Court Opinion

ID: 5134839
Source: CourtListenerOpinion
Date Created: 2021-12-14 19:19:28.95797+00
Date Added: 2024-06-11T08:23:46.035032
License: Public Domain

Filed
                                                                                         Washington State
                                                                                         Court of Appeals
                                                                                          Division Two

                                                                                        December 14, 2021

      IN THE COURT OF APPEALS OF THE STATE OF WASHINGTON

                                         DIVISION II
    COOKE AQUACULTURE PACIFIC, LLC,                                  No. 54564-1-II

                                Appellant,

         v.

    WASHINGTON STATE DEPARTMENT OF                            UNPUBLISHED OPINION
    NATURAL RESOURCES, and HILARY
    FRANZ, the Washington Commissioner of
    Public Lands,

                                Respondent.

        VELJACIC, J. — Cooke Pacific, LLC (Cooke) appeals the superior court’s order affirming

the Department of Natural Resources’ (DNR)1 termination of Cooke’s lease. The Commissioner

of DNR, Hillary Franz, terminated the lease based on Cooke’s default of its lease obligations.

Cooke asserts the superior court erred by applying the arbitrary and capricious standard of review,

rather than the de novo standard of review, to DNR’s decision to terminate the lease. It also asserts

the court erred by affirming the termination decision because a de novo review shows that the

termination was unlawful. Alternatively, Cooke asserts the court erred in finding that DNR’s

decision was not arbitrary and capricious.

        We hold that the superior court properly applied the arbitrary and capricious standard of

review because DNR’s decision to terminate the lease was administrative, and that DNR’s decision

1
  The respondents are the Commissioner of Public Lands, Hillary Franz (in her official capacity),
and the Washington State DNR. Because Cooke’s allegations relate primarily to DNR’s decision
regarding its lease, we refer to respondents collectively as “DNR” except where indicated
otherwise.
54564-1-II

to terminate the lease was not arbitrary and capricious. Accordingly, we affirm the superior court’s

final order upholding DNR’s lease termination decision.

                                               FACTS

I.     BACKGROUND

       Since 1984, several private companies have successively leased aquatic lands in Port

Angeles harbor from DNR for finfish aquaculture, which involved the use of floating net pen

structures. Cooke’s Port Angeles fish farm is used “for the net pen farming of Atlantic Salmon . .

. . This includes stocking, husbandry, harvesting, and other activities related to and in support of

this activity.” Administrative Record (AR) at 2447. The facility has two floating net pen structures

within the leasehold area. Cooke uses ancillary equipment within the lease area, to include a

floating wooden support raft, a feeding machine, generators, pumps, pressure washers, and air

compressors. The cage system is moored in place with 38 Danforth-style anchors, chains, and

lines. Tractor tires are used as fenders on the steel structure and come in contact with the water.

The facility also has a staff building located on the larger net pen structure.

       In 2014, the United States Navy proposed constructing a pier and support facilities adjacent

to the Port Angeles net pen leasehold. While discussing its project with DNR, the Navy told DNR

that some of Cooke’s anchor and anchor lines were located outside of Cooke’s leasehold area.

Cooke denied that any of its anchors were outside of the leasehold area.

II.    2015 LEASE

       Cooke applied to DNR to renew its lease at the Port Angeles location. Ultimately, the

parties signed the lease, and it became effective on October 1, 2015. It was set to expire on

September 30, 2025.

                                                  2
54564-1-II

       A.      Timely Rent

       Section 4.1(a) of the lease provided that Cooke must pay DNR rent annually, with rent due

on or before the commencement date (October 1). Historically, Cooke had failed to timely pay its

rent on several occasions.

       B.      Good Condition and Required Improvements

       Section 11.2(a) required Cooke to keep the property and improvements “in good order and

repair, in a clean, attractive, and safe condition.” AR at 2437.

       Cooke was also required under the lease to make certain improvements to the property.

Section 7.1(a) of the lease defines “improvements” as “additions within, upon, or attached to the

land,” including “fill, structures, bulkheads, docks, pilings, or other fixtures.” AR at 2421. Section

7.2 defines “existing improvements” as including “thirty-eight (38) Danforth-style anchors.” AR

at 2421.

       Exhibit B to the lease provided that Cooke was also required to “replace existing

unencapsulated floatation materials with encapsulated floatation materials” by December 1, 2016.

AR at 2447. This referred to certain floating Styrofoam near a wooden float on the leasehold.

Cooke was also required to ensure that all improvements, defined to include the anchors, were

located entirely on the property within the leasehold by October 1, 2016. As noted above, DNR

had been informed that Cooke placed anchors outside its leasehold.2

2
  During lease negotiations, DNR staff wrote an internal memorandum requesting to enter into the
new lease and described the issues, including issues with some of the anchoring system being
located outside the lease area that Cooke was aware of. The memo stated, in relevant part:
       Additional obligations were added to Exhibit B. They pertain to . . . ensuring that
       all improvements are located on the Property. The improvements in question are
       anchoring systems that may be outside of the current lease area.
AR at 498.

                                                  3
54564-1-II

       C.      Leasehold Boundaries

       Relatedly, under section 1.2(a) of the lease, Exhibit A provided a legal description of the

property, which Cooke warranted was a true and accurate description of the lease boundaries:

       (a) State leases to [Cooke] and [Cooke] leases from State the real property described
       in Exhibit A together with all the rights of State, if any, to improvements on and
       easements benefiting the Property, but subject to the exceptions and restrictions set
       forth in this Lease (collectively the “Property”).

AR at 2416.

       D.      Default and Event of Default

       Section 14.1 of the lease defines “default” to include (1) the failure to pay rent when due

and (2) the failure to comply with any other provision of the lease.

       The lease also provided remedies in the event that a party breached provisions in the lease.

Section 14.2(c) defines an “Event of Default”:

       State may elect to deem a default by Tenant as an Event of Default if the default
       occurs within six (6) months after a default by Tenant for which State has provided
       notice and opportunity to cure and regardless of whether the first and subsequent
       defaults are of the same nature.

AR at 2439. If an event of default occurred, DNR had the remedies listed in section 14.3, which

included the option to terminate the lease.

III.   COMPLIANCE, DNR’S INVESTIGATION, AND DNR’S TERMINATION OF THE LEASE

       A.      Confirmation of Compliance

       On February 10, 2017, DNR asked Cooke to confirm that Cooke was in compliance with

the lease provisions. In particular, DNR inquired whether Cooke was in compliance with the

requirement that Cooke replace the unencapsulated flotation materials and ensure that all

improvements, which includes anchors, were located within the leasehold. Cooke responded three

days later and confirmed that it was in compliance. Cooke stated, “all the tires have been removed

                                                 4
54564-1-II

along with the wooden dock. The repairs were made to the concrete barge that sealed up the

broken areas and exposed Styrofoam. And all the improvements are located within the property.”

AR at 1468.

       B.      Cypress Island Collapse and Failure to Timely Pay Rent

       In August 2017, a net pen at Cooke’s Cypress Island commercial fish farm suffered a

structural collapse resulting in the release of Atlantic salmon into the surrounding waters.

       DNR began an exhaustive review of the structural integrity of the Cypress Island fish farm,

the cause of the collapse, and the structural integrity of Cooke’s other farms throughout the state.

       In October, Cooke failed to timely pay DNR its annual rent. DNR sent Cooke a notice of

default and provided it a 60-day cure period. Cooke cured this default five days later.

       C.      Mott MacDonald Inspection

       In November, DNR hired a marine engineering firm, Mott MacDonald, which contracted

with Collins Engineers, to inspect Cooke’s net pen locations. Mott MacDonald and Collins

Engineers inspected the Port Angeles net pen on December 4 and 5. At this inspection, they

noticed several anchors that were located outside the leasehold boundaries.

       On December 15, the Mott MacDonald firm issued its preliminary findings. It found that

the anchor lines were “deemed to be in satisfactory to fair condition.” AR at 1724. It found

“numerous errant/abandoned anchor line ropes . . . either draped over or wrapped around the

anchor lines of the two net pens systems.” AR at 1724. Mott McDonald also found unencapsulated

floatation material: “[t]here was an 8 ft long by 5 ft tall area of missing concrete with exposed

reinforcing wire at the southeast corner.” AR at 1727. Mott McDonald found that, “[i]nspections

conducted by the Owner do not appear in accordance with manufacturer’s recommendations or

                                                 5
54564-1-II

industry standards.” AR at 1730. And “[s]ome anchors are likely outside the limits of the leased

area.” AR at 1730.

       On December 18, Mott MacDonald sent DNR its full report. The report noted that while

there are deficiencies with multiple anchors one “must be addressed immediately” because “[t]here

is a broken link in the section of chain near the anchor.” AR at 4218. The report also stated that

mooring lines were “missing” and were “wrapped around other lines,” among additional problems.

AR at 4218. Finally, it noted that the float supporting the shed was in disrepair: “[c]oncrete float

has a large damaged area along the eastern face.” AR at 4220.

       D.      Lease Defaults

       Based on the December 15, preliminary findings, DNR determined that Cooke had three

defaults related to the lease requirements:

                Exhibit B, Paragraph 2.B, [of the October, 2015 lease] identified an existing
       concrete float on the site, and required Cooke to “replace all unencapsulated
       floatation material on the concrete float by December 1, 2016.” In violation of this
       provision, as of December 9, 2017, the Styrofoam floatation material on the
       concrete float remained unencapsulated.
                Exhibit B, Paragraph 2.K, required, “By October 1, 2016, [Cooke] will
       ensure that all Improvements are located entirely on the Property.” In violation of
       this provision, as of December 9, 2017, anchors associated with both the primary
       and secondary net pen arrays at the site were located outside of the leasehold.
       Section 7.2 of the Lease explicitly defines anchors as “Existing Improvements” at
       the site.
                 ...
                Furthermore, Section 11.2 of the Lease requires Cooke to “keep and
       maintain the [leasehold] and all improvements . . . in good order and repair, in a
       clear, attractive, and safe condition.” In violation of this provision, as of December
       9, 2017, two net pen anchor chains were disconnected from their anchors, and a
       third anchor chain had an open link that is vulnerable to complete failure.

AR at 1719-20.

       Due to these defaults, DNR sent a notice of default and termination of the lease to Cooke

on December 15. The notice stated that DNR was terminating the lease based on an event of

                                                 6
54564-1-II

default: the untimely rent that occurred within a six-month period of three other defaults. DNR

did not give Cooke any additional time to cure its defaults.

IV.    PROCEDURAL HISTORY

       On January 4, 2018, Cooke filed a “notice of appeal under RCW 79.02.030” (lease

termination action) and a complaint for declaratory judgment in Clallam County Superior Court. 3

DNR moved to change venue because the lease contained a forum selection clause that designated

Thurston County as the proper venue. The court granted DNR’s motion.

       Upon transfer, DNR moved to bifurcate the lease termination action and the declaratory

action. Cooke did not oppose DNR’s motion and the court granted the motion. This case involves

the lease termination action.

       On December 23, 2019, Cooke filed a brief on the merits. With respect to the standard of

review, Cooke argued that DNR’s decision to terminate the lease agreement was quasi-judicial

rather than administrative in nature. Therefore, Cooke argued, the trial court should review DNR’s

findings of fact for substantial evidence, and review de novo whether those findings supported its

conclusion of law. Accordingly, it contended that DNR’s findings of fact were not supported by

substantial evidence in the record, and therefore, those findings did not support DNR’s decision to

terminate the lease. In the alternative, Cooke argued that if the arbitrary and capricious standard

of review applied, then DNR’s decision to terminate the lease was arbitrary and capricious because

its action was willful, unreasoning, and in disregard of the facts and circumstances.

3
 For the declaratory judgment action, Cooke argued that it was not in default of the lease; that
DNR did not have a basis to terminate the lease; and that DNR failed to act in good faith and fair
dealing by terminating the lease.

                                                 7
54564-1-II

       Additionally, Cooke appeared to argue that it was entitled to a cure period under the lease

agreement, and therefore, its lease was erroneously terminated. Further, Cooke appeared to argue

that DNR breached its duty of good faith and fair dealing in terminating the lease.

       In response, DNR argued the trial court should affirm its decision to terminate the lease.

First, relying on Northwest Alloys, Inc. v. Dep’t of Natural Resources, 10 Wn. App. 2d 169, 447

P.3d 620 (2019), review denied, 194 Wn.2d 1019 (2020), DNR contended that its decision to

terminate Cooke’s lease was administrative in nature, and therefore, it contended that proper

standard of review was the arbitrary and capricious standard. Under that standard, DNR argued

that its decision “was well reasoned and made after having considered the relevant facts and

surrounding circumstances,” and therefore, it “lawfully and reasonably exercised [the] option

provided under the contract to terminate Cooke’s Lease for a series of defaults.” CP at 647.

       The trial court agreed with DNR that the arbitrary and capricious standard of review applied

based on Nw. Alloys, 10 Wn. App. 2d 169. And based on that standard of review, “the court

[found] that there [was] a basis in the record to support the termination decision.” Report of

Proceedings at 83. Accordingly, the court affirmed DNR’s decision to terminate Cooke’s lease.

Cooke timely filed this notice of appeal.

                                            ANALYSIS

I.     STANDARD OF REVIEW

       The parties disagree as to the appropriate standard of review. Cooke argues that DNR

made a quasi-judicial determination when terminating the lease. DNR argues that it was acting in

its administrative capacity in terminating the lease and that we, like the superior court, should

apply the arbitrary and capricious standard of review under Northwest Alloys, 10 Wn. App. 2d 169.

We agree with DNR.

                                                8
54564-1-II

          A.     Legal Principles

          A determination of the correct standard of review is a purely legal question that we review

de novo. See End Prison Indus. Complex v. King County, 192 Wn.2d 560, 566, 431 P.3d 998

(2018).

          RCW 79.02.030 provides that:

                  Any applicant to purchase, or lease, any public lands of the state . . . and
          any person whose property rights or interests will be affected by such sale or lease,
          feeling aggrieved by any order or decision of the . . . commissioner, concerning the
          same, may appeal therefrom to the superior court of the county in which such lands
          or materials are situated . . . . The hearing and trial of said appeal in the superior
          court shall be de novo before the court, without a jury, upon the pleadings and
          papers so certified. . . . Any party feeling aggrieved by the judgment of the superior
          court may seek appellate review as in other civil cases.

“Although RCW 79.02.030 uses the language ‘de novo’ review, such a review of an administrative

agency’s decision ‘is only permissible when the agency acts in a quasi-judicial manner.’” Nw.

Alloys, 10 Wn. App. 2d at 184 (quoting Yaw v. Walla Walla Sch. Dist. No. 140, 106 Wn.2d 408,

413, 722 P.2d 803 (1986)). “In cases in which the agency acted in its administrative function,

review is limited to whether the agency acted arbitrarily, capriciously, or contrary to law.” Nw.

Alloys, 10 Wn. App. 2d at 184. “‘Allowing only limited appellate review over administrative

decisions, rather than original or appellate jurisdiction as a matter of right, serves an important

policy purpose in protecting the integrity of administrative decision-making.’” Nw. Alloys, 10 Wn.

App. 2d at 184 (internal quotation marks omitted) (quoting Residents Opposed to Kittitas Turbines

v. State Energy Facility Site Evaluation Council, 165 Wn.2d 275, 295, 197 P.3d 1153 (2008)).

          Our Supreme Court identified a four-part test to determine whether an agency’s action was

administrative or quasi-judicial in Francisco v. Board of Directors of Bellevue Public School, 85

Wn.2d 575, 579, 537 P.2d 789 (1975). The action is quasi-judicial only if (1) the court could have

been charged in the first instance with making the decision; (2) the agency function is one that

                                                    9
54564-1-II

courts typically perform; (3) the agency is performing functions of investigation, declaration, and

enforcement of liabilities as they stand on present or past facts under existing laws; and (4) the

agency’s action is comparable to the ordinary business of courts. Nw. Alloys, 10 Wn. App. 2d at

184 (applying the four-part test from Francisco, 85 Wn.2d at 579).

        B.      Right to Terminate under Lease Provisions

        An application of the Francisco factors shows that whether DNR had the right to terminate

the lease based on the lease provisions was quasi-judicial. The interpretation of lease provisions

is something with which the court could have been charged, and that function typically is one that

courts perform. DNR was declaring and enforcing liabilities under the lease. And DNR’s action

was comparable to the ordinary business of the courts. Therefore, the correct standard of review

for whether DNR had the right to terminate the lease is de novo.

        C.      Decision to Terminate the Lease

        An application of the Francisco factors shows that the decision whether to terminate the

lease was administrative. First, “[t]hrough the aquatic lands statutes, the State granted sovereign

powers to DNR for protection of the State’s interest in the [public] trust.” Nw. Alloys, 10 Wn.

App. 2d at 185. Like denying the opportunity to sublet, as in Northwest Alloys, DNR is vested

with the discretionary, administrative responsibility to terminate a lease if the leaseholder breaches

the lease as the interests of the State or affected trust require. In contrast to functions a court could

be charged with, DNR clearly holds a unique, constitutionally mandated position vis a vis its

management of navigable waters and underlying lands.

        Second, courts have not “historically managed aquatic lands held in public trust because

that is a function DNR performs.” Id. at 186.

                                                   10
54564-1-II

       Third, in deciding to terminate the lease, DNR performed no formal inquest or inquiry,

made no formal declaration of rights among parties as a court would do in a declaratory judgment

action, and conducted no enforcement of liabilities aside from enforcing remedies available to it

in the contract with Cooke.

       Fourth, what DNR was doing here was, in its capacity as property manager or landlord,

acting upon a contractual remedy available to it through its lease with Cooke. While courts may

terminate leases as a remedy to a cause of action, courts do not, in the ordinary course, act as

property managers or landlords.

       We hold that DNR’s decision to terminate the lease was administrative, not quasi-judicial,

and thus, the correct standard of review of DNR’s termination decision is whether it was arbitrary

and capricious.

II.    DNR HAD THE RIGHT TO TERMINATE THE LEASE UNDER THE LEASE PROVISIONS

       There is no question that Cooke’s failure to pay rent on October 1, 2017 constituted a

default under section 14.1(a) of the lease. This means that under section 14.2(c), DNR could

declare an event of default if another default occurred within six months. And under section

14.3(a), DNR had the option to terminate the lease if an event of default occurred. We conclude

that additional defaults did occur within six months of October 1, 2017.

       First, exhibit B, paragraph 2.K—defined in section 7.2 to include anchors—required Cooke

to ensure that by October 1, 2016 all improvements were located within the leasehold area. There

is no question that Mott McDonald’s investigation revealed that some anchors remained outside

the limits of the leased area. Under section 14.1(c), this failure to comply with a lease provision

constituted a default.

                                                11
54564-1-II

       Cooke admits that the anchors securing the fish farm apparatus were outside the leasehold,

but that DNR had “known for years that the anchors were outside the leasehold.” Appellant’s Br.

at 44. It also argues that it was not required by paragraph 2.K of exhibit B to relocate the anchors

to inside the leasehold. But anchors are defined as “improvements” in the lease. Paragraph 2.K

of exhibit B, listing Cooke’s additional obligations reads, “By October 1, 2016, [Cooke] will

ensure that all Improvements are located entirely on the Property.” AR at 2448 (emphasis added).

Cooke proceeds to argue that this obligation was really about the net pens, which they had

confirmed were within the leasehold prior to termination. To the extent Cooke is asking us to

disregard the plain language of the lease and read the requirement that “all Improvements [be]

located on the Property,” AR at 2448, excludes anchors, we decline to do so.

       Second, Mott McDonald documented serious deficiencies with multiple anchors, including

that two net pen anchor chains were disconnected from their anchors, and that a third anchor chain

had an open link that made it subject to failure. These deficiencies violated section 11.2(a) of the

lease, which required Cooke to keep all improvements in good repair and in a safe condition.

Under section 14.1(c), this failure to comply with a lease provision constituted a default.

       Cooke does not refute that the anchor chains were disconnected from their anchors or that

the third chain had an open link, but instead argues that the final Mott McDonald report found that

the facility was in “fair condition” and that the anchors themselves (versus the lines) were in

satisfactory to fair condition. But even if there is an alternative interpretation of the facts, we

review an agency’s factual findings for substantial evidence, asking whether the record contains

                                                12
54564-1-II

evidence sufficient to convince a rational, fair-minded person that the finding is true. B & R Sales,

Inc. v. Dep’t of Labor & Indus., 186 Wn. App. 367, 374, 344 P.3d 741 (2015). Substantial evidence

is that which is sufficient “‘to persuade a fair-minded person of the truth of the declared premises.’”

Ames v. Wash. State Health Dep’t Med. Quality Health Assurance Comm’n, 166 Wn.2d 255, 261,

208 P.3d 549 (2009) (internal quotation marks omitted) (quoting Heinmiller v. Dep’t of Health,

127 Wn.2d 595, 607, 903 P.2d 433, 909 P.2d 1294 (1995)).

       Cooke ignores other portions of the Mott McDonald report which clearly described that

two of the anchor lines were disconnected from their anchors and that one had an open link. Under

a substantial evidence standard, we are only concerned with whether Mott McDonald’s

observation was sufficient to persuade a fair-minded person that the two anchor chains were

disconnected and that one had an open link. We conclude that substantial evidence supports

DNR’s claim that as of December 9, 2017, two anchor chains were disconnected from their anchors

and one anchor chain had an open link.

       Cooke argues that it was contractually obligated and entitled to an opportunity to cure any

alleged defects prior to the termination of the lease. In support of this assertion, Cooke relies on

section 14.2(b) of the lease, which provides a 60-day cure period for a defaults. However, by the

plain terms of section 14.2(b), it only applies “[u]nless expressly provided elsewhere in this

Lease.” AR at 2439. “Elsewhere in this Lease” includes section 14.2(c), by which DNR may

deem a default an “Event of Default” if the default occurs within six months after a default in

which DNR provided Cooke notice and an opportunity to cure. AR at 2439.

                                                  13
54564-1-II

       DNR provided notice and an opportunity to cure regarding Cooke’s default of the rent

provision on October 20, 2017. On December 9, 2017, DNR became aware of additional defaults

of the lease regarding the property itself. At that point, DNR could deem one or more of the

subsequent defaults an event of default. Cooke was not entitled to an opportunity to cure.4

       Accordingly, we hold that DNR had the right under the terms of the lease to terminate

Cooke’s lease.

IV.    DNR’S DECISION WAS NOT ARBITRARY AND CAPRICIOUS

       Next, Cooke argues that DNR’s decision to terminate its lease was arbitrary and

capricious.5 DNR argues that its termination of the lease was based on the facts and was authorized

under the lease, therefore its decision to terminate the lease was not arbitrary and capricious. We

agree with DNR.

               Agency action is arbitrary and capricious if it is willful, unreasoned, and
       taken without regard to the attending facts or circumstances. Where there is room
       for two opinions, agency action taken after due consideration is not arbitrary and
       capricious even if a reviewing court may believe it to be erroneous. Deference will
       be given to the specialized knowledge and expertise of the administrative agency.
       The party who challenges an agency action under this standard carries a heavy
       burden.

4
  Cooke also argues that DNR breached the lease by failing to act in good faith and fair dealing
because the parties’ course of conduct established that DNR accepted Cooke’s late rental payments
for years prior to terminating the lease. Cooke argues that DNR failed to act in good faith and fair
dealing because it did not allow Cooke a cure period for the unencapsulated Styrofoam and the
improvements prior to its termination of the lease. But these arguments are waiver arguments by
another name, and Cooke did not assign error to the superior court’s determination that waiver did
not apply. Accordingly, we do not reach these arguments.
5
 Cooke also argues that the superior court erred in not making findings and conclusions. But the
superior court is not required to enter written findings of fact under RCW 79.02.030. Nw. Alloys,
10 Wn. App. 2d at 183 (“[u]nder RCW 79.02.030, the superior court defers to the factual findings
of the commissioner and limits its review to the application of law to the admitted facts.”).
Accordingly, the superior court did not err by not entering findings of fact.

                                                14
54564-1-II

Nw. Alloys, 10 Wn. App. 2d at 187 (internal citations omitted). “‘[N]either the existence of

contradictory evidence nor the possibility of deriving conflicting conclusions from the evidence

renders an agency decision arbitrary and capricious.’” Squaxin Island Tribe v. Dep’t of Ecology,

177 Wn. App. 734, 742, 312 P.3d 766 (2013) (quoting Rios v. Dep’t of Labor & Indust., 145 Wn.2d

483, 504, 39 P.3d 961 (2002)).

       DNR terminated the lease under section 14.2(c), which states that the

       State may elect to deem a default by Tenant as an Event of Default if the default
       occurs within six (6) months after a default by Tenant for which State has provided
       notice and opportunity to cure and regardless of whether the first and subsequent
       defaults are of the same nature.

AR at 2439. “Default” includes, among other things a “[f]ailure to pay rent or other expenses

when due” and “[f]ailure to comply with any other provision of this Lease.” AR at 2439. As set

out above, substantial evidence supports that Cooke failed to make the timely rent payment by

October 1, 2017 and failed to maintain the property and all improvements in good order and repair

in a clean, attractive, and safe condition by allowing disconnected anchors and an open link on

another anchor chain. As the lease describes, once an event of default occurs, the State may elect

to terminate the lease: “14.3 Remedies . . . (a) Upon an Event of Default, State may terminate this

Lease and remove Tenant by summary proceedings or otherwise.” AR at 2439.

       DNR’s decision to terminate the lease was based on facts supported by substantial

evidence, pursuant to plain terms of the contract, was well reasoned and made with due regard to

the facts and circumstances.

                                                15
54564-1-II

                                        CONCLUSION

        We affirm the superior court’s final order upholding DNR’s lease termination decision.

        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.

                                                            Veljacic, J.

We concur:

        Maxa, P.J.

        Cruser, J.

                                               16