woods View lots could have been

available for sale as early as May 2008. As it is, by 2009, the real estate market had become

unfavorable. The Woods View business loan went into default. On December 31, 2009, the

Woods View property went into foreclosure. Piper herself went bankrupt in May 2010 and was

discharged. WVII estimates that the delays cost WVII somewhere between $ 2. 55 million and

4. 37 million and personally cost Piper somewhere between $ 1. 39 million and $ 1. 56 million.

On October 14, 2009, WVII Piper On claim12

and served a notice of on the County.

December 18, 2009, WVII and Piper filed a lawsuit in superior court asserting federal due process

and takings claims as well as state law torts. The County removed the suit to the U.S. District

Court for the Western District of Washington in Tacoma. There, the judge dismissed the federal

constitutional claims with prejudice and dismissed the state claims without prejudice. A year later,

the Ninth Circuit Court of Appeals affirmed this decision on different grounds. The Ninth Circuit

disagreed with the ripeness analysis, but agreed with the each subsequent ruling. Specifically, the

11 CTED told Gears that " if the proposed on -site system serves urban levels of development, we believe it is consequently an urban level of service ... which is contrary to the purpose of the Rural Residential zone." CP at 610.

12 Former RCW 4. 96.020 ( 2009).

11 No. 44404 -6 -II

Ninth Circuit held that WVII' s substantive due process claims failed because " it is at least fairly

debatable that Appellees' delays in issuing the SDAP and SEPA approvals were rationally related

to a legitimate governmental interest in ensuring that local development complied with state law."

CP at 1476.

On July 18, 2011, WVII refiled its complaint in state court alleging negligence, tortious

interference, and unconstitutional takings and requesting a declaratory judgment and injunctive

relief.13 The County filed a motion for summary judgment to dismiss all of WVII' s claims, which

the superior court denied.

In a second motion for summary judgment, the County requested dismissal of WVII' s

tortious interference and negligence claims. In a supplemental brief to the superior court, the

County also requested dismissal of the takings claim. On December 12, 2012, the superior court

dismissed all of WVII' s claims. This appeal followed. The County raised a LUPA issue on cross

appeal.

ANALYSIS

This case involves multiple theories of liability that apply to many of the same facts. We

discuss procedural issues first. Then, we discuss the three substantive issues —negligence, tortious

interference, and takings.

I. STANDARD OF REVIEW

A grant of summary judgment is reviewed de novo. Mohr v. Grantham, 172 Wn.2d 844,

859, 262 P. 3d 490 ( 2011). We will affirm the summary judgment only if there is no genuine issue

13 The parties have stipulated to dismiss the claims for declaratory judgment and injunctive relief as well as the County' s counterclaim for malicious prosecution.

12 No. 44404 -6 -II

of material fact and the moving party is entitled to judgment as a matter of law. Qwest Corp v.

City of Bellevue, 161 Wn. 2d 353, 358, 166 P. 3d 667 ( 2007). However, the party opposing

summary judgment " may not rest upon the mere allegations or denials of his pleading, but .. .

must set forth specific facts showing that there is a genuine issue for trial." CR 56( e).

On review of a summary judgment, the evidence is reviewed in the light most favorable to

the nonmoving party, and all reasonable inferences from that evidence are drawn in favor of the

nonmoving party. Qwest, 161 Wn.2d at 358. If reasonable minds can differ on facts controlling

the outcome of the litigation, then there is a genuine issue of material fact and summary judgment

is improper. Ranger Ins. Co.. v. Pierce County, 164 Wn. 2d 545, 552, 192 P. 3d 886 ( 2008).

Summary judgment is also improper if the issue at bar requires the weighing of " competing,

apparently competent evidence," in which case this court will reverse and remand for a trial to

resolve the factual issues. Larson v. Nelson, 118 Wn. App. 797, 810, 77 P. 3d 671 ( 2003).

II. STATUTE OF LIMITATIONS

The County argues that WVII' s claims for negligence and tortious interference are barred

by the three -year statute of limitations. The County argues that it was required to issue a decision

on the SDAP application and SEPA threshold decision by July 22, 2006, and that its failure to do

so started the statute of limitations running, meaning that the statute of limitations expired on July

22, 2009. WVII argues that its tortious interference claim did not accrue until late October 2006

when it first became aware of the facts that would support a tortious interference claim. WVII

further argues that its negligence and tortious interference claims arising out of the County' s delay

did not accrue until December 2006 as the County' s requests for further information extended the

statutory deadline for the County to process its application and, thus, the time when the County

13 No. 44404 -6 -II

was in violation of the ordinance. 14 We agree with WVII and hold that WVII' s claims are not

barred by the statute of limitations.' 5 The statute of limitations for negligence and tortious interference is three years. RCW

4. 16. 080( 2). The statute of limitations begins to run when the plaintiff has a right to seek recovery

in the courts. Malnar v. Carlson, 128 Wn.2d 521, 529, 910 P. 2d 455 ( 1996). That is, the statute

of limitations does not begin to run until every element of an action is susceptible of proof,

including the occurrence of actual loss or damage. Haslund v. City ofSeattle, 86 Wn.2d 607, 619,

547 P. 2d 1221 ( 1976); Mayer v. City of Seattle, 102 Wn. App. 66, 76, 10 P. 3d 408 ( 2000), review

denied, 142 Wn.2d 1029 ( 2001).

WVII bases its claims, in part, on the County' s delay in issuing the SDAP and in affirming

the SDAP issuance on appea1. 16 As WVII points out, the County exceeded time limits imposed

by its own ordinances. See former KCC 21. 04. 110( A)(4)( a) ( 1998). As Division One of this court

has recognized, where a claim arises out of a permitting body' s failure to comply with statutory

time limits, the cause of action does not accrue until the time limit is actually exceeded. Birnbaum

v. Pierce County, 167 Wn. App. 728, 734, 274 P.3d 1070, review denied, 175 Wn.2d 1018 ( 2012).

14 WVII argues, and the County does not dispute, that the 10 -year statute of limitations for its taking claim has not run. 15 Accordingly, we do not reach WVII' s alternative theory that the continuing tort doctrine prevented the statute of limitations from running until the County' s allegedly tortious conduct ended.

16 The County does not appear to dispute that the hearing examiner' s failure to timely make a decision on the SDAP appeal fell within the statute of limitations.

14 No. 44404 -6 -II

Here, WVII completed its SDAP application on May 5, 2006. Former KCC 21. 04. 110( A)

required a decision within 78 days of the application becoming complete. As the County points

out, that would make its SDAP decision due on July 22, 2006 —more than three years before WVII

submitted its claims to the County. But that is not the whole story because former KCC

21. 04. 110( A)(4)( a) also excludes

a] ny period during which the applicant has been required by the county to correct plans, perform studies, or provide additional information. The period shall be calculated from the date the county notifies the applicant of the need for additional information to the earlier of either: ( 1) the date the county determines whether the additional information provided satisfies the request for information; or (2) fourteen days after the date the information has been provided to the county.

Here, the County made two such requests for additional information. First, on or prior to July 13,

2006, the County requested information about " two possible ` depressions' on the property which

may have been protected streams." CP at 1955. WVII provided the requested information on July

19, 2006. The County did not respond, so the time limit would have begun to run 14 days after

July 19, 2006 - that is, August 2, 2006.

But on July 31, 2006, the County again requested additional information. WVII provided

the requested information on November 20, 2006. Again, the County did not respond, meaning

that the time limit did not start running again until 14 days after November 20, 2006 —that is,

December 4, 2006.

Accordingly, the 78 -day time limit on the County' s permitting decisions began to run on

or about May 5 and excluded the period between July 13, 2006 and August 2, 2006, as well as the

period between July 31, 2006 and December 4, 2006. This calculation means that approximately

10 of the 78 days remained. Therefore, any claim for delay of the SDAP permit did not accrue

15 No. 44404 -6 -II

until December 13, 2006, the earliest date the County was in violation of its own time limit

ordinance. That is less than three years before WVII presented its tort claims on October 14, 2009.

The County' s only response to this argument is that it was not raised until the second 17 supplemental brief in the superior court and contradicted WVII' s earlier pleadings. But "[ w]here

evidence raising issues beyond the scope of the pleadings is admitted without objection, the

pleadings will be deemed amended to conform to the proof." Jensen v. Ledgett, 15 Wn. App. 552,

555, 550 P. 2d 1175 ( 1976) ( citing Robertson v. Bindel, 67 Wn.2d 172, 406 P. 2d 779 ( 1965)). The

County did not object to WVII' s tolling argument and, thus, waived the issue.

WVII' s negligence claim arising out of the delay on its SDAP application was not time

barred. Because WVII' s tortious interference claim arises in part from the delay, it also complies

with the statute of limitations. We conclude that WVII' s negligence and tortious interference

claims are not barred by the statute of limitations.

III. STANDING

The County argues that Piper has no standing to litigate any harm WVII suffered because

she was a mere shareholder and guarantor of the WVII LLC. We agree and, therefore, affirm the

superior court' s dismissal of Piper' s claims.

Generally, a party can only litigate a claim if she has a "` present, substantial interest ' in

its outcome and can show that she will be "` benefited by the relief granted. "' State ex rel. Hays v.

17 The County also argues that the contention that the delay claim accrued in December is inconsistent with the claim that it was wrongful to suspend processing of the SDAP starting in October 2006. Perhaps, but this does not make WVII' s statute of limitations analysis any less correct. Furthermore, as WVII argues, the County could have continued processing other portions of the SDAP application even while waiting on a response to Gears' s letter.

16 No. 44404 -6 -II

Wilson, 17 Wn.2d 670, 672, 137 P. 2d 105 ( 1943) ( quoting 39 AM. JUR. Parties § 10, at 860 ( 1942)).

But shareholders and guarantors attempting to assert standing in the name of a corporation or

principal face a higher hurdle.

Shareholders are usually not allowed to bring an individual direct cause of action for an

injury inflicted upon the corporation or its property by a third party. United States v. Stonehill, 83

F. 3d 1156, 1160 ( 9th Cir.) ( citing Cohen v. Beneficial Indus. Loan Corp., 337 U.S. 541, 548, 69

S. Ct. 1221, 93 L. Ed. 1528 ( 1949); Sutter v. Gen. Petroleum Corp., 28 Cal. 2d 525, 530, 170 P. 2d

898 ( 1946); Jones v. H.F. Ahmanson & Co., 1 Cal. 3d 93, 81 Cal. Rptr. 592, 597 -99, 460 P. 2d 464

1969)), cert. denied, 519 U. S. 992 ( 1996). The exception to this rule occurs where the

shareholder' s claim arises from " something other than his shareholder status." Sound Infiniti, Inc.

v. Snyder, 145 Wn. App. 333, 352, 186 P. 3d 1107 ( 2008) ( emphasis omitted), aff'd, 169 Wn.2d

199, 237 P. 3d 241 ( 2010). Thus, Division One of this court recognizes two exceptions to the usual

rule against shareholder standing: "( 1) where there is a special duty, such as a contractual duty,

between the wrongdoer and the shareholder; and ( 2) where the shareholder suffered an injury

separate and distinct from that suffered by other shareholders." Sabey v. Howard Johnson & Co.,

101 Wn. App. 575, 584 -85, 5 P. 3d 730 ( 2000). Similarly, Division One has held that " a guarantor

must show a distinct and different injury before an independent action can be maintained." Miller

v. U.S. Bank of Wash., N.A., 72 Wn. App. 416, 423, 865 P. 2d 536 ( 1994) ( citing Sparling v.

Hoffman Constr. Co., 864 F.2d 635, 640 ( 9th Cir. 1988)).

The causes of action in this case arose out of WVII' s relationships with regulatory agencies

and potential business partners. Piper herself was not a party to any of these relationships, and the

fact that she negotiated or executed contracts on behalf of WVII does not make her a party. Hunter

17 No. 44404 -6 -II

v. Knight, Vale & Gregory, 18 Wn. App. 640, 644 -45, 571 P. 2d 212 ( 1977), review denied, 89

Wn.2d 1021 ( 1978). Rather, WVII acquired the property and applied for the permits. CP at 1392

Q. And for all the important things that happened in this development, it was Woods View II

that was the owner; correct? A. Yes. ").

WVII argues that Piper suffered a separate and distinct injury because the failure of the

Woods View project resulted in a nonjudicial foreclosure that extinguished WVII' s liability but

preserved the right to pursue a deficiency judgment against Piper as guarantor. WVII further points

to debts that Piper personally guaranteed in Norpac Construction, LLC' s favor, which also went

into default because the Woods View project failed. Finally, WVII points to various creditors who

filed suit against Norpac and Piper, but not WVII.

But these facts are properly analyzed as consequential damages that would not have

happened but for the primary harm to WVII. A shareholder does not have standing to recover

consequential damages that result from the harm to her corporation. Stonehill, 83 F. 3d at 1160.

The fact that Piper was the sole shareholder of WVII does not change our analysis: a sole

shareholder, by necessity, cannot show " an injury distinct from that to other shareholders."

Sparling, 864 F. 2d at 641.

Piper has not established an exception to the shareholder standing rule. Therefore, she

18 lacks standing.

18 Accordingly, we do not reach the issue of whether Piper was collaterally estopped from litigating the issue of standing.

18 No. 44404 -6 -II

IV. LUPA

On cross appeal, the County argues that its permitting actions can be challenged only

through a LUPA appeal and that WVII' s failure to bring an action under LUPA bars any damages

actions arising from its permitting activity. 19 WVII argues that LUPA does not bar its action

because it is seeking monetary compensation rather than a modification of a land use decision, and

its action is not a superior court review of an administrative decision. We agree with WVII. LUPA

does not bar this action.

LUPA is normally the exclusive remedy for land use decisions. RCW 36. 70C. 030( 1). But

LUPA does not apply to "[ c] laims provided by any law for monetary damages or compensation."

RCW 36. 70C. 030( 1)( c). This is not a strict bar —as this court has recognized, a damage claim

may still be controlled by LUPA if it is dependent on " an interpretive decision regarding the

application of a zoning ordinance." Asche v. Bloomquist, 132 Wn. App. 784, 801, 133 P. 3d 475

2006), review denied, 159 Wn.2d 1005 ( 2007). Further, even if an applicant obtains the requested

permit approval, he still must file a LUPA appeal if he intends to challenge the propriety of any

conditions placed on issuance of the permit. James v Kitsap County, 154 Wn.2d 574, 590, 115

P. 3d 286 ( 2005).

This case is not like Asche nor James, however. WVII is not challenging the actual land

use decisions below because it received all of the permits it asked for nor is it challenging any

conditions imposed. Instead, this case is analogous to Lakey v. Puget Sound Energy, Inc., 176

19 The County' s brief indicates that it' s cross notice of appeal is intended only to preserve arguments from its first summary judgment motion and that the County seeks no relief other than the affirmance of the summary judgment below.

19 No. 44404 -641

Wn.2d 909, 296 P. 3d 860 ( 2013). There, the Supreme Court ruled that the appellants were not

required to file a LUPA petition to pursue their claims for damages where the appellants were only

seeking money compensation rather than a reversal or modification of a land use decision. Further,

the Supreme Court held that because LUPA provides for judicial review of a local jurisdiction' s

land use decision and the appellants were making a claim that they could not raise before the

hearing examiner, appellants were not invoking the superior court' s appellate jurisdiction and

LUPA did not govern their claim. Lakey, 176 Wn.2d at 927 -28.

Similarly, all WVII seeks is damages for the delay in rendering those decisions. In such a

case, LUPA is not a bar to the plaintiff' s claims. Libera v. City ofPort Angeles, 178 Wn. App.

669, 675 n. 6, 316 P. 3d 1064 ( 2013). LUPA does not bar WVII' s claims here and we reject the

County' s LUPA cross appeal.

V. NEGLIGENCE / PUBLIC DUTY DOCTRINE

WVII argues that the County' s delay in processing its SDAP and issuing the MDNS fell

short of the standard of care for municipalities in the course of their permitting responsibilities.

We agree with the County' s public duty doctrine arguments and affirm the summary judgment as

to WVII' s negligence claim.

Every negligence action requires a showing of "a duty of care running from the defendant

to the plaintiff." Honcoop v. State, 111 Wn.2d 182, 188, 759 P. 2d 1188 ( 1988). Where the

defendant is a government entity,

the public duty doctrine provides that a plaintiff must show the duty breached was owed to him or her in particular, and was not the breach of an obligation owed to the public in general, i.e., a duty owed to all is a duty owed to none.

20 No. 44404 -6 -II

Munich v. Skagit Emergency Commc' n Ctr., 175 Wn.2d 871, 878, 288 P. 3d 328 ( 2012) ( citing

Babcock v. Mason County Fire Dist. No. 6, 144 Wn.2d 774, 785, 30 P. 3d 1261 ( 2001); Beal v.

City ofSeattle, 134 Wn.2d 769, 784, 954 P. 2d 237 ( 1998)).

There are four exceptions to the public duty doctrine: ( 1) legislative intent, (2) failure to

enforce, ( 3) the rescue doctrine, and ( 4) a special relationship. Munich, 175 Wn.2d at 879 ( citing

Cummins v. Lewis County, 156 Wn.2d 844, 853, 133 P. 3d 458 ( 2006)). If any one ofthe exceptions

applies, then the government owes the plaintiff a duty as a matter of law. Munich, 175 Wn.2d at

879. Here, WVII argues only the failure to enforce and special relationship exceptions are at issue,

but we conclude neither exception applies.

A. FAILURE TO ENFORCE

The failure to enforce exception applies when "[( 1)] governmental agents responsible for

enforcing statutory requirements [( 2)] possess actual knowledge of a statutory violation, fail to

take corrective action despite a statutory duty to do so, and [( 3)] the plaintiff is within the class the

statute intended to protect." Bailey v. Town of Forks, 108 Wn.2d 262, 268, 737 P. 2d 1257, 735

P. 2d 523 ( 1987). This exception is narrowly construed, so as to respect the policy of Taylor v.

Stevens County, 111 Wn.2d 159, 165, 759 P. 2d 447 ( 1988). Atherton Condo. Apartment -Owners

Ass 'n Bd. ofDirs. v. Blume Dev. Co., 115 Wn.2d 506, 531, 799 P. 2d 250 ( 1990).

In Taylor, our Supreme Court held that " building codes impose duties that are owed to the

public at large." 111 Wn.2d at 165. That is, " building codes are designed to protect the public

safety, health and welfare, not to protect individuals from economic loss caused by public officials

while carrying on public duties." Taylor, 111 Wn.2d at 169 ( emphasis added). Taylor purposely

drew the scope of the public duty narrowly in order to avoid " dissuad[ ing] public officials from

21 No. 44404 -6 -II

carrying out their public duty." 111 Wn.2d at 171. These same policy principles require this court

to construe the failure to enforce exception narrowly as well.

WVII admits that no reported case has applied the failure to enforce exception in a case

like this. Indeed, WVII raises the unusual theory that the statutory requirement that the County

failed to enforce was its own mandate to issue a timely permit. We found no Washington case that

has applied the failure -to- enforce exception where the defendant government entity fails to take

corrective action against itself Rather, the failure to enforce exception envisions a situation in

which a regulator knowingly approves " inherently dangerous and hazardous conditions," Pepper

v. J.J. Welcome Constr. Co., 73 Wn. App. 523, 533 -34, 871 P.2d 601, abrogated by Phillips v.

King County, 87 Wn. App. 468, 943 P. 2d 306 ( 1997), review denied, 124 Wn.2d 1029 ( 1994), or

where a police officer fails to take an intoxicated driver into custody, Bailey, 108 Wn.2d at 264.

Also missing is any " mandatory duty to take specific action" to correct a violation. Forest

v. State, 62 Wn. App. 363, 369, 814 P. 2d 1181 ( 1991). While former KCC 21. 04. 110( A) does

state that decisions " shall be issued not more than seventy -eight days after the date of the

determination of completeness" ( emphasis added), the ordinance does not tell the County what to

do if it does not, in fact, issue a decision by that time. The reason for this is obvious —it is the

judiciary, not the County, which is responsible for correcting the County 's failure to abide by its

own time limits. That is, any duty to correct the County' s behavior is not vested in the County.

Drawing the failure -to- enforce exception narrowly, as Taylor requires us to do, we hold that WVII

has failed to show that the exception should apply.

22 No. 44404 -6 -II

B. SPECIAL RELATIONSHIP

The special relationship exception applies when "( 1) there is direct contact or privity

between the public official and the injured plaintiff which sets the latter apart from the general

public, and ( 2) there are express assurances given by a public official, which ( 3) gives rise to

justifiable reliance on the part of the plaintiff." Taylor, 111 Wn.2d at 166.

The first element, privity, is defined broadly —it refers to the relationship between a

government agency and any reasonably foreseeable plaintiff. Chambers -Castanes v. King County,

100. Wn.2d 275, 286, 669 P. 2d 451 ( 1983). Drawing all factual inferences in WVII' s favor, we

hold that WVII was a reasonably foreseeable plaintiff.

The second element requires that " a direct inquiry is made by an individual and incorrect

information is clearly set forth by the government, the government intends that it be relied upon

and it is relied upon by the individual to his detriment." Meaney v. Dodd, 111 Wn.2d 174, 180,

759 P. 2d 455 ( 1988). An assurance is express only if it promises that a government official "would

act in a specific manner." Babcock, 144 Wn.2d at 791. Furthermore, any express assurance must

be unequivocal. Meaney, 111 Wn.2d at 180.

The third elementjustifiable reliance — is a " question of fact generally not amenable to

summary judgment." Babcock, 144 Wn.2d at 792.

WVII points to the County' s statement that " it would process the application as a vested

permit request, meaning that [ WVII] should receive the permit under the land use requirements in

place at that time." CP at 602 -03. This may be an assurance that WVII would receive the SDAP

permit, which it did. But it was not an assurance that WVII would receive the permit within a

specific timeframe. Perhaps WVII had a reasonable expectancy that the SDAP permit would issue

23 No. 44404 -6 -II

within the 78 -day time limit established by former KCC 21. 04. 110( A). If so, that expectancy was

an implied assurance not an express one. WVII fails to point out what " incorrect information [was]

clearly set forth" by the County. Meaney, 111 Wn.2d at 180. For that reason WVII' s claim that

the special relationship exception applies fails.

C. CONCLUSION

Because neither of the asserted exceptions to the public duty doctrine (failure to enforce or

special relationship) applies, the public duty doctrine bars negligence liability as a matter of law.

WVII. fails to establish that the County' s duty to timely issue SDAPs was owed to WVII in

particular rather than the public in general. As such, WVII' s negligence claim fails at the outset,

and summary judgment on the negligence claim was proper. As to WVII' s negligence claim, we

affirm the superior court' s summary dismissal.

VI. TORTIOUS INTERFERENCE

WVII argues that the County interfered with its business expectancies and contracts when

it suspended the processing of WVII' s SDAP application, caused KCSD to withdraw from its

contract to manage the LOSS for WVII, communicated with DOH regarding WVII' s pending

LOSS permit, and delayed the approval process for the project. We disagree.

Tortious interference has five elements: ( 1) Business relationship /expectancy, ( 2)

defendant' s knowledge of relationship, ( 3) intentional interference resulting in termination of

relationship, (4) improper purpose /means, and ( 5) damages. Pac. Nw. Shooting Park Ass 'n v. City

of Sequim, 158 Wn.2d 342, 351, 144 P. 3d 276 ( 2006). These elements are described in detail

below.

24 No. 44404 -6 -II

We conclude WVII fails to show that the County' s interference resulted in the termination

of WVII' s relationship with either KCSD or Legacy under prong ( 3). We further conclude that

WVII is unable to show any genuine dispute as to a material fact regarding prong (4), whether the

County acted with improper means or improper purpose regarding its business expectancy in the

project. Accordingly, we decline to reach the issue of damages or proximate cause, and we affirm

the superior court' s order granting summary judgment on this claim.

A. ELEMENTS OF TORTIOUS INTERFERENCE

1. BUSINESS RELATIONSHIP OR EXPECTANCY

A developer has a protected business expectancy in its projects, which can give rise to a

tortious interference claim. Westmark Dev. Corp. v. City of Burien, 140 Wn. App. 540, 557 -58,

166 P. 3d 813 ( 2007), review denied, 163 Wn.2d 1055 .(2008). WVII' s expectancy in its Woods

View project satisfies the first element. Furthermore, WVII had business relationships with its

prospective LOSS manager, KCSD, and its prospective lender, Legacy. Both KCSD and Legacy

made an initial commitment to work with WVII. Drawing all factual inferences in favor of WVII,

the nonmoving party, we hold that the first element of tortious interference is satisfied.

2. KNOWLEDGE OF RELATIONSHIP

The knowledge element is satisfied when the defendant knows of "facts giving rise to the

existence of the relationship." Calbom v. Knudtzon, 65 Wn.2d 157, 165, 396 P. 2d 148 ( 1964).

This element does not require specific knowledge, only awareness of " some kind of business

arrangement." Topline Equip., Inc. v. Stan Witty Land, Inc., 31 Wn. App. 86, 93, 639 P. 2d 825,

review denied, 97 Wn.2d 1015 ( 1982). Here, the County was certainly aware of WVII' s business

plans for the Woods View development. The County was also aware of WVII' s business

25 No. 44404 -6 -II

relationships with KCSD and Legacythat is the reason the County communicated with KCSD

and Legacy. Drawing all factual inferences in WVII' s favor, the second element is satisfied.

3. INTENTIONAL INTERFERENCE RESULTING IN TERMINATION OF RELATIONSHIP

a. KCSD

WVII alleges that the County interfered with WVII' s business relationships with both

KCSD and Legacy, as well as WVII' s business expectancy in the Woods View project in general.

It is true that the County communicated with both KCSD and Legacy, and it is true that both KCSD

and Legacy terminated their business relationships with WVII. The question is whether the

County' s communications caused those business relationships to end. Even drawing all factual

inferences in WVII' s favor, a reasonable finder of fact could not find that the County caused the

termination of WVII' s relationships with KCSD and Legacy.

The County contacted KCSD in June 2007 to voice its concerns over the legality of the

Woods View project. By that time, WVII had already decided of its own volition to abandon its

relationship with KCSD and " move forward with using a DOH approved private management

entity." CP at 135; see also CP at 139 ( "[ M]y client has not concluded a maintenance agreement

with [ KCSD] and at this point does not intend to do so. "). Accordingly, whether or not KCSD

acted on the basis of the County' s legal arguments, it was not KCSD that ended the relationship

with WVII but rather WVII itself. There is no genuine issue of material fact as to whether the

County tortiously interfered with WVII' s relationship with KCSD.

b. LEGACY

WVII' s arguments with respect to Legacy are similarly unavailing. It is true that Legacy

declined to fund WVII' s loan after a conference call with the County. However, according to

26 No. 44404 -6 -II

Legacy' s vice president, Brent Eley, the County did not express any opinion about whether the

Woods View project or the associated permits would be approved and that Legacy " did not feel as

though the County actors tried to discourage our consideration of loaning to Woods View II LLC

and did not ... try[] to inject itself into [ Legacy' s] business relationship with Woods View II LLC

or Ms. Piper." CP at 124 -25. Eley' s testimony unambiguously shows that the County did not

cause Legacy to decline to fund WVII' s loan. WVII fails to present any evidence that would lead

a reasonable finder of fact to disbelieve Eley' s account. Accordingly, we hold that WVII has failed

to show specific facts that would create a genuine issue of fact regarding the County' s alleged

tortious interference with WVII' s relationship with Legacy. CR 56( e).

C. WOODS VIEW BUSINESS EXPECTANCY

WVII argues that the County' s own delay, as well as delay that the County caused DOH to

incur, caused the Woods View project to fail. Even assuming without deciding that WVII

establishes intentional interference resulting in termination of relationship, WVII fails to establish

a genuine dispute as to prong ( 4) improper purpose /means. Accordingly, we need not analyze

further whether the County' s interference resulted in termination of the project.

4. IMPROPER PURPOSE OR MEANS

The fourth element may be satisfied by proving either that the defendant had an improper

purpose or that the defendant used improper means. The terms are not synonymous: this court

has recognized that

in government delay cases, proving improper purpose requires showing that the defendant delayed plaintiff with the purpose of improperly preventing plaintiff' s land development, and proving improper means requires showing that the defendant arbitrarily singled out for delay a particular plaintiff or type of plaintiff.

27 No. 44404 -6 -II

Libera, 178 Wn. App. at 677 ( citing Pleas v. City of Seattle, 112 Wn.2d 794, 804 -06, 774 P. 2d

1158 ( 1989); Westmark, 140 Wn. App. at 560 -61). Accordingly, to prove that the County

interfered to further an improper purpose or by virtue of an improper means, WVII must

demonstrate not only that the County did interfere but that it had a duty not to interfere. Libera,

178 Wn. App. at 676. We conclude that WVII fails to raise a genuine issue of material fact as to

improper purpose and improper means.

a. IMPROPER MEANS

WVII' s argument with regard to improper means is threefold. Attempting to draw

analogies to Westmark, WVII takes issue with ( 1) the additional delay caused by the County' s

suspension of the application process while it waited for the state to respond to one of its inquiries,

2) the County' s interference with KCSD, which caused KCSD to terminate its relationship with

WVII, and ( 3) the delay caused by the County' s correspondence with DOH, including its repeated

representations that the development did not comply with the GMA and the County' s

comprehensive plan.

In the permitting context, one example of an improper means is imposing an extraordinary

delay. Westmark, 140 Wn. App. at 560. WVII relies heavily on Westmark, an instructive decision,

but one that is nevertheless distinguishable from the facts here. In Westmark, a plaintiff in

unincorporated King County applied to King County fora permit to build an apartment complex.

140 Wn. App. at 543 -44. While the application was pending and when King County was nearly

ready to make a decision on the developer' s permit, the city of Burien incorporated the area and

assumed permitting responsibility. Westmark, 140 Wn. App. at 544. The city then delayed

28 No. 44404 -6 -II

approving the developer' s permit for a period of years when the typical response time was 30 to

120 days. Westmark, 140 Wn. App. at 561.

The evidence revealed that Burien had incorporated in part to stop the development of

apartment buildings and that the specific development at issue was one of only a few proposed

projects that Burien took over when there were as many as 100 others pending in the area.

Westmark, 140 Wn. App. at 559. The Westmark court found that Burien had employed improper

means to delay the permitting process. 140 Wn. App. at 560.

Specifically, the city' s SEPA decision took more than 3 years when ordinarily it should

take between 30 and 120 days. Westmark, 140 Wn. App. at 561. City employees made decisions

that resulted in additional delay without ever having reviewed the project' s files. Westmark, 140

Wn. App. at 559. And despite the fact that the developer immediately provided any requested

information, Burien would not provide straight answers. Westmark, 140 Wn. App. at 560 -61.

Here, the County took 19 months to issue a SDAP when, by ordinance, the decision should

take no more than 78 days. Former KCC 21. 04. 110( A). But the delays here, unlike those in

Westmark, were not caused by the County' s use of "improper" means. The record demonstrates

that the County did temporarily suspend the application process, but the County did so only

because it anticipated guidance from the state and then Governor Gregoire regarding what the

County felt was an untenable position.

The County wrote a letter to the governor in which it recognized the conflict that arose

where ( as here) a sewer system designed for urban use was nevertheless permitted to serve a rural

area by virtue of the fact that those areas involved " pre -GMA vested lot[ s]." CP at 901.

Understandably, the County was hesitant to proceed with the WVII permitting process because it

29 No. 44404 -6 -II

believed doing so made it susceptible to liability for violating the GMA. Even though the vested

rights doctrine rendered the County powerless to deny WVII building permits, it became aware

that extending urban services outside urban growth areas was contrary to current GMA goals and

policies. WVII fails to show how the delay caused by the County' s reasonable appeal to the State

for guidance constitutes " improper means" for the purpose of a tortious interference claim.

Moreover, WVII' s allegation that the County improperly injected itself into dealings

between KCSD and WVII, causing the relationship to deteriorate, is unpersuasive. WVII is correct

that the County expressed its displeasure with the notion that KCSD would serve as the owner or

operator of the LOSS for WVII. But again, the County did so because it was of the opinion that

the controlling statutes and regulations did not permit an entity like KCSD to manage the LOSS.

The County also stated unequivocally that despite its position, it could not prevent KCSD from

reaching an agreement with WVII should it decide to. Furthermore, by the time the County

expressed its sentiment to KCSD, WVII had already indicated that it had decided to use a " DOH

approved private management entity" instead. CP at 135. WVII again fails to show that the

County interfered using " improper means."

Finally, WVII alleges that the County interfered with the development in part by " falsely ".

telling DOH that the development did not comply with applicable land use designations. But in

context, the County simply relayed its concern that the project appeared inconsistent with the GMA

and in potential violation of the State' s duty to ensure that approved projects are consistent with

local planning mandates. And again, the County expressly reminded DOH that the County had no

authority to deny the project. Furthermore, the County' s position that the LOSS did not comply

with the GMA was accurate. The GMA endeavors to prohibit the extension of urban services to

30 No. 44404 -6 -II

rural areas. RCW 36. 70A. 110( 4). We conclude that even reviewing the evidence in WVII' s favor,

the delays here do not rise to the level of " extraordinary" delay by use of improper means as

contemplated by Westmark.

Another example of an improper means is singling out a project by imposing additional

requirements not contained in the applicable statute. Pleas, 112 Wn. 2d at 796 -97. But here, the

County did not and could not impose the single ownership condition. That decision rested with

the DOH. WAC 246 -272B- 02150. WVII also failed to show that the County singled out its

proposed development in the permitting process as compared to other similarly situated projects.

Unlike the facts in Westmark, WVII does not attempt to show that the County' s alleged

interference with DOH was limited to its development efforts or even to its type of development.

In other words, the County could consistently issue the development permits and argue to DOH

that an on -site sewer system serving a high density site in a rural area should not be approved by

DOH because it is inconsistent with the County' s current comprehensive plan and the GMA' s

provisions regarding development outside an urban growth area. This is a rational position for the

County to take. The County argues that its statements cannot constitute improper means because

the County was " merely asserting an arguable interpretation of existing law." Leingang v. Pierce

County Med. Bureau, Inc., 131 Wn.2d 133, 157, 930 P. 2d 288 ( 1997). We agree with the County

that WVII fails to show a material issue of fact as to whether the County arbitrarily singled out for

delay WVII' s development.

b. IMPROPER PURPOSE

While improper purpose and improper means are separate inquiries, " impropriety may be

more easily found if the means of interference was wrongful." Pleas, 112 Wn.2d at 806. Where

31 No. 44404 -6 -II

a municipality singles out a project, it is an improper purpose to do so for the purpose of political

advantage, such as placating a state representative or a community group. Westmark, 140 Wn.

App. at 560; Pleas, 112 Wn.2d at 796.

In Pleas, our Supreme Court identified an improper purpose for the sake of a tortious

interference claim where the city of Seattle actively obstructed an apartment complex project

specifically to gain the favor of politically active and influential organizations. Pleas, 112 Wn.2d

at 805. The city consistently delayed processing the application to correspond with a group of

concerned citizens, defied court orders to continue to process the project' s application, encouraged

the citizen' s group to petition for a favorable rezone to block the project, and otherwise bypassed

ordinary procedures to appease its constituents. Pleas, 112 Wn.2d at 796 -800. And in Westmark,

Burien obstructed the apartment building in part to please a state representative who lived near the

proposed site and actively opposed the development. 140 Wn. App at 560.

Here, although there was considerable community opposition to the WVII development,

this fact alone does not indicate that the County intentionally caused delay for the sole purpose of

placating its constituents. Commissioner Bauer did tell a constituent that the " County staff and

elected officials believe that they have actively worked to find ways within the law to deny this

project." CP at 436. But this statement was only a small portion of an otherwise lengthy e -mail

sent to a concerned citizen to explain why the County could not prevent the project from going

forward, and simultaneously to express agreement that the project was. not " good for the area or

consistent with current land use standards." CP at 436. Importantly, the commissioner said that

his understanding was that the County had worked to find ways within the law to deny the project.

While improper purpose is not synonymous with " illegal" purpose, it follows logically that a

32 No. 44404 -6 -II

County' s pursuit of legally available avenues to address its concerns would necessarily not

constitute " improper purposes." Unlike Pleas, the County here did not use improper means to

single out the Woods View project, and WVII fails to show that the County had an improper

purpose in communicating with DOH. We conclude that there is no genuine issue of material fact

as to improper purpose.

In summation, to avoid summary judgment, WVII must show that a genuine dispute exists

or that they have established all five elements of tortious interference. Here, WVII fails to establish

a genuine issue of material fact as to the improper purpose or improper means element. Thus,

summary judgment is properly granted as to WVII' s intentional tortious interference claim.

Consequently, we decline to examine the issues of damages or causation.20

VII. TAKINGS

WVII makes three arguments to support its takings claim. It argues ( 1) that a permanent

and substantial reduction in property value is sufficient to state a successful takings claim, ( 2) the

County compelled DOH to require WVII to burden its property with a covenant prohibiting the

transfer of individual lots in the development, and ( 3) the County engaged in "a set of guerilla [sic]

tactics unreasonably intended to hold up and prevent construction of a project," thus effecting a

20 The County argues that the tortious interference claim is collaterally estopped by the federal court' s decision in this case. Because the tortious interference claim fails on its merits, we do not address the County' s collateral estoppel argument.

33 No. 44404 -6 -II

21 taking. Reply Br. of Appellant at 29. We affirm summary judgment as to takings because WVII

cannot show that the County' s actions resulted in a taking.

Washington State Constitution article I, section 16 states that "[ n] o private property shall

be taken or damaged for public or private use without just compensation having been first made."

Under existing Washington and federal law, a police power measure can violate article I, section

16 of the Washington State Constitution or the Fifth Amendment of the United States Constitution

and thus be subject to a takings challenge when ( 1) a regulation affects a total taking of all

economically viable use of one' s property, Lucas v. South Carolina Coastal Council, 505 U.S.

1003, 1019, 112 S. Ct. 2886, 120 L. Ed. 2d 798 ( 1992); ( 2) the regulation has resulted in an actual

physical invasion upon one' s property, Loretto v. Teleprompter Manhattan CATV Corp., 458 U.S.

419, 433, 102 S. Ct. 3164, 73 L. Ed. 2d 868 ( 1982); ( 3) a regulation destroys one or more of the

fundamental attributes of ownership ( the right to possess, exclude other, and to dispose of

property), Presbytery ofSeattle v. King County, 114 Wn.2d 320, 330, 787 P. 2d 907, cert. denied,

498 U.S. 911 ( 1990); or (4) the regulations were employed to enhance the value of publicly -held

property, Orion Corp. v. State, 109 Wn.2d 621, 651, 747 P. 2d 1062 ( 1987), cert. denied, 486 U. S.

21 In its opening brief, WVII argues only that the superior court should not have dismissed the takings claim because the County did not specifically request summary judgment on that claim. We reject WVII' s argument that the County did not request summary judgment on the takings issue because it did so in a supplemental brief

34 No. 44404 -6 -II

1022 ( 1988); Manufactured Housing Cmtys. of Wash. v. State, 142 Wn2d 347, 355 -56, 13

P. 3d 183 ( 2000). 22

Under these controlling legal principles, WVII fails to show that a taking occurred.

A. A PERMANENT AND SUBSTANTIAL REDUCTION IN PROPERTY VALUE

Relying on Borden v. City ofOlympia, 113 Wn. App. 359, 374, 53 P. 3d 1020 ( 2002), review

denied, 149 Wn.2d 1021 ( 2003), WVII claims that a permanent and substantial reduction in

property value is sufficient to state a takings claim. But in Borden, the court found that no taking

had occurred based on a flooding incident, and WVII does not explain how Borden supports its

position in any respect. WVII also relies on Lambier v. City ofKennewick, 56 Wn. App. 275, 279,

783 P. 2d 596 ( 1989), review denied, 114 Wn.2d 1016 ( 1990).

In Lambier, due to the city' s design and construction of a road, up to 12 vehicles ended up

crashing in the Lambiers' yard over time, causing the resale value of their home to plummet to

nearly half its value. 56 Wn. App at 277. The court noted that the city affirmatively undertook

the construction project that resulted in the Lambiers' damages. Lambier, 56 Wn. App. at 280.

WVII argues summarily that a taking is established so long as it can show a " subsequent decline

in market value" resulting from the regulation. Lambier, 56 Wn. App. at 279 ( citing Martin v.

Port of Seattle, 64 Wn.2d 309, 320, 391 P. 2d 540 ( 1964), cent. denied, 379 U.S. 989 ( 1965)). But

we note that both Borden and Lambier are distinguishable because the plaintiffs there alleged a ( 1)

22 Regulations have also been found unconstitutional because they violate substantive due process whether or not a total taking invasion has actually occurred. See Guimont v. Clarke, or physical

121 Wn.2d 586, 608, 854 P. 2d 1 ( 1993), cert. denied, 510 U. S. 1176 ( 1994); Margola Assocs. v. City of Seattle, 121 Wn. 2d 625, 649, 854 P. 2d 23 ( 1993). WVII does not assert a substantive due process claim.

35 No. 44404 -6 -II

government' s ( 2) physical invasion that ( 3) resulted in damages. And here, WVII does not allege

a government' s physical invasion onto WVII land that caused damages. Again WVII fails to

explain how Borden or Lambier support its takings claim here.

Perhaps more to the point, neither Lucas nor Guimont v. Clarke, 121 Wn.2d 586, 854 P. 2d

1 ( 1993), cert. denied, 510 U.S. 1176 ( 1994), upon which WVII relies, suggest that a reduction in

property value alone constitutes some sort of per se taking. As just noted, Lucas held that a taking .

occurs when a regulation eliminates all economically viable use of one' s property. 505 U.S. at

1019. Our Supreme Court incorporated this rule into its threshold test in determining whether a

regulation has worked a taking. Guimont, 121 Wn.2d at 600. We recognize that this appeal does

not challenge a regulation as did the appeals in Lucas and Guimont. Nonetheless, WVII' s apparent

position that any substantial loss of property value alone is a taking is at odds with the rationales

underlying both these decisions. If the loss of some economically viable use is not per se a taking,

then neither is the loss of some property value.

B. FUNDAMENTAL ATTRIBUTE OF PROPERTY OWNERSHIP

Citing Manufactured Housing, WVII next argues that a property owner has the unrestricted

right to dispose of it and anything that destroys that right without compensation constitutes a

taking. WVII claims that the County compelled DOH to require WVII to burden its property with

a covenant prohibiting the transfer of individual lots and these actions by the County constitute a

taking. This argument fails.

36 No. 44404 -6 -II

The central flaw in WVII' s position is that the County had no legal authority to compel the

DOH to require anything of WVII. That authority rested with DOH alone. The County simply

asserted a reasonable, legal position to DOH, and the DOH made its own decision in response.

The County did not interfere with WVII' s property ownership rights in any manner.

C. TAKING BY DELAY

Finally, WVII argues that the County engaged in "a set of guerilla [sic] tactics unreasonably

intended to hold up and prevent construction of a project," thus effecting a taking. Reply Br. of

Appellant at 29. WVII cites to no authority, and we have found none, for the position that

government delay can constitute a taking. "' Where no authorities are cited in support of a

proposition, the court is not required to search out authorities, but may assume that counsel, after

diligent search, has found none. "' Nguyen v. City of Seattle, 179 Wn. App. 155, 171, 317 P. 3d

518 ( 2014) ( internal quotation marks omitted) ( quoting State v. Logan, 102 Wn. App. 907, 911

n. 1, 10 P. 3d 504 ( 2000)).

Accordingly, the County' s actions do not constitute a taking as a matter of law. The

superior court did not err in granting summary judgment on WVII' s takings claim and we affirm.23

23 Accordingly, we do not reach the issue of whether the takings claim was collaterally estopped by the federal court' s decision.

37 No. 44404 -6 -II

CONCLUSION

We reject the County' s LUPA and statute of limitations arguments. Regarding the superior

court' s grant of summary judgment on the issues of standing, negligence, takings, and tortious

interference, we affirm.24

A majority of the panel having determined that this opinion will not be printed in the Washington Appellate Reports, but will be filed for public record in accordance with RCW 2. 06. 040,

it is so ordered.

We concur:

24 The County argues that it cannot be held liable for its communications to DOH under the Noerr- Pennington doctrine. E. R.R. Presidents Conf. v. Noerr Motor Freight, 365 U.S. 127, 81 S. Ct. 523, 5 L. Ed. 2d 464 ( 1961). That doctrine immunizes petitions to government from certain types of liability. Because we hold that WVII' s claims against the County fail, we need not address the County' s immunity under this doctrine. 38