Court Opinion

ID: 9790951
Source: CourtListenerOpinion
Date Created: 2023-08-31 02:01:54.739173+00
Date Added: 2024-06-11T07:37:32.824218
License: Public Domain

Rosellini, J.
(concurring in part, dissenting in part) — I concur with Justice Dimmick's concurring/dissenting opinion. However, the majority's analysis of the Consumer Protection Act cause of action deserves further comment.
The purpose of the Consumer Protection Act as set forth by the Legislature in RCW 19.86.920 was to "complement the body of federal law governing restraints of trade, unfair competition and unfair, deceptive, and fraudulent acts or practices in order to protect the public and foster fair and honest competition." At the same time, however, the Legislature made clear it did not wish to prohibit "acts or practices which are reasonable in relation to the development and preservation of business or which are not injurious to the public interest". In attempting to balance these two concerns, the act essentially copies the approach taken by the federal government in the Federal Trade Commission Act, 15 U.S.C. §§ 41-58 (1970), and further directs us to be guided by the interpretation given by the federal courts to the various federal statutes dealing with the same or similar matters. RCW 19.86.920.
Enacted in 1914, section 5 of the Federal Trade Commission Act originally declared only unfair methods of competition unlawful. As such, the act was not intended to protect the consumer, but rather to afford more complete relief to competitors under the antitrust laws. With the passage of the Wheeler-Lea Amendment of 1938, adding the phrase "and unfair or deceptive acts or practices in commerce" to section 5's prohibition of unfair methods of competition, the Federal Trade Commission was empowered to proscribe practices affecting consumers as well as *54competitors. Section 5 as codified at 15 U.S.C. § 45(a)(1) (1982) now provides: "Unfair methods of competition in or affecting commerce, and unfair or deceptive acts or practices in or affecting commerce, are declared unlawful."
The protection afforded under federal trade regulations is primarily for the public at large, rather than the individual consumer. Under 15 U.S.C. § 45(b) (1970), the Federal Trade Commission Act authorized federal action against violators only if it is in the public interest. A common element running through all the types of conduct found by the Commission to be unfair or deceptive is solicitation or public offering. It is the unfair or deceptive practice which has a tendency to mislead the consuming public that is the gist of the Federal Trade Commission Act. See Comment, Toward Effective Consumer Law Enforcement: The Capacity To Deceive Test Applied to Private Actions, 10 Gonz. L. Rev. 457 (1975); Leaffer & Lipson, Consumer Actions Against Unfair or Deceptive Acts or Practices: The Private Uses of Federal Trade Commission Jurisprudence, 48 Geo. Wash. L. Rev. 521 (1980).
Following the purpose section's mandate to be guided by federal law dealing with the same or similar matters, this court in Lightfoot v. MacDonald, 86 Wn.2d 331, 544 P.2d 88 (1976) held that the private right of action provisions were designed to enlist private citizens' aid in enforcement of the act, which is desirable only if it serves the public interest and implements the purpose of the act. We concluded that the act did not grant an additional remedy for private wrongs which do not affect the public generally. A breach of a private contract affecting no one but the parties to the contract was not an act or practice affecting the public interest.
We believe the presence of public interest is demonstrated when the proof establishes that (1) the defendant by unfair or deceptive acts or practices in the conduct of trade or commerce has induced the plaintiff to act or refrain from acting; (2) the plaintiff suffers damage brought about by such action or failure to act; and (3) *55the defendant's deceptive acts or practices have the potential for repetition.
Anhold v. Daniels, 94 Wn.2d 40, 46, 614 P.2d 184 (1980).
The Anhold criteria, that the unfair or deceptive acts or practices have induced the plaintiff to act or refrain from acting, parallels and complements the body of federal law governing unfair and deceptive acts or practices. The purpose of the public interest requirement is to limit actions under the act to those which are the consequence of a generalized course of conduct by a seller, and to exclude actions arising from single transactional disputes. Anhold placed the inducement requirement on private suits as a reasonable and logical limitation on the scope of private actions. See Anhold, at 47 (Rosellini, J., concurring); Comment, Private Suits Under Washington's Consumer Protection Act: The Public Interest Requirement, 54 Wash. L. Rev. 795 (1979). An element of "inducement" has a bearing on the establishment of a public interest, in that it confines the actions to those areas of conduct which concern solicitation of the consuming public to act or refrain from acting.
In the instant action, Hess attempted to establish the requisite public interest by an offer of evidence of untimely, erratic, inadequate and defective performance of construction contracts by Eastlake, of dozens of violations of building ordinances, and of five other lawsuits pending against Eastlake arising out of allegedly improper performance of construction contracts. While this evidence tends to establish that other members of the consuming public have been damaged by improper performance of Eastlake contracts, it does not establish that unfair or deceptive misrepresentations induced the parties of those contracts to act or refrain from acting. Mere proof that a contractor is a second-rate builder who does not live up to industry standards does not tend to establish unfair or deceptive solicitation of the consuming public. There must be unfair or deceptive acts or practices which induce the consuming public to act or refrain from acting in order for the Consumer Protection Act to come into play. Thus, in Keyes v. Bollinger, 31 Wn. *56App. 286, 292, 640 P.2d 1077 (1982), the court held that a contractor engages in an unfair or deceptive act by estimating or representing completion dates to purchasers, representations with which he is unable to substantially comply due to reasons which should be reasonably foreseeable in light of the contractor's knowledge and experience.
Here, it appears that Eastlake contracted to perform according to specifications and represented that performance would be completed in a workmanlike manner. Where these representations lack substantial compliance for reasons which should have been reasonably foreseeable in the light of the contractor's knowledge and experience, the contractor engages in an unfair or deceptive act which induced the purchaser to enter into the contract.
Keyes stands for the further proposition that where the evidence shows that the contractor engages in such acts as a matter of business practice, then such conduct affects the public interest. Keyes, at 292-93. This is in the nature of establishing that the unfair or deceptive acts have a potential for repetition.
In order to meet the Anhold criteria, the offer of proof must further establish that Eastlake made similar representations to the consuming public which lacked substantial compliance for reasons which should have been reasonably foreseeable. Only then would such evidence be relevant to establishing a business practice that has the potential for repetition in unfairly or deceptively inducing the consuming public to act or refrain from acting.
Accepting the foregoing as the interpretation the majority has given the Consumer Protection Act, I concur.
Brachtenbach, J., concurs with Rosellini, J.