T hi s di s pos i t i on i s notappr opr i a t e f orpubl i c a t i on and i s notpr e c e de nt * e xc e pta s pr ovi de d by 9th C i r . R . 36- 3. NOT F OR P UB L I CAT I ON UN I TE D STATE S C OU RT OF APPE ALS FOR T HE NI NTH CI RC UI T S U R IN D E R JI T S IN G H B R A R ; B A L V IR K A U R BRA R, P l ai n t i ffs - A p p el l an t s, v. T H R I F T Y P A Y L E S S I N C , aC a lif o rn ia c o rp o r a t i o n ; FI RS T AM ER I CAN TI TL E I N S U R A N C E C O M P A N Y , aC a lif o rn ia c orpor a t i on, D efen d an t s - A p p el l ees. N o. 10- 35715 D . C. N o . 2 : 0 8 - c v - 0 1 7 7 7 - RSM ME MOR AN DU M *

S U R IN D E R JI T S IN G H B R A R ; B A L V IR K A U R BRA R, P l ai n t i ffs - A p p el l ees, v. T H R I F T Y P A Y L E S S I N C , aC a lif o rn ia c orpor a t i on, D e f

e n d a n t - A p p e lla n t. N o. 10- 35741 D . C. N o . 2 : 0 8 - c v - 0 1 7 7 7 - RSM



# FI LED DE C 07 2011 M OLLY C. DW Y ER, CLERK U . S. C O U R T OF APPE ALST he part i es agre e W as hi ng t on l aw appl i es t o the contra ctati ss ue. 1 2

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rom the U ni t ed S t at es D i stri ctC ou rt f orthe W e s t e rn D i s tr i c tof W a s hi ngt on R i c a r do S . M a rt i ne z , D i s tr i c tJ udge , P r e s i di ng A r gue d a nd S ubm i tt e d D e c e m be r5, 2011

S e a tt l e , W a s hi ngt on B efo re: T A S H IM A , M cK E O W N , an d T A L L M A N , C i rcu i tJu d g es. P l ai nt i ff s- A pp el l ant s S uri nd er

j i tS i ng h B rar and B al vi r K aur B rar ( t og ether, th e “B r a r s ” ) ap p e a l th e d e c is io n b y th e d is tr ic t c o u rt, f o llo w in g ab e n c h tr ia l, aw ar di ng D ef

endant -A pp el l ee T hri fty P ay l es s I nc. (“ T hri fty” ) the ea rnes tm on ey pai d b y the B rars and C ou nt er cl ai m -D ef endant s A m ar

j ee tS i ng h and A sw i nd er B rar ( col l ec t i vel y, the “ B uyer s” ) pursuantt o a fa i l ed com m er ci al re al es t at e s al es a g r e e m e n t. T h r if

ty c r o s s - ap p e a ls th e c o u rt’s d e n ia l o f p r e ju d g e m e n t in te r e s t. W e ha ve j ur i s di c t i on i n thi s di ve r s i ty a c t i on, 28 U . S . C . § 1291, a nd w e a f f i rm the a w a r d o f th e e arn e s t m o n e y to T h r if ty , r e v e r s e th e d e n ia l o f p r e ju d g m e n t in te r e s t, a nd r e m a nd f

ore ntry of

a n a m e nde d j udgm e nt . A s the pa rt i e s a r e f a m i l i a rw i th the f a c ts , w e r e p e a t th e m h e r e o n ly a s n e c e s s a ry to e x p la in o u rd e c is io n . W e r evi ew a di stri ctcourt ’ s f i nd i ng s of f

ac tfol l ow i ng a bench tri al for c l ear e rr o ra n d its c o n c lu s io n s o f la w d e n o v o . Jarv is v . K 2 Inc. , 4 8 6 F .3 d 5 2 6 , 5 2 9 ( 9 th C ir . 2 0 0 7 ) . U n d e rW a s h in g to n la w , “[ i]f ac o n tr a c t r e q u ir e s p e r f o rm a n c e b y b o th 13

p art i es, th e p arty cl ai m i n g n o n p erfo rm an ce o f th e o th er m u stfi rstest ab l i sh as a m a tte ro f f a c t th e p a rty ’s o w n p e r f o rm a n c e ,” u n le s s th a t p e r f o rm a n c e w a s e x c u s e d . W i l le ne rv . Sw e e t i ng , 730 P . 2d 45, 49 ( W a s h. 1986) . I n W i l lener , the W a s hi ngt on S upr e m e C ourthe l d tha tw he r e ne i the rpa rty t o ar e a l e s t a t e c ontr a c tpe r f orm e d, the p r o s p e c tiv e b u y e r s w e r e e n title d to ar e f u n d o f th e ire a rn e s t m o n e y . I

d. T he B r a r s c onc e de tha tthe B uy e r s f a i l e d t o t e nde rthe pur c ha s e pr i c e on the c l os i ng da t e but , r e l y i ng on W i l lener , cont end thatT hri fty i s notent i t l ed t o k ee p the e a rne s tm one y be c aus e i ta l l e ge dl y f a i l e d t o ma i n t a i n th e Pr o p e rty [ u n t i l th e c l o s i n g d a t e ] i n th e s a me m a nne ra s pr i orhe r e t o pur s ua ntt o i t s norm a l c our s e of bus i ne s s ( s uc h m a i nt e na nc e obl i ga t i on noti nc l udi ng e xtr a or di na ry c api t a l e xpe ndi tur e s ore xpe ndi tur e s not in c u rr e d in s u c h n o rm a l c o u r s e o f b u s in e s s ) , s u b

je c t to n o rm al w ear an d t ear . . . o r o th er ev en t s b eyo n d [i t s] c o n tr o l . . . . I n p a rtic u la r , th e B r a r s p o in t to th e c o n d itio n o f th e f lo o r s o n th e c lo s in g d a te . U nl i ke W

i l lener , ho w ever , w here the se l l er s “ di d n otsa t i sf y the perf orm ance re qu i re d b y the agree m ent , ” 730 P . 2d at50 -51, here , the di stri ctcourt corr ec t l y det erm i ned thatT hri fty s at i sf i ed i t s c on tra ctual ob l i gat i on s, fi nd i ng that the B r a r s ’ c ont e nt i on tha t“ T hr i f ty f a i l e d t o m a i nt a i n the pr ope rty i n i t s e xi s t i ng cond i t i on up t o cl osi ng . . . i s i ncorrec t . ” T h r if ty ’s le a s e o f

th e p r o p e rty to L i qu i dat i on W orl d, Inc. (“ L W I” ) w as no ta m at er i al brea ch. Indeed, the B uyer s4

ac q u iesc ed to

— an d n eg o ti ated to co n ti n u e— L W I’s lea se . N o r w as T h rifty’s f a ilu r e to f

in a liz e r e p a ir s to th e f

lo o rb y th e c lo s in g d a te am a te r ia l b r e a c h . T hri fty’ s e xp ert , w ho m the di stri ctcourtfoun d t o b e “ hi gh l y c re di bl e, ” t es t i fi ed tha tthe c r a c ks i n the f

l oorw e r e notthe r e s ul tof L W I ’ s us e of

the pr ope rty a nd lik e ly h a d b e e n th e r e f

o rs o m e tim e ; th e B r a r s o f f e r e d n o e v id e n c e to th e c o n tr a ry . A n y rep ai rs t o th e fl o o r w ere v o l u n t ari l y u n d ert ak en b y T h ri fty i n an effo rtt o cl o se th e s a le . T hr i f ty s a t i s f i e d i t s c ontr a c tua l obl i ga t i ons by t e nde r i ng m a rke t abl e t i t l e on the c l os i ng da t e a nd, thus , the e a rne s tm one y w a s f or f e i t e d t o T hr i f

ty upon the B u yers’ d efau l t . W e th erefo re affirm th e d i stri ctco u rt ’ s aw ard o f th e earn est m o n ey t o T h ri fty. T he B r a r s a nd T hr i f

ty a gr e e tha tthe di s tr i c tc ourte rr e d i n de ny i ng pr e j udgm e nti nt e r e s t . S ubs e que ntt o the di s tr i c tc ourt ’ s de c i s i on, the W a s hi ngt on S up re m e C ou rtcl ar i fi ed that“ prej ud gm enti nt er es tm aybe aw ar ded n oton l y w hen o n e p a rty h a s im p r o p e r ly u s e d th e f u n d s , b u t a ls o w h e n o n e p a r ty is im p r o p e r ly de pr i v e d of thos e f unds . ” Fo r b e s v . A m. B ld g . Ma i n t . C o . W. , 240 P . 3d 790, 794 ( W a s h. 2010) ( e m pha s i s a dde d) . H a vi ng be e n de pr i ve d of the “ us e va l ue ” of

the earnes tm on ey , w hi ch w as hel d i n esc row by the t i t l e c om pany, T hri fty i s e nt i t l ed t o pr e j udgm e nti nt e r e s t . A c c or di ngl y , w e r e ve r s e the di s tr i c tc ourt ’ s de ni a l of5

pr e j udgm e nti nt e r e s ta nd r e m a nd f ore ntry of

a n a m e nde d j udgm e nta ga i ns tthe Bu y e r s w i th i n t e r e s ta tth e W a s h i n g t o n s t a tu t o ry r a t e o f tw e l v e p e r c e n tp e ra n n u m, W a s h . R e v . C o d e § 1 9 .5 2 .0 1 0 ( 1 ) , f r o m th e d a te o f

th e f a ile d c lo s in g . C o st s o n b o th ap p eal s sh al l b e aw ard ed t o T h ri fty. In N o. 10 -357 15 , the j ud gm enti s A F F IR M E D . In N o. 10 -357 41 , the order is R E V E R S E D a n d R E M A N D E D w ith d ir e c tio n s .