Court Opinion

ID: 4380608
Source: CourtListenerOpinion
Date Created: 2019-03-25 19:41:57.836121+00
Date Added: 2024-06-11T14:29:25.572401
License: Public Domain

IN THE COURT OF APPEALS OF THE STATE OF WASHINGTON

RICHARD LIONEL DYSON, an          )             No. 77358-5-1
individual,                       )
                                  )             DIVISION ONE
                      Appellant,  )
                                  )
               v.                 )
                                  )
WAL-MART STORES, INC., a          )
Delaware Corporation,             )             UNPUBLISHED OPINION
                                  )
                      Respondent, )
                                  )
BROADWAY 32ND STREET REALTY )
CORP., a New York Corporation,    )
                                  )
                      Defendant.  )            FILED: March 25, 2019

      SCHINDLER, J. — Richard Dyson appeals summary judgment dismissal of his

personal injury lawsuit against Wal-Mart Stores Inc. We reverse and remand for trial.

                                        FACTS

      On May 13, 2014, Richard Dyson was riding his bicycle in a parking lot in the

Federal Way Rainier View Plaza shopping complex. The front tire of his bicycle hit a

pothole. Dyson fell forward, injuring his wrist, hand, ankle, and back and breaking two

teeth. Dyson notified Broadway 32nd Street Realty Corporation (Broadway) and Wal-

Mart Stores Inc. Broadway owns the Rainier View Plaza property. Wal-Mart store 2571

is located at 1900 South 314th Street in the Rainier View Plaza.
No. 77358-5-1/2

        On March 3, 2015, Broadway sent a letter to Wal-Mart with a copy to Dyson.

Broadway states it investigated the bicycle accident and confirmed Wal-Mart "is

responsible for maintaining the parking lot." The letter states:

        We have been investigating an incident that occurred in your parking lot in
        which Richard Dyson lost control of his [bi]cycle due to a pothole. He
        sustained dental injuries with over $3000 in dental bills to repair the
        damage to his teeth.

        Documents pertaining to the land/property in question . . . confirm Wa!mart
        is responsible for maintaining the parking lot in question. Therefore, we
        ask you immediately place your liability carrier on notice of this matter and
        contact Richard Dyson.

        On March 31, Dyson contacted Wal-Mart to submit a claim. On April 10, Wal-

Mart denied Dyson's claim on the grounds that "[o]ur investigation into this matter

indicates no negligence on the part of Wal-Mart." The letter to Dyson states:

        This letter is regarding your incident, which occurred on or about
        05/13/2014 in the Wal-Mart/Sam's facility 2571 located in Federal Way,
        WA. Wal-Mart regrets any type of accident that occurs on the premises of
        their stores. It is Wal-Mart's goal to provide a reasonably safe place for
        their customers to shop.

        Our investigation into this matter indicates no negligence on the part of
        Wal-Mart Stores, Inc. We are respectfully denying this claim.

        On October 13, 2016, Dyson filed a personal injury lawsuit against Wal-Mart and

Broadway. Dyson served Wal-Mart with the complaint on December 14, 2016. The

complaint alleges Dyson "was riding a bicycle in a parking lot owned, operated and

maintained by one or both Defendants and located in Federal Way, Washington near

Wal-Mart Store #2571." Dyson alleged, "Defendants negligently maintained the parking

lot."

        Specifically, the surface of the parking lot was extremely cracked, buckled,
        and pitted, creating a[n] unreasonably unsafe condition. Defendant knew
        or should have known of this hazard in the exercise of reasonable care.

                                             2
No. 77358-5-1/3

      The condition of the parking lot was unsafe condition and a hazard to
      motorists and bicyclists making use of the parking lot and to whom the
      Defendant owed a duty to maintain a safe premises for normal use by
      persons driving or riding in the parking lot.

      On December 29, 2016, Wal-Mart filed an answer and served Dyson with

interrogatories. The response to interrogatories was due on January 31, 2017.

      On January 27, 2017, Wal-Mart's attorney contacted Dyson's attorney. The Wal-

Mart attorney said that without admitting liability, Wal-Mart agreed to accept "full

responsibility for the condition of the parking lot" involved in the accident. Because Wal-

Mart accepted responsibility, the Wal-Mart attorney told Dyson's attorney there was no

need to continue to attempt service or pursue claims against Broadway as the owner of

the premises. At the request of Dyson's attorney, the Wal-Mart attorney confirmed the

agreement in writing. The January 27, 2017 letter states:

      As we discussed, Wal-Mart has accepted, without admitting any liability,
      full responsibility for the condition of the parking lot that was involved in
      your client's accident of May 13, 2014. As such, there will be no need for
      you to attempt to serve or pursue the original co-defendant, which was
      simply the owner of the premises. Wal-Mart was responsible for repair
      and maintenance of the parking lot, and has accepted all potential legal
      responsibility, if any, for any damages proven by Richard Dyson in this
      particular accident.

       In May 2017, the King County Superior Court entered a noncompliance order.

The order states Broadway did not file an answer to the complaint. On June 5, Wal-

Mart's attorney sent a letter to Dyson's attorney reiterating that Wal-Mart accepted

responsibility for all claims against Broadway. The attorney requested Dyson dismiss

Broadway. The letter states:

      As previously communicated, Wal-Mart has accepted responsibility for all
      of Plaintiffs claims against Broadway 32nd Realty Corp. As such, please
      file a CR 41 Dismissal for Plaintiff's claims against Broadway because
      they are no longer a necessary party to the lawsuit.

                                             3
No. 77358-5-1/4

      On June 8, Dyson filed a CR 41 motion to dismiss Broadway. On June 16, the

court entered an order dismissing all claims against Broadway with prejudice.

      Wal-Mart deposed Dyson on July 24. The attorney showed Dyson a number of

photographs of "the roadway leading into Wal-Mart's parking lot" and surrounding areas.

Dyson identified the pothole that caused his bicycle accident. The pothole Dyson

identified is located on property that Broadway, not Wal-Mart, is responsible for

maintaining.

      On July 26, Wal-Mart's attorney sent an e-mail to Dyson's attorney rescinding the

agreement to accept responsibility for the condition of the parking lot where the accident

occurred.

      Wal-Mart's agreement to take responsibility for the area of Mr. Dyson's
      accident was premised on his allegation that the accident occurred on
      Wal-Mart property. Accordingly, and in good faith, we agreed to take
      responsibility for the parking lot that Wal-Mart maintains under its lease
      with Broadway; we did not agree to take responsibility for other parking
      lots. During Mr. Dyson's deposition testimony it became apparent that the
      accident did not take place on Wal-Mart property as stated in Mr. Dyson's
      Complaint; it occurred across the street. Given this new information, Wal-
      Mart cannot agree to take responsibility for that area, as Wal-Mart does
      not own or maintain that area.[11

       Dyson's attorney stated that Wal-Mart's unilateral and erroneous decision to

accept responsibility did not void the agreement and Dyson had relied on the agreement

to dismiss the claims against Broadway.

      In his complaint, Mr. Dyson alleged that his accident occurred on property
      owned by one or both defendants, as he did not know which entity was the
      property owner. He alleged negligence of BOTH defendants for their
      failure to properly maintain the premises. Unless [Wal-Mart's attorney]
      was completely certain where the accident occurred, he should not have
      accepted responsibility and requested that the co-defendant be dismissed.
      There was never any determination, other than [Wal-Mart's attorney]'s

       I Emphasis in original.

                                            4
No. 77358-5-1/5

       erroneous one, regarding where exactly Mr. Dyson's injury occurred. Mr.
       Dyson has relied to his detriment on [Wal-Mart's attorney]'s assurance
       that Wal-Mart was the responsible party and dismissed 32nd Street Realty
       Corp.

       On August 9, Wal-Mart filed a motion for summary judgment dismissal of all

claims alleged in the lawsuit. Wal-Mart argued it was entitled to rescind the agreement

as a unilateral mistake. Wal-Mart argued it justifiably assumed Dyson's bicycle accident

occurred on its property because Dyson sued Wal-Mart and "the area described in

Dyson's Complaint generally aligns with Wal-Mart's leasehold." Wal-Mart argued it did

not bear the risk of the mistake and enforcement of the agreement would be

unconscionable. In support, the Wal-Mart attorney submitted a declaration and

attached a copy of a "Lease Information Form" and diagram of the Rainier View Plaza, a

Wal-Mart incident report, excerpts from Dyson's answers to interrogatories, copies of

photographs admitted as exhibits during the deposition of Dyson, and correspondence

with Dyson's attorney.

       The Wal-Mart attorney states in his declaration that Wal-Mart leases the parking

lot from Broadway and "[a]ttached hereto as Exhibit A is a true and accurate copy of the

lease." The declaration does not attach the lease. Exhibit A is a Lease Information

Form "[c]reated on December 19, 2016" and "Requested By" Wal-Mart claims

representative Michael Keeler. The Lease Information Form contains very limited

information. The Form states that the lease contains a "hold harmless" provision and

that Wal-Mart is liable for the "parking lot" and "demised premises." "Exhibit B" is a

diagram of the parking lot and landscape areas of Rainier View Plaza at 20th Avenue

South and South 312th Street. The attorney states Exhibit B is an "accurate copy of an

attachment to the lease, depicting the area of Wal-Mart's responsibility."

                                             5
No. 77358-5-1/6

       In response to the motion for summary judgment, Dyson did not dispute that Wal-

Mart "was wrong as to a basic assumption" and that Wal-Mart "would not have assumed

responsibility" for the condition of the parking lot where the accident occurred if not for

its mistake. Dyson argued the undisputed record showed he did not have reason to

know of or cause Wal-Mart's mistaken unilateral assumption of responsibility. Dyson

asserted the record showed Wal-Mart conducted its own independent investigation

before agreeing to accept responsibility for the condition of the parking lot where the

accident occurred without regard to the complaint or his answers to interrogatories.

Dyson argued the record established not only Wal-Mart's unequivocal unilateral

decision to assume responsibility, but also its insistence that he dismiss Broadway.

       The trial court granted Wal-Mart's motion for summary judgment and dismissed

the complaint with prejudice.

                                        ANALYSIS

       Dyson contends Wal-Mart did not meet its burden of establishing it can rescind

the agreement to accept full responsibility for the condition of the parking lot that

resulted in his injuries on the ground of unilateral mistake.

       We review summary judgment de novo. Hartley v. State, 103 Wn.2d 768, 774,

698 P.2d 77(1985). We engage in the same inquiry as the trial court, viewing the facts

and reasonable inferences in the light most favorable to the nonmoving party. Owen v.

Burlington N. Santa Fe R.R., 153 Wn.2d 780, 787, 108 P.3d 1220 (2005). Summary

judgment is appropriate when there is no genuine issue of material fact and the moving

party is entitled to judgment as a matter of law. CR 56(c). When reasonable minds
No. 77358-5-1/7

could reach only one conclusion, questions of fact may be determined as a matter of

law. Owen, 153 Wn.2d at 788 (quoting Hartley, 103 Wn.2d at 775).

       Washington courts follow the Restatement(Second) of Contracts elements of

mistake. Denaxas v. Sandstone Court of Bellevue, LLC, 148 Wn.2d 654,668 n.8, 63

P.3d 125(2003)(citing RESTATEMENT(SECOND)OF CONTRACTS §§ 151-53(Am. LAW INST.

1981)); Gill v. Waggoner,65 Wn. App. 272, 278-79, 828 P.2d 55 (1992). A party

seeking to rescind an agreement on the ground of unilateral mistake must prove (1) a

mistake not in accord with existing facts as to a basic assumption that it relied on in

making the agreement;(2) the effect of the mistake is such if the party had been aware

of the mistake the party seeking to rescind would not have entered into the agreement;

and (3)the other party knew of the mistake, had reason to know of the mistake, or

caused the mistake. Gill, 65 Wn. App. at 278-79 (citing RESTATEMENT § 153); Snap-On

Tools Corp. v. Roberts, 35 Wn. App. 32, 34-35, 665 P.2d 417(1983); Diamond "B"

Constructors, Inc. v. Granite Falls School Dist., 117 Wn. App. 157, 167-68, 70 P.3d 966

(2003); benaxas, 148 Wn.2d at 668.
        1
      Restatement § 153 states:

       Where a mistake of one party at the time a contract was made as to a
       basic assumption on which he made the contract has a material effect on
       tIie agreed exchange of performances that is adverse to him, the contract
       is voidable by him if he does not bear the risk of the mistake under the rule
       stated in § 154, and
              (a) the effect of the mistake is such that enforcement of the
       contract would be unconscionable, or
              (b) the other party had reason to know of the mistake or his fault
       caused the mistake.[2]

       2  A mistaken party who acted in bad faith is barred from seeking to void a contract based on
unilateral mistake. See RESTATEMENT § 157. The record does not establish that either Wal-Mart or
Dyson acted in bad faith.

                                                    7
No. 77358-5-1/8

       The undisputed record establishes Wal-Mart mistakenly believed the accident

occurred on the property it leased from Broadway and if Wal-Mart had been aware of
the mistake, it would not have agreed to accept responsibility for the condition of the

parking lot that caused the bicycle accident and damages.

       Dyson argues Wal-Mart did not show Dyson knew of, had reason to know of, or

caused 'Wal-Mart's mistake. Wal-Mart asserts it accepted responsibility based on the

allegations in the complaint and answers to interrogatories that state the accident

occurred on Wal-Mart property.
       After the May 13, 2014 accident, Dyson contacted Broadway and Wal-Mart.

Broadway engaged in an independent investigation and concluded Wal-Mart was

responsible. The March 3, 2015 letter Broadway sent to Wal-Mart states,"We have

been investigating an incident that occurred in your parking lot" and "[d]ocuments

pertaining to the land/property in question. . . confirm Walmart is responsible for
        1
maintaining the parking lot in question." Broadway sent Dyson a copy of the letter and

on March 31, 2015, Dyson contacted Wal-Mart to submit a claim. On April 10, 2015,

Wal-Mart denied the claim. The letter states, "Our investigation into this matter

indicates no negligence on the part of Wal-Mart."

       Contrary to Wal-Mart's assertion, neither the complaint nor the answers to

interrogatories state the accident occurred on Wal-Mart property. Critically, the

uncontrOverted record shows that before receiving interrogatory answers, Wal-Mart

agreed On January 27, 2017 to assume "full responsibility for the condition of the

parking lot" and "all potential legal responsibility, if any, for any damages."

                                              8
No. 77358-5-1/9

        Dyson filed his personal injury lawsuit against Broadway and Wal-Mart on

October 13, 2016. The complaint alleges,"On or about May 13, 2014, Plaintiff Dyson

was riding a bicycle in a parking lot owned, operated and maintained by one or both

Defendants and located in Federal Way, Washington near Wal-Mart Store #2571."

        Wal-Mart filed an answer and propounded interrogatories to Dyson on December

29, 2016. Answers to interrogatories were due January 31, 2017.

        On January 27, 2017, Wal-Mart agreed it would accept responsibility for the

condition of the parking lot where the accident occurred. The January 27, 2017 letter to

Dyson states Wal-Mart "has accepted, without admitting any liability, full responsibility

for the Condition of the parking lot that was involved" in his accident. The letter

specifically states Wal-Mart "was responsible for repair and maintenance of the parking

lot, and   as accepted all potential legal responsibility, if any, for any damages proven by
Richard Dyson in this particular accident." The letter also states, "[There will be no

need for you to attempt to serve or pursue the original co-defendant, which was simply

the owner of the premises."

        On June 2, 2017, Dyson responded to the interrogatories.3 In response to the

interrogatory asking for "a description of all the facts relating to the incident, the
        1
circumstances leading up to your injury of May 13, 2014, and any facts or

circumstances you believe contributed to the cause of the incident," Dyson answered:
       1
             I was riding my bicycle on the roadway leading into the Walmart.
      There were huge potholes in the roadway. I tried to avoid one, and the
      ended up front wheel going into an even bigger pothole. I flipped forward
      off my bike and landed on my face, breaking two of my teeth. 1 tried to

        3 Only undated excerpts from Dyson's answers to interrogatories are in the record on appeal.
The declaration of Wal-Mart's attorney that attaches the pertinent answers to interrogatories states,"On
June 2, 2017, Mr. Dyson responded to Wal-Mart's interrogatories."

                                                    9
No. 77358-5-1/10

      break my fall and injured my left wrist and middle finger on my right hand.
      The cause of the accident was the poorly maintained condition of the
      roadway.
       1
      On June 5, 2017, the Wal-Mart attorney reiterated Wal-Mart's agreement to

accept responsibility and insisted Dyson dismiss Broadway from the lawsuit.
        1
      As previously communicated, Wal-Mart has accepted responsibility for all
      of Plaintiff's claims against Broadway 32nd Street Realty Corp. As such,
      pease file a CR 41 Dismissal for Plaintiff's claims against Broadway
      because they are no longer a necessary party to the lawsuit.

      A unilateral mistake of fact may be grounds for relief if the other party knows of

the mistake. Snap-On Tools, 35 Wn. App. at 35. Wal-Mart argues it is entitled to

rescind he agreement as a unilateral mistake because Dyson knew the "precise

location" where he fell. The record shows Dyson knew Broadway investigated his claim

and informed Wal-Mart that Wal-Mart was responsible for the condition of the roadway

where he fell. The record also shows Wal-Mart investigated and independently decided

to accept responsibility for the roadway where the accident occurred before engaging in

discoveiy.

      The only evidence Wal-Mart cites to argue Dyson knew or should have known of

its mistake is a diagram attached to Wal-Mart's lease with Broadway that shows the

boundaries of its area of responsibility. Wal-Mart produced the diagram and referred to

the lease with Broadway for the first time in support of the summary judgment motion to

dismiss the complaint. The record establishes Dyson did not know or have reason to

know about the provisions of the lease between Broadway and Wal-Mart or the diagram

and boundaries in the lease. We conclude Wal-Mart did not meet its burden to

establis1-11 Dyson had reason to know about or caused Wal-Mart's mistake.

                                           10
No. 77358-5-1/11

      Gill is analogous. In Gill the plaintiff was injured in a traffic collision and incurred

medicalbills of $37,156. Gill, 65 Wn. App. at 274. The insurance company offered to

pay only1 $3,500. Gill, 65 Wn. App. at 274. Due to a miscommunication, a new

insurance adjuster offered $35,000 instead of the $3,500 that the insurance company

authorized. Gill, 65 Wn. App. at 275. The plaintiff accepted the offer. The insurance

company argued the agreement was void as a unilateral mistake. Gill, 65 Wn. App. at

275-76. The court held the plaintiff had no reason to know of the insurance company's

mistake because he "could reasonably have come to the conclusion that [the insurance

company] evaluated his claim at $35,000." Gill, 65 Wn. App. at 277. As in Gill, the

undisputed record shows Dyson had no reason to know of Wal-Mart's mistake because

he reasonably could have come to the conclusion that Broadway's and Wal-Mart's

investigations showed Wal-Mart was responsible for the condition of the parking lot.
      The undisputed record also establishes Wal-Mart did not meet its burden of

proving it did not bear the risk of the mistake. The party seeking to rescind a contract

on the ground of unilateral mistake must not have borne the risk of the mistake. Pub.

Util. Dist. No. 1 of Lewis County v. Wash. Pub. Power Supply Sys., 104 Wn.2d 353,

362, 705 P.2d 1195 (1985).

      [A] party bears the risk of mistake when, at the time the contract is made,
      the party is aware of limited knowledge with respect to the facts to which
      the mistake relates but treats such limited knowledge as sufficient. It is
      said in such a situation that there is no mistake; instead, there is an
      awareness of uncertainty, a conscious ignorance of the future.

Pub. Util. Dist. No. 1, 104 Wn.2d at 3624 (citing RESTATEMENT § 154). Restatement §

      4 Citations   omitted.

                                             11
No. 77358-5-1/12

154 states:

      P. party bears the risk of a mistake when
             (a) the risk is allocated to him by agreement of the parties, or
             (b) he is aware, at the time the contract is made, that he has only
      limited knowledge with respect to the facts to which the mistake relates
      but treats his limited knowledge as sufficient, or
             (c) the risk is allocated to him by the court on the ground that it is
      reasonable in the circumstances to do so.

       Contrary to the assertion of Wal-Mart, neither case law nor the record supports

the argument that it did not bear the risk of the mistake. The record shows Wal-Mart

decided to accept responsibility based on the independent investigation of Broadway

and its own investigation almost immediately after Dyson filed the lawsuit. Because

Wal-Mail decided to treat the limited knowledge it had as sufficient, it bears the risk of

the mistake.

       Wal-Mart argues enforcement of the agreement to accept responsibility for

Broadway's parking lot would be unconscionable. Whether an agreement is

unconscionable is a question of law we review de novo. McKee v. AT&T Corp., 164

Wn.2d 372, 396, 191 P.3d 845(2008); Gill, 65 Wn. App. at 278("Whether particular

facts render an agreement unconscionable is a question of law.").

       In cases of mistake, courts have discretion to "grant relief on such terms as

justice requires." RESTATEMENT § 158(2). "An unconscionable contract is one which 'no

man in his senses, not under delusion, would make.. . and which no fair and honest

man would accept.'" Gill, 65 Wn. App. at 2785 (quoting Montpomerv Ward & Co. v.

Annuity Bd. of S. Baptist Convention, 16 Wn. App. 439, 444, 556 P.2d 552(1976)).

       5 Alteration   in original.

                                             12
No. 77358-5-1/13

       Ideally, the court will grant relief to put the parties in the position they were in

before the mistake, but that is not possible in all cases. RESTATEMENT § 158 cmt. b. A

contract may be enforceable if the nonmistaken party has relied on the contract. Gill 65

Wn. ApP. at 278. "Reliance by the other party may make enforcement of a contract

proper although enforcement would otherwise be unconscionable." RESTATEMENT § 153

cmt. d.

       The uncontroverted record establishes Dyson relied on Wal-Mart's unequivocal

acceptaInce of responsibility and insistence that he dismiss Broadway. Under the

circumstances of this case and the relationship between Wal-Mart and Broadway, we

conclude enforcement of Wal-Mart's agreement to accept responsibility for the parking

lot where Dyson fell is not unconscionable.
        1
       We reverse summary judgment dismissal of the lawsuit against Wal-Mart and

remand for trial.

WE CONCUR:

                                               13