Opinion ID: 1162670
Heading Depth: 1
Heading Rank: 14

Heading: Applying Beam Distilling to This Case.

Text: In accordance with Beam Distilling, as we have noted, once this court has applied a rule retroactively to the parties in the case announcing a new rule, we will apply the new rule to all others not barred by procedural requirements, such as the statute of limitation or res judicata. We begin by recognizing that our decisions in San Telmo and R/L Assocs. have established, while invalidating HPO provisions, that the plaintiffs in those cases were entitled to the benefit of those holdings. In R/L Assocs. v. Seattle, 113 Wn.2d 402, 780 P.2d 838 (1989), this court stated: Because we hold the tenant assistance provisions invalid, R/L is entitled to a refund of the fees already paid to comply with the provisions. 113 Wn.2d at 411. Similarly, the plaintiffs in San Telmo were relieved of the requirement of building replacement housing or paying housing replacement fees. The City incorrectly argues the refund in R/L Assocs. was not retroactive, as the plaintiff R/L Associates had challenged the fee and only paid into the court's registry to continue its court action. 113 Wn.2d at 405. However, in National Can, this court stated: Whether the taxes had been collected or still remained to be collected is not relevant to the issue of retroactive application. [9] National Can, 109 Wn.2d at 891. We have observed that this court's San Telmo and R/L Assocs. decisions were applied to the parties in those actions. The City argues that the San Telmo and R/L Assocs. decisions should not be applied to cases arising on facts predating the pronouncement of those decisions, even though those decisions were applied to the parties in those cases. We may conclude then that the City is asking for this court to apply those decisions in a selectively prospective manner, an approach we decline to follow. The City further contends it is unfair to grant refunds to plaintiffs who paid fees, did not challenge the HPO, and now sue based on the benefit of hard-fought battles won by others. It argues that in this case, unlike the case in R/L Assocs., no class member challenged the ordinance fees and [a]s far as the record shows, they paid their fees willingly and went on to build successful projects. Brief of Respondent-Cross Appellant, at 45. Beam Distilling addresses precisely this question of whether it is fair to allow parties who have not challenged a tax or fee regime to then, after an invalidation of a tax or fee, ride the coattails of successful challengers into court and enjoy the fruits of the labors of those who have struggled to defeat existing laws: [T]he petitioner now before us ... did not challenge the Georgia law until after its fellow liquor distributors had won their battle in Bacchus.... Insofar as equality drives us, it might be argued that the new rule ... should not be applied to those who only exploit others' efforts by litigating in the new rule's wake. ... As for the putative hangers-on, they are merely asserting a right that the Court has told them is theirs in law, that the Court has not deemed necessary to apply on a prospective basis only, and that is not otherwise barred by state procedural requirements. They cannot be characterized as freeloaders any more than those who seek vindication under a new rule on facts arising after the rule's announcement. Those in each class rely on the labors of the first successful litigant. We might, of course, limit retroactive application to those who at least tried to fight their own battles by litigating before victory was certain. To this possibility, it is enough to say that distinguishing between those with cases pending and those without would only serve to encourage the filing of replicative suits when this or any other appellate court created the possibility of a new rule by taking a case for review. (Citations omitted.) Beam Distilling, 115 L.Ed.2d at 492-93. We agree. We hold that refunds were properly available in this case, pursuant to an alternative theory of relief independent of a civil rights action, as the decisions of this court in San Telmo and R/L Assocs. were properly applied retroactively. The practice of retroactive application is overwhelmingly the norm. Beam Distilling, 115 L.Ed.2d at 488. Furthermore, under the Beam Distilling holding which we adopt, there is no balancing the equities to determine whether we should now apply rules which were applied retroactively in the San Telmo and R/L Assocs. decisions prospectively to the parties in this case: Nor, finally, are litigants to be distinguished for choice-of law purposes on the particular equities of their claims to prospectivity: whether they actually relied on the old rule and how they would suffer from retroactive application of the new. It is simply in the nature of precedent, as a necessary component of any system that aspires to fairness and equality, that the substantive law will not shift and spring on such a basis. To this extent, our decision here does limit the possible applications of the Chevron Oil analysis ... Because the rejection of modified prospectivity precludes retroactive application of a new rule to some litigants when it is not applied to others, the Chevron Oil test cannot determine the choice of law by relying on the equities of the particular case. Beam Distilling, 115 L.Ed.2d at 493. We accordingly affirm the trial court award of refunds. As to any property owners who may be present in the class who paid HPO fees pursuant to ordinance provisions prior to the invalidation of those provisions, such plaintiffs' remedies lie solely in refund relief, since there will be no initial showing of arbitrary and capricious conduct necessary for a section 1983 action. The right to refund relief is subject to the statute of limitation for refund actions, discussed below. By contract, property owners who were assessed fees after trial court invalidation of applicable ordinance provisions may pursue damages remedies under section 1983, subject to the applicable limitations period for such actions in Washington.