Opinion ID: 1215217
Heading Depth: 1
Heading Rank: 4

Heading: the doctrine of law of the case

Text: [2] As noted, this is the second appeal of the 1983 case. Where there has been a determination of the applicable law in a prior appeal, the law of the case doctrine ordinarily precludes redeciding the same legal issues in a subsequent appeal. It is also the rule that questions determined on appeal, or which might have been determined had they been presented, will not again be considered on a subsequent appeal if there is no substantial change in the evidence at a second determination of the cause. The Supreme Court is bound by its decision on the first appeal until such time as it might be authoritatively overruled. (Citations omitted.) Adamson v. Traylor, 66 Wn.2d 338, 339, 402 P.2d 499 (1965); Greene v. Rothschild, 68 Wn.2d 1, 7, 402 P.2d 356, 414 P.2d 1013 (1965). The court has held that the law of the case doctrine is discretionary, not mandatory. Greene, at 6, 8. This rule has been codified as RAP 2.5(c)(2). Prior Appellate Court Decision. The appellate court may at the instance of a party review the propriety of an earlier decision of the appellate court in the same case and, where justice would best be served, decide the case on the basis of the appellate court's opinion of the law at the time of the later review. See First Small Business Co. v. Intercapital Corp., 108 Wn.2d 324, 332-33, 738 P.2d 263 (1987). Reconsideration of an identical legal issue in a subsequent appeal of the same case will be granted where the holding of the prior appeal is clearly erroneous and the application of the doctrine would result in manifest injustice. Under the doctrine of law of the case, as applied in this jurisdiction, the parties, the trial court, and this court are bound by the holdings of the court on a prior appeal until such time as they are authoritatively overruled. Such a holding should be overruled if it lays down or tacitly applies a rule of law which is clearly erroneous, and if to apply the doctrine would work a manifest injustice to one party, whereas no corresponding injustice would result to the other party if the erroneous decision should be set aside. (Citations omitted.) Greene, at 10. This court has reconsidered an issue in a second appeal in a case similar to this one. In Pier 67, Inc. v. King Cy., 78 Wn.2d 48, 469 P.2d 902 (1970), cert. denied, 401 U.S. 911 (1971), the court had decided in a series of prior cases, known as the Metropolitan Bldg. Co. cases, that the assessment of a leasehold interest in nontaxable, state-owned property should reflect the lessee's equity in that property and that both the rent reserved and mortgage indebtedness should be deducted in making the valuation. However, there were two flaws in this approach. First: Condemnation valuation represents the lessee's equity in the leasehold; it is a non sequitur to say that it is its true value for ad valorem taxation. Taxation of property at its value, without regard to the owner's equity, is an established principal of ad valorem taxation. (First italics ours.) Pier 67, at 55. Second, in deciding that the lessee's equity should be valued: The court left unmentioned the rule of RCW 84.04.080 that no deduction be allowed for indebtedness owed. It simply reiterated the logic of the first two cases: the taxable value was determined to be the lessee's equity or the amount in excess of his capital indebtedness. The final opinion ... attempted to resolve the incongruity between the prior Metropolitan cases and the prohibition of indebtedness deductions found in RCW 84.04.080. The court rationalized that allowing deductions for mortgaged indebtedness did not violate the statute; it merely provided an easy means to amortize the capital investments in improvements[.] Pier 67, at 56-57. When the Pier 67 case first appeared before the court, it applied the rule of the Metropolitan Bldg. Co. cases. When Pier 67 reappeared on a second appeal, the court reversed itself. In doing so the court considered the doctrine of law of the case. It is not our intention to detract in any manner from the importance of the doctrine of stare decisis. The doctrine brings stability and continuity to the law; yet the magnitude of an error, spawned only 22 years after statehood, that permits private enterprise to minimize or escape taxation of leaseholds upon tax-exempt real property forces us to conclude that the court must again address itself to issues previously raised. Pier 67, at 50-51. Because there was a statute that expressly prohibited what the court's prior holding permitted, the prior holding was clearly erroneous. The court therefore disregarded the doctrine of law of the case and decided the issue again, correctly. The question before us now, therefore, is whether the Folsom I opinion is clearly erroneous.