IN THE COURT OF APPEALS FORTHE STATE OF WASHINGTON

RON AMUNDSON and EDEL 

### ) No. 77265-1-I consolidated AMUNDSON, husband and wife, and 

### ) with No. 77461-1 & No. their marital community, 

### ) 77462-0 

### ) Appellants/Cross-Respondents, 

### ) DIVISION ONE
v. 

### ) UNPUBLISHED OPINION 

### ) JAMES ROGER LEMCKE and 

### ) DONNARAE LEMCKE, husband and 

### ) wife, and their marital community; 

### ) KENNETH HARTUNG and JEANETTE 

### ) BETH MEANS, husband and wife, and 

### ) their marital community; TRAVIS KRANT 

### ) and STACY KRANT, husband and wife, 

### ) and their marital community, 

### ) ) Respondents/Cross-Appellants. 

### ) FILED: October21, 2019 ANDRUS, J.

— Ron and EdeI Amundson, prospective purchasers of a propertysituated on Lake Union owned byJames and Donnarae Lemcke (Sellers), appeal the dismissal of their claim for specific performance. The Amundsons challenge the validity of a right offirst refusal held by Kenneth Hartung, Jeanette Means, and Travis and Staci Krant, who are houseboat owners and moorage tenants on the Sellers’ property (Tenants). The Amundsons also contend thatthe Tenantsfailed to properlyexercise their rightoffirst refusal byoffering to purchase the propertyon terms that did not match theAmundsons’ offer.No. 77265-1-1/2 The Sellers and Tenants cross-appeal the denial ofdamagestothe Sellers and attorney fees and costs to the Tenants under the us pendens statute, RCW 4.28.328. We conclude that the Tenants’ right offirst refusal was valid and that the material terms oftheiroffer matched those in theAmundsons’ offer. Wetherefore affirm summary judgment and the dismissal of the Amundsons’ complaint. We similarly affirm the denial ofthe Sellers’ claim ofdamages and the Tenants’ claim for attorney fees under the us pendens statute because the Amundsons had substantialjustification forfiling a us pendenswhen they initiated this lawsuit. FACTS The Sellers1 own propertysituated on Lake Union in Seattle (Property). The Property consists of a cottage and a dock with three moorage spaces, each of which accommodates one floating home. Houseboat owners Travis and Staci Krant have leased moorage space from Donnarae since 2015. Kenneth Hartung and Jeanette Means, fellow houseboat owners, have leased their moorage space since 1974.2 Donnarae granted these Tenants a right of first refusal to purchase the Property in the event she chose to sell it. The Krants’ right of first refusal is documented in theirwritten lease, dated June 1,2015:

1 Donnarae inherited the property from her grandmother, and the lease agreements at issue are between Donnarae and the Tenants. Both James and Donnarae, who are collectively referred to asthe Sellers, signed the purchase and sale agreements with theAmundsons and the Tenants.

2 Richard Duke, who had entered into an oral lease agreement for moorage space with Donnarae’s grandmother, leased his houseboatand the moorage spaceto Means and Hartung in 1974. When Duke passed awayin 2015, Means and Hartung inherited the homeandthe moorage space lease. -2-No. 77265-1-1/3
9. RightofFirstRefusal: Forgood consideration in hand received, I as Landlord, agree that if I decide to sell the property, all three houseboat owners will havefirst right of refusal (either individuallyor collectively) on the property, but NOT the moorage slips separately. The houseboat owners will have 60 days to match any bona-fide offer tendered for the purchase of the property if any such offer should be presented from otherthan the three houseboat owners. Hartung and Means did not have a written lease with Donnarae, but Donnarae testified thatshe orally promised Means and Hartung a right offirst refusal. Means and Hartung also testified that they inherited a right of first refusal from Richard. Duke, the previous owneroftheir houseboat. In 2016, the Sellers listed the Property forsale for$1.8 million. On May 3, 2016, the Amundsons submitted a list-price cash offer, contained on a standard Commercial BrokersAssociation Purchase and SaleAgreementform. On May 5, 2016, the Sellers submitted a counteroffer by adding a proposed addendum: Buyer, Ron Amundson, may only assign this contract to an LLC controlled by himselfand/or his immediate family members. Buyer agrees to provide proof of funds sufficient for closing on or before 5:00 PM on May 9, 2016 orthis contract is null and void.

Pursuant to the terms of existing floating home moorage site rental agreements, each ofthe three moorage site tenants have a 60 day right offirst refusal allowing them individuallyorcollectivelyto match any offer received by Seller. Any purchase and sale agreement secured through this listing shall be subject to and contingent upon the expiration orwaiverofthe rightoffirst refusal. Ifanyone ormore existing floating home moorage site tenants (or entity formed and controlled by them) exercise their right offirst refusal and purchase the subject property, then the Selling Office portion of the commission will be waived.

-3-No. 77265-1 -114

The Amundsons accepted this counteroffer, and the parties executed an agreementthat same day (Amundson PSA). The nextday, theAmundsons’ real estate broker, PeterArgeres, sent Mark Anderson, the Sellers’ listing agent, a copy of the Amundsons’ Merrill Lynch accountstatement, showing a portfoliovalued atover$9 million, tosatisfythe proof of funds requirement. Anderson acknowledged the Sellers’ acceptance of the documentation as adequate to satisfythe contingency. The Sellers notified theTenants oftheAmundson PSAon May9, 2016, and informed them that they had 60 days to match the Amundsons’ offer. On July 7, 2016, the Tenants’ attorney, Phil MHler, notified the Sellers’ attorney, Gregory Petrie, of the Tenants’ intent to exercise their right of first refusal. The Tenants submiffed a proposed agreement on the same standard Commercial Brokers Association form as the Amundson PSA (the Tenants’ PSA). The Tenants’ offer included the following addendum: 1. Buyer may assign this contract to a Washington non-profit corporation to be operated as a cooperative in which the named individuals comprising Buyer collectively own not less than a 50% interest. 2. Buyer agrees to provide proof offunds sufficientfor closing on or before 5pm on July 14, 2016 orthis contract is null and void.

5. Form 17 and Form 22-J as attached tothe “Amundson PSA” dated May 3 are incorporated herein. To satisfy their proof of funds requirement, the Tenants submitted
numerous bank statements reflecting liquid assets of approximately $1.2 million and a loan approval letterfrom Sound Community Bank. The bank’s
-4-No. 77265-1-1/5

letter noted that the Tenants intended to include a fourth co-borrower, Katence Olson, on the loan. The loan commitmentwas conditioned on, among otherthings,
an appraisal ofthe Property. Anderson, the listing agent, sent an e-mail to Petrie, the Sellers’ attorney, questioning the adequacyofthe Tenants’ documentation: I don’t think this offer is a valid matching offer. Other buyer [Amundson] offer includes proof of funds for closing on addendum nearbackofoffer. Ifhouseboatowners needfinancing to close, then it’s subject to an appraisal, unless bank provides approval letter which states buyers are approved, have access to funds, and most importantly it does not require an appraisal for closing. Petrie responded: “I agree that ifthey intend to rely upon anyfinancing, they must show they have liquid assets to close in the event the bank refuses to loan the money.” On July 14, 2016, Petrie met with the Sellers to discuss the competing agreements. The Sellers chose to accept the Tenants’ offer and to terminate the agreement with the Amundsons. Donnarae felt that the Tenants’ PSA was materially the same as the Amundson PSA and was a valid exercise of the Tenants’ right offirst refusal. Petrie notified Argeres thatthe Sellers had accepted theTenants’ offerand subsequently provided him with a copy of the Tenants’ proof of funds. Argeres challenged the adequacy ofthe Tenants’ documentation: Mycalculations come upto about$1 .2 millionwhich is onlytwothirds of the necessary matching amount. Two thirds is not a matching amount. Therefore, this is nota matching offerperthe Purchase and SaleAgreement. Sothe prospective Buyers “Tenants” did notsatisfy providing proof offunds sufficient for closing per our Purchase and Sale agreement dated May 3, 2016. Please remove the Tenant’s

-5-No. 77265-1-1/6 First Right to Purchase so my Buyer [Amundson] can proceed to closing. The Sellers chose to proceed with the sale to the Tenants. Hartung, Means, the Krants, and Olson applied fora loan with Sound Community Bank in lateJuly2016 and executed loan commitments with the bank in mid-August 2016. While the Tenants worked to close the transaction, on August 3, 2016, the Amundsons tendered the full purchase price by cashier’s check to the closing agent, First American Title Insurance Company, and demanded that it close the transaction pursuant to the terms ofthe Amundson PSA. But the firm refused to completethe transaction. On August 11, 2016, the Amundsons filed a complaint against the Sellers and the Tenants, seeking specific performance oftheAmundson PSA. Theyfiled
a notice of I/s pendens on the Property at the same time. The us pendens precluded the Sellers from delivering clear title to the Tenants, causing the bank to refuse to close on the Tenants’ loan. After conducting discovery, the Amundsons moved for summaryjudgment against both the Sellers and the Tenants “to determine who may buy that Lake Union property.” The Tenants also moved for summaryjudgment, claiming that they were rightfully entitled to purchase the Property because their offer was a matching offer. On July20, 2017, thetrial courtgranted summaryjudgmenttotheTenants, holding thatthe two agreements, while notthe “mirror image” ofone another, “did not materiallyvary.

. . so as to rendervoid the right offirst refusal.” It concluded that “The [Sellers’] acceptance of [the Tenants’] purchase and sale agreement -6-No. 77265-1 -117

rendered the Amundsons’ contract null and void.” The trial court then dismissed the Amundsons’ complaint. On August 3, 2017, the Tenants and the Sellers signed a “Stipulation and Judgment of Specific Performance,” providing for the sale of the Property to the Tenants in the event the Amundsons did not prevail on appeal. The trial court entered thisjudgment on August4, 2017. The Sellers subsequently sought attorney fees under Paragraph 21 ofthe Amundson PSA and the lost interest on the $1 .8 million purchase price underthe
uspendensstatute, RCW4.28.328. TheTenants also soughtan award ofattorney fees underthe Ifs pendens statute. The trial court awarded $37,510 in attorney fees and costs to the Sellers. But itdenied the Sellers’ requestforprejudgment interestand theTenants’ request for attorney fees, concluding that under RCW 4.28.328, the Amundsons had substantialjustification forfiling the Ifspendens and that neitherthe Sellers northe Tenants were entitled to recover underthat statute. The Amundsons appeal the summaryjudgment dismissal oftheir claim for specific performance, the ordergranting attorneyfees and coststothe Sellers, and thejudgment ofspecific performance in favor oftheTenants. The Sellers and the Tenants cross-appeal the denial oftheir requestfor relief under RCW4.28.328. ANALYSIS This court reviews a trial court’s order on cross motions for summary judgment and related evidentiary rulings de novo. Wilkinson v. Chiwawa Cmtys. Ass’n, 180 Wn.2d 241, 249, 327 P.3d 614 (2014). Summary judgment is

-7-No. 77265-1-1/8

appropriate “ifthere are no genuine issues ofmaterial factand the moving party is entitled tojudgment as a matterof law.” ki 1. Validity ofthe Right of First Refusal The Amundsons first argue thatthe Tenants did not possess valid rights of first refusal because they did not tender any consideration to Donnarae in exchange forthose rights. But as a non-party to the lease agreements between Donnarae and theTenants, theAmundsons lackstanding to challengethe validity oftheir rights offirst refusal. See Old Nat’I BankofWash. v. Arneson, 54Wn. App. 717, 724, 776 P.2d 145 (1989) (prospective purchaser and purported assignee of right offirst refusal lacked standing to challenge the validity ofa priorconveyance ofthe right offirst refusal from the assignorto an adjacent landowner). Even ifthe Amundsons had standing, the Tenants’ lease agreements with Donnarae provided legally sufficient consideration to support their right of first refusal. The Amundsons cite no supportforthe proposition that there must be a payment of additional consideration beyond a tenant’s promise to perform their obligations under the lease to validate a right offirst refusal. Consideration is a bargained-forexchange ofpromises. Williams FruitCo. v. Hanover Ins. Co., 3Wn. App. 276, 281, 474 P.2d 577 (1970); Labriolav. Pollard Gr~., Inc., 152Wn.2d 828, 833, 100 P.3d 791 (2004). A promise for a promise is sufficient consideration. Omni Group, Inc. v. Seattle-First Nat’l Bank, 32 Wn. App. 22, 24, 645 P.2d 727 (1982). “It is the accepted rule of law in thisjurisdiction that a lessee’s option to purchase contained in a lease agreement, is grounded upon consideration, and is enforcible [sic] by specific performance.” Time Oil Co. v. Palmer, 28 Wn.2d 272,

-8-No. 77265-1 -119

274, 182 P.2d 695 (1947). Here, the Krants’ lease explicitly provided thatthey had provided “good consideration”forthe right offirst refusal. Atthetimethis rightwas conveyed, the Krants agreed to pay rent, to keep the premises in clean and sanitary condition, to properly dispose ofall garbage, to maintain their houseboat
so as not to jeopardize neighboring houseboats or the dock, not to damage the moorage dock, and not to cause any nuisance or waste. There is no indication thatthe Krants everfailed to fulfill these promises. Hartung and Means similarly fulfilled their obligation to pay rent to Donnarae. There is no evidence that Hartung and Means ever breached anyterm oftheiroral leasewith Donnarae. And Donnarae certainly neverclaimed thatthere
was no consideration given forthe right offirst refusal. The Tenants’ promise to complywith the lease terms and theirsubsequent payment of rent thereunder is legally sufficient consideration to support a right of first refusal. The Tenants’ respective rights offirst refusal were valid. 2. Matchinci Acireement Terms The Amundsons next argue that the Tenants’ PSA did not match the Amundson PSA. First, theAmundsons contend the Sellers modified the Tenants’ “proof of funds” requirement by accepting a conditional loan pre-approval letter from their lenderwhile insisting thattheAmundsons prove they had $1 .8 million in immediately available liquid assets. Second, the Amundsons argue that the assignment clause in the Tenants’ PSA differed materially from the assignment provision in the Amundson PSA. They contend that because the terms did not

-9-No. 77265-1-1110

match in these two respects, the Tenants failed to properly exercise their right of first refusal, and the Sellers had no right to terminate the Amundson PSA. “A right offirst refusal.

. . is recognized as avalid contract right.

. . entitling the owner ofthe right to the opportunity to buy the subject property on the same terms contained in a bona fide offerfrom a third party, acceptable to the property owner.” Matson v. Emory, 36 Wn. App. 681, 683, 676 P.2d 1029 (1984). In the context of matching offers, “exact identity of offers is not required.” ki. at 685. While the terms ofthe two deals must be the same, onlythe essential terms need to be identical. Northwest Television Club, Inc. v. Gross Seattle, Inc., 96 Wn.2d 973, 981, 634 P.2d 837 (1981).
a. Proofof Sufficient Funds to Close Both agreements had identical paymentterms, stating thatthe buyer had to deliver$1 .8 million in cash at closing and thattherewas nofinancing contingency. The closing date for both agreementswas September2016.~ Both agreements also contained identical “proof offunds” provisions. The Amundson PSA provided that: “Buyer agrees to provide proof offunds sufficient for closing on or before 5:00 PM on May 9, 2016 orthis contract is null and void.” The Tenants’ PSA provided that: “Buyeragrees to provide proofoffunds sufficient for closing on or before 5 pm on July 14, 2016 or this contract is null and void.” Both prospective purchasers had the same number of days to submit

~The saletotheAmundsons was contingenton a45-dayfeasibility period and the removal ofthe Tenants’ 60-day right offirst refusal. Closing would have occurred 30 days afterthe right of first refusal expired. The sale to the Tenants was contingent on a 30-day feasibility period and closing was scheduled to occur 30 days afterthe expiration ofthe feasibility period. Thus, under both agreements closing would have occurred in September2016. -10-No. 77265-1-I/li

documentation to satisfythe Sellers thatthey had the financial resources to close the transaction. Based on a review ofthe fourcorners ofthe two agreements, the proofoffunds provisions matched. The Amundsons argue that the proof of funds contingency required the prospective purchasers to show that they had $1 .8 million in cash in hand within four days of signing the agreement. The Sellers and the Tenants argue that the proofoffunds contingency merely required the Tenants to satisfy the Sellers that they had sources of funding available to generate $1.8 million in cash by the closing date. When parties dispute the meaning of a contract, the court must ascertain and effectuate their intentatthetimetheyformed the agreement. Matterof Estate of Petelle, 8 Wn. App. 2d 714, 71 9-20, 440 P.3d 1026 (2019). Washington courts follow the objective manifestation theory of contracts. Pelly v. Panasyuk, 2 Wn. App. 2d 848, 865, 413 P.3d 619 (2018). Under this approach, we attempt to determine intent by focusing on the objective manifestations of the agreement, ratherthan on thesubjective intentofthe parties. Hearst Commc’ns, Inc. v. Seattle Times Co., 154 Wn.2d 493, 503, 115 P.3d 262 (2005). We impute an intention corresponding to the reasonable meaning ofthe words used and generally give words in a contracttheir ordinary, usual, and popular meaning unless the entirety ofthe agreement clearly demonstrates a contrary intent. Pelly, 2 Wn. App. 2d at 865. In Berg v. Hudesman, 115 Wn.2d 657, 667, 801 P.2d 222 (1990), our Supreme Court adopted the “context rule” for interpreting contracts. This rule

-11

-No. 77265-1-1/12

recognizes that the intent of the parties cannot be interpreted without examining the context surrounding the making of the contract. ki. Extrinsic evidence is admissible to ascertain the parties’ intent. Pelly, 2 Wn. App.2d at 866. The court mayconsiderextrinsicevidence concerning the subject matterand objective ofthe contract, the circumstances surrounding the making of the contract, the subsequent conduct of the parties to the contract, the reasonableness of the parties’ respective interpretations, statements made by the parties in preliminary negotiations, usages oftrade, and anycourse ofdealing between the parties. Berg at 666-68. If the agreement has only one reasonable meaning when viewed in this context, that meaning necessarily reflects the parties’ intent. Petelle, 8 Wn. App. 2d at 720. Ifthe agreement has more than one reasonable meaning, a question offact exists. ki. When no material facts are in dispute, contract interpretation is
a question of law thatwe review de novo. Burnett v. Pagliacci Pizza, Inc., 9 Wn. App. 2d 192, 199-200, 442 P.3d 1267 (2019). First, Petrie, the Sellers’ attorney, testified that proof offunds provisions in purchase and saletransactions are a common method ofproviding a sellera level of comfort thatthe buyerwill be able to financially conclude the transaction. Ron Amundson testified that he understood that“[t}he Seller Defendants wanted to sell to a financially strong buyer who had cash available to close

. . .“ Amundson’s understanding of the agreement is consistent with Petrie’s testimony that the Sellers wanted a cash sale and wanted to be satisfied that any buyer had the
resources needed to actually close the sale.

-12-No. 77265-1-1/13 Second, the contract language does not specify how the prospective purchasers were expected to prove their financial resources. Petrie stated that nothing in the Amundson PSA, or in general practice, required that this proof of funds consist entirelyofcash. According to Petrie, he neverdiscussed thetype of proof needed to satisfy the Sellers’ proof of funds demand with either the Amundsons orwith Amundson’s broker, Argeres. Argeres testified that when he received the Sellers’ counteroffer, he contactedAnderson, the Sellers’ broker, to clarifythe meaning ofthe proofoffunds provision. According to Argeres, Anderson told him that the Amundsons needed to showthey had enough “cash now”to buythe Property. TheAmundsons relyon this evidence to argue that their interpretation of the proof of funds provision is correct.Butthis oral discussionwas nottranslated intospecificlanguage in the proof offunds addendum. UnderWashington law, a broker has no authorityto construe contract language, and a principal is not bound by representations a broker may have made in that regard. Gile v. Tsutakawa, 109 Wash. 366, 375, 187 Pac. 323 (1920) (when there is no indication that the brokerwas given authority to modify the terms of an agreement, the broker’s verbal representations construing the contractwere not binding); see also Sound Built Homes, Inc. v. Windermere Real Estate/South, Inc., 118 Wn. App. 617, 625-26, 72 P.3d 788 (2003) (real estate agent has no authority to make contract to sell land); Larson v. Bear, 38 Wn.2d 485, 489-90, 230 P.2d 610 (1951) (same). Indeed, the Amundson PSA explicitly states that the Sellers’ broker made no “representations or warranties

. .

- 13-No. 77265-1-1/14

concerning the legal effect ofthis agreement.” Paragraph 22(a) ofthe Amundson PSA provided that “[t]his Agreement and any addenda and exhibits thereto state the entire understanding of Buyer and Seller regarding the sale ofthe Property. There are no verbal or other written agreements which modify or affect the Agreement.” While extrinsicevidence is admissibleto determinethe parties’ intent when they signed a contract, it is not admissibleto add a term to a fully integrated contract. Donatelliv. D.R. Strong Consulting Eng’rs, Inc., 179Wn.2d 84, 115, 312 P.3d 620 (2013). There is no indication that Anderson had the Sellers’ express authority to define, and add to, the contractual terms. Thus, because the record demonstrates thatAnderson lacked the ability to add clarifying terms to the PSA addenda, his statement regarding the meaning ofthe proof offunds contingency is nonbinding and inadmissible. But the purpose behind the proof of funds contingency is relevant to the analysis. It was a condition precedent of both agreements—the Sellers had no obligation to close the sale transaction with either buyer unless the Sellers were satisfied with the buyer’s financial abilityto fund the purchase price.4 In Matson, the court imposed “a duty of reasonableness and good faith when one party must perform to the satisfaction ofthe other party.” 36 Wn. App. at 686. It stated that

~We rejectthe Tenants’ contention thatthe contingencywasjust a contractual obligation, the performance ornonperformanceofwhich has no bearing on thevalidityoftheTenants’ exercise oftheir right offirst refusal. A condition precedent is an event occurring afterthe making ofa valid contractwhich must occur before a right to immediate performance arises. Jones Assocs., Inc. v. Eastside Properties, Inc., 41 Wn. App. 462, 466, 704 P.2d 681 (1985). Here, the Sellers had the right to walk from the agreement ifthe Tenants failed to prove theirfinancial ability to close. The proof offunds contingencywas a condition precedent ofthe contract and any failure to meet that condition would renderthe exercise ofthe right offirst refusal void.

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-No. 77265-1-1115

“[ajbsent findings of bad fa[th or unreasonableness, the property owner should retain primary control over disposition ofthe property.” Id. at 687. In this case, there is no evidence that the Sellers acted in bad faith or unreasonably when they considered the two purchasers’ proof of funds and determined that the Tenants’ financial resources were adequate. Anderson questioned the adequacy ofthe Tenants’ proof offunds and advised the Sellers that he considered the Tenants’ offer to be riskier than the Amundsons’ offer because itwas dependent on financing. But laterthat same afternoon, Petrie told Miller, the Tenants’ attorney, thatthe Sellers were satisfied with the Tenants’ loan commitment as long as they had adequate cash to bridge the gap between the loan and the purchase price. On July 14, 2016, Petrie spoke again with Miller regarding the Tenants’ “cash” component and “loan” component of the proof of funds submission. Petrie told Millerthat the Sellers were not concerned with the Tenants’ ability to secure a loan. Moreover, Miller offered to supply additional information ifthe Sellers felt it necessary. Petrie then metwith the Sellers to discuss both purchase agreements after talking to Miller. Donnarae testified that, from her perspective, both the Amundsons and the Tenants had demonstrated their respective financial abilityto close the sale. Whether Anderson, the Sellers’ broker, felt the deal with the Tenants was riskierthan the deal with the Amundsons does not create a genuine issue offact asto the Sellers’ satisfaction with the proofoffunds provided by each party. Based on this record, we concludethattheAmundson PSAdid not mandate
a showing of “cash now” and that the Sellers had the discretion to accept the

- 15-No. 77265-1-1116

Tenants’ loan commitment letter as sufficient to demonstrate their financial
resources to close. The record reveals no evidence thatthe Sellers acted in bad faith in doing so. Next, the Amundsons argue that even iftheir PSA did not impose a “cash now” standard, the Tenants were unable to secure the loan funds they needed by the September 12, 2016, closing date. Butthis argument is not supported by the record.Although Joshua Buckingham, a loan officerfor Sound Community Bank, testified that he could not say whether the bank had an obligation to fund the Tenants’ loan before September 12, 2016, an underwriter for the bank, Heather Lee, e-mailed the Tenants’ attorney, Phil Miller, at 10:49 a.m. on September 12, 2016, indicating thatthe bankwas readyto close and fund the sale. The Amundsons correctly point out that Sound Community Bank did not fund the loan as planned. Laurie Stewart, the President and CEO of Sound Community Bank, testified that as of the morning of September 12, 2016, the Tenants had signed all required closing and loan documents, which had been reviewed and approved bythe bank. But, ‘The one remaining unsatisfied condition
was the requirement of receipt bythe Bank ofan acceptable title report.” Stewart testified that the bank would not transferthe funds because the Amundsons had filed a uspendens on the Property. The Amundsons admit that the sole reason the bank did not fund the loan
was the existence of their Ifs pendens, but they argue that if the Tenants had possessed $1 .8 million in liquid assets, they could have closed the sale. But clear

-16-No. 77265-1-1/17

title was a condition ofthis sale. Paragraph 12 ofthe Amundson PSA included a Seller representation that“[tjhere is no pending orthreatened litigation which would adverselyaffectthe Propertyor Buyer’s ownershipthereofafterClosing.” If, before closing, the buyer discovered information that caused this representation to be false, the buyer had the right to terminate the agreement. When the Amundsons placed a cloud on the title by filing a Ifs pendens and initiating this lawsuit, the Tenants had no legal obligation to close, and the failure ofthe Tenants to tender $1 .8 million on the closing date did not constitute a breach oftheir PSA with the Sellers or constitute aforfeiture oftheir right offirst refusal. b. Assignment Clause TheAmundsonsalso challengethe assignmentclause in theTenants’ PSA, arguing that it differed materially from the assignment clause in the Amundson PSA. Paragraph 20 ofthe two agreements was identical: Buyer EJmay ~1 may not (may not, if not completed) assign this Agreement, or Buyer’s rights hereunder, without Seller’s priorwritten consent, unless provided otherwise herein. Ifthe “may not” option is selected and thewords “and/orassigns” orsimilarwords are used to identifythe Buyer, then thisAgreement may be assigned with notice to Seller but without Seller’s consent only to an entity which is controlled by or under common control with the Buyer identified in thisAgreement. Any otherassignment requires Seller’s consent.

. The Amundson PSA identified the “Buyer” as “Ron Amundson and or assigns.” Because the “may not” option was selected, and the words “and or assigns” were used to identifythe buyer, theAmundson PSA could be assigned onlyto an entity controlled by or under the common control of Ron Amundson. The parties broadened the assignment provision with the following language: Buyer, Ron Amundson, may only assign this contract to an LLC controlled by himselfand/or his immediate family members.

- 17-No. 77265-1 -1/18

This change allowed theAmundsons to assign the contractto an entitywhich their immediate family members controlled, even if Ron Amundson personally did not retain a controlling interest in that limited liability company. The Tenants’ PSA, like the Amundson PSA, identified the “Buyer” as “Kenneth Hartung, Beth Means, Travis & Staci Krant or assigns.” As under the Amundson PSA, theTenants could assign the agreementonlyto an entityin which they retained control. Butthe parties modified the assignmentwith an assignment addendum similarto that set out in theAmundson PSA: Buyer may assign this contract to a Washington non-profit corporation to be operated as a cooperative in which the named individuals comprising Buyer collectively own not less than a 50% interest. This modification allowed the Tenants to assign the contract to a nonprofit entity
as long as it operated as a cooperative and the four individuals named in the contract retained a combined ownership interest ofat least 50 percent. The trial court determined the assignment clauses were sufficiently similar to constitute a match: As a practical matter, each contract allows loss ofcontrol on the part ofthe buyers. TheAmundsons could assign theirentire interestto a family member and [the Tenants] could assign away 50% thereby losing control. Although the provision[s] do not mirror each other[,] they do not materiallyvaryforthe purposes ofthe seller’s aims.

. Here, rather than void the right of first refusal by holding it to an assignment restriction that was tailored to the Amundson’s family situation, the sellers tailored [the Tenants’] agreement to meet their own needs to minimize closing risk

. . The Amundsons challenge this conclusion, arguing that their assignment rights were more restricted than those granted to the Tenants and thatthis was a

-18-No. 77265-1-1/19

material variation. The Tenants contend that the language difference merely reflected the factthattheAmundsons are a married couple, whereas the Tenants collectively consist of two, unrelated couples. They also argue that both assignment provisions served the same purpose—to protect the interests of the seller “by restricting the assignment prior to closing to an assignee that may not have the abilityto close the sale.” In Northwest Television Club, our Supreme Court recognized that the authority on what constitutes a material variation is ‘meager” and that results vary depending on thefacts ofeach case. 96Wn.2d at 980-81. In thatcase, Northwest Television leased an old mansion on Capitol Hill and held a right offirst refusal. j~ at974. The lessornotified NorthwestTelevision that it had received a purchase offer from Dorland. Dorland’s $90,000 offer was contingent on the sale of Dorland’s Mercer Island residencewithin 90 days ofthe offer. at976. Northwest Television notified the lessor of its intent to exercise the right of first refusal for $90,000. ki. Its offerwas conditioned on the sale ofa home owned bythe principal stockholderofthe corporation within 90 days ofthe offer. j.ç[~ The lessor rejected this offer, and NorthwestTelevision soughtspecific performance of its right offirst refusal. The Supreme Court found no material difference between two purchase agreements in which the purchase pricewasthe same, the contingencies werethe
same (the sale of a residence), and the time of acceptance was the same. 96 Wn.2d at 981-982. The only difference between the two agreements was the property needing to be sold as a condition of closing. j~ The court held that it

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made no sense to require the lessee to condition its offer on the sale of a home belonging to another individual because imposing such an “exact match” requirement on the lessee would render its right offirst refusal illusory. Id. at 983. As in Northwest Television, the two agreements matched in price, conditions, and time to close. It would make little sense to limit the Tenants’ assignment rights to an LLC controlled by immediate family members because they are not all members ofthe same family. To impose such an “exact match” requirement here would renderthe Tenants’ right offirst refusal illusory. Conversely, in Matson, this court refused to enforce a right offirst refusal becausethe holder’s offerofan all-cash sale differed materiallyfrom athird party’s offerto exchange parcelswith thesellerand to paythe selleran additional $25,000 in cash. 36 Wn. App. at 685. It concluded that “[ajilowing a cash offerto be the equivalent of the property exchange offer, regardless of the factual situation, imposes a different contract on the parties and seriously infringes on the owner’s rightto dispose ofthe property.” j..~. The Matson courtthus looked to whetherthe term at issue “imposed a different contract” on the seller. Unlike in Matson, we conclude thatthe Tenants’ assignment clause did not impose a differentcontracton the Sellers. Asthetrial courtnoted, both assignment provisions allowed the buyersto transfertheir rightsto an entity in which they held
no majority control. TheAmundsonswere allowed to assign their rights to an LLC owned by Ron Amundson’s immediate family members, while the Tenants were allowed to assign their rights to a nonprofit corporation in which the Tenants retained a 50 percent interest. Although a 50 percent interest is not a majority

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interest, theAmundsonswere not required to retain any interest in orcontrol ofthe entity to whom they assigned their contract rights. The two assignment clauses did in fact serve the same purpose and were sufficiently similar underthe facts of this case.5 3. Lis Pendens Statute In their cross-appeals, the Sellers and Tenants argue that the trial court erred in denying the Sellers’ request for prejudgment interest and the Tenants’ request for attorney fees under the I/s pendens statute, RCW 4.28.328. This statute provides: Unlessthe claimantestablishesasubstantialjustification forfiling the lis pendens, a claimant is liable to an aggrieved partywho prevails in defense of the action in which the lis pendens was filed for actual damages caused by filing the lis pendens, and in the court’s discretion, reasonable attorneys’ fees and costs incurred in defending the action. The Sellers arguetheAmundsons lacked a substantialjustification forfiling
a I/s pendens and used it as a “weapon to prevent [the Tenants] from obtaining cash,” so they could argue thatthe Tenants’ right offirst refusal was void. Under the us pendens statute, “where the claimants have a reasonable, good faith basis in fact or law for believing they have an interest in the property, a lis pendens is substantiallyjustified.” S. Kitsap FamilyWorship Ctr. v. Weir, 135 Wn. App. 900,

~ The Amundsons also assign errorto the trial court’s consideration of certain statements contained in declarations from Petrie and Miller. A trial court may not consider inadmissible evidence when ruling on a motion for summaryjudgment. King County Fire Prot. Dist. No. 16, v. Hous. Auth., 123 Wn.2d 819, 826, 872 P.2d 516 (1994). We presume the trial court disregarded any inadmissible evidence.

~ State v. Melton, 63 Wn. App. 63, 68, 817 P.2d 413 (1991) (“Atrial judge is presumed to be able to disregard inadmissible evidence.”). Assuming without deciding thatthe contested evidence was inadmissible and thatthis argumentwas properly preserved, the fact that inadmissible evidence was presented to the trial court, without more, does not require reversal ofsummaryjudgment. Cano-Garcia v. King County, 168Wn. App. 223, 249, 277 P.3d 34, 49 (2012). The record shows no improper reliance on inadmissible evidence.

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912,146 P.3d 935 (2006). See Richauv. Rayner, 98Wn.App. 190,198,988 P.2d 1052 (1999) (no substantial justification when claimants assumed that they had the rightsto propertywithoutanyfactual basisto supportsuch as belief); Keystone Land & Dev. Co. v. Xerox Corp., 353 F.3d 1070, 1075—76 (9th Cir. 2003) (interpreting Washington law, court held that substantial justification exists where
a claimant relied on a valid and viable legal theoryto file a uspendens). In this case, we concludethattheAmundsons had a substantialjustification forfiling the us pendens on the Property. The Amundsons had a good faith basis in fact and lawfor believing theTenants’ PSAdid not match theirs, thatthe Sellers had granted more beneficial sale terms to the Tenants because of their long standing personal relationship, and thatthe Tenants’ right offirst refusal was void. That we conclude otherwise does not mean their position was not well-founded. Their legal theorywas valid and viable. Even iftheAmundsons soughtto prevent the sale ofthe Property to the Tenants, we cannot conclude their motivation was wrongful. TheAmundsons believed, in good faith, thatthey had the rightto title to the Property and the us pendens putthe world on notice oftheir lawsuit and claim of right to title. We affirm the trial court’s denial of prejudgment interest to the Sellers and attorneyfees to the Tenants under RCW4.28.328. 4. Attorney Fees on Appeal The Sellers are entitled to an award ofattorneyfees and costs in defending the Amundsons’ appeal underthe attorney fee provision in the Amundson PSA,6

6 The Amundson PSA provided: “If Buyer or Seller institutes suit against the other concerning this Agreement, the prevailing party is entitled to reasonable attorneys’ fees and expenses. In the event oftrial, the amount ofthe attorney’s fee shall be fixed bythe court.” -22-No. 77265-1 -1/23

subject to compliance with RAP 18.1. We deny the Sellers’ request for attorney feesfortheircross appeal because the assigned error relates solelyto thefiling of the I/s pendens. Because we conclude that the Amundsons had a substantial justification forfiling the uspendens on the Property, the Sellers are not entitled to attorney fees fortheir cross-appeal underthe us pendens statute. We also deny the Tenants’ requestfor attorneyfees on appeal forthe same reason. Affirmed.

WE CONCUR:

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