IN THE COURT OF APPEALS OF THE STATE OF WASHINGTON No. 68636-4-1 DIVISION ONE HYON PAK and TAM BUI, husband and wife and the marital community comprised thereof, Appellants,

v. DOMINIC SHIM, Respondent, CHANG SHIM, and the marital 

### community of DOMINIC SHIM and CHANG SHIM, Third Party Defendants. UNPUBLISHED OPINION

FILED: September 16, 2013 en to



### Schindler, J. — Dominic Shim sued Hyon Pak for breach of fiduciary duty, conversion and fraud. Pak contends the court erred indenying his motion to dismiss 

### and substantial evidence does notsupportthe conclusion that he breached a fiduciary 

### duty and engaged in conversion and fraud. We affirm. FACTS 

### Dominic Shim owned convenience stores inArlington, Wenatchee, and Yakima. 

## Hyon Pakwas anattorney. Beginning in 2003, Pakrepresented Shim in anumberof
traffic infraction cases.No. 68636-4-1/2 

### In 2006, Shim and Pak decided to make investments and purchase real property together. Shim refinanced his house and sold the Wenatchee convenience store to 

### fund the investments. Shim gave Pak eight checks totaling $431,716.23: a checkfrom the escrow trust account of Hanmi Law Offices at City Bank in Lynnwood for $56,076.20 payable to "Pak Law Offices;" four cashier's checks from Bank ofAmerica payable to Pak, one in the amount of $16,000 and three in the amount of $40,000; and three cashier's checks from Key Bank each in the amount of $79,880.01 and payable to Pak. 

### Pak deposited the eight checks in his individual checking account atWashington Mutual. In late 2006 or early 2007, Pak told Shim about an opportunity to invest in a privately held start-up technology company, Etelos, Inc. Pak agreed to purchase shares in Etelos and transfer half ofthe shares to Shim. Pak testified that in March, June, and October of 2007, he used $986,400 of his personal funds to purchase 2,266,000 shares in Etelos at $0.40 per share. When Shim asked Pak to transfer half ofthe shares to him, Pak told Shim for the first time that under federal securities laws, he could not transfer any ofthe shares until 12 months after Etelos made a public offering. In March 2007, Shim and Pak established the "RAVE Kids Trust." Pak drafted the trust documents. The trust designates Shim and Pak as the sole trustees and beneficiaries. In early 2007, Pak entered into an agreement to purchase property in Kingston. Pak signed the purchase and sale agreement for $573,399.46 as a trustee of the RAVE Kids Trust. Pak paid $431,716.23 ofthe purchase price with the money from Shim and the remaining $141,683.23 with his own funds. On April 16, 2007, the Kingston property was conveyed by statutory warranty deed to the RAVE Kids Trust.No. 68636-4-1/3 

### In May 2007, Shim obtained a home equity line ofcredit (HELOC) inthe amount 

### of $450,000. The HELOC was secured by a "Deed of Trust" on the Kingston property. Sometime before the closing date ofthe HELOC, Pak designated Shim as a joint account holder on his checking account atWashington Mutual. The proceeds from the 

### HELOC were deposited into thejoint account. InJune, Pak made an online banking 

### transfer of$275,000 from thejoint account to his individual account at Washington
Mutual. InAugust or September 2007, Shim decided to sell the College Mart convenience store in Yakima. Shim retained Pak as his escrow agent. The purchaser 

### agreed to pay $1,170,000 to buy College Mart. After the closing date inearly October, Pak drafted promissory notes to secure the sale. Acting as the escrow agent, Pak received two promissory notes from the 

### purchasertotaling $41,335.021 and cash payments totaling $480,372.38. Each ofthe promissory notes state that "[t]his note shall be secured by a deed oftrust on College Mart." But Pak never recorded a deed oftrust on College Mart. Pak gave Shim a check 

### for the proceeds from the College Mart sale. Pak deducted $30,000 from the proceeds for the broker's fee. Shim told Pak he did not hire him as a broker and did not agree to pay a broker's fee. Shim demanded a check for the full amount ofthe proceeds. Pak continuously refused to transfer the funds to Shim for the College Mart sale.



### 1With respectto thepromissory notes, thepurchaserofCollege Martexecuted onepromissory note for $20,000 plus interest at 12 percent, due and payable in full to Shim on December 30, 2007; and a second promissory note for $21,335.02 plus interest at 12 percent, due and payable in full to Shim on March 25, 2008.No. 68636-4-1/4 

### In February 2008, Pak sent a letter to Shim telling himthat Etelos planned to make a public offering in April 2008, and that Shim would receive stock certificates 12 months later. The letter states, in pertinent part, Etelos is currently a privately held company that will go public in April 2008. The shares, which you own, are part of a larger block offounder shares that cannot be trade[d] until at least 12 months afterthe public 

### offering. When the founder shares are open for trading, you and your wife will receive stock certificates issued in your names by Etelos, Inc. In April 2008, Etelos stock sold at an opening price of $1.50 per share, with a three-to-one stock split of its common shares. Pak did not transfer the Etelos shares to 

### Shim 12 months later as promised. Pak transferred 411,000 shares to Shim inearly 2010 afterthe share price had plummeted invalue. On February 17, 2010, Shim filed a complaint against Pak alleging breach of 

### fiduciary duty, conversion andfraud.2 Shim and Paktestified during thetwo-day bench

2Thecomplaintalleges, in pertinentpart: A. Conversion 47. Defendant Hyon Pak's acceptance of Mr. Shim's money interfered with his right to his money from October, 2007 up to the present time. 49. Defendant Hyon Pakfs] receipt and possession offunds from a line ofcredit.
.. interfered with Mr. Shim's right to those funds. 50. Defendant Hyon Pak's purchase, on behalfof Mr. Shim, ofshares of Etelos, Inc. stock interfered with his right to possession ofthe stock. 51. Defendant Hyon Pak possessed intent to interfere with Mr. Shim's right of possession to his property. 52. The actions ofthe Defendant Hyon Pak caused the deprivation of Mr. Shim's right of possession to his property.
B. Fraud 55. Defendant Hyon Pak falsely represented his intention to fulfill his duty as escrow agent to transfer the proceeds ofthe sale of College Mart to Mr. Shim following the sale. 56. Defendant Hyon Pak knowingly made these false representations to Mr. Shim with respect to his role as escrow agent inthe sale ofCollege Mart. 58. Defendant Hyon Pak knowingly made false representations to Mr. Shim regarding the line of credit....No. 68636-4-1/5 trial, and the court admitted into evidence over 150 exhibits. At the close ofShim's case, Pak moved to dismiss the lawsuit for failure to name the real party in interest. The trial court denied the motion to dismiss. At the conclusion ofthe trial, the court ruled that Pak breached a fiduciary duty and committed conversion and fraud with respect to the HELOC and College Mart 

### transactions.3 The court entered extensive and detailed written findings offact and conclusions of law that address each business transaction in chronological order and 

### employ a running total to determine the amount owed.

59. Defendant Hyon Pak knowingly made false representations and refused to provide an accounting to Mr. Shim regarding the details of the shares ofstock of Etelos, Inc. 60. Defendant Hyon Pak's intent in making these false representations was to gain Mr. Shim's assent to enter into the fraudulent agreements. 61. Mr. Shim was entirely ignorant ofDefendant Hyon Pak's deceit at the time of the agreements and relied on the truth ofDefendant Hyon Pak's representations. 62. Mr. Shim was acting ingood faith, and was within right, in his reliance on Defendant Hyon Pak's representations. 63. Damages incurred to Mr. Shim are the direct result ofDefendant Hyon Pak's fraudulent representations. C. Breach ofFiduciary Duty 66. The agreement between Defendant Hyon Pak and Mr. Shim forDefendant Hyon Pak to fulfill his duties as escrow agent in the sale of College Martgave rise to a fiduciary duty on the part of Defendant Hyon Pak. 68. The agreement between Defendant Hyon Pak and Mr. Shim for Defendant Hyon Pak to fulfill his duties as acquirer of an investment property located in Kingston, WA gave rise to a fiduciary duty on the part ofDefendant Hyon Pak. 69. The agreementbetween Defendant Hyon Pak and Mr. Shim for Defendant Hyon Pak to fulfill their duties as acquirer ofshares of Etelos, Inc. stock gave rise to a fiduciary duty on the part ofthe Defendant Hyon Pak. 70. Defendant Hyon Pak breached his duties to Mr. Shim, withrespect to his role as escrow agent in the sale of College Mart. 72. Defendant Hyon Pak breached his duties to Mr. Shim by liquidating the line of credit in his name .... 73. Defendant Hyon Pak breached his duties to Mr. Shim by improperly holding and failing to provide an accounting ofthe shares of Etelos, Inc. stock. 74. Mr. Shim suffered damages as a result of Defendant Hyon Pak's breach of fiduciary duties. 3The court also concluded Pak breached a fiduciary duty to Shimwith respect to the purchase of the Etelos shares.No. 68636-4-1/6 

### The court found that following the purchase of the Kingston property and the HELOCtransaction, Pak owed Shim $311,720.74. The court offset that amount against the value ofthe Etelos stock that Pak transferred to Shim. The court found that 

### following the sale ofCollege Mart, Pakthen owed Shim $521,707.40. Afteraccounting for payments that Pak made to Shim, the court found that the total amountthat Pak 

### owed Shim was $520,972. The court also found that Shim and Pakjointlyowned the Kingston property. The court entered ajudgment against Pakfor $520,972 at 12 percent interest, and ordered the parties to "determine the appropriate method for 

### transferring the [Kingston] propertyfrom one to the other." Pak appeals.4
ANALYSIS Motion to Dismiss Pak contends the trial court erred in denying his motion to dismiss the claims related to the College Mart transaction. Pak asserts the real party in interest is College Mart, not Shim. We review the trial court's decision on a motion to dismiss for abuse of discretion. Sprague v. Sysco Corp., 97 Wn. App. 169, 171-72, 982 P.2d 1202 (1999). CR 17(a) states that every action shall be brought in the name ofthe real party in 

### interest.5 Butwhere adefendantfails totimely raise a real party in interestdefense, the defense is waived. Nw. Indep. Forest Mfrs. v. Dep't of Labor & Indus., 78 Wn. App.
4The trial court denied Pak's motion for reconsideration. 

### 5CR 17(a) provides: Real Party in Interest. Every action shall be prosecuted in the name of the real party in interest. An executor, administrator, guardian, bailee, trustee of an express trust, a party with whom or in whose name a contract has been made for the benefit ofanother, or a party authorized by statute may sue in his own name withoutjoining with him the party for whose benefit the action is brought. No action shall be dismissed on the ground that it is not prosecuted in the name ofthe real party in interest until a reasonable time has been allowed after objection for ratification of commencement ofthe action by, orjoinder or substitution of, the real party in interest; and such ratification, joinder, or substitution shall have the same effect as ifthe action had been commenced in the name of the real party in interest.No. 68636-4-1/7 707, 716, 899 P.2d 6 (1995); see also Goqolin &Stelterv. Karn's Auto Imports. Inc., 

### 886 F.2d 100, 102 (5th Cir. 1989); Heflev v. Jones. 687 F.2d 1383, 1388 (10th Cir. 

### 1982).6 Because Pakdid not raise the real party in interestdefense until the close of Shim's case, the trial court did not abuse its discretion by denying the motion to dismiss.
Substantial Evidence 

### Pak argues substantial evidence does notsupportthe trial court's conclusion that he breached a fiduciary duty and engaged inconversion and fraud. We review the trialcourt's findings of fact and conclusions of law to determine 

### whether substantial evidence supports the findings of fact and, in turn, whetherthe 

### findings support the conclusions oflaw. Scottv. Trans-Svs., Inc., 148Wn.2d 701,707- 08, 64 P.3d 1 (2003). Substantial evidence is the quantum of evidence sufficientto 

### persuade a rational, fair-minded person that thepremise is true. WenatcheeSportsmen Ass'n v. Chelan Countv. 141 Wn.2d 169, 176, 4 P.3d 123 (2000). The court views the 

### evidence and allreasonable inferences inthe lightmostfavorable to the prevailing 

### party. Korstv.McMahon. 136Wn. App. 202, 206, 148 P.3d 1081 (2006). We deferto the trialcourt's determination regarding conflictingevidence and 

### credibility ofthe witnesses. Weyerhaeuserv. Tacoma-Pierce Countv Health Dep't, 123 Wn. App. 59, 65, 96 P.3d 460(2004); FisherProps.. Inc. v. Arden-Mavfair, Inc., 115 Wn.2d 364, 369-70, 798 P.2d 799 (1990). 

### Where there is substantial evidence, this court will not substitute itsjudgmentfor 

### that of the trial court, "even though we might have resolved a factual dispute differently." Korst. 136 Wn. App. at 206.
6Because the text ofthe state and federal rules is identical, federal case law interpreting the 

### federal rule ispersuasive authorityfor interpreting the staterule. See Rinkev. Johns-Manville Corp., 47 Wn. App. 222, 225, 734 P.2d 533 (1987).No. 68636-4-1/8 "The party challenging a finding offact bears the burden of showing that it is not supported by the record." Panorama Vill. Homeowners Ass'n v. Golden Rule Roofing, Inc., 102 Wn. App. 422, 425, 10 P.3d 417 (2000). RAP 10.3(g) provides that "[a] separate assignment oferrorfor each finding offact a party contends was improperly 

### made must beincluded with reference to thefinding by number."7 Unchallenged findings are verities on appeal. Moreman v. Butcher, 126 Wn.2d 36, 40, 891 P.2d 725 (1995).Pak contends substantial evidence does not support the conclusion that he 

### engaged inconversion ofthe HELOC funds. " '[Conversion is the act ofwillfully interfering with any chattel, without lawfuljustification, whereby any person entitled thereto is deprived ofthe possession ofit.'" Westview Invs., Ltd. v. U.S. Bank Nat'l 

### Ass'n, 133 Wn. App. 835, 852, 138 P.3d 638 (2006)8 (quoting Pub. Util. Dist. No. 1 of Lewis Countv v. Wash. Pub. Power Supply Svs., 104 Wn.2d 353, 378, 705 P.2d 1195 

### (1985)). Money may be the subject ofconversion inWashington where " 'itwas 

### wrongfully received bythe party charged with conversion, or.. . such party was under 

### obligation to return the specific money to the party claiming it.'" Westview, 133 Wn. App. at 852 (quoting Wash. Pub. Power, 104 Wn.2d at 378). The court found that Shim obtained the HELOC in his individual capacity and that without Shim's consent, Pak transferred $275,000 ofthe HELOC funds from thejoint account to his individual account. The findings state, in pertinent part: 17. On or about May 26, 2007, two months afterthe Kingston Property 

### was purchased, PlaintiffShim knowingly signed a Washington Mutual 

### Home Equity Line ofCredit ("HELOC") in his individual capacity inthe 7Here, Pakdid notseparatelyidentify and assign errorto thefindings offact madeby thetrial court. 8(Alteration in original.)

8No. 68636-4-1/9


### amount of$450,000.00. PlaintiffShim is the party solely liable to repay the HELOC under the HELOC documents. 

### 20. The proceeds ofthe HELOC were directly deposited into [the Washington Mutual] Joint Account. 

### 24. On June 4, 2007, an online banking transfer of$275,000.00 ofthe HELOC funds was transferred from the Joint Account into one of Defendant Pak's individual Washington Mutual accounts withoutthe consent of Plaintiff Shim. The evidence supports the findings. The undisputed evidence established that 

### Shim obtained a HELOC inthe amount of$450,000 and was solely responsible for repaying the HELOC. Shim testified that he contributed the $450,000 from the HELOC to thejoint investment pool and the RAVE Kids Trust. Shim said that he did not agree to place the HELOC funds into thejoint account and was unaware that Paktransferred funds from thejoint account to Pak's personal account. Shim said that Pak told him that he deposited the money into several different accounts but would not provide Shim with any information about the accounts. He didn't give me the record ofthe, where the trust money was. When I, I

. . . keep asking him for itand, uh, he said he put it into the, several different accounts so he cannot provide it right away. He . . . said he was 

### going to give it to me and come up with some sort ofexcuse to put it off and put it off. So Iwasn't sure where the money was. Substantial evidence supports the finding which inturn supports the conclusion 

### that Pak engaged in conversion by withdrawing $275,000 ofthe HELOC funds from the 

### jointaccountwithout Shim'sconsent.9 Pak also contends substantial evidence does not support the conclusion that he 

### breached a fiduciary duty by failing to place the funds from the College Mart sale in an
9Becausesubstantial evidencesupports theconclusion that Pakconverted theHELOC funds, we need not address Pak's arguments as to breach of fiduciary duty and fraud with respectto the HELOC transaction.

9No. 68636-4-1/10



### escrow account, refusing to transferthe proceeds ofthe sale to Shim, and failing to provide a timely accounting. 

### Anescrow agent occupies a fiduciary relationship with all parties to the escrow. Nat'l Bank ofWash, v. Equity Investors, 81 Wn.2d 886, 909-10, 506 P.2d 20 (1973), superceded by statute on other grounds. Laws of 1973, 1st Ex. Sess., ch. 47, § 3. 

### Escrowagents must act strictly in accordance with the provisions of the escrow 

### agreement; they mustcomplywith the instructions ofthe parties, and it is theirduty to exercise ordinary skill and diligence, and due orreasonable care in theiremployment. Equity Investors. 81 Wn.2d at 910. Acting in a fiduciary capacity, escrow agents must 

### also conductthe affairswith which they are entrusted with scrupulous honesty, skill, and diligence. EouitvInvestors, 81 Wn.2d at 910. 

### Here, the evidence supports the conclusion that Pak breached hisfiduciary duty 

### as an escrow agent because he "failed toobtain written escrowinstructions, failed to 

### negotiate anescrowfee, failed todepositfunds in a trustaccount, andfailed tomake a timely accounting oftheproceeds," and "hascontinuously refused to transferthefunds 

## from the proceeds ofthesale" toShim.10 Shim testified that Pak "didn't give me any papers" during the closing of the College Mart sale. 

### Q: So you never received any of the closing documents? A: Idid not. Or title insurance, or anything like that. Ihaven't received anything. 

### Q: Do you knowwhere the originals are?
10The evidence establishing that Pak breached hisfiduciary duty as an escrow agent also 

### supports thetrial court's conclusion that Pakengaged in conversion andfraud as to theCollege Mart transaction. To provefraud, a claimantmust establish(1) representation of an existing fact, (2) 

### materiality, (3) falsity, (4) knowledge thatthestatementisfalse, (5) intentthatitshould beacted onby the 

### persontowhom itis made, (6) ignoranceofits falsity, (7) reliance on thetruth ofthe representation, (8) the righttorely on it, and (9) damage. Adamsv. King Countv. 164Wn.2d 640, 662, 192 P.3d 891 (2008).

10No. 68636-4-1/11

A: I don't know. 

### Shim testified that after he refused to pay Pak a $30,000 brokerage fee, Pak did not deliver the proceeds ofthe sale. 

### Q: So did Mr. Pak ever give you the funds? 

### A: He brought a cashier's check. Iasked him to bring me the cashier's check. He brought a cashier's check. Had the brokerage fee taken out and I refused to take that cashier's check. I asked him to 

### include that $30,000 [that Pak withheld as a broker's fee] in [the cashier's check amount]. 

### Q: So you never instructed him to hold it for you? A: No. 

### Q: So that-- so did he ever-- after you told him to give you the proper amount ofthe cashier's check did he evertry to give you the funds? A: He did not. Q: So you have not received anything from this transaction? A: No. He didn't give it to me again. 

### Q: Have you asked the defendantfor, for money to pay- for the money from this transaction? A: Yes, Ihave. Many times. Pak also contends substantial evidence does not support the conclusion that he committed legal malpractice because there is no evidence of an attorney-client relationship in 2007 when the parties began to carry outtheirjoint investments, and Shim did not introduce expert testimony on breach ofthe duty ofcare. But Shim did not allege legal malpractice in the complaint and the court did not address legal malpractice. The issue attrial was whether Pak breached a fiduciary duty to Shim as 

### his escrowagent, not as hisattorney.11

11 Withoutcitation toauthority, Pakchallenges thetrial court's conclusion that hebreached a fiduciary duty for failing to account for the purchase of Etelos stock because no accounting was required until the stock became transferable 12 months after Etelos issued a public offering. We do not consider issues that are not supported by citation of authority. RAP 10.3(a)(6); McKee v. Am. Home Prods. Corp., 113Wn.2d701, 705, 782 P.2d 1045(1989).

11No. 68636-4-1/12
Admission of Evidence 

### Pak also contends thatthe trial court erred inadmitting copies of two ofthe Key Bank cashier's checks. Shim testified that he gave Pak three cashier's checks from Key Bank each inthe amount of$79,880.01. The court admitted photocopies ofthe cashier's checks and used the amount ofthe checks in calculating the total amount owed. Pak claims admission ofthe copies ofthe cashier's checks violated the best evidence rule. We review a trial court's decision to admit an exhibit into evidence for abuse of discretion. Salas v. Hi-Tech Erectors. 168 Wn.2d 664, 668, 230 P.3d 583 (2010). A trial court abuses its discretion when its decision is manifestly unreasonable or based upon untenable grounds or reasons. Salas. 168 Wn.2d at 668-69. A duplicate of a written instrument is admissible to the same extent as an original unless there is a 

### genuine question raised as to the authenticity ofthe original, or it would be unfair to admit the duplicate. ER 1003. The requirement of authenticity is satisfied by evidence sufficient to support that the evidence is what its proponent claims. ER 901 (a). When a witness with knowledge identifies the evidence as being what it is claimed to be, the authenticity requirement is satisfied. ER 901(b)(1). The evidence at trial showed Exhibit 20 and Exhibit 23 were the best available copies ofthe cashier's checks. Shim testified that he purchased three cashier's checks 

### from Key Bank with money from refinancing his house and gave the checks to Pak. Pak challenges admission of two ofthe three Key Bank cashier's checks, Exhibit 20 check number 001494010 and Exhibit 23 check number 001494012. Pak does not challenge the admission of Exhibit 21 check number 00149011. Shim testified that he

12No. 68636-4-1/13 

### purchased allthree ofthe Key Bank cashier's checks at the same time and they were each for the same amount, $79,880.01. The checks are numbered sequentially. The 

### amount of$79,880.01 is clearly legible on Exhibit 21 check number 001494011. 

### Further, Pak's signature is clearly legible on the back ofeach ofthe Key Bank cashier's checks inthe sequence. The trial court did not abuse its discretion in admitting two of 

### the Key Bankcashier's checks and including the amounts ofthose checks in its calculation ofthe total amount owed.12 We conclude substantial evidence supports the trial court's conclusion that Pak 

## breached afiduciary duty and engaged in conversion and fraud.13
We affirm.


# 1. A^-eQ &

WE CONCUR: 

# vL*-cO*#( CS

12 Pak also contends the trial court erred byincluding in its calculations of the total amount owed 

### a checkwritten by Shim's brotherfor $30,000 payable toPak. Butthetrial courtdid notadmitthecheck into evidence, and there is no evidence that the court used the check amountin determining the total amount owed. 13 Because Shim does notprovide argument orcitation toauthority to support his request for 

### attorneyfees, wedeclinetoaward attorneyfees. RAP 18.1(b); Wilson CourtLtd. P'ship v. Tony Maroni's, Inc., 134Wn.2d 692, 710-11 n.4, 952 P.2d 590 (1998) ("The rule requires more than a bald request for 

### attorneyfees onappeal. Argumentandcitation toauthority arerequired undertherule toadvise us ofthe appropriate groundsfor an award ofattorney fees as costs."(Internal citations omitted.)).

13