IN THE COURT OF APPEALS OF THE STATE OF WASHINGTON 

NEAL COY, ) 

) DIVISION ONE 

Appellant, ) 

) No. 67737-3-1 

v. ) 

) PUBLISHED OPINION 

CITY OF DUVALL, ) 

) 

Respondent. ) FILED: April1, 2013 

) 

DWYER, J.- Neal Coy appeals from the trial court's summary judgment 

dismissal of his claim against the City of Duvall (the City). Coy contends that, 

although the City ultimately approved his preliminary plat application, it acted in 

an arbitrary and capricious manner during the application process. Pursuant 

solely to the "final decision" prong of RCW 64.40.020(1 ), Coy seeks an award of 

money damages for claimed injuries resulting from the City's purportedly arbitrary 

and capricious conduct. Because the statute provides no cause of action in such 

circumstances, we affirm the trial court's dismissal of Coy's claim. 

In May 2006, Coy submitted an application to the City for preliminary plat 

approval of a 32-unit residential subdivision on a 4.58-acre property. In his 

application, Coy proposed filling the entire on-site wetland. The City's outside 

consultant peer reviewer, an ecologist at The Watershed Company, thereafter 
No. 67737-3-1/2 

performed two site visits of the property to determine whether Coy's proposal 

was consistent with the City's code. He determined that Coy's proposed 

mitigation plan was deficient and concluded that, because the wetland "serve[d] 

several functions," it "appear[ed] that the code would not allow alteration of this 

wetland." 

On June 29, 2006, city planner Lara Thomas wrote to Coy's consultant, 

David Evans & Associates, Inc. (Evans}, stating that the City's wetland peer 

review process had been completed and that Coy's wetland fill request did not 

meet the criteria set forth in the City's code. On October 13, 2006, after receiving 

an extension of the period of time allowed for responding to the City's letter, 

Evans suggested to Doreen Booth, the City's planning director, that the City's 

response to the proposal was arbitrary and capricious and "constitute[d] a denial 

of rights afforded to others in the recent past." Evans maintained that the City's 

code allowed for the wetland fill proposed by Coy. On December 11, 2006, 

Booth informed Evans by letter that the City's planning staff could not "approve, 

or recommend approving, the filling of the wetland under the Sensitive Areas 

Regulations [Coy's] project [was] vested in." 

In January 2007, Evans and the City explored the possibility of processing 

Coy's application under the new City code, rather than the code in which the 

application had vested, and Coy submitted a wetland analysis based upon the 

new code. Ultimately, however, in May 2007, Coy decided not to pursue permit 

approval pursuant to the City's new code; instead, he decided to remain vested 

in the prior code. 

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Then, in October, Coy's attorney wrote to the City, requesting "the City's 

prompt and immediate action to confirm that wetland alteration with off-site 

mitigation is authorized for this preliminary plat application." The City's outside 

counsel, Amy Pearsall, responded, maintaining that the City was not "prepared at 

this time to say that" Coy's proposal was consistent with the City's code. 

However, Pearsall proposed a compromise whereby the City would review a 

proposal consistent with Coy's interpretation of the code if Coy could submit 

appropriate documentation demonstrating code compliance. 

Following Coy's submission of this documentation, the City's outside 

consultant determined on July 14, 2008, that Coy had met the requirements for 

filling the wetland. However, an appropriate site for off-site mitigation could not 

be located; thus, the City allowed Coy to perform off-site mitigation by 

contributing to the Snohomish Basin Mitigation Bank. The hearing examiner 

approved Coy's preliminary plat application on December 23, 2008. 

On January 22, 2009, Coy sued the City pursuant to RCW 64.40.020(1), 

which provides permit applicants with a cause of action for damages "to obtain 

relief from acts of an agency which are arbitrary, capricious, unlawful, or exceed 

lawful authority, or relief from a failure to act within time limits established by 

law." Coy alleged that the City had both (1) failed to comply with the statutorilymandated time limit for processing the permit application and (2) acted in an 

arbitrary and capricious manner during the application process. The City moved 

for partial summary judgment, seeking dismissal of Coy's claim for damages 

resulting from the alleged arbitrary and capricious conduct. On September 9, 

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2011, the trial court granted the City's motion, dismissing that claim for relief. 

Coy thereafter stipulated to the dismissal of his claim asserting that the City had 

failed to comply with the application processing time limit. Thus, the trial court 

entered an order dismissing that remaining claim. The trial court thereafter 

granted the City's motion for an award of attorney fees pursuant to RCW 

64.40.020(2). 1 

Coy appeals from the trial court's dismissal of his claim for relief from the 

City's alleged arbitrary and capricious conduct. 

II 

Coy contends that he is entitled to delay damages due to the City's 

purportedly arbitrary and capricious conduct during the application process, 

notwithstanding the fact that his permit application was ultimately approved. 

However, as we have recently held, the "final decision" prong of RCW 

64.40.020(1 ), pursuant to which Coy seeks relief, provides only for damages 

resulting from an agency's "final decision"-not from its conduct occurring prior to 

that decision. Thus, Coy did not state a viable cause of action pursuant to that 

statutory provision, and the trial court did not err by dismissing the claim. 

RCW 64.40.020(1) grants to property owners who apply for land use 

permits a cause of action (1) "for damages to obtain relief from acts of an agency 

which are arbitrary, capricious, unlawful, or exceed lawful authority" or (2) for 

damages to obtain "relief from a failure to act within time limits established by 

1 "The prevailing party in an action brought pursuant to this chapter may be entitled to 

reasonable costs and attorney's fees." 

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law." Such a cause of action arises only where there is an "act" by the agency, 

defined by statute as either (1) "a final decision by an agency which places 

requirements, limitations, or conditions upon the use of real property in excess of 

those allowed by applicable regulations" or (2) "the failure of an agency to act 

within time limits established by law in response to a property owner's application 

for a permit." RCW 64.40.010(6). The statute further provides that the 

recoverable "damages" are the "reasonable expenses and losses ... incurred 

between the time a cause of action arises and the time a holder of an interest in 

real property is granted relief as provided in RCW 64.40.020." RCW 

64.40.010(4). Thus, the statute allows a permit applicant to recover damages in 

two circumstances-when those damages result from an agency's "final 

decision" and when the damages are caused by an agency's failure to act within 

statutorily-prescribed time limits. 

Here, Coy asserts that the City acted in an arbitrary and capricious 

manner by determining that Coy's proposal to fill the wetland was inconsistent 

with the City's code and, thus, that its approval could not be recommended by 

City planning staff. Coy contends that the City's conduct was arbitrary and 

capricious because, he asserts, the City had previously approved other such 

wetland fills under the same code language. Thus, Coy sought damages to 

obtain relief from an allegedly arbitrary and capricious "act" of the City-not from 

an alleged failure of the City to act.2 See RCW 64.40.01 0(6). Moreover, Coy 

2 Although Coy's complaint alleged that the City had both acted in an arbitrary and 

capricious manner and failed to act on his application within the statutorily-prescribed time limit, 

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does not contend that the hearing examiner's ultimate approval of his preliminary 

plat application was itself arbitrary and capricious. Rather, he asserts that the 

hearing examiner's decision-the "final decision" contemplated by RCW 

64.40.020(1 )-was the result of an "arbitrary process." 

However, as we recently decided in Birnbaum v. Pierce County, 167 Wn. 

App. 728, 274 P.3d 1070 (2012), the "final decision" prong of RCW 64.40.020(1) 

does not provide a cause of action in such circumstances. There, Pierce County 

approved Birnbaum's conditional use permit application five years after its 

submission. Birnbaum, 167 Wn. App. at 730-31. Thirty days after the approval 

of her permit application, Birnbaum sued Pierce County pursuant to RCW 

64.40.020(1), alleging that the County had both exceeded the statutorilyprescribed time limit for action on her application and made arbitrary and 

capricious requests for additional information prior to approving that application. 

Birnbaum, 167 Wn. App. at 731-32. The trial court dismissed Birnbaum's action 

pursuant to CR 12(b)(6), and we affirmed. Birnbaum, 167 Wn. App. at 731-37. 

As relevant here, we determined that Birnbaum had not "stated a claim for 

damages based on arbitrary and capricious actions or delays under the final 

decision prong of the statute." Birnbaum, 167 Wn. App. at 735-37. We noted 

that "Birnbaum's complaint [did] not allege that the final 2010 permit approval 

place[d] requirements, limitations, or conditions upon her real property that gave 

Coy stipulated to the dismissal of his claim based upon the City's alleged noncompliance with the 

application processing time limit. He appeals only from the trial court's dismissal of his claim for 

relief from the City's alleged arbitrary and capricious conduct. Thus, only the "final decision" 

prong of RCW 64.40.020(1) is at issue here. 

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rise to her damages"-thus, the permit approval itself was not the "act" for which 

Birnbaum sought damages. Birnbaum, 167 Wn. App. at 735. Rather, Birnbaum 

sought "damages for costs and delays that occurred while the County processed 

the application, before the permit issued." Birnbaum, 167 Wn. App. at 735. We 

held that, pursuant to its plain meaning, the statutory definition of damages set 

forth in RCW 64.40.010(4) "authorizes damages only for expenses and losses 

that are incurred after a cause of action under the statute arises." Birnbaum, 167 

Wn. App. at 735-36. Thus, the damages alleged by Birnbaum, which were 

incurred prior to the final decision giving rise to a cause of action, were not 

recoverable. Birnbaum, 167 Wn. App. at 736. We rejected Birnbaum's assertion 

that "a claim for arbitrary delay occurring prior to a final decision ... may be 

brought once the permit decision is final." Birnbaum, 167 Wn. App. at 736. 

Rather, we held: 

Under the final decision prong, the final decision is the act 

which triggers the cause of action. The definition of "damages" 

limits recovery to those damages that occur after the cause of 

action accrues. Simply put, the statute does not contemplate 

damages-for delay or otherwise-under the final decision prong 

that occurred prior to the final decision. 

Birnbaum, 167 Wn. App. at 737. 

Similarly, here, Coy seeks damages for delays resulting from the City's 

allegedly arbitrary conduct prior to the City's final decision-in this case, the 

hearing examiner's ultimate approval of Coy's preliminary plat application. Coy 

does not allege that the hearing examiner's approval of the permit application 

"places requirements, limitations, or conditions" upon Coy's use of his property 

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No. 67737-3-1/8 

"in excess of those allowed by applicable regulations." RCW 64.40.01 0(6). 

Thus, the conduct at issue-from which Coy contends his alleged damages 

flow-is the City's conduct during the application process, not the hearing 

examiner's final decision approving the application. But, as Birnbaum makes 

clear, damages resulting from such conduct are not recoverable pursuant to 

chapter 64.40 RCW. Rather, damages must result from either a final decision 

(which Coy does not challenge) or a failure by the agency to act within the 

statutorily-prescribed time limit (which Coy no longer alleges). RCW 

64.40.010(4). Just as we stated in Birnbaum, "the statute does not contemplate 

damages-for delay or otherwise-under the final decision prong that occurred 

prior to the final decision." 167 Wn. App. at 737. 

Pursuant to RCW 64.40.020, where a permit applicant challenges an act 

of an agency-rather than the agency's failure to act-the applicant's damages 

must flow from the agency's final decision. Because, here, Coy challenges the 

agency's conduct prior to the final decision, he has not stated a viable claim for 

relief pursuant to that statute. Accordingly, the trial court properly dismissed his 

claim. 

Ill 

Coy additionally contends that the trial court erred by granting an award of 

attorney fees to the City. We disagree. 

Coy first asserts that the trial court's grant of an award of attorney fees to 

the City was improper because, he contends, the City prevailed on "jurisdictional" 

grounds rather than "on the merits" of the claim. However, RCW 64.40.020(2), 

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which provides for an award of attorney fees to the prevailing party in an action 

brought pursuant to that chapter, does not require that a party prevail on any 

particular ground. Nevertheless, Coy contends that RCW 4.84.370 is a "similar, 

almost parallel, statute" and that, pursuant to that statute, Washington courts 

have determined that an award of fees is precluded where a party does not 

prevail on the merits of a claim. But that statutory language-which provides that 

"the county, city, or town whose decision is on appeal is considered a prevailing 

party if its decision is upheld at superior court and on appeal," RCW 4.84.370(2) 

(emphasis added)-bears little resemblance to the language of RCW 

64.40.020(2). It does not inform our decision. Under the plain language of the 

applicable statutory provision, the trial court had the discretion to award fees to 

the prevailing party, regardless of the basis for its victory. 

Coy additionally asserts that, even if the grant of an award of fees was 

proper, the trial court abused its discretion in determining the amount of that 

award. Specifically, he asserts that, "considering the City prevailed on 

jurisdictional grounds and not the merits, the number of hours spent on this case 

were extraordinary." However, Coy fails to note that the City addressed "the 

merits" of the arbitrary and capricious claim in its motion for partial summary 

judgment, even though the trial court dismissed that claim on other bases. 

Moreover, Coy does not address the fact that the City prevailed on his claim 

regarding the timeliness of the application process; although Coy eventually 

stipulated to the dismissal of that claim, he did not do so until after a motion for 

partial summary judgment on that issue had been submitted to the trial court. 

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"The amount of a fee award is discretionary, and will be overturned only 

for manifest abuse." Boeing Co. v. Sierracin Corp., 108 Wn.2d 38, 65, 738 P.2d 

665 (1987). The trial court did not abuse its discretion in either determining to 

make an award of fees or in determining the amount of the award it entered. 

IV 

Finally, the City requests an award of attorney fees on appeal pursuant to 

RCW 64.40.020(2). The City is the prevailing party on appeal. Accordingly, 

upon proper application, our commissioner will enter an appropriate order 

awarding appellate attorney fees to the City. 

Affirmed. 

We concur: 

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SCHINDLER, J. (concurring)- I concur in the result but write separately because I 

would also affirm on the grounds that Coy failed to exhaust all administrative remedies 

before filing his lawsuit against the City of Duvall alleging a cause of action under 

chapter 64.40 RCW, and I disagree with the mischaracterization of Callfas v. 

Department of Construction and Land Use of the City of Seattle, 129 Wn. App. 579, 120 

P.3d 110 (2005), in Birnbaum v. Pierce County, 167 Wn. App. 728, 274 P.3d 1070 

(2012). 

The exhaustion of all administrative remedies is a statutory condition precedent 

to asserting a cause of action under chapter 64.40 RCW. RCW 64.40.030 states: "Any 

action to assert claims under the provisions of this chapter shall be commenced only 

within thirty days after all administrative remedies have been exhausted."1 

Coy claims he "diligently pursued the legitimate remedies available." But 

contrary to his assertion, the undisputed record shows that Coy was aware of, but 

chose not to pursue, all administrative remedies. 

On May 11, 2006, David Evans & Associates (Evans) submitted a preliminary 

plat application to subdivide the 4.58 acres of property owned by Coy into 32 lots for 

single family homes. The property contains a wetland. The preliminary plat application 

proposed filling "the entire on-site wetland area and provid[ing] fee in-lieu mitigation to 

the City of Duvall." In support of the proposal, Evans submitted a "Sensitive Areas 

Report" prepared by The Jay Group, Inc. 

The City retained The Watershed Company to analyze whether the proposal 

complied with the City of Duvall's "Sensitive Area Regulations." Ecologist Hugh 

Mortensen determined that the wetland was larger than represented in the proposal, 

1 (Emphasis added.) 

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No. 67737-3-1/12 

and is "an emergent wetland in a rapidly developing watershed [that] has both the 

potential and the opportunity to improve water quality." Mortensen concluded the Duvall 

City code "would not allow alteration of this wetland, since it does serve several 

functions." Mortensen also concluded the proposal did not comply with the requirement 

to consider practical or feasible alternatives that would result in less environmental 

impact, and did not provide an analysis of mitigation sequencing. 

The proposal is to fill the entire on-site wetland area and provide 

fee in-lieu mitigation to the City of Duvall. Typically, since mitigation has 

been shown to have a historically low success rate, both in Duvall and in 

the broader region, it is common that agencies allow it only as a last 

resort. One of the key steps in preparing or evaluating a wetland 

modification proposal is to demonstrate that there is no practicable or 

feasible alternative development proposal that results in less impact to the 

wetland and its buffer. The proposal should include an analysis of 

mitigation sequencing and an evaluation of how the project has been 

designed to avoid impacts to the wetland or buffer and to minimize any 

impacts that are determined to be unavoidable. In evaluating the 

proposed design, it would appear that there are many efforts that could be 

taken to avoid wetland fill, not the least of which would be a redesign of 

the project to include fewer lots or cluster the allowed density on the nonsensitive area portion of the site. 

On June 29, the City notified Coy that the proposal to fill the wetland did not meet 

the current code requirements and Coy could either revise the proposed plat to reduce 

density, or resubmit the application after the new Sensitive Area Regulations were 

adopted. 

The City of Duvall has completed the wetland peer review process. 

The City's wetland consultant has determined that there is more wetland 

and buffer on site than the Sensitive Areas Report prepared by the Jay 

Group dated April 7, 2006 shows. The City has determined based on peer 

review that the wetland fill request does not meet the criteria in [former] 

DMC [(Duvall Municipal Code)] 14.42.300A [(2005)]. Under existing 

regulation the project will be subject to minimal fill in accordance with 

[former] DMC 14.42.320 [(2005)], Wetland- Permitted Alterations. As the 

applicant you have two choices revise your plans and density calculations 

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accordingly or wait and resubmit your application under the new Sensitive 

Area Regulations that are anticipated to be adopted in September of this 

year. 

Jack Molver of Evans & Associates sent Coy a draft letter in response to the City 

for his review, and strongly urged Coy to not pursue administrative remedies, including 

a variance or reasonable use exception. 

Here is a draft for your consideration. 

I think that it is clear that the city is making an arbitrary call. The 

code clearly makes provisions for the fill. 

Not complying with use of the DRC seems to be a violation of the 

code. [Former] DMC 14.02.030 [(2005)] states that one duty of the 

Planning Director is to manage the DRC.12l 

I do not believe that we want to go into the appeal, variance or 

reasonable use provisions discussed in [former DMCs] 14.42.060. 

14.42.070 and 14.42.080 [(2005)] because we must stand firm in our 

believe [sic] that what we are proposing to do is permitted outright.t31 

If so, there is nothing to seek a variance from. 

The Reasonable Use route is risky in that the [hearing examiner] 

must rule that all reasonable use is denied.141 That is clearly not the case. 

Please give me your comments. 

In the letter dated October 13 from Molver to City Planning Director Doreen 

Booth, Molver claims that the proposal to fill the wetland was allowed by the code, and 

asserts the City's position is "arbitrary and capricious, and constitute[s] a denial of rights 

afforded to others in the recent past." Molver requests the Duvall City Development 

Review Committee (DRC) review the "wetland issues associated with this project." 

In response to the October 13 letter, Planning Director Booth cites the City code 

provisions and reiterates that the City "cannot approve, or recommend approving, the 

filling of the wetland under the Sensitive Areas Regulations your project is vested in." 

2 (Emphasis in original.) 

3 (Emphasis added.) 

4 (Emphasis in original.) 

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No. 67737-3-1114 

Booth pointed out that the DRC did not hear appeals, and Coy could appeal to the 

hearing examiner. 

It is a planning director decision re: code interpretation. According to our 

city attorney, projects are not vested in process, and an appeal of my 

interpretation would be to the hearing examiner in accordance with 

[former] DMC 14.08.010.C [(2005)]. Please call me ... if you have any 

questions. 

After receipt of the response from Booth, Molver again advised Coy against filing 

an appeal.5 Coy did not appeal the City's interpretation of the code or seek a variance 

or reasonable use exception. Nonetheless, Coy claims he pursued administrative 

remedies by requesting review by the DRC, and no other administrative remedies were 

available. Coy misrepresents the function of the DRC, and the record shows there were 

other administrative remedies that he did not pursue. 

The DRC is an advisory board managed by the Planning Director. The DRC is 

not an appellate review body to which the director's code interpretation decision may be 

appealed. Former DMC 14.02.030A(A)(4) (2005); former DMC 14.02.080(8) (2005). 

Under the code, the hearing examiner is the final decision-maker for issues 

related to preliminary plats. Former DMC 14.08.010(C); former DMC 14.42.070. The 

code also expressly provides for an appeal to the hearing examiner of an interim 

decision concerning Sensitive Area Regulations. Former DMC 14.42.070 states: 

14.42.070 Appeals. 

A. Any decision to require a special sensitive area study pursuant 

to this chapter may be appealed by the applicant to the hearing examiner. 

The fee and costs, procedural and appellate provisions established in this 

code for variances shall apply. 

B. Any decision to approve, condition or deny a development 

proposal based on the requirements of the sensitive area regulation may 

5 In 2007, Coy submitted a wetland analysis under the City's new Sensitive Area Regulations. 

However, based on the impact of the new drainage regulations, Coy abandoned that approach. 

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be required in conjunction with and according to the review procedures for 

the permit or approval involved. 

C. Any decision authorized by the sensitive area regulations where 

no review process exist for the permit or approval involved beyond the 

development review committee (DRC), may be appealed by an aggrieved 

party to the hearing examiner pursuant to this title. 

See also former DMC 14.42.060 (reasonable use exception); former DMC 14.42.080 

(variances). 

Coy does not assert that he attempted to appeal the City's interpretation of the 

Sensitive Area Regulations, nor does he address why he did not have to exhaust other 

administrative remedies. For instance, the City code clearly provides for the issuance of 

a variance where, due to the special circumstances applicable to the property, "the strict 

application of the sensitive area regulations would deprive the subject property of rights 

and privileges enjoyed by other properties in the vicinity and in the same zone." Former 

DMC 14.42.080(B)(1 ). 

Because the record shows that Coy did not exhaust all administrative remedies, I 

would also affirm on this ground. 

I also write separately because I disagree with the footnote in Birnbaum rejecting 

a statement in Callfas as "not reconcilable with the statutory definition of 'damages' " in 

RCW 64.40.020(1 ). Birnbaum, 167 Wn. App. at 736, n.2. The footnote in Birnbaum 

states: 

Callfas stated, "Indeed, a permit applicant like the Callfases would have a 

claim under chapter 64.40 RCW for delay damages, as we noted above, 

without a writ once the tardy permit was issued." Callfas, 129 Wn. App. at 

597. This statement is not reconcilable with the statutory definition of 

"damages," which that opinion had no occasion to analyze. We 

respectfully reject it. 

Birnbaum, 167 Wn. App. at 736, n.2. 

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No. 67737-3-1/16 

The statement in Callfas refers to the discussion of the supreme court's decision 

in Mission Springs, Inc. v. City of Spokane, 134 Wn.2d 947, 954 P.2d 250 (1998), and is 

not contrary to the definition in RCW 64.40.020(1 ). In addressing Mission Springs, the 

opinion clearly states that the developer "filed his action under chapter 64.40 RCW well 

within 30 days of the City's 'act' of voting to delay the permit to which he was entitled." 

Callfas, 129 Wn. App. at 594. 

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