Court Opinion

ID: 6325276
Source: CourtListenerOpinion
Date Created: 2022-03-21 20:15:24.416508+00
Date Added: 2024-06-11T09:19:56.664842
License: Public Domain

IN THE COURT OF APPEALS OF THE STATE OF WASHINGTON

 TANDEM, A WINE AND CHEESE BAR                   No. 82158-0-I
 LLC, a Washington limited liability
 company,                                        DIVISION ONE

               Appellant,                        UNPUBLISHED OPINION

        v.

 NWCV ASSOCIATES, LLC, a
 Washington limited liability company,

               Respondent,

        and

 BRADLY and LISA HAVENS, husband
 and wife, and their marital community,

               Third Party Defendants.

      SMITH, J. — Tandem, a Wine and Cheese Bar LLC (Tandem), appeals

from the trial court’s summary dismissal of its claims for breach of lease, breach

of the covenant of quiet enjoyment, and wrongful eviction against its former

landlord, NWCV Associates, LLC (NWCV). We affirm.

                                       FACTS

      NWCV owns a two-story commercial building in Woodinville. In February

2015, NWCV entered into a lease (Lease) with Bradly and Lisa Havens for a

suite in its building (premises). Later, and with NWCV’s consent, the Havens

assigned the Lease to their company, Tandem, which operated a wine bar and

restaurant at the premises.

      In October 2018, Tandem filed for bankruptcy protection under chapter 11

 Citations and pin cites are based on the Westlaw online version of the cited material.
No. 82158-0-I/2

of the United States Bankruptcy Code. During the bankruptcy proceeding,

Tandem moved to assume the Lease, and NWCV moved to terminate it. On

June 18, 2019, the matters came before the bankruptcy court, which, after an

evidentiary hearing, denied Tandem’s motion to assume the Lease, granted

NWCV’s motion to terminate the Lease, and dismissed Tandem’s bankruptcy

case. The bankruptcy court ordered as follows:

             1.     [NWCV]’s Motion is granted and the . . . Lease . . . is
      hereby terminated.
             2.     [Tandem] is ordered to surrender possession of the
      leased premises to [NWCV].
             3.     [Tandem] will not operate its restaurant or use the
      leased premises and common areas in any way after the entry of
      this Order without the consent of [NWCV].
             4.     [NWCV] will cooperate with [Tandem] to allow
      [Tandem] to remove its property from the premises.

The bankruptcy court entered its order on Friday, June 21, 2019.

      Meanwhile, after the June 18 evidentiary hearing, one of Tandem’s

attorneys informed NWCV’s attorney that Tandem had weddings scheduled for

the upcoming weekend (the weekend of June 22-23, 2019). Tandem’s attorney

requested that NWCV allow Tandem’s restaurant to remain open for the

weekend so the weddings would not be disrupted. On Friday, June 21, NWCV’s

attorney wrote Tandem’s other attorney:

      [NWCV] remains willing and ready to accommodate [Tandem]’s
      request made through [your co-counsel] at the courthouse on
      Tuesday. We understand that [Tandem] has one or more private
      events scheduled for this weekend, including a big wedding.
      [NWCV] has no wish to inflict harm upon third parties, such as the
      prospective bride and groom. The order signed by [the bankruptcy
      court] today allows [NWCV] to give [Tandem] permission to conduct
      business in the premises after the entry of the order. [NWCV] is
      willing to grant [Tandem] permission to open for business as usual
      today, tomorrow, and Sunday.

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No. 82158-0-I/3

      However, this permission is conditioned upon [Tandem]’s
      agreement to close the business at the end of the evening on
      Sunday and not to reopen. We will expect [Tandem] to turn in their
      keys on Monday morning, and [NWCV] will change the locks at that
      time.

      As we discussed previously, [NWCV] will give [Tandem] ready
      access through the end of June to remove personal property from
      the premises.

NWCV’s attorney asked Tandem to “confirm . . . acceptance of this offer on the

terms set forth above.” It is undisputed that Tandem did not expressly confirm its

acceptance. It also is undisputed that Tandem conducted business at the

premises Saturday and Sunday, June 22-23.

      On Monday morning, June 24, NWCV changed the locks on the premises

in the Havens’ absence. That same day, Tandem’s attorney emailed NWCV’s

attorney and stated, “We will make arrangements to have all of the personal

property removed from the premises by the end of the month.”

      In September 2019, Tandem, through new counsel, filed this lawsuit

against NWCV. 1 Tandem alleged four causes of action against NWCV:

(1) breach of the covenant of quiet enjoyment, (2) wrongful eviction premised on

a violation of chapter 59.12 RCW, i.e., the unlawful detainer statutes, (3) breach

of the Lease, and (4) conversion. NWCV counterclaimed for waste, conversion,

declaratory judgment regarding the ownership of certain installations within the

premises, foreclosure of a landlord’s lien, and breach of the Lease. It also

      1  The record reflects that in the intervening months, disputes arose among
the parties and Tandem’s secured creditor regarding the disposition of personal
property remaining at the premises. These disputes are not material to the
issues in this appeal, and thus, we do not discuss them further.

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No. 82158-0-I/4

brought third party claims against the Havens for conversion and waste.

       NWCV moved for summary judgment dismissal of all four of Tandem’s

causes of action against it. Tandem cross-moved for partial summary judgment,

seeking an order holding NWCV liable for wrongful eviction as a matter of law

and dismissing some of NWCV’s counterclaims.

       The trial court granted NWCV’s motion in part and entered an order

dismissing all of Tandem’s claims against NWCV except the conversion claim

(summary judgment order). It denied Tandem’s cross-motion for partial summary

judgment.

       After the trial court declined to certify its orders for immediate appeal,

Tandem sought discretionary review, which a commissioner of this court denied. 2

The parties then agreed to dismiss all outstanding claims with the intent “to bring

an end to this case in the trial court, so that . . . Tandem is free to file an appeal

of right from the summary judgment order.” The trial court, pursuant to the

parties’ stipulation, entered an order dismissing “the claims, counterclaims, and

third party claims which remain extant in this Court . . . without prejudice”

(dismissal order). Tandem then filed a notice of appeal designating the summary

judgment order and the dismissal order. Tandem did not designate the trial

court’s separate order denying its cross-motion for partial summary judgment

(denial order).

       2See RAP 2.2(d) (CR 54(b) certification required to appeal from a
judgment that does not dispose of all claims as to all parties); CR 54(b) (court
may direct entry of final judgment as to fewer than all of the claims or parties only
upon an express determination that “there is no just reason for delay”).

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No. 82158-0-I/5

                                       ANALYSIS

                                  Summary Judgment

       As an initial matter, Tandem argues that we should reverse not only the

summary judgment order, but also the trial court’s ruling denying Tandem’s

cross-motion for summary judgment on NWCV’s landlord lien claim. NWCV

contends that this ruling is not properly before us because it was part of the

denial order, which Tandem did not designate in its notice of appeal. We agree

with NWCV.

       We generally will not review a decision not designated in the notice of

appeal. RAP 2.4(a). RAP 2.4(b) provides an exception for an undesignated

ruling if, as relevant here, “the . . . ruling prejudicially affects the decision

designated in the notice.” Tandem contends that this exception applies to the

trial court’s ruling denying summary judgment on NWCV’s landlord lien claim

because that ruling prejudicially affected the summary judgment order.

       Tandem is incorrect. An order or ruling prejudicially affects a decision if

the decision would not have occurred absent the order or ruling. See Adkins v.

Aluminum Co. of Am., 110 Wn.2d 128, 134, 750 P.2d 1257 (1988) (trial court’s

decision to grant a mistrial was reviewable in appeal from judgment following

second trial, where “[t]he second trial would not have occurred absent the trial

court’s decision granting the motion for a mistrial”). Here, the trial court could

have granted summary judgment on Tandem’s claims against NWCV without

considering—much less denying summary judgment on—NWCV’s landlord lien

claim against Tandem. Contrary to Tandem’s assertions, one ruling does not

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No. 82158-0-I/6

prejudicially affect another ruling merely because both rulings were made in the

context of cross-motions for summary judgment.

       Tandem also contends that the trial court’s ruling denying summary

judgment on the landlord lien claim prejudicially affected the dismissal order,

which Tandem did designate. Again, Tandem is incorrect. The parties stipulated

to dismiss the remaining claims in this case. So, the trial court had no choice but

to do so, regardless of its earlier ruling. See CR 41(a)(1)(A) (“[A]ny action shall

be dismissed by the court . . . [w]hen all parties who have appeared so stipulate

in writing.”); CR 41(c) (making the rule applicable to counterclaims, cross claims,

and third party claims). Although the parties may not have entered the stipulation

absent the denial order, the “but for” precedent to the dismissal order was the

parties’ stipulation, not the denial order. Cf. Right-Price Recreation, LLC v.

Connells Prairie Cmty. Council, 146 Wn.2d 370, 380, 46 P.3d 789 (2002) (earlier

ruling is reviewable under RAP 2.4(b) if “the order appealed from would not have

happened but for the first order”). Furthermore, because Tandem agreed to the

dismissal order, it cannot—and does not—argue the trial court erred in entering

that order. Cf. Fite v. Lee, 11 Wn. App. 21, 25-26, 521 P.2d 964 (1974) (“The

order of dismissal . . . was in the nature of a judgment by consent, which, in the

absence of fraud or mistake or want of jurisdiction, will not be reviewed on

appeal.”). We are unpersuaded that RAP 2.4(b) allows an appellant to bring an

undesignated ruling up for review by designating an agreed order that the

appellant does not actually challenge.

       Finally, Tandem argues that we should exercise our discretion to review

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No. 82158-0-I/7

the trial court’s ruling on NWCV’s landlord lien claim under RAP 18.8(a), which

provides that we may “waive or alter the provisions of any of [the RAPs] . . . in

order to serve the ends of justice.” For the reasons already discussed, we

decline to do so.

          We turn, then, to the trial court’s summary judgment order. Tandem

argues that because NWCV’s changing of the locks on Monday, June 24, 2019,

was unlawful, the trial court erred by summarily dismissing Tandem’s claims for

breach of the covenant of quiet enjoyment, wrongful eviction, and breach of the

Lease. We disagree.

          We review summary judgment orders de novo, and “[w]e may affirm on

any basis supported by the record.” Bavand v. OneWest Bank, 196 Wn. App.

813, 825, 385 P.3d 233 (2016). “[S]ummary judgment is appropriate where there

is ‘no genuine issue as to any material fact and . . . the moving party is entitled to

a judgment as a matter of law.’ ” Elcon Constr., Inc. v. E. Wash. Univ., 174

Wn.2d 157, 164, 273 P.3d 965 (2012) (second alteration in original) (quoting CR

56(c)).

          Here, Tandem does not challenge the validity or efficacy of the bankruptcy

court’s order.,3 That order plainly terminated the Lease and directed Tandem to

surrender possession of the premises. Importantly, it also directed Tandem not

to “operate its restaurant or use the leased premises and common areas in any

way after the entry of this Order” without NWCV’s consent. (emphasis added.)

       For this reason, we agree with Tandem that we need not address
          3

NWCV’s argument that the order was entitled to full faith and credit in the trial
court.

                                              7
No. 82158-0-I/8

On Friday, June 21, 2019, NWCV offered to allow Tandem to open for business

through Sunday, expressly “conditioned upon [Tandem]’s agreement to close the

business at the end of the evening on Sunday and not to reopen.” NWCV further

notified Tandem of its intent to change the locks on Monday morning, and on

Monday morning, it did so in Tandem’s absence. Under these circumstances,

the trial court did not err in summarily dismissing Tandem’s claim that NWCV’s

changing of the locks constituted a breach of the Lease—which was no longer in

effect—or of the covenant of quiet enjoyment implied therein. Cf. Esmieu v.

Hsieh, 20 Wn. App. 455, 460, 580 P.2d 1105 (1978), aff’d, 92 Wn.2d 530, 598

P.2d 1369 (1979) (covenant of quiet enjoyment is implied in every lease). And,

given that NWCV’s consent to use the premises lasted only through Sunday and

NWCV plainly stated its intent to change the locks on Monday, the trial court also

did not err by summarily rejecting Tandem’s claim that NWCV’s follow-through on

its stated intent constituted a wrongful eviction. Cf. Olin v. Goehler, 39 Wn. App.

688, 692, 694 P.2d 1129 (1985) (“A lessor’s unlawful lockout of one with a right

to possession is a breach of the implied covenant of quiet enjoyment.” (emphasis

added)).

       Tandem disagrees and points out that it did not expressly accept the

terms in NWCV’s June 21, 2019, offer to allow Tandem to continue operating

through the weekend, including turnover of possession the following Monday.

This observation does not help Tandem: If there was no agreement, then there

also was no consent for Tandem to continue using the premises after June 21,

2019. In any case, we are unpersuaded that Tandem’s silence in the face of

                                            8
No. 82158-0-I/9

NWCV’s communicated intent to change the locks on Monday rendered NWCV’s

doing so unlawful. Cf. Bakke v. Columbia Valley Lumber Co., 49 Wn.2d 165,

169, 298 P.2d 849 (1956) (where landowner’s offer to allow use of road was

clearly conditioned on payment of a specified price until such time as the parties

reached a more permanent arrangement, “[t]he offer was accepted when the

[recipient] remained silent and continued to use the road, knowing that the

[landowner] expected compensation on the stated basis”).

       Tandem also asserts that it remained a tenant despite the bankruptcy

court’s order terminating the Lease, and thus, absent an ejectment action, “the

only proper means of removing Tandem was by obtaining a writ of restitution

pursuant to [the unlawful detainer statutes,] RCW 59.12 et seq., even after the

issue of possession or right to possession had been determined.” Relying on

Worthington v. Moreland Motor Truck Co., 140 Wash. 528, 250 P. 30 (1926),

Tandem first argues that “[f]ollowing the Bankruptcy Order, Tandem’s status was

still that of a . . . month-to-month tenant.”

       In Worthington, the underlying lease expired by its terms on August 31.

140 Wash. at 530. The tenant paid, and the landlord accepted, monthly rent for

September and October as the parties attempted to negotiate a new lease.

Worthington, 140 Wash. at 529-30. On November 1, after negotiations failed, the

tenant vacated the premises, and on November 3, the tenant notified the landlord

it had vacated. Worthington, 140 Wash. at 530, 532. The landlord sued for

unpaid rent. Worthington, 140 Wash. at 530. Our Supreme Court held that

because there was a tenancy “for an indefinite time” following the expiration of

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No. 82158-0-I/10

the lease, and monthly rent was being paid and accepted, the relation between

the parties was a month-to-month tenancy. Worthington, 140 Wash. at 532.

      Here, by contrast, there was no tenancy for an “indefinite time” after the

bankruptcy court terminated the Lease. As discussed, the bankruptcy court’s

order extinguished Tandem’s right to use the premises for any purpose absent

NWCV’s consent. That consent, to the extent given, lasted only through the

weekend. Tandem’s reliance on Worthington is misplaced, and we are

unpersuaded that a month-to-month tenancy existed following entry of the

bankruptcy court’s order.

      Tandem asserts, in the alternative, that it was a tenant at sufferance. In

support, it cites Hinkhouse v. Wacker, 112 Wash. 253, 191 P. 881 (1920), aff’d

on reh’g, 112 Wash. 253, 195 P. 218 (1921). Hinkhouse involved a purported

six-year lease of community property farmland that was signed by the lessor

husband but not his wife. 112 Wash. at 254. The lessee argued that even

though the wife had not signed the lease, the lessee was entitled to possession

for the second year of the lease because he had already sown wheat for that

year. Hinkhouse, 112 Wash. at 256. Our Supreme Court disagreed and held

that because the lease was of community property and the wife did not sign it, it

was valid only for the first year. Hinkhouse, 112 Wash. at 256. Hinkhouse does

not discuss tenancy at sufferance, much less support Tandem’s assertion that it

was a tenant at sufferance.

      Tandem also cites RCW 59.04.050 and Sarvis v. Land Resources, Inc., 62

Wn. App. 888, 815 P.2d 840 (1991), to support its status as a tenant at

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No. 82158-0-I/11

sufferance. RCW 59.04.050 provides, “Whenever any person obtains

possession of premises without the consent of the owner . . . , he or she shall be

deemed a tenant by sufferance merely.” (Emphasis added.) In Sarvis, we

applied that statute and held that an individual was a tenant by sufferance

because, “by residing on the property, [he] had ‘obtained possession.’ ” 62 Wn.

App. at 891. But here, unlike in Sarvis, Tandem did not “obtain” possession after

it closed for business Sunday night. Tandem’s personal property remained in the

premises, but that was expressly contemplated by the same court order that

terminated the Lease and extinguished Tandem’s right to use the premises

without NWCV’s consent, which lasted only through Sunday. Cf. DALE A.

WHITMAN, ET AL., THE LAW OF PROPERTY § 6.20 at 212 (4th ed. 2019) (“The

tenant’s merely leaving items of personalty behind is not a holding over, because

possession is required.”). Under the circumstances presented here, Tandem

was not a tenant by sufferance when NWCV changed the locks on Monday

morning.

       Furthermore, even assuming Tandem was a tenant by sufferance as of

Monday morning, Tandem does not cite any authority that supports its assertion

that a writ of restitution obtained via an unlawful detainer action is the exclusive

means to remove such a tenant. Indeed, under the common law, the landlord

“has an election to treat the tenant [at sufferance] as a trespasser and to oust

him without advance notice.” 17 W ILLIAM B. STOEBUCK & JOHN W. WEAVER,

WASHINGTON PRACTICE: REAL ESTATE: PROPERTY LAW § 6.74 at 434 (2d ed. 2004);

see also 4 THOMPSON ON REAL PROPERTY § 39.05(d) at 596-97 (David A. Thomas

                                             11
No. 82158-0-I/12

ed., 3d ed. 2017) (tenancy at sufferance “continues until the landlord acts to alter

the unexpected extension of the tenant’s presence on the landlord’s property,”

and “[h]istorically, the landlord could forcibly remove the tenant and the tenant’s

goods as long as the landlord acted reasonably”); W HITMAN, supra, § 6.75 at 311

(“[I]t stretches the imagination to say that a tenant at sufferance (who becomes

such by a non-permissive holding over) is truly a tenant.”). Although Tandem

points to statutes that now prohibit such ousters in the residential context, it

identifies no statutory counterpart in the commercial context.

       Tandem also points to Nelson v. Swanson, 177 Wash. 187, 31 P.2d 521

(1934), Gray v. Pierce County Housing Authority, 123 Wn. App. 744, 97 P.3d 26

(2004), and Olin, 39 Wn. App. at 688. But none of these cases involved a tenant

at sufferance. See Nelson, 177 Wash. at 190-91 (landlord liable for forcibly

ejecting tenant who was merely in default by entering tenant’s hotel during

business hours, announcing that he was “taking charge” and, when tenant

objected, picking the tenant up and throwing him on the sidewalk); Gray, 123 Wn.

App. at 757 (seven-day lockout provision in housing authority’s contracts with

participants in an educational program violated residential landlord tenant act);

Olin, 39 Wn. App. at 691 (lockout of tenant unlawful where tenant retained right

to re-enter premises upon its assignee’s abandonment). Also, none involved a

lease that was terminated by court order or a tenant whose right to use the

premises was also terminated by court order. And, none involved a “lockout” that

occurred in the tenant’s absence and only after a court had ordered the tenant to

surrender possession, the landlord’s consent to further use had ended, and the

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No. 82158-0-I/13

landlord had given notice of its intent to change the locks. Nelson, Gray, and

Olin do not require reversal.

       As a final matter, Tandem correctly observes, quoting Priestley Mining &

Milling Co. v. Lenox Mining & Development Co., that the purpose of a writ of

restitution is “to prevent violations of the peace in disputes over the possession of

real estate, regardless of the claim of right or title under which the entry is made.”

41 Wn.2d 101, 103, 247 P.2d 688 (1952). To this end, it may have been

advisable for NWCV to obtain a writ given that a breach of the peace could have

occurred had the Havens shown up at the premises while NWCV was changing

the locks. 4 Nevertheless, the trial court did not err by concluding under the

circumstances that NWCV’s decision not to do so was not a breach of the Lease,

a breach of the covenant of quiet enjoyment, or a wrongful eviction as a matter of

law.

                                   Fees on Appeal

       “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.

       4  We need not and do not decide whether NWCV would have been
required to initiate an unlawful detainer action to obtain a writ under the
circumstances presented here. Cf. In re Marriage of Cox, No. 81966-6-I, slip op.
at 5-6 (Wash. Ct. App. Dec. 20, 2021) (observing that “there is no authority for
the proposition that a writ of restitution is only available under ch. 59.12 RCW”),
https://www.courts.wa.gov/opinions/pdf/819666.pdf. Accordingly, we also do not
address the parties’ arguments about whether a superior court would have had
jurisdiction to entertain an unlawful detainer action given the bankruptcy court’s
order and whether the bankruptcy court’s order constituted res judicata as to any
such action.

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No. 82158-0-I/14

945, 954, 15 P.3d 172 (2000). Here, each party argues it is entitled to an award

of appellate fees under the Lease, which provides, “In the event a party to this

Lease brings a suit or action arising out of this Lease against the other party, the

prevailing party shall be entitled to recover . . . such sum as the Court may

adjudge to be a reasonable attorneys’ fee.” Also, neither party argues that this

action does not “arise” out of the Lease or that the other party is not entitled to an

award of attorney fees under the Lease should that other party prevail on appeal.

For these reasons, and because NWCV is the prevailing party on appeal, we

award NWCV its reasonable attorney fees on appeal subject to its compliance

with RAP 18.1.

       We affirm.

WE CONCUR:

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