Court Opinion

ID: 2715693
Source: CourtListenerOpinion
Date Created: 2014-08-06 17:28:28.85826+00
Date Added: 2024-06-11T15:15:05.848247
License: Public Domain

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       IN THE COURT OF APPEALS OF THE STATE OF WASHINGTON

DIMENSION FUNDING, LLC,
                                                  No. 70854-6-I
                     Respondent,
                                                  DIVISION ONE
              v.

CALL-O-CALL, INC., a New York
corporation, ANDREY TOVSTASHY,                    UNPUBLISHED OPINION
and DOES 1-10,
                                                  FILED: August 4, 2014
                     Appellants.

       Becker, J. —This is an appeal from a summary judgment holding

appellant Call-O-Call Inc. liable for breach of contract. We affirm.

       On December 10, 2003, Call-O-Call Inc. signed a 36-month lease

agreement with Dimension Funding LLC for equipment described in Schedule A:

       1-STX Gateway System
       Gateway Switch Bay - 19"
       Rack Mount Enclosure
       1-E1/T1, 155 Board

       Paragraph 16 required Call-O-Call to return the equipment to Dimension

at the conclusion of the 36-month lease term. If Call-O-Call failed to do so,

Dimension could extend the lease for 12 months:

       By this Lease, Lessee acquires no ownership rights in the
       Equipment, and has no option to purchase it. Upon the expiration,
       or earlier termination or cancellation of this Lease, or in the event of
No. 70854-6-1/2

       default hereunder, Lessee at its expense, shall return the
       Equipment in good repair, ordinary wear and tear resulting from
       proper use thereof, alone excepted, by delivering it, carefully
       crated, shipped freight prepaid and properly insured to such place
       or carrier as Lessor may specify. At the expiration of the Lease,
       Lessee shall return the Equipment in accordance with the terms
       hereof. Ifthe Equipment is not returned within 10 days, Lessor
       shall have the option of renewing the Lease for an additional twelve
       month period and Lessee shall pay to Lessor rentals in the same
       periodic amounts indicated under "Amount of Rental Payments",
       above.

Paragraph 20 stated that the lease was the entire agreement between the

parties.

       At the end of the 36-month lease period, Dimension sent Call-O-Call a

letter offering to sell the equipment for $8,925. Call-O-Call did not accept this

offer. The parties exchanged numerous emails for about a month. Call-O-Call

asked to purchase only the rack mount enclosure for $400. Call-O-Call claimed it

was prohibited from removing the rack mount enclosure by a lease agreement

with an entity called NACT and refused to return it. Dimension requested the

return of all the equipment.

       Dimension referred to the equipment as three items. Call-O-Call referred

to the equipment as two items. Dimension sent Call-O-Call an inspection report

created January 14, 2004, showing two boards and one rack mount enclosure.

Call-O-Call responded: "We have signed agreement with 2 items on it and we

never exchanged or leased other items under this agreement."

       Dimension told Call-O-Call it would extend the lease for 12 months if the

equipment was not returned. Call-O-Call did not return any equipment and made

no payments under the extended lease.
No. 70854-6-1/3

       Dimension referred the account to collections and filed suit for breach of

contract in King County Superior Court.

       Dimension successfully moved for summary judgment. The trial court

rejected Call-O-Call's argument that any agreement it had with NACT affected its

obligation to return the equipment:

       Okay. I'm going to grant the motion for summary judgment of the
       property as described in the Schedule A of the lease. I don't find
       that any lease or option agreement or any other sort of contract
       between Call-O-Call and NACT—I think it is the acronym—is
       relevant to this case. There's—we have a written lease specifically
       stating that there are no side agreements. Ifthere is a side
       agreement, it doesn't affect the validity of the lease and there's an
       integration clause. So any other agreements with a third party are
       not relevant.

The court also found insufficient evidence to support Call-O-Call's claim of

anticipatory repudiation:

              I don't find sufficient evidence here of anticipatory
       repudiation so as to excuse performance under the lease. And I'll
       sign an order that exactly tracks Schedule A, the equipment. And I
       guess the two of you will have to figure out what that is. But there's
       been a breach clearly because there wasn't return of that
       equipment.

       Call-O-Call appeals.

       An order of summary judgment is reviewed de novo, viewing all facts and

reasonable inferences in the light most favorable to the nonmoving party. Eicon

Constr.. Inc. v. E. Wash. Univ., 174 Wash. 2d 157, 164, 273 P.3d 965 (2012).

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); Eicon

Constr.. 174Wn.2dat164.
No. 70854-6-1/4

       Call-O-Call contends that when Dimension requested that three items be

returned, it repudiated the contract, relieving Call-O-Call of its lease obligations.

       Repudiation of a contract by one party may be treated by the other as a

breach that will excuse the other's performance. CKP, Inc. v. GRS Constr. Co.,

63Wn. App. 601,620, 821 P.2d 63. review denied. 120Wn.2d 1010(1992). An

anticipatory breach occurs when one of the parties to a bilateral contract either

expressly or impliedly repudiates the contract prior to the time of performance.

Lovric v. Dunatov, 18 Wash. App. 274, 282, 567 P.2d 678 (1977).

       Cases cited by Call-O-Call are not on point because in each of them,

neither party had fully performed under the contract. Walker v. Herke, 20 Wash. 2d
239, 147 P.2d 255 (1944) (buyer's statement that he would not accept and pay

for steers unless additional costs were paid by seller excused seller from

delivering steers); Kilaas v. Mother's Grandma Cookie Co., 156 Wash. 8, 285 P.
1118 (1930) (agreement for sale of raisins; court held that buyer's statement that

it would not accept or pay for the raisins relieved seller of any further duty to

deliver them); Jones-Scott Co. v. Ellensburq Milling Co., 116 Wash. 266, 199 P.
238 (1921) (buyer's statement that itwould not accept delivery of 10,000 bushels

of wheat eliminated the seller's obligation to deliver the wheat); Turner v.

Gunderson, 60 Wash. App. 696, 703, 807 P.2d 370 (seller's demand for different

terms in real estate contract excused purchaser from obligation to pay purchase

price and entitled him to return of deposit), review denied, 117 Wash. 2d 1013

(1991).
No. 70854-6-1/5

       Call-O-Call contends Dimension committed an anticipatory breach by

refusing to accept the return of the equipment. Dimension did not say it would

refuse to accept the equipment specified on Schedule A. The dispute about

whether the equipment specified on Schedule A consisted of two items or three

is irrelevant. Call-O-Call could have and should have returned all the equipment

it received.

         Furthermore, when the dispute emerged about whether there were two

items or three, Dimension had already fully performed by supplying the

equipment. We therefore conclude that no anticipatory repudiation by Dimension

occurred. Call-O-Call was not excused from returning the equipment. The court

properly granted summary judgmentfor Dimension on the claim of breach of

contract.

       Affirmed.

WE CONCUR:

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