FILED 

JANUARY 30, 2018 

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 

SUZANNE G. KUNDA, ) 

) 

Appellant, ) 

) 

V. ) 

) 

MICKEY D. SHAUL and MICHELLE R. ) 

SHAUL, husband and wife and the marital ) 

community comprised thereof; MICK ) 

SHAUL CONSTRUCTION, a sole ) 

proprietorship; AMERICAN ) 

CONTRACTORS INDEMNITY ) 

COMPANY, Bond No. 100124722, a ) 

California corporation, ) 

) 

Respondent. ) 

No. 34920-9-111 

UNPUBLISHED OPINION 

KORSMO, J. -A bonding company successfully convinced the trial court that it 

had no obligation to pay on a contractor's bond because the jury verdict form did not 

mention the company when it returned a verdict against the contractor. We reverse. 

FACTS 

Some unusual procedural twists and turns have created a unique problem that 

largely renders the underlying factual circumstances of this case irrelevant to our 
No. 34920-9-111 

Kunda v. Shaul, et ux, et al 

decision. 1 Suzanne Kunda sued Mick Shaul Construction, a sole proprietorship, and 

American Contractors Indemnity Company (ACIC) over a home remodeling project. 

ACIC had issued Shaul's contractor's bond. Kunda alleged five causes of action against 

Shaul; the only mention of ACIC in the complaint was an allegation that it was 

responsible for Shaul's breach of contract due to the bond.· 

Shaul and ACIC used the same attorney in accordance with Shaul's obligations 

under the bond to provide a defense and indemnify ACIC. The defendants filed a joint 

answer to the complaint, admitting the existence of the contractor's bond, denying 

liability, and raising 19 affirmative defenses, the last 10 of which dealt with ACIC or the 

bond. Shaul had also filed a breach of contract action against Kunda; the two matters 

were consolidated for trial. The matters proceeded to a weeklong jury trial in Walla 

Walla Superior Court in January 2016. 

The jury was asked to consider 14 verdict forms to resolve the competing claims. 

None of the verdict forms mentioned ACIC as either a claimant or as a potentially liable 

party. The jury returned verdicts in favor of Kunda on three of her five claims, including 

breach of contract, unjust enrichment, and conversion. The jury verdict form for Kunda's 

breach of contract claim only listed Shaul Construction and its owners as the liable 

1 Also, little of the record from the proceedings prior to judgment is included in 

the record on appeal. There is no copy of the bond in the appellate record. 

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Kunda v. Shaul, et ux, et al 

parties. Kunda was awarded $132,346.00 by the jury.2 The judgment was filed March 

30, 2016. It listed Shaul Construction and the owners individually as debtors; the 

judgment totaled $153,251.80 when costs and attorney fees were included. 

Kunda's efforts at collecting from Shaul proved unavailing,3 so she turned to 

ACIC to collect on the $12,000 bond. ACIC rebuffed her efforts. Kunda then filed a 

post-judgment motion for summary judgment against ACIC on August 29, 2016. ACIC 

appeared and moved for dismissal of the claim against it, arguing that the failure to obtain 

a jury verdict against ACIC was a failure to prosecute the case and required a dismissal 

with prejudice. 

The trial court heard the competing motions on November 7, 2016. The court 

concluded that ACIC had not admitted liability in its answer. It therefore denied the 

motion for summary judgment and granted ACIC's motion to dismiss. Ms. Kunda timely 

appealed to this court. A panel heard oral argument on the matter. 

ANALYSIS 

This peculiar fact pattern begets a peculiar result. We conclude that because 

neither Kunda nor ACIC received a jury verdict on its claims against the other, use of the 

2 The verdict form does not segregate damages between the breach of contract and 

other claims. 

3 We were advised at oral argument that the Shauls filed for bankruptcy, leading 

Kunda to seek recovery on the bond. 

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No. 34920-9-III 

Kunda v. Shaul, et ux, et al 

summary judgment process post-verdict was not improper because the issues were left 

unresolved.4

Well settled standards govern review of a typical summary judgment ruling. A 

reviewing court considers those matters de novo, considering the same evidence 

presented to the trial court. Lybbert v. Grant County, 141 Wn.2d 29, 34, 1 P.3d 1124 

(2000). If there is no genuine issue of material fact, summary judgment will be granted if 

the moving party is entitled to judgment as a matter of law. Id. "The purpose of 

summary judgment is to avoid a useless trial when there is no genuine issue of any 

material fact." Olympic Fish Prod., Inc. v. Lloyd, 93 Wn.2d 596, 602, 611 P.2d 737 

(1980). 

The "Contractors Registration Act" (CRA), chapter 18.27 RCW, provides a 

mechanism for homeowners to recover against a contractor's surety bond. Cosmopolitan 

Eng'g Grp., Inc. v. Ondeo Degremont, Inc., 159 Wn.2d 292, 299, 149 P.3d 666 (2006). 

The surety typically provides a performance bond, which protects the homeowner from 

the contractor's material breach of the underlying contract. 33 Matthew King, 

WASHINGTON PRACTICE: WASHING TON CONSTRUCTION LAW MANUAL § 13 :4, at 261 

(2008). The CRA requires general contractors to file with the Department of Labor and 

Industries a $12,000 bond issued by a suitable surety insurer. RCW 18.27.040(1). "Any 

4 Since we grant relief to Ms. Kunda, we necessarily deny ACIC's request for 

attorney fees on appeal and do not further address that issue. 

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Kunda v. Shaul, et ux, et al 

person, firm, or corporation having a claim against the contractor ... may bring suit 

against the contractor and the bond." RCW 18.27.040(3). "The surety issuing the bond 

shall be named as a party to any suit upon the bond." Id. (emphasis added). These rules 

allow plaintiffs flexibility to account for their individual circumstances; the CRA does 

not require a plaintiff to sue the contractor and surety in a single action; suits may be 

brought separately. Wardv. LaMonico, 47 Wn. App. 373,378, 735 P.2d 92 (1987). 

Nevertheless, actions filed under RCW 18.27.040 refer only to actions for recovery 

against the contractor's bond. Ondeo, 159 Wn.2d at 299. A trial court properly includes 

a surety in a judgement for damages, but caps damages against the surety at the amount 

of its bond. Brotherton v. Kralman Steel Structures, Inc., 165 Wn. App. 727, 732, 269 

P.3d 307 (2011).

While the bond protects those with claims against a contractor, the bond is not the 

equivalent of liability insurance and the bonding company does not perform the function 

of a typical insurer. See, generally, I STEVEN PLITT ET AL., COUCH ON INSURANCE 3D § 

1: 18 (2016) ( discussing differences); Harman v. Pierce County Bldg Dep 't, I 06 Wn.2d 

32, 720 P.2d 433 (1986) (contractor's bond and contractor's liability insurance protect 

different interests). Typically, liability of the surety is measured by the liability of the 

principal, provided the default for which the surety is sought to be held falls within the 

purview of the bond. Lybecker v. United Pac. Ins. Co., 67 Wn.2d 11, 18,406 P.2d 945 

(1965); 11 LEER. Russ & THOMAS F. SEGALLA, COUCH ON INSURANCE 3D § 163:32 

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No. 34920-9-111 

Kunda v. Shaul, et ux, et al 

(2016); see also Tucker v. Brown, 20 Wn.2d 7 40, 848, 150 P .2d 604 ( 1944) ("The 

liability of a bondsman is always measured by the express terms of his covenant, the 

duties and obligations of his principal, as defined by the state statutes, and the conditions 

contained in the bond. The surety cannot be held liable unless the principal is liable."). 

"A trial is the judicial examination of the issues between the parties, whether they 

are issues of law or of fact." CR 38. In a typical case, the bonding company would be 

included with the contractor on the liability verdict form for the breach of contract claim 

or the issue would have been decided as a matter of law by the judge at the request of a 

party upon the close of the evidence. None of those possibilities occurred here. 

Similarly, none of the affirmative defenses were presented to the jury for consideration. 

In this circumstance, we conclude that there was no resolution of any of these issues and 

that the trial remained incomplete. 

The question of what is to be done remains. Our starting point is the fact that there 

is an unchallenged jury verdict bearing on this issue-the jury's determination that the 

contractor breached its contract with Ms. Kunda. What are the consequences of that 

verdict for these unresolved issues? ACIC raises several arguments suggesting that the 

case concluded with the jury's resolution of the verdict forms submitted to it. We 

disagree. 

Unlike the criminal law, we are aware of no implied acquittal doctrine that would 

apply to a civil case and serve as the basis for a determination that ACIC was not liable 

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No. 34920-9-111 

Kunda v. Shaul, et ux, et al 

on the bond. ACIC suggests that CR 40(d) required dismissal of the unresolved issues. 

Again, we disagree. That rule merely states the possibilities once a case is called for trial: 

it will tried, dismissed, or continued. The rule does not speak to the problem of issues 

left unresolved by trial. There was a trial in this case; CR 40( d) is not implicated. 5

Instead, Kunda sought relief under the summary judgment process.6 ACIC 

understandably, and correctly, argues that the rules do not contemplate CR 56 being used 

after trial. While we agree that the rules contemplate summary judgment motions will be 

brought prior to trial, it appears that allowing the summary judgment process in this 

particular factual circumstance better serves the purpose of the rule than denying its use 

here would do. 

ACIC correctly points out that summary judgment motions typically are required 

to be heard more than 14 days prior to trial. CR 56(c). However, the same sentence of 

the rule also provides that the timing is subject to the discretion of the trial court.7 We 

5 In the typical civil case, a plaintiff will lose if she fails to prove one of the 

elements of her case. Similarly, parties will seek judgment as a matter of law if the 

evidence (or lack thereof) compels a result in their favor. Neither of those circumstances 

exist here. 

6 Counsel admitted at trial that the rule was not a particularly good fit, although no 

rule appeared to be. We agree that this approach usually will have little to recommend it 

and caution against reliance on the process employed in this action. In many instances, 

CR 60 might be appropriate, but the bankruptcy filing made use of that rule impractical 

here. 

7 "Summary judgment motions shall be heard more than 14 calendar days before 

the date set for trial unless leave of court is granted to allow otherwise." CR 56(c). 

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No. 34920-9-III 

Kunda v. Shaul, et ux, et al 

think the trial court erred by not allowing the CR 56 motion to be heard since the failure 

of the parties to submit the remaining issues to the jury left them untried and employment 

of CR 56 would prevent an unnecessary second trial. There is no genuine prejudice to 

ACIC. 

As noted previously, Ms. Kunda was free to have sued Shaul and ACIC in 

separate actions. Ward, 47 Wn. App. at 378. It is recognized that while it would be 

inequitable to bind a surety conclusively by a judgment to which it was not a party, it is, 

at a second proceeding, not unfair to presume the validity and correctness of the 

judgment against the contractor when considering the liability of the surety. Id. at 379-

380; RESTATEMENT (THIRD) OF SURETYSHIP & GUARANTY§ 67 (1996) (emphasis 

added). Under this approach, the surety maintains the ability to rebut the verdict and 

raise its own defenses that are independent of the contractor's liability. Ward, 47 Wn. 

App. at 3 80. Thus, we have no hesitation in concluding that principles of res judicata 

would not have barred a second trial against ACIC or the use of the verdict against Shaul 

in that action. By analogy to Ward, we believe that use of CR 56 to preclude an 

unnecessary second trial was appropriate. 

It also is not unprecedented to add parties to a judgment after trial. An early case 

allowing the real party in interest to become a party on appeal is Schroeder v. Hotel 

Commercial Co., 84 Wash. 685, 694-695, 147 P. 417 (1915). There the court permitted 

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No. 34920-9-III 

Kunda v. Shaul, et ux, et al 

the real party in interest to join in an appeal that was also a trial de novo. Id. at 694. The 

court noted avoidance of an unnecessary second trial as the reason for the action: 

There is no pretense that the Eilers Music House, had it been a nominal 

party throughout, could have advanced anything further in its behalf than 

has been presented. To compel the respondent to again litigate this 

transaction with that company would be a manifest injustice. We have 

often held that a person, though not a technical party to the action, is bound 

by a decree if he be interested in the subject-matter and has exercised the 

right to participate in the litigation. 

Id. at 695. 

This court relied on Schroeder in Betchard-Clayton, Inc. v. King, 41 Wn. App. 

887, 894-895, 707 P.2d 1361 (1985). There, the corporate officers of one party were 

added as defendants after the end of the case and a third party plaintiff was added. Id. 

Relying in part on CR 21, this court upheld the actions, noting that the rule permitted 

addition of parties after the close of the case. Id. This court, citing still more authorities, 

stressed the uselessness of not permitting the addition of new parties. Id. at 896. 

Washington courts have freely added parties after trial, including to judgments, to 

avoid unnecessary second trials. That policy, again by analogy, also supports the use of 

CR 56 in this case. ACIC was a party to the action and was able to present any evidence 

it had. It fully participated in the case and would have been shielded from liability under 

the bond if Shaul had prevailed on the breach of contract case. Both parties failed to 

offer a verdict form to deal with ACIC's liability or its affirmative defenses. Under these 

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No. 34920-9-III 

Kunda v. Shaul, et ux, et al 

circumstances, there simply is nothing to be gained by requiring a second trial to address 

the unresolved claims. 

With respect to Ms. Kunda, the problem appears to be more in the nature of a 

scrivener's error than it does any failure of proof. With respect to ACIC, the failure to 

seek judgment as a matter of law or to submit jury interrogatories or verdict forms may 

have been oversight or it may simply have been deemed unnecessary in light of the 

evidence developed at trial. It might even have been a deliberate effort to take advantage 

of the plaintiffs apparent oversight on her verdict forms. Rather than attempt to unravel 

this Gordian's Knot, we simply follow the example of Alexander the Great and cut 

through it. 8

Whatever the cause, we see no prejudice from the late addition of ACIC to the 

judgment, subject to the limitation of the bond amount. ACIC admitted in its answer that 

the bond was in effect at the time of the failed remodel project. The jury's verdict against 

Shaul confirmed that the contractor, not the homeowner, breached the contract. That 

determination was the last piece of the puzzle for the jury to find for Kunda on the bond, 

something it would have had to do if requested. Similarly, the trial judge would have had 

to do the same if a timely request had been made.9

8 See BULFINCH'S MYTHOLOGY: THE AGE OF FABLE 44 (Richard P. Martin, ed., 

1991). 

9 Since the failures of plaintiff made this appeal necessary, we decline to award 

costs or fees in this appeal. RAP 14.2. Both parties will pay their own. 

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Kunda v. Shaul, et ux, et al 

Accordingly, we reverse the trial court's rulings in favor of ACIC and remand for

entry of judgment in favor of Kunda up to the limit of the bond.

Reversed.

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.

I Kors�

WE CONCUR:

Pennell, J.

11