Court Opinion

ID: 4090627
Source: CourtListenerOpinion
Date Created: 2016-10-19 03:43:55.359554+00
Date Added: 2024-06-11T14:35:09.159110
License: Public Domain

Filed
                                                                                         Washington State
                                                                                         Court of Appeals
                                                                                          Division Two

                                                                                         October 18, 2016

       IN THE COURT OF APPEALS OF THE STATE OF WASHINGTON

                                          DIVISION II
    BUSINESS SERVICES OF AMERICA, II., INC.                             No. 47316-0-II

                                 Appellant,

           v.

    WAFERTECH, LLC,                                               UNPUBLISHED OPINION

                                 Respondent.

                 SUTTON, J. — Business Services of America, II., Inc. (BSofA) appeals the trial

court’s order on remand1 and the order awarding sanctions.2 This appeal arises after this court

remanded the matter to the trial court “to determine BSofA’s legal status and BSofA’s ability to

pursue its appeal against WaferTech.” Bus. Servs. of Am. II, Inc. v. WaferTech, LLC, noted at 184
Wash. App. 1013, slip op. at *7 (2014). On remand, the trial court entered findings of fact and

conclusions of law that BSofA “is a non-existent entity with no cognizable legal existence” and

“does not have the capacity to sue or be sued.” Clerk’s Papers (CP) at 767. The trial court also

ordered BSofA to pay $300 in sanctions to WaferTech because BSofA had served an incorrect

motion. Both BSofA and WaferTech request reasonable attorney fees and costs on appeal.

1
 Findings of Fact, Conclusions of Law, and Order of Dismissal with Prejudice, filed
February 20, 2015.
2
    Order Granting Plaintiff’s Motion to Admit Exhibits, filed July 24, 2015.
No. 47316-0-II

       We hold that the trial court’s findings of fact support the conclusions of law that BSofA is

a non-existent entity with no cognizable legal existence and that it does not have the capacity to

sue or be sued. We affirm the trial court’s order on remand and affirm the trial court’s order

awarding $300 in sanctions to WaferTech. We decline to award either party its reasonable attorney

fees and costs on appeal.

                                             FACTS

       BSofA, as the assignee of a subcontractor, sued WaferTech in a lien foreclosure action

because WaferTech wrongfully terminated the subcontractor.3 In August 2013, the trial court

granted summary judgment to WaferTech in BSofA’s lien foreclosure action. The trial court also

denied BSofA’s CR 60(a) motion to correct an alleged error in its corporate name. 4 BSofA

appealed. Bus. Servs. of Am., 184 Wash. App. 1013. This court affirmed the trial court’s denial of

BSofA’s CR 60(a) motion, but held that the record before it did not provide the information needed

to determine whether BSofA had any legal existence sufficient to allow it to pursue its appeal of

the trial court’s summary judgment order. “[W]e must remand for the trial court to determine

BSofA’s legal status and BSofA’s ability to pursue its appeal against WaferTech.” Bus. Servs. of

Am., slip op. at *7.

3
 The parties have been involved in protracted litigation in a number of other proceedings that are
not relevant to the issues on appeal here.
4
  BSofA alleged that the corporate name on court documents was incorrect and moved to change
it from “Business Services of America II, Inc.” to “Business Services America II, Inc.” CP at 669
(emphasis added). To avoid confusion, we refer to “Business Services America II, Inc.” as
BSA II.

                                                2
No. 47316-0-II

       On remand, BSofA filed a motion to show cause as to why the trial court should not enter

findings that “WaferTech has known since 2001 that the plaintiff in the action is BSA II and that

[BSofA] is a misnomer for BSA II.” CP at 725. The trial court clarified the scope of the show

cause hearing and stated that “the Court of Appeals’ mandate specifically wants this Court to

address what, if any, is the status of the named plaintiff in this proceeding and that will be the

limited inquiry of the Court [at the show cause hearing].”5 Verbatim Report of Proceedings (VRP)

(Feb 19, 2015) at 15. The trial court ordered BSofA to appear and present evidence as to BSofA’s

legal existence. At the hearing, BSofA’s counsel stated that “[he did not] have any evidence that

[BSofA] exist[ed].” VRP (February 20, 215) at 6.

       At the conclusion of the hearing, the trial court entered findings of fact that BSofA had

never been registered as a corporation, partnership, sole proprietorship, or limited liability

company, and does not have any other legal status whether by operation of law or otherwise in any

state or territory of the United States of America, including the District of Columbia, or in any

foreign jurisdiction. Based on its findings of fact, the trial court concluded that “as a matter of

law, [BSofA] is a non-existent entity with no cognizable legal existence,” and that “[b]ecause it

lacks legal existence, [BSofA], does not have the capacity to sue or be sued.” CP at 767. BSofA

appealed.

5
 This court’s mandate is binding on the lower court and must be strictly followed. Bank of Am.,
N.A. v. Owens, 177 Wash. App. 181, 189, 311 P.3d 594 (2013).

                                                3
No. 47316-0-II

         On appeal, BSofA filed a motion under RAP 7.3,6 to correct the misnomer of “Business

Services of America II, Inc.” to “Business Services America II, Inc.” in the caption.7               A

commissioner of this court denied the motion, ruling, “Appellant’s motion to correct misnomer is

denied. The identity of the appellant is the legal issue in dispute, not simply a misnomer.” Ruling

by Commissioner dated June 18, 2015. When BSofA moved below to supplement the record, it

served an incorrect motion on WaferTech. The trial court ordered BSofA to pay WaferTech $300

in sanctions because of BSofA’s incorrectly served motion. BSofA also appeals the sanction

award.

                                            ANALYSIS

                                     I. BSOFA’S LEGAL STATUS

         BSofA assigns8 error to the trial court’s findings of fact and conclusions of law regarding

its status as a legal entity. We hold that substantial evidence supports the trial court’s findings and

the trial court’s findings support the conclusions.

         We review a trial court’s findings of fact to determine if substantial evidence supports the

findings and whether the findings support the conclusions of law. Scott’s Excavating Vancouver,

6
  RAP 7.3 provides that “[t]he appellate court has the authority . . . to perform all acts necessary
or appropriate to secure the fair and orderly review of a case.”
7
  Appellant’s Motion Under RAP 7.1 to Correction Misnomer, filed May 17, 2015
8
  BSofA argues many issues that are not before us on appeal, including arguments related to the
August 15, 2013 orders granting summary judgment and an award of attorney fees to WaferTech.
Those issues were the subject of BSofA’s September 2013 appeal to this court. This court declined
to reach those issues on the merits because this court remanded the case to the trial court to
determine the legal existence status of BSofA and its ability to pursue an appeal. Bus. Servs. of
Am., slip op. at *1. Our review here is limited to the trial court’s order on remand and order
awarding sanctions.

                                                  4
No. 47316-0-II

LLC v. Winlock Properties, LLC, 176 Wash. App. 335, 341, 308 P.3d 791 (2013). Substantial

evidence is “‘a quantum of evidence sufficient to persuade a rational[,] fair-minded person the

premise is true.” Winlock Properties, 176 Wash. App. at 341-42 (internal quotations omitted,

alteration in original) (quoting Korst v. McMahon, 136 Wash. App. 202, 206, 148 P.3d 1081 (2006)).

We view reasonable inferences in the light most favorable to the prevailing party and defer to the

trial court on issues of conflicting evidence, witness credibility, and persuasiveness of the

evidence. Winlock Properties, 176 Wash. App. at 342. The party challenging a finding of fact bears

the burden of showing that the record does not support it. Winlock Properties, 176 Wash. App. at

342. Unchallenged findings are verities on appeal. Jensen v. Lake Jane Estates, 165 Wash. App.
100, 105, 267 P.3d 435, (2011). We review a trial court’s conclusions of law de novo. Winlock

Properties, 176 Wash. App. at 342.

       On remand, BSofA conceded that it cannot demonstrate that BSofA was a legal entity when

it stated that “[BSofA does not] have any evidence regarding BSofA and [it] couldn’t have any

evidence.” VRP (Feb. 20, 2015 at 5-6). Additionally, BSofA did not present any evidence that it

was a valid corporation or entity in any jurisdiction. Therefore, substantial evidence supports the

trial court’s findings of fact. We hold that the trial court’s findings of fact support the conclusions

of law that “Business Services of America II, Inc. is a non-existent entity with no cognizable legal

existence” and that it “does not have the capacity to sue or be sued.” CP at 767. Accordingly, we

affirm the trial court’s findings of fact and conclusions of law.

                        II. ORDER AWARDING SANCTIONS TO WAFERTECH

       BSofA argues that the trial court erred when it ordered BSofA to pay $300 in sanctions to

WaferTech because BSofA had served an incorrect motion.               BSofA makes the conclusory

                                                  5
No. 47316-0-II

statement that the trial court’s award was “without any basis” but provides no citation to the record

to support their argument.

       We do not address issues that a party does not raise appropriately in their opening brief or

that a party fails to discuss meaningfully with citations to authority. Cowiche Canyon Conservancy

v. Bosley, 118 Wash. 2d 801, 809, 828 P.2d 549 (1992); RAP 10.3(a)(6). BSofA elected not to

provide a verbatim report of the hearing on the sanctions and, thus, the record of the trial court’s

decision is not before us. RAP 9.2(a).9 Because BSofA fails to support its argument with citations

to the record or authority, BSofA waives this argument under RAP 10.3(a)(6).10 We affirm the

trial court’s order awarding $300 in sanctions to WaferTech.

                                        ATTORNEY FEES

       Both BSofA and WaferTech request reasonable attorney fees and costs on appeal under

RAP 18.1(a)11 and RCW 60.04.081(4). We decline to award either party its attorney fees and costs

on appeal.

       RCW 60.04.081 provides that a trial court may award reasonable attorney fees and costs

to the lien claimant if “the court determines that the lien is not frivolous and was made with

reasonable cause, and is not clearly excessive” or to the party challenging the lien if “the lien is

9
  RAP 9.2(a) provides in relevant part, “If the party seeking review does not intend to provide a
verbatim report of proceedings, a statement to that effect should be filed in lieu of a statement of
arrangements within 30 days after the notice of appeal was filed or discretionary review was
granted and served on all parties of record.”

 We are not required to search the record to support a party’s argument. Bostwick v. Ballard
10

Marine, Inc., 127 Wash. App. 762, 770, 112 P.3d 571 (2005).
11
 RAP 18.1(a) provides that we may award a party reasonable attorney fees and costs on appeal
when applicable law grants to the party the right to recover them.

                                                 6
No. 47316-0-II

frivolous and made without reasonable cause, or clearly excessive.”           RCW 60.04.081(4).

However, BSofA has no cognizable existence or capacity to sue or be sued, and thus, an award of

attorney fees and costs is not appropriate. We exercise our discretion under RAP 18.1(a) and

decline to award either party attorney fees and costs on appeal.

                                         CONCLUSION

        We hold that the trial court’s findings of fact support the conclusions of law that BSofA is

a non-existent entity with no cognizable legal existence and that it does not have the capacity to

sue or be sued. We affirm the trial court’s order on remand and affirm the trial court’s order

awarding $300 in sanctions to WaferTech. We decline to award either party attorney fees and

costs on appeal.

        A majority of the panel having determined that this opinion will not be printed in the

Washington Appellate Reports, but will be filed for public record in accordance with RCW 2.06.040,

it is so ordered.

                                                     SUTTON, J.
 We concur:

 JOHANSON, P.J.

 LEE, J.

                                                 7