Court Opinion

ID: 4585071
Source: CourtListenerOpinion
Date Created: 2020-11-09 22:09:30.28221+00
Date Added: 2024-06-11T13:47:07.788183
License: Public Domain

IN THE COURT OF APPEALS OF THE STATE OF WASHINGTON

SALTAIRE CRAFTSMEN, LLC, a
Washington limited liability company,           No. 80288-7-I

                    Plaintiff,                  DIVISION ONE

            v.                                  UNPUBLISHED OPINION

MARY ANNE BLAKE, an individual,

                    Respondent,

            v.

RYAN ANDREW MCLAUGHLIN, an
individual,

                    Appellant.

      SMITH, J. — Ryan McLaughlin appeals trial court orders that granted

summary judgment in favor of his former spouse, Mary Anne Blake, and awarded

attorney fees to her in connection with McLaughlin’s obligations under a

separation contract. Because Blake incurred a debt for which McLaughlin was

contractually obligated to indemnify her, there are no genuine issues of material

fact and Blake was entitled to judgment as a matter of law. We affirm the court’s

orders.

                                        FACTS

      In 2015, Ryan McLaughlin and his then-spouse, Mary Anne Blake, began

the process of starting a business, Little Bean Coffee Company LLC, to build and

operate a coffee shop in Redmond, Washington. On July 14, 2015, Blake and
No. 80288-7-I/2

McLaughlin entered into construction contracts with Saltaire Craftsmen LLC to

build the coffee shop in leased space. The agreement provided that Saltaire

would perform the work on a fixed-cost basis with a deposit and periodic invoices

based on the percentage of completion.

       The parties separated in September 2015, before the construction was

complete. They signed a separation contract in June 2016, which was later

incorporated into the dissolution decree. In the contract, Blake assigned her

interest in the business to McLaughlin and he assumed responsibility for all

business-related debts and liabilities. Specific provisions in the contract set forth

the parties’ rights and obligations with respect to the business:

                 Wife shall assign all right, title and interest in Little Bean
       Coffee Company, LLC or any successor thereof ("LLC") to
       Husband. . . . Husband shall obtain releases of Wife’s personal
       guaranty on any liabilities of the LLC (i.e. the Redmond 158th, LLC
       lease and Saltaire Construction contract) and provide said releases
       to her simultaneously with execution of the CR 2A Agreement. . . .
                 Husband shall indemnify, defend, hold harmless, protect and
       reimburse Wife for, from, and against any and all debts of any type
       whatsoever, legal proceedings, claims, losses, demands, damages
       liabilities, costs and expenses (including without limitation,
       reasonable attorney’s fees), fines, judgments, mediator costs,
       arbitrator costs, court costs, legal fees incurred at any time, and all
       interest thereon related to this business being awarded to the
       Husband, including but not limited to the American Express credit
       card debt, Saltaire Construction fees and Redmond 158th, LLC
       lease.
                 Husband shall immediately make his best efforts to obtain a
       release and/or to obtain written acknowledgment from any
       business-related creditor that such creditor has removed Wife’s
       name from each business-related debt held in her name or jointly
       with him or as a member of the marital community. This shall be a
       continuing, ongoing obligation that shall survive entry of the Decree
       of Dissolution and shall remain in effect until Wife is no longer
       obligated on any business-related debt.

(Emphasis added.)

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No. 80288-7-I/3

      McLaughlin was unable to secure a hold harmless agreement from

Saltaire releasing Blake from the contract. On August 31, 2018, Saltaire sued

Blake, alleging that she owed a principal balance of $14,907.35, plus interest,

attorney fees, and costs under the construction contract.         Blake informed

McLaughlin of the lawsuit.        McLaughlin acknowledged that he had a

“responsibility to defend” Blake, said he was already in contact with Saltaire

about the matter, and told Blake it was “unnecessary” for her to file a notice of

appearance and he would not reimburse her for doing so.           Blake informed

McLaughlin that if he did not quickly resolve the lawsuit, she would be forced to

add him as a third party defendant.

      On October 25, 2018, after Saltaire indicated its intent to file a motion for

default, Blake answered Saltaire’s complaint and filed a third party complaint

against McLaughlin for breach of the separation contract. McLaughlin retained

legal counsel.

      Over the next two months, Blake’s counsel repeatedly attempted to obtain

information from McLaughlin about the nature of the dispute with Saltaire,

whether McLaughlin had any defenses to the claim, and how he intended to

proceed. McLaughlin provided no substantive information. On January 7, 2019,

McLaughlin filed an answer to Blake’s third party complaint. He did not assert

any claims against Saltaire.

      Four days later, Saltaire served Blake with discovery requests, which she

promptly forwarded to McLaughlin’s counsel. The discovery requests included

questions about modifications to the contract, defenses to Saltaire’s claims, and

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No. 80288-7-I/4

requests for documents, including invoices and receipts.          Blake’s counsel

requested that McLaughlin respond to the discovery and sought information from

him to enable her to respond. McLaughlin eventually provided some documents

to Blake, but without explanation as to how they related to any particular defense.

      On March 14, 2019, Saltaire filed a motion to compel discovery responses

and for terms, and reserved a summary judgment hearing date. Around April 1,

2019, Blake settled the case with Saltaire for $15,000, and the court granted

Saltaire’s motion to dismiss the lawsuit.1 The terms of the settlement required

Blake to enter a confession of judgment to secure payment.

      Blake then filed a motion for summary judgment against McLaughlin,

arguing that McLaughlin breached the separation contract by failing to defend or

indemnify her against the claims asserted by Saltaire.          She claimed that

McLaughlin was liable for $15,000, the amount she paid to settle Saltaire’s claim,

plus interest, and for the attorney fees and expenses she incurred under an

attorney fee provision in the separation contract.      McLaughlin opposed the

motion.

      Following a hearing, the court granted Blake’s motion.       The trial court

subsequently entered an order amending the judgment to add costs and attorney

fees under the separation contract. The court awarded approximately $25,000 in

“reasonable and necessary” attorney fees to Blake, resulting in a total judgment

      1  Blake negotiated a settlement that did not include the more than $15,000
in attorney fees and costs sought by Saltaire.

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No. 80288-7-I/5

of $41,406.94.2 The court also denied McLaughlin’s motion for reconsideration.

McLaughlin appeals.

                                   ANALYSIS

      Long settled standards govern our review. This court reviews a summary

judgment de novo, performing the same inquiry as the trial court. Lybbert v.

Grant County, 141 Wn.2d 29, 34, 1 P.3d 1124 (2000). The facts, and all

reasonable inferences to be drawn from them, are viewed in the light most

favorable to the nonmoving party.       Lybbert, 141 Wn.2d at 34.        Summary

judgment is appropriate where “the pleadings, affidavits, and depositions

establish that there is no genuine issue of material fact and that the moving party

is entitled to judgment as a matter of law.” Jones v. Allstate Ins. Co., 146 Wn.2d

291, 300-01, 45 P.3d 1068 (2002); CR 56(c). Where reasonable minds could

reach only one conclusion from the admissible facts in evidence, the issue may

be determined on summary judgment. Sutton v. Tacoma Sch. Dist. No. 10, 180

Wn. App. 859, 865, 324 P.3d 763 (2014).3

      2  The court deducted $7,000 in fees sought by Blake to account for
counsel’s billing entries that appeared to reflect administrative rather than legal
tasks.
       3 It is also well established that because appellate review of summary

judgment is de novo, findings of fact and conclusions of law are not only
unnecessary, they are superfluous and will be disregarded by the court on
appeal. Nelson v. Dep’t of Labor & Indus., 198 Wn. App. 101, 109, 392 P.3d
1138 (2017); Hemenway v. Miller, 116 Wn.2d 725, 731, 807 P.2d 863 (1991).
We therefore do not consider the trial court’s factual finding that McLaughlin
failed to indemnify and defend Blake or its conclusions that he breached
provisions of the separation contract.

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No. 80288-7-I/6

       McLaughlin claims there are genuine issues of material fact regarding the

validity and enforceability of the liquidated damages provision in the Saltaire

construction contract that preclude summary judgment.

       McLaughlin did not raise this issue below. Opposing summary judgment,

McLaughlin contended that summary judgment was improper because he made

efforts to release Blake from her obligations under the Saltaire contract. He also

asserted that Blake’s motion was “premature” because she settled her claims

with Saltaire before the expiration of discovery and with knowledge that he had

reserved the right to assert additional claims or defenses. “On review of an order

granting or denying a motion for summary judgment the appellate court will

consider only evidence and issues called to the attention of the trial court.” RAP

9.12. This rule ensures that the appellate court engages in the same inquiry as

the trial court. Vernon v. Aacres Allvest, LLC, 183 Wn. App. 422, 436, 333 P.3d

534 (2014).

       McLaughlin claims that he raised the liquidated damage provision issue

“to Ms. Blake” repeatedly throughout the litigation.        The record belies the

assertion, and in any event, this is immaterial. It is undisputed that McLaughlin

failed to call the issue to the attention of the trial court when it addressed Blake’s

motion for summary judgment. He mentioned the issue for the first time in his

motion for reconsideration. But CR 59, which governs motions to reconsider,

does not permit a party to propose new theories of the case that could have been

raised before entry of an adverse decision. JDFJ Corp. v. Int’l Raceway, Inc., 97

Wn. App. 1, 7, 970 P.2d 343 (1999). Because McLaughlin did not properly raise

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No. 80288-7-I/7

the issue of the validity of the contract provision below, it is beyond our scope of

review under RAP 9.12, and we will not consider the argument on appeal.

       Moreover, when Blake filed her motion for summary judgment, the court

had already granted Saltaire’s motion to dismiss its lawsuit against Blake under

the construction contract.    The contract at issue was the parties’ separation

contract, not the Saltaire contract. The separation contract required McLaughlin

to “indemnify, defend, hold harmless, protect and reimburse” Blake “for, from,

and against any and all debts of any type whatsoever” related to Little Bean or

Saltaire’s construction fees.    Because Blake incurred a debt stemming from

Saltaire’s legal claims that arose under the construction contract, McLaughlin

was required to reimburse her. Nothing in the contract required Blake to litigate

or otherwise assert claims on McLaughlin’s behalf, even if she was aware that

McLaughlin “disputed” amounts owed to Saltaire or was aware of the basis for

the dispute.   Blake was entitled to protect herself and settle the case.         The

contract did not require her to confer with McLaughlin, comply with his preferred

litigation strategy, or to defer settlement until after the discovery deadline passed.

       McLaughlin also challenges the denial of his motion for reconsideration.

In addition to reiterating his arguments described above, he argues that Blake

omitted certain relevant documents in response to Saltaire’s discovery requests

and those omissions were “prejudicial to the trial court.” But McLaughlin fails to

establish a discovery violation. And discovery between Saltaire and Blake was

wholly irrelevant to Blake’s claim against McLaughlin under the separation

contract.   To the extent that the allegedly withheld documents pertained to

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No. 80288-7-I/8

McLaughlin’s attempt to comply with his obligation to obtain an agreement

releasing Blake from the Saltaire contract, such compliance did not alter or

extinguish his separate obligation to indemnify and reimburse Blake for debts she

incurred in relation to the Saltaire contract. The trial court did not abuse its

discretion in denying reconsideration. See Perry v. Hamilton, 51 Wn. App. 936,

938, 756 P.2d 150 (1988) (Motions for reconsideration are addressed to the

sound discretion of the trial court.).

       Both parties request attorney fees on appeal. RAP 18.1(a) provides for

reasonable attorney fees or expenses “[i]f applicable law grants to a party the

right to recover reasonable attorney fees or expenses on review.” “A party is

entitled to attorney fees on appeal if a contract, statute, or recognized ground of

equity permits recovery of attorney fees at trial and the party is the substantially

prevailing party.”   Hwang v. McMahill, 103 Wn. App. 945, 954, 15 P.3d 172

(2000).    The indemnification provision at issue includes “without limitation,

reasonable attorney’s fees.”4 Blake prevailed on her claim under the separation

contract. She is entitled to reasonable attorney fees and costs associated with

this appeal, including fees incurred in connection with McLaughlin’s emergency

motion to stay enforcement of the judgment previously denied by a commissioner

of this court, subject to her compliance with RAP 18.1(d).

       4The separation contract includes two additional provisions that expressly
provide for reimbursement of attorney fees in connection with the enforcement of
the contract.

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No. 80288-7-I/9

      Affirmed.

WE CONCUR:

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