Court Opinion

ID: 2785125
Source: CourtListenerOpinion
Date Created: 2015-03-10 18:10:00.618991+00
Date Added: 2024-06-11T11:28:34.914151
License: Public Domain

FILED
                                                                                        COURT OF APPEALS
                                                                                               DIVISION II
                                                                                      2015M
                                                                                       S TAT
                                                                                       B

      IN THE COURT OF APPEALS OF THE STATE OF WASHINGTON

                                                    DIVISION II

 FRED HACKER, a married man, and JOHN                                     No. 46158 -7 -II
 HACKER, a single man,

                                      Respondents,

         v.

 RICHARD FROST,                                                     UNPUBLISHED OPINION

                                      Appellant,

 TAMMIE FROST,

                                      Defendant.

        JOHANSON, C. J. —          Richard Frost appeals the trial court' s summary judgment order in Fred

and   John Hacker'   s   favor.'    Richard argues that the trial court erred when it entered judgment

against the marital community based on Tammie Frost' s signature on a 2013 promissory note.

Because there is no genuine dispute as to any material fact and Hacker is entitled to summary

judgment as a matter of law, we affirm.

1 We refer to the respondents, Fred and John Hacker, collectively as " Hacker" for convenience.
We refer to Tammie and Richard Frost by their first names because their individual actions are
important in this   case, and we      intend   no   disrespect.
No. 46158 -7 -II

                                                       FACTS

         In 2004, Hacker loaned the Frosts money to buy a piece of real estate. Hacker also lent the

Frosts   additional sums at various        times throughout the years.      Although Hacker claims that the

Frosts committed to pay the money back, these loans were not memorialized in writing.

         In January 2013, after the statute of limitations had run on the Frosts' debts to Hacker,

Tammie signed a promissory note that combined all ofthe debts, including interest.2 Tammie also

wrote Richard' s name on the promissory note by hand.

         In May 2013, having received no money from the Frosts, Hacker filed this suit against the

Frosts   and   their   marital   community.      Richard and Hacker filed cross motions for summary

judgment. To support summary judgment, Hacker presented a copy of the 2004 check that he gave

the Frosts for the real estate purchase, a copy of the promissory note, and his declaration. Richard

filed only an affidavit stating that he never signed the promissory note, that Tammie had

 supposedly" agreed to pay Hacker and added Richard' s name by hand to the document, and that

he had " nothing to do        whatsoever" with   the   note.   Clerk' s Papers ( CP) at 29. Notably, Richard' s

affidavit failed to state that ( 1) the marital community did not benefit from the promissory note,

 2) the promissory note was a gift, or ( 3) Tammie lacked authority to sign the promissory note on

behalf   of   the   marital   community.    The trial court granted summary judgment against Tammie

individually and the Frosts' marital community.

         Richard appeals the trial court' s order of summary judgment in Hacker' s favor only as it

applies to the Frosts' marital community.

2 It is undisputed that the statute of limitations had run on all the debts when Tammie signed the
promissory note.
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No. 46158 -7 -II

                                                              ANALYSIS

          Richard argues that Tammie lacked authority to bind the marital community after the

statute   of   limitations had         run   because     by   signing the promissory      note,   she (   1) made a gift of

community property or (2) was not acting for the community' s benefit. We disagree.

                                      I. STANDARD OF REVIEW AND RULES OF LAW

          We    review a       trial court' s   order   granting summary judgment de          novo.   Camicia v. Howard

S   Wright Constr. Co., 179 Wash. 2d 684, 693, 317 P.3d 987 ( 2014).                                Summary judgment is

appropriate only where there is no genuine issue of material fact and the moving party is entitled

to judgment       as a matter of       law. CR 56( c).        A fact is   material when   it "' affects the outcome of the

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

 quoting Owen          v.   Burlington N. & Santa Fe R. R. Co., 153 Wash. 2d 780, 789, 108 P.3d 1220 ( 2005)).

A party is entitled to summary judgment only where reasonable persons could reach just one

conclusion.       Walston       v.   Boeing Co.,      181 Wash. 2d 391, 395, 334 P.3d 519 ( 2014).           When reviewing

an order granting summary judgment, we conduct the same inquiry as the trial court, review the

evidence in the light most favorable to the nonmoving party, and make all reasonable inferences

in that party'     s   favor.    Lakey    v.    Puget Sound      Energy, Inc., 176 Wash. 2d 909, 922, 296 P.3d 860

 2013).

          The statute of limitations for a loan that is not memorialized in writing is three years. RCW

4. 16. 080( 3).    However, the debt may be revived after the statute of limitations has run if a new

promise    is   made        in writing.      RCW 4. 16. 280.      In general, a spouse may revive a debt as to the

marital community after the statute of limitations has expired if the spouse has authority to do so.

Matson    v.    Weidenkopf, 101         Wn.     App. 472, 480 -81,     3 P.3d 805 ( 2000).   This general authority may

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No. 46158 -7 -II

be   express or,     more    typically, is " inferred from     the community relationship."        Matson, 101 Wn.

App. at 481.

          Spouses do not have authority to make gifts of community property without express or

implied   consent        from the   other spouse.    RCW 26. 16. 030( 2). Although the statute does not define

a gift explicitly, a " debt incurred for the purpose of a gift" is treated the same as an expenditure of

funds for the purpose of a " gift" under RCW 26. 16. 030( 2) and is also an exception to a spouse' s

general authority to manage community property. In re Marriage ofSchweitzer, 132 Wash. 2d 318,

331, 937 P.2d 1062 ( 1997) ( Schweitzer II).

         A moral obligation is sufficient consideration for a new promise to pay an expired debt.

Orsborn    v.   Old Nat' l Bank of Wash., 10 Wn.              App.    169, 173, 516 P.2d 795 ( 1973).      The law

presumes      that any     debt incurred    during   the   marriage   is   a   community debt.   Oil Heat Co. of Port

Angeles, Inc.       v.   Sweeney,   26 Wn.   App.    351, 353, 613 P.2d 169 ( 1980).      Spouses are presumed to

have the authority to manage and control community property except in certain circumstances.

RCW 26. 16. 030.           There is also a presumption that debts incurred during the marriage are for the

community'      s   benefit.    Schweitzer    v.   Schweitzer, 81 Wash. App. 589, 597, 915 P.2d 575 ( 1996)

 Schweitzer I), remanded, 132 Wash. 2d 318.

                    II. AUTHORITY TO BIND THE MARITAL COMMUNITY AND EXCEPTIONS

          Here, it is uncontested that the statute of limitations on the Frosts' original debt to Hacker

was   three   years      because the loan    was not   in writing. It is also uncontested that Tammie signed a

written promissory note to revive the original debt. Because Tammie signed the promissory note

during    her   marriage,      she is presumed to have acted with authority to manage and control

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No. 46158 -7 -II

community property and it is presumed that this debt was incurred for the marital community' s

benefit. RCW 26. 16. 030; Matson, 101 Wash. App. at 480 -81; Schweitzer I, 81 Wash. App. at 597.

                    A. THE PROMISSORY NOTE WAS NOT A GIFT AS A MATTER OF LAW

        Richard relies on Schweitzer II and Nichols Hills Bank v. McCool, 104 Wash. 2d 78, 701 P.2d
1114 ( 1985), to support his argument that the gift exception in RCW 26. 16. 030( 2) applies and the

promissory    note was      a gift of     community property         as a matter of    law. He argues that like in

Schweitzer II and Nichols Hills, their marital community had no legal obligation to repay Hacker

after the statute of limitations had run, and, therefore, the promissory note was a gift.

        However, these cases are easily distinguishable. In Nichols Hills, our Supreme Court did

not discuss whether the marital community' s legal obligations impact the RCW 26. 16. 030( 2) gift

analysis at all. Instead, the issue in Nichols Hills was not whether a gift was made but whether the

wife   had   consented     to   co-   signing   a   loan for her   son. 104 Wash. 2d    at   81.   Our Supreme Court,

therefore,   never considered          the issue that Richard        argues   here.   Therefore, this case does not

support Richard' s argument.

        In Schweitzer II,         our    Supreme Court held that "[           g] iven that there was no community

obligation to finance [ the son' s] college education, the expenditures and loans constituted a gift."
132 Wash. 2d      at   331.   However, the court' s holding was based on facts developed at trial showing

that the mother and father had several discussions and at times bitter disagreements about giving

their son money for college. Schweitzer II,''132 Wn.2d at 330 -32.

         In this case, Richard argues that simply because there was no legal obligation to repay the

loan since the statute of limitations had run, the promissory note was a gift as a matter of law:

Neither Nichols Hills           nor   Schweitzer II     support such a     broad   rule.    Richard also points to no

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No. 46158- 7- 11

authority, and we are aware of none, to support his argument that when one spouse signs a

promissory note after the statute of limitations has run on a community debt, the new debt does

not benefit the marital community as a matter of law. Thus, this argument also fails.

        Therefore, we reject Richard' s argument that simply because there was no legal obligation

to repay the loan, the promissory note was a gift as a matter of law.

           B. RICHARD FAILS TO RAISE A GENUINE DISPUTE AS TO ANY MATERIAL FACT

        Finally, there is no genuine dispute of material fact about whether the promissory note was

a gift or whether       it   was   for the benefit   of   the   marital
                                                                          community. Richard'        s affidavit—   the only

evidence   that he      contributed     to the summary judgment             record —establishes       that Hacker wrote a

check to the Frosts in 2004, that the Frosts purchased real estate in part with that check, that

Tammie signed the 2013 promissory note, and that he " had nothing to do whatsoever" with the

note.   CP   at   29.        However, the fact that Richard did not know that Tammie had signed the

promissory note does not raise a genuine dispute whether the note was a gift as a matter of law —

spouses   regularly     make expenditures and         incur debts         without   the   other spouse' s   knowledge —and

Richard' s other pleadings do not allege additional facts to support such a conclusion. Even making

all reasonable inferences from these facts in Richard' s favor, he has failed to raise a genuine

dispute that Tammie made a gift of marital property.

        Richard also argues that Tammie did not have authority to bind the marital community

because she was not acting for the community' s benefit when she signed the promissory note. He

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No. 46158 -7 -II

argues that the marital community had no legal obligation to pay Hacker when Tammie signed the

promissory note and that the marital community received no consideration for the new promise to

pay. Again, we disagree.

            Because Tammie signed the promissory note during the Frosts' marriage, we presume that

it is   a   community debt      and      that it is for the community'   s   benefit.   And a moral obligation is

sufficient consideration for a new promise to pay an expired debt. Orsborn, 10 Wash. App. at 173.

The record shows that Richard did not know about Tammie' s plan to sign the promissory note and

that he never signed it himself. However, Richard' s affidavit fails to state that the promissory note

did not benefit the marital community nor did he provide any additional evidence in the summary

judgment record from which we could make such an inference. Making all reasonable inferences

in Richard' s favor, these facts fail to demonstrate a genuine dispute as to a material fact regarding

whether the promissory note is a community debt or whether the community benefited from it.

                                                 III. ATTORNEY FEES

            Hacker requests an award of attorney fees on appeal. However, because he did not devote

a separate section of his opening brief to his attorney fees request and does not argue that he has

the right to reasonable attorney fees under applicable law, Hacker is not entitled to attorney fees

on appeal.      RAP 18. 1(   a) -( b).

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No. 46158 -7 -II

                                         IV. CONCLUSION

        Because Richard fails to raise a genuine dispute as to any material fact or fails to show he

is entitled to judgment as a matter of law, we conclude that Hacker is entitled to summary

judgment. Accordingly, we affirm.

        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.

 We concur:

 MAXA,

SUTTON, J.