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WESTMARK DEVELOPMENT CORPORATION, a Washington corporation; Trizec Investment Corporation, a Washington corporation, Respondent, v. The CITY OF BURIEN, a municipal corporation, Appellant.
Published in Part Opinion
¶ 1 This case concerns the City of Burien's delay in issuing a SEPA 1 decision on a permit application and its misrepresentation that a settlement agreement was approved in an open public meeting. The jury was asked to decide claims of negligence, tortious interference with a business expectancy, and negligent misrepresentation. On a general verdict form, the jury awarded the plaintiff, Westmark Development Corporation, $10,710,000. We affirm for the reasons stated below.
FACTS
¶ 2 In 1990, Westmark Development Corporation filed an application with King County for a permit to construct a 216-unit apartment building to be known as “Emerald Pointe on the Sound.” It was to be built in what would later become the City of Burien. Pursuant to SEPA, King County made a threshold determination of probable significant environmental impacts of the project and issued a determination of significance (DS). The issuance of a DS meant that an environmental impact statement (EIS) would need to be prepared for the project.
¶ 3 Westmark decided to modify the project to reduce possible environmental impacts. In January 1992, King County sent a letter to Westmark outlining what would need to be done to mitigate the environmental impacts. In May 1992, Westmark submitted a new environmental checklist, revised site plans, civil drawings, a landscape plan, a wildlife report, a traffic study, and a complete resubmittal of building plans and structural drawings. Westmark's revised project eliminated two buildings from the plan and reduced the number of apartments from 216 to 176. In June 1992, King County sent a letter to Westmark stating, “The SEPA Section will review revised plans for the above-referenced permit application in accordance with the State Environmental Policy Act (SEPA, RCW 43.21C), the SEPA Rules (Washington Administrative Code Chapter 197-11), and the County Environmental Procedures (King County Code Chapter 20.44).” Ex. 50.
¶ 4 Burien officially incorporated on February 28, 1993. Under an interlocal agreement, King County would continue processing permit applications filed with the county before Burien's incorporation. On April 5, 1993, however, Burien assumed responsibility for the Emerald Pointe project, along with a few other projects, under an amendment to the interlocal agreement. Testimony at trial established that Westmark believed King County was close to issuing a decision on its revised application around the time the project was transferred to Burien.
¶ 5 Burien did not issue a decision on Westmark's revised application until August 17, 1996, when it issued a DS.2 On June 24, 1996, before Burien issued the DS, Westmark filed this lawsuit alleging negligence and intentional interference with a business expectancy (Westmark I). When a trial was eventually held, the parties disputed why Burien took over three years to issue a decision on the revised application. Westmark argued that Burien intentionally delayed making a decision because it was opposed to the development of apartments and was influenced by Burien resident and then state representative Georgette Valle. Burien argued that the delay was due to Westmark's failure to pay fees and submit requested documents. It also argued to the trial court that it was not obligated to issue a new decision on the revised project. Some of the evidence the parties presented will be discussed below.
¶ 6 Westmark I did not proceed to trial, however, until 2005. It was close to trial in February 1998. Shortly before trial, though, the parties believed they had reached a settlement, based on an exchange of letters and phone calls. The Westmark I trial date was stricken and depositions were cancelled. The settlement fell apart, however, and Westmark sued Burien, arguing that it had breached the settlement agreement (Westmark II). Burien argued that there was no valid settlement agreement because the “ ‘letters manifested the intent of the parties that their legal obligations would be deferred until a final “Settlement Agreement” was drafted, agreed upon, approved and executed by the proper authorities.’ ” City of Burien v. Westmark Dev. Corp., noted at 103 Wash.App. 1037, 2000 WL 1772501, at *4, 2000 Wash.App. LEXIS 2433, at *16. The trial court in Westmark II ruled on summary judgment that the letters exchanged constituted a settlement and that Burien had breached the agreement. The Court of Appeals affirmed “the trial court's decision granting summary judgment in Westmark's favor as to the existence and enforceability of a settlement agreement with the City of Burien, but vacate[d] on the issue of breach.” Westmark, 103 Wash.App. 1037, 2000 WL 1772501, at *8, 2000 Wash.App. LEXIS 2433, at *28.
¶ 7 On remand from the Court of Appeals, the parties attempted to implement the settlement agreement but were not successful. As part of their attempt to implement the agreement, Westmark I was dismissed. The parties never agreed on final settlement agreement terms, and Westmark II was set for trial in January 2004. A few months before trial, and over five years after the settlement agreement was reached, Burien advised Westmark that the agreement might be void because it violated the Open Public Meetings Act (OPMA), chapter 42.30 RCW. Under the OPMA, a city council can approve of a settlement agreement only in an open public meeting. The settlement agreement between Burien and Westmark had never been approved by the Burien city council in an open public meeting. Westmark requested that the court determine the validity of the settlement agreement under the OPMA. Noting that the Court of Appeals did not address this issue, the trial court voided the settlement agreement. It concluded that this resolved all claims for relief in Westmark II and dismissed the case with prejudice. It also vacated the prior dismissal of Westmark I and permitted Westmark to file and serve an amended complaint.
¶ 8 Westmark's amended complaint alleged violation of 42 USC section 1983, negligence, violation of chapter 43.21C RCW, negligent misrepresentation, and intentional or negligent interference with business relations or expectancies. Westmark named Burien, its attorney Mike Kenyon, and several city employees as defendants. The case was removed to federal court, which remanded the four state law claims but retained jurisdiction over the section 1983 claims. The federal court stayed further proceedings pending resolution of the state law claims.
¶ 9 The case proceeded in state court solely against Burien because the 42 USC section 1983 claims were the only claims that ran against the individual defendants. The trial court dismissed the chapter 43.21C RCW claim because “administrative review was not sought or has not been completed” as to this claim. The trial began on October 6, 2005. After the trial began, the hearing examiner issued his formal decision upholding Burien's 1996 DS. The court refused to admit this decision and instructed the jury that “[t]he issue of what type of SEPA threshold determination should issue is not before you.”
¶ 10 In jury instruction 5, the court summarized Westmark's three claims:
(1) The plaintiff Westmark Development Corporation claims that the defendant City of Burien was negligent by unreasonably delaying a threshold determination regarding Westmark's Revised application for a permit to build a 176-unit project.
(2) The plaintiff Westmark also claims that the defendant Burien intentionally interfered with plaintiff's business expectancies by the various acts and omissions described above and below that were motivated by Burien's improper motive to stop all construction of multi-family housing and that were intended to or had the effect of delaying and/or preventing construction of the project.
(3) The plaintiff Westmark also claims that the defendant Burien made negligent misrepresentations to Westmark by providing false, incomplete, and/or misleading information to Westmark regarding the validity of the settlement between the parties in 1998.
At Burien's request, the jury was given a general verdict form. In its closing argument, Westmark asked for total damages of $13,130,000-$3,429,000 for the delay from 1993 to 1996 and $9,571,130 for the delay from 1998 to 2003.3 Verbatim Report of Proceedings (VRP) (Nov. 17, 2005) at 3819-20. The jury returned a verdict in favor of Westmark for $10,710,000. Burien appeals.
ANALYSIS
Chapter 64.40 RCW
¶ 11 Burien argues that chapter 64.40 RCW provides the only method for recovering delay damages arising out of the permitting process. It further argues that Westmark has no claim for damages because it failed to satisfy the procedural requirements of the statute. Chapter 64.40 RCW, however, does not preclude Westmark from recovering damages under a common-law tort theory because the statute itself provides that it is “in addition to any other remedies provided by law,” RCW 64.40.040, and Washington precedent allows common-law tort claims in addition to chapter 64.40 RCW claims.
¶ 12 In 1982, the legislature created a claim for damages on behalf of permit applicants under certain circumstances:
Owners of a property interest who have filed an application for a permit have an action for damages to obtain relief from acts of an agency which are arbitrary, capricious, unlawful, or exceed lawful authority, or relief from a failure to act within time limits established by law: PROVIDED, That the action is unlawful or in excess of lawful authority only if the final decision of the agency was made with knowledge of its unlawfulness or that it was in excess of lawful authority, or it should reasonably have been known to have been unlawful or in excess of lawful authority.
RCW 64.40.020(1). The statute also provides, “The remedies provided by this chapter are in addition to any other remedies provided by law.” RCW 64.40.040. The purpose of chapter 64.40 RCW is to “provide a swift remedy for property damage caused by governmental agency action.” Wilson v. City of Seattle, 122 Wash.2d 814, 825, 863 P.2d 1336 (1993). The statute contains exhaustion and time limit requirements: “Any action to assert claims under the provisions of this chapter shall be commenced only within thirty days after all administrative remedies have been exhausted.” RCW 64.40.030.
¶ 13 The plain language of chapter 64.40 RCW provides that it is a remedy “in addition” to “other remedies provided by law” and is not the exclusive remedy for claims against an “agency” arising out of the permitting process. RCW 64.40.040. City of Seattle v. Blume, 134 Wash.2d 243, 947 P.2d 223 (1997) supports our interpretation of the statute. The Blumes sought a permit to construct an office and research facility. They anticipated a six-to nine-month permit processing time and that construction would begin in the fall 1987. The project was opposed by two neighborhood groups, however, and after a series of delays, the Blumes withdrew their project in 1992 as no longer feasible. In seeking relief against Seattle, the Blumes alleged that “ by delaying the permitting process” Seattle violated chapter 64.40 RCW. Blume, 134 Wash.2d at 249, 947 P.2d 223. The Blumes also brought a claim for tortious interference with a business expectancy. The Court of Appeals held that both claims were time barred under RCW 64.40.030. The Supreme Court disagreed, stating, “Petitioners' tortious interference claim is separate from their claim for damages pursuant to RCW 64.40.020. Thus, it was erroneous for the court to find that Petitioners' tortious interference claim was time barred under RCW 64.40.030.” Blume, 134 Wash.2d at 251, 947 P.2d 223. The court further explained that intentional interference with a business expectancy is a “common-law tort” subject to the three-year statute of limitations. Blume, 134 Wash.2d at 251, 947 P.2d 223.
¶ 14 In dissent, Justice Talmadge maintained that tortious interference with a business expectancy should be abolished “where clearer remedial schemes such as RCW 64.40 and other statutory provisions exist.” Blume, 134 Wash.2d at 267, 947 P.2d 223. The majority was not persuaded by this and declined to abolish tortious interference with a business expectancy in the context of permit applications. In light of Blume and other precedents, we hold that chapter 64.40 RCW does not bar claims for tortious interference with a business expectancy in the permit process context. See also Wilson, 122 Wash.2d at 823, 863 P.2d 1336 (“RCW 64.40.020 is not merely a codification of preexisting common-law tort remedies, but is a new cause of action not previously available. The statute expressly states the remedies provided are in addition to any other remedies provided by law.”); and Callfas v. Dep't of Constr. & Land Use, 129 Wash.App. 579, 595 n. 7, 120 P.3d 110 (2005) (“[I]f the Callfases can state a claim for intentional interference with a business expectancy, that cause of action would not be barred by [the chapter 64.40 RCW] statute of limitations.”). Chapter 64.40 RCW also does not bar Westmark's claim for negligent delay. Though the cases cited do not expressly discuss negligent delay, like tortious interference with a business expectancy, it is not barred by chapter 64.40 RCW because it is a common-law tort remedy. Moreover, the tortious interference claim was predicated at least in part on negligent delay.
¶ 15 Burien argues that Callfas and Blume are distinguishable because the plaintiffs in those cases alleged more than just permit delay. Westmark also alleged more than permit delay. As will be discussed below, Westmark argued to the jury that Burien interfered with its business expectancies for an improper purpose by singling out Emerald Pointe because of its opposition to apartment dwellers and its desire to appease a politician that lived nearby.
¶ 16 Burien also argues that RCW 64.40.040, which provides, “The remedies provided by this chapter are in addition to any other remedies provided by law,” does not allow Westmark to pursue a tortious interference with a business expectancy claim because “remedies” are distinct from “rights.” It cites Pettis v. State, 98 Wash.App. 553, 990 P.2d 453 (1999), which explained, “ ‘A “right” is a legal consequence deriving from certain facts, while a remedy is a procedure prescribed by law to enforce a right.’ ” Pettis, 98 Wash.App. at 561, 990 P.2d 453 (quoting State v. McClendon, 131 Wash.2d 853, 861, 935 P.2d 1334 (1997)). Contrary to Burien's argument, however, the Supreme Court has not interpreted chapter 64.40 RCW as being the sole means by which an action for negligent delay in the permitting process may be brought. See Wilson, 122 Wash.2d at 823, 863 P.2d 1336 (“RCW 64.40.020 is not merely a codification of preexisting common-law tort remedies, but is a new cause of action not previously available. The statute expressly states the remedies provided are in addition to any other remedies provided by law.”).
¶ 17 Finally, Burien contends that SEPA decisions, including the time necessary to make them, are discretionary and therefore should enjoy quasi-judicial immunity. In support, it cites Dunstan v. City of Seattle, 24 Wash.App. 265, 600 P.2d 674 (1979), but the plaintiffs in that case based their tort claim on the validity of the permit decision, not the delay in making the decision. Also, as explained above, the courts in Blume, Wilson, and Callfas acknowledged the validity of common-law tort claims arising out of delays in the permit application process. See also Pleas v. City of Seattle, 112 Wash.2d 794, 805, 774 P.2d 1158 (1989) (allowing a claim for tortious interference with a business expectancy claim based in part on the city “arbitrarily delaying” a building project).
Jury Instructions
¶ 18 Burien contends that the trial court erred by instructing the jury that it could consider SEPA timelines in determining whether Burien was negligent and by allowing the jury to “decide which timeline applied to this case.” Br. of Appellant at 50. The trial court instructed the jury that Westmark had the burden of proving “that Burien unreasonably delayed making a SEPA decision on Westmark's revised application[.]” Instruction 7. Instruction 9, to which Burien does not cite or assign error, explained the meaning of a “SEPA decision” as follows:
Upon receipt of a complete revised application, the responsible official for the City of Burien has a duty to make a SEPA decision. The responsible official may decide that the contents of the revised application: (1) did not constitute a substantial change to the original application, and would not require a threshold determination; (2) did constitute a substantial change to the original application but was still likely to have significant adverse environmental impacts so that a new threshold determination was not required; or (3) did constitute a substantial change to the original application and likely lacked significant environmental impacts so that a new threshold determination is required.
Instruction 9. Instruction 10 explained to the jury, “The violation, if any, of a statute, ordinance, or administrative regulation is not necessarily negligence, but may be considered by you as evidence in determining negligence.” (Emphasis added.) And, “Such a violation may be excused if it is due to some cause beyond the violator's control, and that ordinary care could not have guarded against [it].” Finally, instruction 11 informed the jury:
For any complete applications submitted prior to September 1, 1992 where a threshold determination is required:
A regulation in Washington provides that the responsible official shall make a threshold determination as close as possible to the time the agency is presented with a proposal. In most cases the time to make a decision should not exceed fifteen days. Complex proposals, those where additional information is needed, and/or those accompanied by an inaccurate checklist may require additional time․
Instruction 11 also informed the jury:
For any complete applications submitted after August 31, 1992 where a threshold determination is required:
A regulation in Washington provides that the responsible official shall make a threshold determination as close as possible to the time an agency is presented with a proposal, but in any event, no later than ninety days after the application and supporting documentation and [sic] determined to be complete.
¶ 19 The court did not err by informing the jury of SEPA timelines. It did not instruct the jury that it had to choose which timeline applied. Instead, the court instructed the jury that after receiving a complete revised application, an agency is required to make a “SEPA decision.” It further instructed the jury that a SEPA decision is, essentially, any decision on the revised application, even if the decision is to not change the original threshold decision. In deciding whether Burien's delay in making a SEPA decision was negligent, the jury was instructed on two different timelines that have been used in Washington for threshold determinations. The jury was instructed that Burien's failure to meet these timelines was not necessarily negligence, but could be considered by the jury “as evidence in determining negligence.” Instruction 10. And further, “Such a violation may be excused if it is due to some cause beyond the violator's control, and that ordinary care could not have guarded against [it].” Instruction 10. Stated another way, the jury was instructed that it could consider, or not consider, either timeline in determining whether Burien's delay in making a SEPA decision was negligent. Nothing directed the jury to conclude that a violation of a regulation was conclusive evidence of negligence. The jury was not bound by the timelines for another reason as well-it could have concluded that the delay was “beyond the violator's control” because Westmark was to blame for the delay due to its failure to pay fees and provide documents to Burien.
¶ 20 Burien also contends that instructing the jury on SEPA timelines was error because instruction 13 explained that the jury could find tortious interference with a business expectancy based on a violation of “a statute, a regulation, a recognized rule of common law, or an established standard of a trade or profession.” Burien argues that this was prejudicial because the jury could find tortious interference based on a violation of SEPA timelines, but was not instructed on which timeline applied to this case. We do not consider this argument because Burien makes it for the first time in its reply brief, thus not allowing Westmark an opportunity to respond. Cowiche Canyon Conservancy v. Bosley, 118 Wash.2d 801, 809, 828 P.2d 549 (1992); see also In re Disciplinary Proceeding of Kennedy, 80 Wash.2d 222, 236, 492 P.2d 1364 (1972) (“Points not argued and discussed in the opening brief are deemed abandoned and are not open to consideration on their merits.”); and Dickson v. United States Fid. & Guar. Co., 77 Wash.2d 785, 787-88, 466 P.2d 515 (1970) (“Contentions may not be presented for the first time in the reply brief.”).
Testimony of Robert Thorpe
¶ 21 Burien argues that the jury instructions discussed above were particularly prejudicial because Westmark's expert witness on SEPA processing, Robert Thorpe, was allowed to testify about the law. We conclude that the court did not err in allowing Thorpe to testify because he merely testified as to how long, as a matter of fact, a SEPA decision takes and not on the legal deadlines for making such a decision. Additionally, Burien did not object to most of the testimony it argues was improper.
¶ 22 Thorpe testified that he had worked as a SEPA responsible official since 1971. Westmark's attorney asked Thorpe, “Well, have you made threshold determinations on apartment projects where there was originally a declaration of significance, and then there was a revision made so that you needed to make a new threshold determination?” VRP (Oct. 24, 2005) at 1474-75. Burien's attorney objected to the question, citing ER 403. The court overruled the objection because “[i]t's an attempt to lay foundation.” Id. at 1475. Thorpe answered the question. Westmark's attorney then asked, “What is your practice, as a SEPA responsible official, for the amount of time you take to make a threshold determination?” Id. at 1475. Burien objected but the court overruled the objection. Thorpe then answered,
We all started under the old rules of 15 days was the requirement, when the regulations first came out, and the standard practice is, normally, around 30 days, and in an extreme situation nowadays, you might see 90 days. But standard of practice is, in everything that I've ever been involved in, in either making a decision or the applications I've made for a number of clients, is around 30 to 45 days.
Id. at 1475-76. Burien again objected and moved to strike Thorpe's answer “on the basis that this is a matter of law for the Court to determine, not his standard of practice.” Id. at 1476. The court then heard argument in the absence of the jury.
¶ 23 After hearing argument, the court ruled that Thorpe could give his opinion on “the factual issue of how long, reasonably, a normal SEPA official would take” to make a SEPA determination and not on any legal deadline that might exist. Id. at 1486. After the jury returned, the court sustained Burien's objection, struck Thorpe's last answer (quoted above), and instructed the jury to disregard it. The court did not err by allowing Thorpe's testimony following the ruling because this testimony concerned how long it would normally take, as a matter of fact, to make a SEPA determination for a project like Emerald Pointe. It was based on his experience as a SEPA responsible official.
¶ 24 Burien also argues that the court erred by allowing Thorpe to testify that when King County accepted Westmark's revised plan, the original DS was no longer in place and a new threshold determination was required. Similarly, Burien argues that the court erred by allowing Thorpe to testify that standard practice was that when a government unit accepts a revision, this automatically withdraws the DS, so Burien should have begun processing the application even though Westmark may not have paid all of its fees. Burien did not object to any of this testimony, however, and it does not fall within the scope of its original objection to Thorpe's testimony about SEPA timelines. On appeal, Burien has not adequately briefed why reversal is required despite its failure to object during the trial. And like Thorpe's other testimony, this testimony was based on his experience as a SEPA responsible official.
¶ 25 Finally, Burien argues that the court erred by allowing Thorpe to testify about what information was necessary to complete Westmark's revised application. Again, Burien did not object when this testimony was given and, in fact, Thorpe gave this testimony in response to Burien's questions on cross-examination.
Exclusion of Hearing Officer's Decision
¶ 26 Burien assigns error to the trial court's refusal to admit into evidence the hearing officer's decision upholding Burien's DS. Burien does not provide argument regarding this evidentiary exclusion beyond a statement in a footnote that it was erroneous and prejudicial because Westmark presented evidence that the revised application deserved a Determination of Nonsignificance (DNS) or a Mitigated Determination of Nonsignificance (MDNS). “Passing treatment of an issue or lack of reasoned argument is insufficient to merit judicial consideration.” Palmer v. Jensen, 81 Wash.App. 148, 153, 913 P.2d 413 (1996), remanded on other grounds, 132 Wash.2d 193, 937 P.2d 597 (1997). Moreover, the appropriateness of Burien's decision to issue a DS instead of a DNS or an MDNS was not relevant to this case because Westmark claimed that it was harmed by Burien's delay in issuing the DS, not by the DS itself.
Tortious Interference with a Business Expectancy
¶ 27 Burien contends that the evidence was insufficient to support the jury's verdict in favor of Westmark on the tortious interference with a business expectancy claim. Westmark argues that it presented sufficient evidence that Burien interfered with its business expectancy for an improper purpose and by improper means. Specifically, Westmark argues that substantial evidence supported the inference that Burien singled out Westmark's project because it was an apartment building and because of pressure from a local politician (improper purpose) and improperly delayed review of the project (improper means). We affirm the trial court because, viewing the evidence in a light most favorable to Westmark, there was substantial evidence from which the jury could conclude that Burien acted for an improper purpose or by improper means.
¶ 28 “Overturning a jury verdict is appropriate only when it is clearly unsupported by substantial evidence.” Burnside v. Simpson Paper Co., 123 Wash.2d 93, 107-08, 864 P.2d 937 (1994). The “substantial evidence” test is met where there is sufficient evidence to persuade a rational, fair-minded person of the truth of the premise. Winbun v. Moore, 143 Wash.2d 206, 213, 18 P.3d 576 (2001). In reviewing the evidence, the appellate court does not reweigh the evidence, draw its own inferences, or substitute its judgment for the jury.
“This court will not willingly assume that the jury did not fairly and objectively consider the evidence and the contentions of the parties relative to the issues before it. The inferences to be drawn from the evidence are for the jury and not for this court. The credibility of witnesses and the weight to be given to the evidence are matters within the province of the jury and even if convinced that a wrong verdict has been rendered, the reviewing court will not substitute its judgment for that of the jury, so long as there was evidence which, if believed, would support the verdict rendered.”
Burnside, 123 Wash.2d at 108, 864 P.2d 937 (citations omitted) (quoting State v. O'Connell, 83 Wash.2d 797, 839, 523 P.2d 872 (1974)).
¶ 29 The Washington Supreme Court has identified five elements necessary to make a claim for tortious interference with a business expectancy:
“1. The existence of a valid contractual relationship or business expectancy;
“2. That defendants had knowledge of that relationship;
“3. An intentional interference inducing or causing a breach or termination of the relationship or expectancy;
“4. That defendants interfered for an improper purpose or used improper means; and
“5. Resultant damages.”
Commodore v. Univ. Mech. Contractors, Inc., 120 Wash.2d 120, 137, 839 P.2d 314 (1992) (quoting Sintra, Inc. v. Seattle, 119 Wash.2d 1, 28, 829 P.2d 765 (1992)). Burien argues that it did not interfere with Westmark's business expectancy for an improper purpose or by improper means.
¶ 30 Substantial evidence supports the conclusion that Burien intentionally interfered with Westmark's business expectancy for an improper purpose by singling out the Emerald Pointe project because it was to be an apartment building. “[A] cause of action for tortious interference arises from either the defendant's pursuit of an improper objective of harming the plaintiff or the use of wrongful means that in fact cause injury to plaintiff's contractual or business relationships.” Pleas v. City of Seattle, 112 Wash.2d 794, 803-04, 774 P.2d 1158 (1989). The jury was instructed that “ ‘[i]nterference for an improper purpose’ means interference with an intent to harm the plaintiff Westmark.” Instruction 13. A municipality may not “single out” a building project and use its permitting process to block the project's development. See Pleas, 112 Wash.2d at 806, 774 P.2d 1158 (“There is ample evidence in the record to support the finding of the trial court that the City singled out Parkridge's project and applied its land use regulations in such a manner to block any apartment development on the property.”). Although there was evidence to the contrary, there was evidence that Burien singled out the Emerald Pointe project because it was to be an apartment building.
¶ 31 The evidence in favor of Westmark showed that King County was close to making a SEPA decision around the time that the project was transferred to Burien. See, e.g., RP (Oct. 17, 2005) at 845-46 (King County stated and Westmark's architect, Roger Richert, believed that SEPA review of Westmark's revised application would proceed quickly). Burien incorporated on February 28, 1993. Shortly before incorporation, the city council passed a resolution imposing a moratorium on multi-family developments within the new city limits of Burien. Burien's first mayor, Arun Jhaveri, testified that the purpose of the moratorium was “to freeze not only new applications but multifamily development in general․” Clerk's Papers (CP) at 5246. The attorney who represented Westmark through much of the permitting process, John Hempelmann, testified that Burien incorporated partly to stop the development of apartment buildings. He also testified that he believed Burien opposed the Emerald Pointe project and requested that it be comprised of condominiums instead of apartments because Burien did not want to attract the kind of people that live in apartments. In 1998, Burien requested that Emerald Pointe be built as condominiums instead of apartments.
¶ 32 The evidence also showed that Burien was not forthright about its motives for taking on the Emerald Pointe project, giving credence to Westmark's theory that it was singled out. During the time of Burien's incorporation, there were around 100 project proposals pending with King County that were to occur within the area that eventually became Burien. Emerald Pointe was one of only a few projects transferred from King County to Burien. Burien's mayor testified that these projects were chosen because “these were projects of smaller or less complex nature” appropriate for the small staff of a newly incorporated city. CP at 5242. Burien argued at trial, however, that its delay in issuing a SEPA determination on the Emerald Pointe project was due in part to its complexity. See, e.g., VRP (Nov. 17, 2005) at 2726 (“[I]t is complex. To clear eight acres of total vegetation, make cuts and fills that are stable to hold the building sites is not a simple operation[.]”). And Robert Garwood, the Burien planner who was initially assigned to the Emerald Pointe project, testified that he was told that Burien took over Emerald Pointe because it was controversial. The testimony of Burien's first director of community development, Gregg Dohrn, revealed that he had discussed Emerald Pointe with King County prior to Burien's incorporation and later labeled it a “hot project.” VRP (Nov. 7, 2005) at 2839. Dohrn gave Emerald Pointe “priority status” but did not issue a SEPA determination in the two-year and seven-month period he was Burien's SEPA responsible official. The evidence indicated that Dohrn's successor, Patrick Dugan, had decided to issue a DS for the project before he became Burien's SEPA responsible official and before he had reviewed the project's files.
¶ 33 There was also evidence that Burien intentionally interfered with Westmark's business expectancy for another improper purpose by singling out Emerald Pointe because of then state representative Georgette Valle's opposition to the project. Westmark's principal, architect, and attorneys were aware of her opposition to the project while it was under King County's control. Westmark's land use attorney, Hempelmann, testified that he was concerned that she was meeting with Burien officials behind closed doors “trying to kill this project.” VRP (Oct. 21, 2005) at 1381. The evidence showed that Valle lived close to the Emerald Pointe site and wanted to see it turned into a wildlife preserve.
¶ 34 Viewing all of this evidence in a light favorable to Westmark, the jury could have concluded that Burien singled out the Emerald Pointe project because of its general opposition to apartments and apartment dwellers and because of the pressure from Valle. As stated above, a municipality may not “single out” a building project and use its permitting process to block the project's development. See Pleas, 112 Wash.2d at 806, 774 P.2d 1158.
¶ 35 If the evidence in favor of Westmark is believed, the jury also could have concluded that Burien used improper means (delay) to interfere with Westmark's business expectancy. As described above, there was evidence that King County was close to making a decision on Westmark's revised application. When the project was transferred to Burien, Burien gave it priority status. One of Westmark's architects, Roger Richert, testified that Westmark immediately provided Burien the documents it requested if such documents were available. As of November 1994, Burien had had the project for a year and a half and had not made a decision on the revised application.
¶ 36 John Hempelmann testified that he had been involved in hundreds of SEPA reviews with governmental entities and has encountered delay in getting threshold determinations, but he had never experienced a situation where it took three years. He further testified that this was the longest, most frustrating, delayed process in the history of his career. Hempelmann was frustrated because Burien would not respond to Westmark's inquiries about the sufficiency of the environmental information provided. He also testified that Westmark would ask what specific issues needed to be addressed and Burien would not give straight answers.
¶ 37 Westmark's expert witness on SEPA processing, Robert Thorpe, testified that Burien took three years and four months to make a SEPA decision on Westmark's revised application. He also testified that in his experience, SEPA decisions typically take 30 days and at the most, 120 days. This evidence, if believed, was sufficient for the jury to find that Burien improperly delayed the project.
¶ 38 Burien argues that the delay in issuing a SEPA determination was due to Westmark's refusal to pay fees or submit documents on time. Westmark disputes this, arguing that it paid all fees and provided requested documents. The evidence on this is conflicting, and the jury could have reasonably concluded that the delay was not due to unpaid fees or Westmark's failure to provide documents. Thorpe testified that in practice, unpaid fees typically do not stop a SEPA determination from being made. He further testified that based on his experience and review of the file, it was unreasonable for Burien to stop processing Westmark's application while fees were being disputed. From this evidence, the jury could have concluded that Burien's delay was not due to unpaid fees or missing documents.
¶ 39 Burien also argues that there was no delay, as a matter of law, because it was not required to issue a SEPA determination since the revised application did not merit anything more than a new DS. Westmark's argument, however, is that Burien was required to make a decision on its revised application within a reasonable time, even if the decision was to maintain a DS. Burien even told Westmark as early as December 1994 that it had “no choice but to start with an environmental review and a SEPA determination for the revised project.” Ex. 124. And Burien eventually made a SEPA determination on the revised application.
¶ 40 Moreover, Burien was required to issue a SEPA determination on Westmark's revised application. Under WAC 197-11-310(1), “A threshold determination is required for any proposal which meets the definition of an action ․ subject to the limitations in WAC 197-11-600(3) concerning proposals for which a threshold decision has already been issued․” “ ‘Proposal’ means a proposed action.” WAC 197-11-784. “A proposal exists at that stage in the development of an action when an agency is presented with an application․” WAC 197-11-784. If there has already been a threshold determination, WAC 197-11-600(3)(b)(i) provides:
Any agency acting on the same proposal shall use an environmental document unchanged, except in the following cases:
․
(b) For DNSs and EISs, preparation of a new threshold determination or supplemental EIS is required if there are:
(i) Substantial changes to a proposal so that the proposal is likely to have significant adverse environmental impacts (or lack of significant adverse impacts, if a DS is being withdrawn)․
These WAC provisions do not demonstrate that Burien was required to issue a DNS or a MDNS. Rather, they imply that an agency acting upon a revised proposal must at least make a SEPA decision on that proposal, whether it be to stand by the original DS or issue a different threshold determination. It appears that Burien understood that it was obligated to at least notify Westmark of its official SEPA decision on the revised application, and it eventually did so in August 1996. Burien's argument on appeal seems to be that it would have been acceptable for it to issue no decision whatsoever on the revised application due to the original DS because it had determined that the changes to the Emerald Pointe project did not merit a DNS or an MDNS. But if that was Burien's decision, it had to be communicated. Burien was at least obligated to notify Westmark of its official decision on the revised application, and Westmark was entitled to argue to the jury that Burien's delay in doing so was unreasonable.
¶ 41 Finally, Burien argues that the evidence of tortious interference with a business expectancy was insufficient because it was not similar enough to the evidence in Pleas. In Pleas, the City of Seattle agreed to notify a group of concerned Capitol Hill residents of any demolition permit applications in the Capitol Hill area. The trial court found that this was “ ‘special treatment [that] constituted a form of favoritism.’ ” Pleas, 112 Wash.2d at 796, 774 P.2d 1158 (quoting CP at 148-49). A developer applied for a permit, and the City notified the group. City officials met and decided to require an EIS before issuing demolition permits, “bypass[ing] the normal procedures” under SEPA, including the threshold determination process. Pleas, 112 Wash.2d at 796, 774 P.2d 1158. The city council granted the neighborhood group's petition for a rezone of the site the developer wanted to demolish. The developer filed a petition for certiorari to review the rezone. The developer had also submitted the data requested for a building permit, but the City refused to take action on the permit application. The developer brought a mandamus action to compel the City to process the permit application. This action was consolidated with the action challenging the rezone.
¶ 42 The trial court ruled that the rezone was “unreasonable, arbitrary and capricious and therefore void” and that the City improperly refused to process the building permit application. Pleas, 112 Wash.2d at 797, 774 P.2d 1158. The court ordered the City to process the building permit application promptly and in good faith. The developer filed a lawsuit against the City for intentional interference with a business expectancy. The lawsuit was stayed until after the developer obtained a building permit and developed the property.
¶ 43 After the court's order, the City notified the developer that a new EIS was required. The City refused to issue a demolition permit even though it had issued emergency orders declaring that the structures the developer sought to demolish were “an imminent hazard.” Pleas, 112 Wash.2d at 798, 774 P.2d 1158. Over five years after the court ordered the City to process the permit application promptly, the City finally issued an EIS, and another year later it granted the developer a master use permit.
¶ 44 The facts in this case may not be as egregious as the facts in Pleas. Pleas, however, does not set the minimum standard for tortious interference with a business expectancy. Moreover, Burien exaggerates when it claims, “this case is nothing like Pleas.” Br. of Appellant at 59. Here, Westmark alleged that Burien acted for an improper purpose by singling out Emerald Pointe because of its opposition to apartment dwellers and its desire to appease a state representative who lived near the development site. Similarly, the City of Seattle in Pleas acted for an improper purpose by singling out a particular development in order to please a neighborhood group. Here, Westmark alleged that Burien improperly delayed its revised application. Similarly, in Pleas the court found that Seattle's improper means was “arbitrarily delaying” the developer's project. The facts in Pleas are sufficiently analogous to the facts in this case. We affirm.
¶ 45 The remainder of this opinion has no precedential value. Therefore, it will be filed for public record in accordance with the rules governing unpublished opinions.
Negligent Misrepresentation
¶ 46 Burien argues that Westmark's negligent misrepresentation claim is fatally flawed on a number of grounds. The Washington Supreme Court has set forth the elements for negligent misrepresentation:
“One who, in the course of his business, profession or employment, ․ supplies false information for the guidance of others in their business transactions, is subject to liability for pecuniary loss caused to them by their justifiable reliance upon the information, if he fails to exercise reasonable care or competence in obtaining or communicating the information.”
Van Dinter v. Orr, 157 Wash.2d 329, 332, 138 P.3d 608 (2006) (quoting Restatement (Second) of Torts § 552(1) (1977)). “To establish a claim, a plaintiff must show that the defendant negligently supplied false information the defendant knew, or should have known, would guide the plaintiff in making a business decision, and that the plaintiff justifiably relied on the false information.” Van Dinter, 157 Wash.2d at 333, 138 P.3d 608. “The proof of such a claim must be clear, cogent, and convincing.” Van Dinter, 157 Wash.2d at 333, 138 P.3d 608.
¶ 47 Burien argues for the first time on appeal that it did not owe Westmark a duty of care in communicating that a settlement had been approved. RAP 2.5(a) provides that an “appellate court may refuse to review any claim of error which was not raised in the trial court․” “RAP 2.5(a) is written in discretionary, rather than mandatory, terms.” Roberson v. Perez, 156 Wash.2d 33, 39, 123 P.3d 844, review denied, 155 Wash.2d 1002, 120 P.3d 578 (2005). RAP 2.5(a) contains exceptions to its general rule against raising new issues on appeal. Under RAP 2.5(a)(2), “a party may raise the ․ failure to establish facts upon which relief can be granted․” “This exception is fitting inasmuch as ‘[a]ppeal is the first time sufficiency of the evidence may realistically be raised.’ ” Roberson, 156 Wash.2d at 40, 123 P.3d 844 (quoting State v. Hickman, 135 Wash.2d 97, 103 n. 3, 954 P.2d 900 (1998)).
¶ 48 Burien argues that its duty argument fits under this exception. We disagree. Burien waived the issue of whether or not it owed Westmark a duty of care because it did not raise this argument in the trial court. This argument cannot be raised on appeal under RAP 2.5(a)(2) because the existence of a duty is a question of law, not a factual inquiry into the sufficiency of the evidence. Hertog v. City of Seattle, 138 Wash.2d 265, 273, 979 P.2d 400 (1999). But, even if we conclude that Burien's duty argument is properly before us, Burien had a duty to not represent to Westmark that a settlement had been approved in an open public meeting.
¶ 49 Burien first argues that no duty arose in this case because its alleged misrepresentations were not “information for the guidance of others in their business transactions ․” but instead occurred during settlement negotiations to resolve ongoing litigation. Restatement (Second) of Torts § 552(1). Second, Burien argues that Westmark's claim is in fact an omission claim and that Westmark failed to establish a relationship requiring disclosure. We reject both arguments.
¶ 50 Burien's misrepresentation was “information for the guidance of others in their business transactions” because both Burien and Westmark had pecuniary interests in the settlement agreement. Restatement (Second) of Torts § 552(1). The Restatement explains that a negligent misrepresentation claim applies to one who supplies false information “in the course of his business, profession or employment, or in any other transaction in which he has a pecuniary interest[.] ” Restatement (Second) of Torts § 552(1) (emphasis added); see also ESCA Corp. v. KPMG Peat Marwick, 135 Wash.2d 820, 826, 959 P.2d 651 (1998) (adopting the definition of negligent misrepresentation set forth in the Restatement (Second) of Torts ). Westmark argued at trial that Burien misrepresented that a settlement agreement had been approved by the city council in an open session. Westmark and Burien had pecuniary interests in the settlement because it involved, among other things, an exchange of money. See, e.g., Ex. 294 (terms of settlement agreement included Burien paying Westmark).
¶ 51 Burien had a duty to not represent that a valid settlement agreement had occurred when the opposite was true. At oral argument, Burien acknowledged that if its communications to Westmark had explicitly stated that the settlement was approved in an open public meeting, this would have constituted an actionable misrepresentation. Thus, Burien effectively acknowledges that it had a duty to not affirmatively represent that the settlement had been approved in an open public meeting. The question that must be resolved is whether Burien's communication could reasonably be interpreted by the jury as representing that the settlement offer was approved by the city council in an open public meeting.
¶ 52 The jury was instructed that it had to find the elements of negligent misrepresentation by clear, cogent, and convincing evidence. The Supreme Court has explained the meaning of this standard of evidence.
What constitutes clear, cogent, and convincing proof necessarily depends upon the character and extent of the evidence considered, viewed in connection with surrounding facts and circumstances. Whether the evidence in a given case meets the standard of persuasion, designated as clear, cogent, and convincing, necessarily requires a process of weighing, comparing, testing, and evaluating-a function best performed by the trier of the fact, who usually has the advantage of actually hearing and seeing the parties and the witnesses, and whose right and duty it is to observe their attitude and demeanor.
The appellate function should, and does, begin and end with ascertaining whether or not there is substantial evidence supporting the facts as found.
Bland v. Mentor, 63 Wash.2d 150, 154, 385 P.2d 727 (1963). The clear, cogent, and convincing standard has two elements: “first, the amount of evidence that is a prerequisite to submitting the question to the trier of fact; and second, the persuasive impact which the law requires of that evidence.” Colonial Imports, Inc. v. Carlton Nw., Inc., 121 Wash.2d 726, 734, 853 P.2d 913 (1993). “The first element, often referred to as the ‘burden of production’, need only be met by substantial evidence.” Colonial Imports, 121 Wash.2d at 734, 853 P.2d 913 (quoting Cook v. Cook, 80 Wash.2d 642, 646, 497 P.2d 584 (1972)). Here, there was substantial evidence of a misrepresentation, and therefore, the jury was properly allowed to consider whether there was clear, cogent, and convincing evidence of a misrepresentation.
¶ 53 Burien's second duty argument is that Westmark's claim is an omissions claim and that Westmark failed to establish a relationship requiring disclosure because attorneys in an adversarial setting do not have a duty to disclose. Though the parties were adversaries, Burien was at least obligated to not represent that the settlement agreement was properly approved in an open public meeting. The events in this case demonstrate the importance of disclosure because Westmark agreed to the cancellation of depositions and the striking of the trial date based on the representation that a settlement had been approved by the Burien City Council. Even after Westmark I was dismissed in 2000, Burien waited approximately two and a half years to inform Westmark that the settlement had not been approved in an open public meeting. And for a total of approximately five and a half years, Westmark proceeded on the assumption that the matter had been settled.
¶ 54 Burien cites numerous cases for the proposition that between opposing counsel, there cannot be a special relationship of trust and confidence requiring disclosure. First, it cites Bowman v. Two, 104 Wash.2d 181, 704 P.2d 140 (1985), a legal malpractice case in which the plaintiff sued her son's attorney, “alleging professional negligence resulting in injuries both to her son and to the parent-child relationship.” Bowman, 104 Wash.2d at 182, 704 P.2d 140. The son's attorney argued that he had no duty to his client's mother. The court agreed because the mother had no contractual relationship with the attorney and because
in no instance has a court found liability to a third party in an adversarial relationship and we find no policy reason for extending that liability. Existence of a duty to an adversary party beyond the courtesy and respect owed all participants in the legal process would interfere with the undivided loyalty an attorney owes a client and would diminish an attorney's ability to achieve the most advantageous position for a client.
Bowman, 104 Wash.2d at 188-89, 704 P.2d 140 (citations omitted). Bowman does not address the situation here where Burien alleges that Westmark negligently misrepresented that a valid settlement had occurred. Loyalty to and achieving an advantageous position for a client are not impacted by this misrepresentation.
¶ 55 Next, Burien cites Trask v. Butler, 123 Wash.2d 835, 872 P.2d 1080 (1994), also a legal malpractice case. In that case, the court stated,
The policy considerations against finding a duty to a nonclient are the strongest where doing so would detract from the attorney's ethical obligations to the client. This occurs where a duty to a nonclient creates a risk of divided loyalties because of a conflicting interest or of a breach of confidence.
Trask, 123 Wash.2d at 844, 872 P.2d 1080 (citation omitted). Like Bowman, Trask does not address the unique facts of this case. Additionally, Burien has not shown how the duty to avoid misrepresenting the validity of a settlement agreement “detract[s] from the attorney's ethical obligations to the client.” Trask, 123 Wash.2d at 844, 872 P.2d 1080.
¶ 56 Burien also cites Guarino v. Interactive Objects, Inc., 122 Wash.App. 95, 86 P.3d 1175 (2004). In particular, it cites to the Guarino court's partial approval of Mergens v. Dreyfoos, 166 F.3d 1114 (11th Cir.1999), a case which held that “reliance on misrepresentations or omissions was unreasonable as a matter of law between the parties negotiating a settlement agreement in the context of a contentious adversarial relationship.” Guarino, 122 Wash.App. 95, 122, 86 P.3d 1175 (2004). Guarino and Mergens do not support Burien's argument because Westmark is alleging that Burien misrepresented the validity of the settlement itself, not that it misrepresented any facts during the negotiation of the settlement.
¶ 57 Finally, Burien cites Mazon v. Krafchick, 158 Wash.2d 440, 144 P.3d 1168 (2006). Mazon does not support Burien's argument either for the same reason: it does not address the situation where one party tells an adverse party that a valid settlement has been reached. Additionally, it is distinguishable because it concerned a dispute between co-counsel and its analysis was specific to that relationship.
¶ 58 Burien next contends that even assuming it had a duty to not represent that a settlement had been properly approved, it made no such representation. We conclude, however, there was sufficient evidence for the jury to find that “Burien supplied information for the guidance of Westmark in its business transactions that was false․” Instruction 15.
¶ 59 There was evidence that Burien misrepresented to Westmark that a valid settlement had occurred. The February 24, 1998 letter from Burien's attorney, Michael Walter, to Westmark's counsel states:
As you know, Mike Kenyon and I met last night in Executive Session with the Burien City Council regarding Westmark's recent settlement proposal, as contained in your February 9, 1998 letter. After some significant deliberation and debate, a majority of the City Council has agreed to accept the settlement proposal, as indicated in your February 9th letter, with the following three modifications.
Ex. 184. The modifications concerned the selection of consultants and inspectors for the project and required that Westmark construct condominiums rather than apartments. The letter went on to state, “Unless we have agreement from Westmark to the revised terms of the Settlement Agreement, as outlined in this letter, we will be confirming our summary judgment motion for February 27th.” Ex. 184.
¶ 60 Burien acknowledges that its attorneys were aware that a settlement agreement required the approval of the city council in an open public meeting. And Westmark acknowledges its understanding of this principle as well. In light of this, the language in this letter could be reasonably interpreted as a representation that the city council had approved the settlement agreement in an open public meeting. While the letter states that Burien's attorneys met with the council in executive session, it goes on to state that “[a]fter some significant deliberation and debate, a majority of the City Council has agreed to accept the settlement․” Ex. 184 (emphasis added). Under the OPMA, a city council cannot agree to accept a settlement in an executive session, thus giving rise to Westmark's reasonable conclusion that the Burien City Council went into open session in order to vote on the settlement. See RCW 42.30.020(1)(3) (“ ‘Final action’ means a collective positive or negative discussion, or an actual vote by a majority of the members of a governing body when sitting as a body or entity, upon a motion, proposal, resolution, order, or ordinance.”) and Feature Realty, Inc. v. City of Spokane, 331 F.3d 1082, 1089 (9th Cir.2003) (“What the city council could not do was approve the settlement by way of a ‘collective positive decision’ in closed session.”).
¶ 61 At trial, Burien's attorney, Michael Kenyon, testified that he knew a settlement agreement needed to be approved in an open public meeting. He also testified that he knew that under the OPMA, a written settlement agreement was not required for a settlement to be approved in an open public meeting. Westmark's attorney, John Hempelmann, also testified that he knew the settlement had to be approved in an open public meeting. Given that both parties were aware of these legal requirements, Westmark could logically read the February 24 letter as representing that the settlement had been approved by the council in an open public meeting in accordance with the OPMA. Burien is charged with the knowledge that its February 24 letter could be reasonably interpreted in this way.
¶ 62 Burien's actions after the February 24 letter reinforced Westmark's belief that a settlement had been approved in an open public meeting. Later, on February 24, Westmark's attorney sent Burien a letter stating, “ ‘Westmark hereby accepts the offer to settle this dispute on the terms set forth․’ ” Br. of Respondent at 53 (quoting Ex. 185). The next day, Burien's counsel sent Westmark's counsel a letter confirming the settlement. “ ‘Thank you for your February 24, 1998 letter, which I received this morning, confirming the Settlement Agreement. As a result of the settlement, I have contacted the Snohomish County Superior Court Clerk and stricken the City's two summary judgment motions.’ ” Br. of Respondent at 53 (quoting Ex. 186). Though Burien later argued that the settlement was invalid because it was never put in writing, the trial court and the Court of Appeals rejected this argument. Additionally, Burien waited over five and a half years after the February 24 letter to tell Westmark that the settlement had not been approved in an open public meeting. Even after the Court of Appeals held that there was an enforceable settlement agreement in 2000 and Westmark I was dismissed, Burien waited until 2003 to inform Westmark that the settlement was invalid under the OPMA. Viewing these facts in a light favorable to Westmark, there was sufficient evidence for the jury to find that Burien made a misrepresentation.
¶ 63 Lastly, Burien argues that Westmark could not have justifiably relied on its communications in believing that the city council had approved the settlement agreement in an open public meeting. A reasonable finder of fact, however, could have found justifiable reliance based on a consideration of all the surrounding circumstances.
¶ 64 Justifiable reliance means that the “ ‘reliance was reasonable under the surrounding circumstances.’ ” Lawyers Title Ins. Corp. v. Baik, 147 Wash.2d 536, 545, 55 P.3d 619 (2002) (emphasis omitted) (quoting ESCA Corp. v. KPMG Peat Marwick, 135 Wash.2d 820, 827-828, 959 P.2d 651 (1998)). “Whether a party justifiably relied upon a misrepresentation is an issue of fact.” ESCA Corp., 135 Wash.2d at 828, 959 P.2d 651.
¶ 65 Here, Westmark justifiably relied on Burien's counsel's communications and subsequent actions in believing that a settlement had been approved in an open public meeting. As explained above, there was evidence that Burien misrepresented that the settlement had been approved in an open public meeting and this misrepresentation was reinforced by Burien's conduct after the purported settlement. Westmark's attorney, John Hempelmann, testified that based on Burien's communications and the fact that both parties knew the law, he believed that the settlement had been approved by the city council in an open public meeting. He testified as follows:
Q: Did you feel the need to go out to Burien and check with the City Council to see if they put the settlement on the record?
A: No.
Q: Is that because you relied on [Burien's attorney], Mr. Kenyon?
A: If Mike Kenyon tells me there's a deal, he's a good city attorney, he knows the rules, I'm sure he's done it.
VRP (Oct. 21, 2005) at 1404. Five years and eight months after Westmark believed the case was settled, Burien disclosed that it failed to have the city council approve the settlement agreement in an open public meeting.
¶ 66 From this evidence, a rational trier of fact could conclude that Westmark reasonably relied on the information supplied by Burien to believe that the settlement had been approved by the city council in an open public meeting. Despite the initial letter's reference to an executive session, it went on to state that a majority of the council had approved of the settlement. Hempelmann testified that based on Burien's counsel's reputation and knowledge of the law, he believed the settlement had been approved in an open session as required by law. Burien's counsel contacted the court and struck Burien's two summary judgment motions, reinforcing Westmark's belief that it had a valid settlement agreement with Burien. Finally, for over five years, Burien never mentioned that the agreement was invalid under the OPMA because it was not approved in an open public meeting. Given the circumstances, the jury could have concluded that Westmark's reliance was reasonable.
¶ 67 Burien argues that Westmark's reliance was, as a matter of law, unreasonable because when attorneys deal with officers of a municipal corporation, they are presumed to know the power and authority of such officers. In support, it cites Stoddard v. King County, 22 Wash.2d 868, 883-84, 158 P.2d 78 (1945). In Stoddard, an architect created plans for Harborview Hospital at the direction of the chairperson of the King County Board of Commissioners. He then sought payment from the county, arguing that he had a contract with the county. The chairperson, however, did not have the authority to enter into the contract. The court held the contract invalid because the board never ratified it. The court stated that
when dealing with an officer or officers of a municipal corporation, one must be presumed to have knowledge of the power and authority of such officer or officers, and that, when he deals with such officer or officers in a manner not in compliance with the law, he does so at his peril.
Stoddard, 22 Wash.2d at 883-84, 158 P.2d 78.
¶ 68 The plaintiff in Stoddard believed that the chairman of the King County Board of Commissioners had the authority to enter into a contract. Unlike in Stoddard, however, Westmark did not believe that Burien's attorneys had the authority to enter into a contract without city council approval in an open meeting. Rather, Westmark relied on Burien's counsel's communications, Burien's subsequent conduct, and the fact that both Burien and Westmark knew the OPMA rules, in believing that the city council had approved of the settlement in an open session. There was sufficient evidence for the jury to find this reliance justifiable.
¶ 69 Finally, Burien argues that Westmark's reliance was unreasonable because it could have inquired as to whether the settlement agreement was approved in an open public meeting (citing Hoel v. Rose, 125 Wash.App. 14, 105 P.3d 395 (2004)). In Hoel, the buyer of a parcel of land sued the seller for negligent misrepresentation. The seller unintentionally misrepresented the property's boundaries but encouraged the buyer to inspect the property for himself. He did not make a full inspection, but before the sale, he obtained an appraisal that contained a diagram of the property. The boundaries in the diagram were significantly different from what the seller had represented. The court held that the buyer had not established justifiable reliance because he should have fully investigated and researched the property, especially since he had information that the seller's representations about the property were false.
¶ 70 Here, Burien represented that the settlement agreement was approved in an open public meeting but, unlike the seller in Hoel, did not encourage Westmark to verify this information. And unlike the buyer in Hoel, Westmark did not have information in its possession contradicting Burien's assertion that the agreement was approved in an open public meeting. In fact, Burien waited over five years to inform Westmark that the agreement was invalid under the OPMA. In sum, unlike the seller in Hoel, Burien never gave Westmark a reason to question its assertion that the agreement was approved in an open public meeting.
Damages
¶ 71 Burien argues that George Johnson's expert testimony on damages was insufficient to support the jury's award of $10,710,000. We conclude that the award is supported by substantial evidence.
¶ 72 Damages for lost profits are recoverable if they are proven with reasonable certainty. “[L]ost profits must be proven with reasonable certainty or conversely, damages which are remote and speculative cannot be recovered.” Larsen v. Walton Plywood Co., 65 Wash.2d 1, 16, 390 P.2d 677 (1964). Washington courts will not deny a plaintiff substantial recovery merely because the precise amount of damage is incapable of exact ascertainment. Jacqueline's Washington, Inc. v. Mercantile Stores Co., 80 Wash.2d 784, 789, 498 P.2d 870 (1972). In a claim for lost profits, “Where the court is convinced substantial damages have been incurred, even though the exact amount in dollars is incapable of proof, the injured party will not be denied a remedy in damages because of lack of certainty.” V.C. Edwards Contracting Co. v. Port of Tacoma, 83 Wash.2d 7, 15, 514 P.2d 1381 (1973). Washington courts adhere to the principle that “ ‘the wrongdoer shall bear the risk of the uncertainty which [its] own wrong has created.’ ” Jacqueline's, 80 Wash.2d at 790, 498 P.2d 870 (quoting Bigelow v. RKO Radio Pictures, Inc., 327 U.S. 251, 266, 66 S.Ct. 574, 90 L.Ed. 652 (1946)). An appellate court should not disturb an award of damages made by a jury unless the award is outside the range of substantial evidence in the record, shocks the conscience of the court, or appears to have been arrived at as the result of passion or prejudice. Hanson PLC v. Nat'l Union Fire Ins. Co., 58 Wash.App. 561, 574, 794 P.2d 66 (1990).
¶ 73 Westmark's expert witness on damages was George Johnson. He had a master's degree in finance and accounting, had worked for many years in the banking industry as a financial consultant, and was at one time the chief financial officer for Pacific First Federal, a bank based in Tacoma. At the time of his testimony, he worked for a company he co-founded that specialized in valuing privately held businesses and determining economic damages. He testified that the capitalization rate he used for his calculations in this case was conservative, understating Westmark's damages by approximately $4 million.
¶ 74 Burien makes numerous arguments attempting to expose flaws in Johnson's testimony. First, it argues Johnson based his calculations on the belief that Burien wrongly denied permits to Westmark. In support, it cites to a portion of Johnson's 2005 damages report that refers to the “wrongful denial of permits.” Br. of Appellants at 94 (quoting Ex. 269 (marked but not offered)). Notwithstanding this reference in his report, Johnson's testimony was clearly based on delay. See, e.g., VRP (Nov. 2, 2005) at 2256 (“So we were calculating the damages due to delay of the project for three years ․”) and Id. at 2260 (“What we said is how well would Westmark have been in ′98, on cash flows for that profit, that's our starting line, that's what would have happened if there was no delay․”).
¶ 75 Next, Burien argues that Johnson's testimony was based on the assumption that a building permit should have been issued and construction should have begun on March 1, 1993. As Westmark correctly notes, however, Johnson's testimony was based on the assumption that Emerald Pointe would be completed by June 1995. Burien responds that this is also a flawed assumption because Johnson, an expert on financing construction projects, did not know how long it would take to complete an EIS and obtain a permit. Burien ignores Johnson's testimony that the precise threshold determination issued (DS, MDNS, or DNS) did not affect his damage calculations.
Q. Now, is there any difference for your purposes as to whether this says assuming MDNS issued in ′98 or whether it says DS issued in ′98; did that affect your calculations?
A. No, it's the same, but a determination is made, and I think that's the claim of Westmark, is that the City of Burien didn't do anything and that if they had issued a determination, one way or another, then Westmark could have proceeded accordingly. But there was no determination made, and it was the delay.
Id. at 2322. Additionally, as to the time it would take to obtain a building permit, Burien's own witness, Michael Kenyon, testified that Emerald Pointe did not have any environmental impacts that could not be mitigated, it was rare for a project to be denied on substantive SEPA authority, Westmark would eventually obtain a permit, and it was more probable than not that Emerald Pointe would be built. The jury had substantial evidence from which it could conclude that, but for the delay by Burien, Emerald Pointe would have been completed by June 1995. Johnson also deliberately made his calculations conservative. Moreover, he also testified that if the start date for damages was moved one year ahead (i.e., Emerald Pointe being completed in 1996 instead of 1995), the jury would need to subtract approximately $478,000 per year from the total damage calculation. In fact, the jury awarded Westmark $2,420,000 less than it requested. Given Johnson's and Kenyon's testimony and the flexibility and conservative nature of Johnson's calculations, there was substantial evidence to support the jury's award.
¶ 76 Burien contends that Johnson's calculations are erroneous because he assumed that damages would run from June 1995 until September 2005. But Johnson summarized his damage calculations for Burien's delay in making a SEPA decision as running from 1995 until 1998 and the damages from negligent misrepresentation as running from 1998 until 2003. And Westmark specifically asked the jury for damages from 1995 until 2003, not damages from 1995 until 2005.
¶ 77 Burien criticizes Johnson's testimony regarding damages resulting from negligent misrepresentation (1998-2003) because his calculations appear to be based on the assumption that Emerald Pointe would consist of 216 condominiums rather than 176 apartments. Even if Johnson did assume Emerald Pointe would consist of 216 condominiums, the jury's award is still inside the range of substantial evidence because Emerald Pointe was going to be built as condominiums as a result of the settlement, Johnson's calculations were conservative, and the award was substantially less than Westmark requested.
¶ 78 Burien also criticizes Johnson's testimony for awarding Westmark credit for the value of the equity it would have had if Emerald Pointe had been built. It argues that loss of equity is not recoverable as delay damages because Westmark could have and still can develop the property. Loss of equity damages are appropriate assuming that Westmark was prevented from building Emerald Pointe and earning equity in it from 1995 through 2003. See, e.g., Lincor Contractors, Ltd. v. Hyskell, 39 Wash.App. 317, 322, 692 P.2d 903 (1984) (“As a natural and proximate result of Continental's breach, Lynnwood Pacific could not construct the building. Lynnwood Pacific's equity in the building can be proven with reasonable certainty. Thus, Lynnwood Pacific is entitled to an award of damages measured by its loss of equity.” (Citations omitted.)).
¶ 79 Burien argues that there is a discrepancy in Johnson's calculations-at one point, he explains that the total damages from 1995 until 2005 are approximately $14.5 million, and later, he gives a total of approximately $13 million for damages from 1995 until 2003. Burien argues that this shows the arbitrary nature of Johnson's testimony. Johnson attempted to explain this discrepancy:
A. Okay. 1995-1995 to 1998 was $3,429,000, and the 1998 to 2003 was $9,571,130, and the sum total of those two together is $13,130,000 [sic].
And I guess a point that I would make, these are 1998 dollars, this is-this is in 1998 dollars, and the first chart that we had, $14 million, is in 2005 dollars. So we've talked about the difference of dollars at different times, and that's why I think it's important for the jury to understand that.
Q. All right. Would that be why the first calculation in 2005 dollars is $14.5 million, approximately, and then you've broken out the two separate periods, it's $13,130,000; does that account for the difference?
A. That's right.
VRP (Nov. 2, 2005) at 2275. Moreover, Johnson's calculations were conservative, saving Burien approximately $4 million, and the jury awarded Westmark $2,420,000 less than it requested.
¶ 80 Finally, Burien argues that Johnson's calculations were arbitrary because he made two different calculations on the value of the land. Johnson explained why he made two different calculations.
Q. All right. Can I ask you, a point of curiosity here, and I didn't ask you about this when we were talking before, you said the value of the land, on March 1, ′98, is three-million-something-thousand dollars, and when you were doing your calculation No. 1 here, I think you said the value of the land was something like $900,000.
A. That's correct.
Q. All right. What's the difference between those two numbers?
A. Well, the difference here is this is the presumption that the permit would have been granted to build condominiums on it, and as it is now, that hasn't been done, so there is no permit on the property.
Q. So when the permit is issued, then the value of the land increases?
A. That's correct.
Id. at 2272. Burien argues that this explanation is not satisfactory because all of Johnson's calculations are premised on what would have happened if Emerald Pointe had been built, but in one of these calculations the land is in valued at only $900,000. It was for the jury to determine the weight to be given this testimony, and as previously noted, the verdict was supported by substantial evidence because Johnson's calculations were conservative and the jury's award was substantially less than Westmark requested.
¶ 81 In sum, Burien's objections to Johnson's testimony go to its weight, not to its admissibility. Burien cross-examined Johnson about many of the alleged flaws in his testimony and argued in closing that his damage calculations were speculative. The jury, however, was not entirely persuaded, and its verdict is supported by substantial evidence.4
Mitigation of Damages
¶ 82 Burien contends the trial court erred by ordering in limine that Burien could not argue that Westmark failed to mitigate its damages by preparing an EIS or filing an action for mandamus to compel Burien to make a decision on the revised application. The court did not err because Westmark was not obligated to prepare an EIS or sue Burien while awaiting a SEPA decision.
¶ 83 The order states, “Evidence and argument that Westmark could have mitigated its damages or avoided delay by filing a mandamus action or by completing the environmental impact statement are precluded.” The court clarified verbally that it intended the order to apply only up until 1996, when Burien issued the DS, and that Burien was allowed to argue that Westmark failed to mitigate by not paying fees on time and not cooperating with Burien's requests for information. Jury instruction 18 reflected this clarification. It explained that “[a] person who is liable for damages to another person's business or property is not liable for any damages arising after the original event that are proximately caused by failure of the injured person to exercise ordinary care to avoid or minimize such new or increased damages.”
¶ 84 The trial court issued its order because arguing that Westmark should have prepared an EIS or filed a mandamus action is “not a proper mitigation argument.” VRP (Oct. 17, 2005) at 1019. As to the failure to prepare an EIS, the court explained that Westmark did not fail to mitigate because it had not yet received a SEPA decision on its revised application and did not know that an EIS would be required for the revised project. See VRP (Oct. 6, 2005) at 147 (“[T]he delay here is the delay in making the necessary decision [that an EIS was required on the revised project], so it's not a matter of mitigation.”). As to Westmark's failure to file a mandamus action, the court explained that “as a matter of law, ․ you can't argue that [Westmark] had to sue [Burien] to get their relief and that the failure to sue [Burien] is-can be proved as mitigated damages.” Id. at 137.
¶ 85 The party whose wrongful conduct caused the damages has the burden of proving the failure to mitigate. Bernsen v. Big Bend Elec. Coop., 68 Wash.App. 427, 435, 842 P.2d 1047 (1993). The doctrine of mitigated damages prevents recovery for damages the injured party could have avoided through reasonable efforts. Cobb v. Snohomish County, 86 Wash.App. 223, 230, 935 P.2d 1384 (1997). The injured party's duty is to “use such means as are reasonable under the circumstances to avoid or minimize the damages.” Young v. Whidbey Island Bd. of Realtors, 96 Wash.2d 729, 732, 638 P.2d 1235 (1982).
¶ 86 The trial court did not err in prohibiting Burien from arguing that Westmark should have mitigated by preparing and submitting an EIS. As discussed above, Westmark was seeking a SEPA decision from Burien on the revised application. Insofar as Burien was obligated to make such a decision and told Westmark that a decision was forthcoming, Westmark was not required to mitigate its damages by preparing an EIS while awaiting a decision. The trial court also did not err in prohibiting Burien from arguing that Westmark should have mitigated by filing an action for mandamus. Burien cites no cases where a court has held that a party should have mitigated its damages by filing a lawsuit against the party that caused its damages.
Sanctions
¶ 87 The trial court sanctioned Burien for discovery violations by excluding all of its proposed damages experts. Burien argues that this court should review the trial court's decision to exclude one of its damages experts, William Partin, de novo because the decision was allegedly based exclusively on the written record.
¶ 88 Burien acknowledges that rulings excluding expert witnesses are reviewed for an abuse of discretion. Weyerhaeuser Co. v. Commercial Union Ins. Co., 142 Wash.2d 654, 683, 15 P.3d 115 (2000). It argues that a different rule should apply here where “[d]ecisions are based on declarations, affidavits, and written documents․” In Re Estate of Bowers, 132 Wash.App. 334, 339, 131 P.3d 916 (2006). In Bowers, the Court of Appeals reviewed the trial court's decision to admit a will to probate under a de novo standard because the trial court's decision was based exclusively upon the written record. The court also stated, “Courts have also recognized that probate proceedings are equitable in nature and reviewed de novo on the entire record.” Bowers, 132 Wash.App. at 339, 131 P.3d 916.
¶ 89 Bowers is not applicable to this case for two reasons. First, it concerns a trial court's decision to admit a will to probate, not a decision to exclude an expert witness. It does not establish an exception to the rule that decisions excluding expert witnesses are reviewed for an abuse of discretion. Burien does not cite to any sanctions cases that apply a de novo standard of review to a trial court's decision to exclude expert witnesses. Second, Bowers does not apply because, here, the trial court based its decision to exclude Partin on the entirety of the case, not merely on the written documents submitted by the parties. See VRP (Sept. 29, 2005) at 49 (“I have never struck a witness, but this time I'm striking the witnesses. And it's based not just on these documents in front of me, it's on the entire history of the case.”); VRP (Oct. 12, 2005) at 599 (“To determine the appropriate sanction in this case, one has to take in the context of the entire file, the entire case, as well as all of the documents that have been filed in support of the motions.”). The appropriate standard of review is abuse of discretion.
¶ 90 Burien next argues that the trial court abused its discretion in excluding Partin because the trial court could have imposed lesser sanctions and because it would not have been prejudicial to allow Burien one witness to rebut Westmark's damages expert.5 We conclude that the trial court acted within its discretion in excluding Partin.
¶ 91 A trial court abuses its discretion when its order is manifestly unreasonable or based on untenable grounds. Wash. St. Physicians Ins. v. Fisons Corp., 122 Wash.2d 299, 339, 858 P.2d 1054 (1993). In the context of sanctions, the abuse of discretion standard “recognizes that deference is owed to the judicial actor who is ‘better positioned than another to decide the issue in question.’ ” Fisons, 122 Wash.2d at 339, 858 P.2d 1054 (quoting Cooter & Gell v. Hartmarx Corp., 496 U.S. 384, 403, 110 S.Ct. 2447, 110 L.Ed.2d 359 (1990)).
¶ 92 At one point, Burien sought to have five experts testify as to damages. The trial court struck all five of Burien's proposed expert witnesses on September 29, 2005. Burien moved to reconsider. On October 12, 2005, the court denied Burien's motion to reconsider and made oral findings of fact that comprise over 30 pages. Those facts are summarized here.
¶ 93 In 1998, approximately four days before the original discovery cutoff for Westmark I, Westmark deposed Partin, but Partin had not formed his own opinions on the case. That case was then purportedly settled. Later, it was reopened under the original cause number. Well before trial, Westmark continually sent Burien updated reports from its damages expert, Johnson. When the case was about 45 days away from discovery cutoff, Westmark asked Burien what experts it was planning to call. Burien responded that it intended to call Partin, but it did not identify any other witnesses or give further information on Partin's testimony. Approximately one month before the discovery cutoff date, Westmark faxed Burien a letter stating that the cutoff date was September 5, 2005, and that it needed information on what damages experts it was going to call. It also requested a date to depose Partin and asked Burien to respond to Westmark's interrogatories regarding expert witnesses. Burien did not respond to this letter.
¶ 94 Ten days before the discovery cutoff date, Burien called Westmark and asked to depose its damages expert, Johnson. Though Johnson had been Westmark's expert since 1998, this was the first time Burien requested to depose him. Johnson was unavailable before the discovery deadline, so the parties agreed to set his deposition after the deadline. The court found that by doing this, Westmark did not waive the discovery cutoff date or the requirement that Burien supplement interrogatories. Westmark also scheduled a deposition of Partin to take place after the discovery cutoff date, but the court found that it did this to be prepared in case Partin testified at trial. The court specifically found that Westmark did not waive discovery rules.
¶ 95 Four days after the discovery cutoff date, on September 9, Burien sent Westmark a letter implying that it had retained a total of four expert witnesses and that it had just sent these experts Johnson's 1998 damage report. The letter did not provide any of the information requested in the interrogatories. It also did not state the experts' qualifications, trials in which they had been involved, the subject area on which they would testify, a summary of their opinions, a basis for their opinions, or their telephone numbers. The letter implied that the experts had not formed their opinions and it was not clear whether they would be called as witnesses at trial. Shortly afterwards, Burien disclosed a fifth expert to Westmark. Later in the month, Burien faxed Westmark damage figures from two of its retained experts, but not from Partin. The faxes did not contain full opinions.
¶ 96 Westmark moved to strike all of Burien's expert witnesses. On September 29, eight days before the parties were scheduled to select jury members, the court heard argument on Westmark's motion. The court was “faced with the decision of trying to figure out some rational determination as to whether the witnesses should be stricken, whether we could go forward and depose them, and what would be an appropriate remedy, under the circumstances.” VRP (Oct. 12, 2005) at 575.
¶ 97 At the hearing, “defendant's attorney still could not tell the Court or plaintiff what these expert witnesses' opinions would be.” Id. at 576; “As to Mr. Partin, defendant's lawyer only was able to say, ‘See Mr. Partin's prior deposition․’ ” Id. at 576. The court found that Partin's prior deposition “does not contain his eventual calculations and many of his important opinions because again, at the time he gave that deposition, he had not reached his conclusions in the case.” Id. at 576. As to the other expert witnesses, Burien was not able to tell the court what their opinions would be.
¶ 98 The court granted Westmark's motion to strike all five witnesses. Later in the day, Burien gave Westmark a letter from Partin that summarized his opinions regarding damages calculations. The court later found that this letter did not contain a full report or a complete analysis. The letter did reveal, however, that Partin's testimony would be significant because he would testify that Westmark suffered no damages. The court found that the letter also indicated that Burien would use Partin's testimony “to get in the opinions of other experts Mr. Partin had relied on to reach his opinion ․ which ․ would not have allowed [Westmark] much of an opportunity to discover those bases.” Id. at 578. The court found that none of the calculations in this letter were contained in Partin's 1998 deposition and neither was his opinion about the profitability of Emerald Pointe. Additionally, he relied on other experts in this letter that he had not relied on in 1998.
¶ 99 The court found that Burien provided no reasonable excuse for its discovery violations. It also found that the violations were deliberate and had accomplished tactical advantage. The court examined each of Burien's excuses and found them either unsupported by the facts or unreasonable. The court also analyzed and rejected lesser sanctions proposed by Burien. The court concluded that “under these circumstances, in this case, striking the witnesses is the least sanction that is reasonable, and it is, in fact, the only reasonable sanction for this violation. All other options would severely prejudice the nonviolating party.” Id. at 599.
¶ 100 Burien's first argument is that the trial court abused its discretion because it could have chosen a lesser sanction. In particular, the court could have ordered Burien to pays fees and costs for Partin's deposition, sanctioned Burien's counsel, or allowed Partin to testify but limited his testimony to solely rebutting Westmark's damages expert. Under all of these options, Partin would be allowed to testify. The trial court rejected these options because allowing Partin to testify would severely prejudice Westmark. At the time the court gave its explanation for its ruling, Burien had not yet submitted the documents and reports upon which Partin's opinions were based. The court found that these underlying documents and reports could be numerous and also “critical to dealing with his opinions.” VRP (Oct. 12, 2005) at 596. Additionally, these reports would be used “to get the opinions of other experts,” likely requiring Westmark to depose these experts as well. Id. at 578. The court also reasoned that Westmark would then need to obtain additional witnesses to rebut Partin's testimony. The court concluded that the delay involved in allowing Partin to testify was excessive, especially because the trial was only days away. Under these circumstances, the court did not abuse its discretion in striking Partin as a witness.
¶ 101 Burien also argues that the trial court could have “limited Partin to what he said in his 1998 deposition, eliminating any conceivable prejudice.” Br. of Appellant at 111. It does not appear that the court considered this particular sanction or that Burien suggested it to the court. In any event, this would have been a strange sanction because the court repeatedly found, and the record verifies, that Partin had barely formed an opinion in 1998. See, e.g., CP at 1915 (Dep. of William Partin, Feb. 10, 1998) (“Q: Have you calculated the economic damages that are proper in this case? A: Not at this time.”). The court did not abuse its discretion in refusing to allow Partin to testify based on his 1998 deposition.
¶ 102 Finally, Burien argues that the trial court abused its discretion because it failed to distinguish between punishing Burien and punishing Burien's counsel. In support, it cites In re Firestorm 1991, 129 Wash.2d 130, 916 P.2d 411 (1996) for the rule that “[t]o the extent possible, individual parties should not be penalized for their attorneys' misconduct in the discovery process.” Firestorm, 129 Wash.2d at 143, 916 P.2d 411.
¶ 103 Firestorm is distinguishable because it concerned “the review of a trial court decision disqualifying Plaintiff's counsel for conducting an ex parte interview with an expert hired by counsel for the Defendants.” Firestorm, 129 Wash.2d at 132, 916 P.2d 411. It is also distinguishable because in that case, it was important to the Supreme Court that the trial court did not enter findings on its decision to disqualify counsel whereas, here, the court entered lengthy findings. It is true that “the least severe sanction that will be adequate to serve the purpose of the particular sanction should be imposed.” Fisons, 122 Wash.2d at 355-56, 858 P.2d 1054. Here, however, the court carefully considered lesser sanctions, such as fines and limiting Partin's testimony. It found these sanctions inadequate given the complexity of the case and Partin's testimony, the limited time Westmark would have to prepare for Partin's testimony, the prejudice Westmark would suffer, and the flagrancy of Burien's violation of the discovery rules. The court did not abuse its discretion.
¶ 104 For the foregoing reasons, we affirm.
FOOTNOTES
1. State Environmental Policy Act, chapter 43.21C RCW.
2. Westmark appealed the DS, but the parties asked the hearing officer to place his decision on hold pending settlement negotiations.
3. Westmark requested a total of $13,130,000, but the correct total of the two sums is $13,000,130.
4. We reject Westmark's argument that any one of its claims can support the jury's general verdict. Westmark concedes that Johnson calculated damages of $3,429,000 due to delay in issuing a SEPA decision and $9,571,130 due to delay caused by negligent misrepresentation. Br. of Respondent at 79. The testimony at trial was directed to each of the claims. Westmark asked for a total award of $13,130,000. If the negligent misrepresentation claim was dismissed, the remaining damages, $3,429,000, clearly do not support the jury's award of $10.7 million. A general verdict may stand if supported by more than one legal theory even if one is found to be invalid. Here, however, over $7 million of the $10.7 million verdict was clearly supported by the negligent misrepresentation claim only. If that claim were reversed, the remaining claims of negligent delay and tortious interference would not support the entire award.
5. Burien does not assign error the trial court's decision to exclude its other expert witnesses.
COLEMAN, J.
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Docket No: No. 57958-4-I.
Decided: September 04, 2007
Court: Court of Appeals of Washington,Division 1.
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