COLLARD v. REAGAN, 26410-2-II (Wash.App. 6-21-2002)

No. 26410-2-IIThe Court of Appeals of Washington, Division Two.
Filed: June 21, 2002 UNPUBLISHED OPINION

Appeal from Superior Court of Pierce County, No. 99-2-08250-3, Hon. John A. McCarthy, August 11, 2000, Judgment or order under review.

Counsel for Appellant(s), Glenn A. Harris, Attorney At Law, 3643 N Pearl St, 1517 S Fawcett, Tacoma, WA 98407.

Linda J. King, Attorney At Law, P.O. Box 881008, Steilacoom, WA 98388-1008.

Counsel for Respondent(s), Salvador A. Mungia II, Gordon Thomas Honeywell etal, P.O. Box 1157, Tacoma, WA 98401.

Dianne K. Conway, Gordon Thomas Honeywell, P.O. Box 1157, Tacoma, WA 98401.

Salvador A. Mungia II, Gordon Thomas Honeywell etal, P.O. Box 1157, Tacoma, WA 98401.

HOUGHTON, J.

Marc Reagan appeals from a trial court ruling that he violated the Consumer Protection Act (chapter 19.86 RCW), granting injunctive relief and awarding damages and attorney fees to the three plaintiffs. The three plaintiffs cross-appeal the trial court’s award of statutory costs rather than full expenses. We affirm the trial court and decline to award the plaintiffs’ full expenses.

FACTS
Marc Reagan owned several houses in Tacoma that he rented to tenants. John and Corina Collard saw a newspaper advertisement to rent one of Reagan’s houses. On December 15, 1998, the Collards completed a rental application for a house located on 56th Street. They also paid Reagan the fee for a credit check. Reagan called the Collards to tell them that they had passed the credit check and that they needed to pay a rental deposit. On December 27, the Collards signed over to Reagan John’s $640.22 worker’s compensation check as the rental deposit. Reagan told the Collards they could move in at 9:30 a.m. on January 10, 1999.

The Collards arranged to have their utilities disconnected at their old home, packed their belongings, and loaded them onto a borrowed truck in preparation for the anticipated move. They arrived at Reagan’s 56th Street house with all their belongings at approximately 9:30 a.m. the morning of January 10. They waited there for about 30 minutes, but Reagan never appeared. During the day, the Collards repeatedly tried to reach Reagan by telephone.

Reagan finally returned their calls on January 11. He told them that he would not rent the house to them, but that he would return their deposit by mail. The next day, he called the Collards and told them to come to his home to pick up their deposit because he had put the wrong postage on the envelope containing their deposit. The Collards arrived at Reagan’s home that day to retrieve their deposit, but instead found an envelope on the doorframe containing a note that stated:

The Application for Renting you filled out for renting the house at 300[illegible] South 56th, You did not read!!!!!!!! You were not approved!!!!!!!! Therefore your deposit will not be refunded to you. I have turned over the telephone recorder tapes along with your brothers [sic] Larry’s tapes to the police department. I have given a description of you to them. You will be arrested if you come even close to my house. Also pictures of the signs that were put up in front of the house at 3001 So. 56th were turned [over] to my attorney and also to the police department.[1]

Plaintiffs’ Exhibit 18. The envelope did not contain the Collards’ deposit.

At the time, the Collards had five children at home between 2 and 12 years old. John received worker’s compensation due to a job-related injury. The Collards had no savings. Their landlord told them they had to move and threatened them with formal eviction proceedings. After their unsuccessful attempt at renting Reagan’s house, the Collards moved into the two-bedroom home of Corina’s mother. Also, Corina’s former husband was threatening to obtain custody of the Collards’ two oldest children because of the contemplated living arrangements with Corina’s mother.

April Brown responded to a newspaper advertisement for Reagan’s rental house located on Tacoma Avenue. She completed a rental application on August 7, 1998. She paid Reagan the credit check fee and told him at the time that she received Section 8 housing assistance.[2]

Reagan later called Brown to tell her she had passed the credit check and that she needed to pay a deposit. Brown gave Reagan a $750 deposit on August 10. Reagan did not respond to Tacoma Housing Authority’s repeated attempts to schedule a house inspection. Between August 10 and 26, Brown packed her belongings in preparation for the move. On August 26, Reagan told Brown that he would not rent the house to her and that he would not return her deposit.

At the time, Brown was coping with the recent death of her 19-year-old son. She told Reagan about her situation when she applied to rent the house. The $750 she gave to Reagan as the deposit came from the last $1,000 she received from the crime victim’s fund, after paying her son’s funeral expenses.

After her unsuccessful attempts to change Reagan’s mind on August 26, Brown, who was diagnosed as bipolar and suffered from severe insomnia and depression, became suicidal. She consumed alcohol and took numerous sleeping pills. She called the suicide crisis hotline, which sent volunteers to stay with and console her. Brown was forced to place her belongings in storage and move in with her daughter and two grandchildren, who had a two-bedroom apartment. Because her daughter’s apartment did not allow dogs, Brown tied her slain son’s dog to a tree in the nearby woods, where she would visit and feed it daily. She eventually had to give the dog away.

The Collards and Brown (hereafter the plaintiffs) filed a lawsuit against Reagan. They sought special and general damages, an injunction, attorney fees, and costs under the Consumer Protection Act (CPA), chapter 19.86 RCW.

The matter was tried to the bench. The plaintiffs testified to the above facts. Several other witnesses also testified at trial regarding their dealings with Reagan. They related almost identical stories: seeing a newspaper advertisement for a rental house; contacting Reagan and completing an application; paying the credit check fee; Reagan’s calling to say that they were approved and that they needed to pay a deposit; submitting the deposit; and Reagan’s refusing to rent the house or refund the deposit.

At the end of trial, the court concluded that Reagan’s conduct violated the CPA. The trial court granted the Collards and Brown’s request for injunctive relief, enjoining Reagan from personally renting his properties. The trial court awarded the Collards $640.22 and Brown $750 in special damages. It also awarded CPA treble damages of $1,920.66 to the Collards and $2,250 to Brown. It further awarded $23,805.63 in attorney fees and $668.95 in costs. The trial court found that Reagan committed fraud and awarded the Collards $40,000 and Brown $60,000 in compensatory damages for the emotional distress they suffered.[3]

Reagan appeals the trial court’s decision to impose treble damages and to issue an injunction against him under the CPA, the amount of damages awarded for emotional distress, and the attorney fee award. The plaintiffs cross-appeal the trial court’s order limiting their cost recovery to those statutory costs listed in RCW 4.84.010.

ANALYSIS
Consumer Protection Act Violation Waiver

For the first time on appeal, Reagan argues that his conduct is governed by the Residential Landlord Tenant Act (RLTA), chapter 59.18
RCW. He asserts that as a matter of law, landlord tenant matters do not come under the CPA. He cites State v. Schwab, 103 Wn.2d 542, 693 P.2d 108
(1985), to support his argument that RLTA violations are not CPA violations.

In Schwab, the plaintiffs alleged both RLTA and CPA violations and allowed the trial court to determine whether the defendant’s conduct violated both statutes. Schwab, 103 Wn.2d at 544. The situation here is different from that in Schwab, in that Reagan never raised an RLTA defense. Thus, the trial court did not address whether Reagan violated the RLTA because the plaintiffs did not base their claim on a violation of this statute. Reagan also did not advise the trial court that the complaint potentially alleged a violation of the wrong statute. The trial court’s ruling was based on the facts meeting the elements of a CPA violation. Unchallenged conclusions of law become the law of the case State v. Moore, 73 Wn. App. 805, 811, 871 P.2d 1086 (1994) (citin State v. Slanaker, 58 Wn. App. 161, 165, 791 P.2d 575, review denied, 115 Wn.2d 1031 (1990)). By not apprising the trial court that the complaint potentially alleged a violation of the wrong statute and instead defending under the CPA, Reagan waived his right to assert later that the CPA was not the proper statute to apply.

Therefore, we decline to review this argument on appeal. RAP 2.5(a) see also Demelash v. Ross Stores, Inc., 105 Wn. App. 508, 527, 20 P.3d 447 (“We generally will not review an issue, theory or argument not presented at the trial court level.”), review denied, 145 Wn.2d 1004
(2001); Brower v. Ackerley, 88 Wn. App. 87, 96, 943 P.2d 1141 (1997) (“An issue not briefed or argued in the trial court will not be considered on appeal.”), review denied, 134 Wn.2d 1021 (1998).

Treble Damages Award and Injunctive Relief

Reagan also contends that the trial court erred in awarding treble damages, attorney fees and costs, and injunctive relief under the CPA. Reagan does not assign error to the trial court’s ruling that his conduct violated the CPA. As noted, unchallenged conclusions of law become the law of the case. Moore, 73 Wn. App. at 811. Therefore, because we assume that Reagan violated the CPA, we address only the question whether the trial court’s relief was proper.[4]

The available forms of relief in a private CPA action include injunctive relief, actual and treble damages, and attorney fees and costs.

RCW 19.86.090.[5] Reagan does not challenge the trial court’s actual damages award. He only challenges the award of treble damages in the context of his argument that the trial court should have applied the RLTA, which does not include treble damages. Because we have determined that the CPA applies here and the CPA allows for treble damage awards, Reagan’s argument fails. Injunctive Relief Failure to Serve Attorney General Reagan further contends that the trial court erred in granting injunctive relief to the plaintiffs because they failed to serve the Attorney General under RCW 19.86.095, which states: `In any proceeding in which there is a request for injunctive relief under RCW 19.86.090, the attorney general shall be served with a copy of the initial pleading alleging a violation of this chapter.’ Reagan asserts that the plaintiffs’ failure to follow this statutory requirement precludes the trial court from ordering injunctive relief. But the statute does not specifically state that failure to serve the Attorney General precludes the availability of injunctive relief.

The purpose of the Attorney General’s involvement in a CPA claim between two private parties is to ensure that the public interest requirement is met. In his response to a point of inquiry before the state Senate that passed this bill, Senator Phillip Talmadge stated: “[M]any private actions would satisfy the public interest requirement even though there was no involvement by the Attorney General in particular private suits. This section is not designed to require the appearance of the Attorney General to establish the public interest requirement.” Senate Journal, April 15, 1983, Reg. Sess., Substitute House Bill No. 458. This language indicates that if the plaintiff in a private CPA action adequately establishes the public interest requirement, the Attorney General’s involvement is not required. Thus, a plaintiff’s failure to serve the Attorney General a copy of the pleading does not necessarily eviscerate the plaintiff’s statutory right to injunctive relief. Here, the unchallenged findings establish that Reagan defrauded others in addition to the plaintiffs using the same scheme. Evidence that others have been injured by the same deceptive conduct of the defendant is sufficient to establish the public interest requirement. Hangman Ridge Training Stables, Inc. v. Safeco Title Ins. Co., 105 Wn.2d 778, 790, 719 P.2d 531 (1986); McRae v. Bolstad, 101 Wn.2d 161, 166, 676 P.2d 496 (1984). Accordingly, the public interest requirement is met here.[6] Nevertheless, Reagan contends that the plaintiffs’ failure to serve the Attorney General deprives the trial court of subject matter jurisdiction. Reagan cites Erection Co. v. Department of Labor Industries, 121 Wn.2d 513, 852 P.2d 288 (1993), to support his argument. The Erection Co. court held that the Department of Labor and Industries lost its jurisdiction to hear a case because the Department did not complete its determination within the statutory 30-day window and there was no contrary legislative intent. But here, the trial court did not lose its jurisdiction to hear the case simply because the Attorney General was not served a copy of the pleading. This statutory provision requires only that the Attorney General be served where there is a request for injunctive relief. In a private CPA action where no injunctive relief is requested, this requirement does not even apply. This service requirement is not jurisdictional. Further, the legislative intent previously discussed clearly indicates that the statute’s purpose is not to mandate Attorney General participation.

Finally, Reagan’s other cited authority is also distinct from this case.

In Litowitz v. Central Puget Sound Growth Management Hearings Board, 93 Wn. App. 66, 966 P.2d 422 (1998), the court held that the plaintiffs’ failure to serve three of the five named parties of record resulted in the superior court’s lack of jurisdiction to hear the appeal. But here, the Attorney General was neither a named nor a necessary party. As the legislative intent makes clear, the purpose of the service requirement is to allow the Attorney General to participate in a particular case to ensure the public interest requirement is met. In essence, the role of the Attorney General is more akin to that of amicus curiae. As such, failure to serve the Attorney General does not deprive the trial court of its jurisdiction to hear the case nor does it render the plaintiffs’ case fatally defective.[7] Injunctive Relief Failure to Balance Under CR 65(d) Reagan also contends that the trial court abused its discretion in granting the plaintiffs’ request for injunctive relief because it failed to conduct the balancing test required by CR 65(d). He asserts that he should not have been personally enjoined from renting homes.

We review a trial court’s decision to grant an injunction and the terms contained in the injunction for abuse of discretion, and a court abuses it discretion where its reasons are based on untenable grounds or where the decision is manifestly unreasonable or arbitrary. Kucera v. State Dep’t of Transp., 140 Wn.2d 200, 209, 995 P.2d 63 (2000). A court grants an injunction only where the legal remedy is inadequate to provide redress for the injury. Kucera, 140 Wn.2d at 209. In addition, the court issuing the injunction must abide by CR 65(d), which provides in part: “Every order granting an injunction and every restraining order shall set forth the reasons for its issuance; shall be specific in terms; shall describe in reasonable detail, and not by reference to the complaint or other document, the act or acts sought to be restrained[.]” Here, the record supports the trial court’s decision to grant the plaintiffs’ request for injunctive relief. In its oral ruling, the trial court stated that granting an injunction was appropriate “to protect other members of society who may be faced with the same situation with Mr. Reagan[.]” Report of Proceedings (RP) 5/17/00 at 158. The court’s reasoning is justified by evidence of Reagan’s fraudulent conduct over the years of victimizing numerous other prospective tenants and his pattern and history of intimidation. The trial court correctly determined that if Reagan were allowed to continue personally renting houses, there is a high likelihood other members of the public would fall prey to his fraudulent tactics. Although Reagan’s potential victims may pursue legal remedies, Reagan’s history demonstrates that he targets vulnerable persons who have little if any means to seek redress. Furthermore, the order is reasonably specific and detailed:

Defendant Marc Reagan is hereby enjoined from being personally involved in the advertising, collection of deposits, and finalization of any rental contract for any house, duplex, or other dwelling unit. Marc Reagan shall contemporaneously notify plaintiffs of the identity of any third party who acts on defendant Marc Reagan’s behalf to advertise, collect deposits, or finalize a rental contract for a dwelling unit in which Reagan holds an ownership interest, or on behalf of Marc Reagan. Marc Reagan shall also contemporaneously provide plaintiffs with copies of all form agreements used by any such third party.

Clerk’s Papers at 177. The injunction prohibits Reagan from personally dealing with prospective tenants and collecting rent deposits. It does not prohibit him from engaging in the business of renting houses. Rather, he may conduct his business through a third party, such as a management company. The trial court properly enjoined Reagan from personally renting his homes.

Attorney Fees

Reagan contends that the trial court erred in awarding attorney fees to the plaintiffs without requiring them to segregate the work done on the CPA claim from the non-CPA matters. Reagan asserts that the non-CPA matters include his bankruptcy proceedings and work performed relating to his court sanction for attempting to obstruct the administration of justice.

A successful CPA claimant is entitled to attorney fees and costs. RCW 19.86.090. The reasonableness of the amount of attorney fees is a factual matter within the trial court’s wide discretion. Sign-O-Lite Signs, Inc. v. DeLaurenti Florists, Inc., 64 Wn. App. 553, 566, 825 P.2d 714, review denied, 120 Wn.2d 1002 (1992). In calculating the award of attorney fees for a successful CPA claim, the trial court must segregate the time spent on the CPA claim from the time spent on other, non-CPA claims. Sign-O-Lite Signs, 64 Wn. App. at 566.

The record supports the trial court’s award of plaintiffs’ attorney fees. The billing statements submitted by the plaintiffs’ attorneys in their request for attorney fees demonstrate that they multiplied the time spent on the case by the hourly rate of the particular individuals who performed the work to arrive at a subtotal. Then they totaled the subtotals. In addition, the trial court reduced the plaintiffs’ attorneys’ original fee request from $28,991.13 to $23,805.63, deleting duplicative fees for a legal assistant present in court during trial and attorney fees attributed to court sanctions against Reagan. And contrary to Reagan’s assertion, fees relating to Reagan’s bankruptcy proceedings were not included in the attorney fee request.[8] The trial court’s attorney fee award is also supported by the CPA and fraud claims involving Reagan’s same conduct. The plaintiffs proved their fraud claim by proving the CPA claim. Thus, segregating the time spent on the CPA claim from the fraud claim was not feasible. Hume v. Am. Disposal Co., 124 Wn.2d 656, 673, 880 P.2d 988 (1994), cert. denied, 513 U.S. 1112
(1995) (where the claims are so interrelated that no reasonable segregation is feasible, the trial court need not artificially segregate attorney fees).

The trial court did not abuse its discretion in its attorney fee award. Compensatory Damages for Emotional Distress

Finally, Reagan contends that the trial court erred in awarding general damages. He claims that the damages are excessive and unsupported by the record. Reagan does not dispute that the plaintiffs prevailed on their fraud claim which is an intentional tort.[9] Rather, he asserts that the trial court erred in awarding the Collards $40,000 and Brown $60,000 for their emotional distress. Damages may be recovered for emotional suffering on proof of an intentional tort. White River Estates v. Hiltbruner, 134 Wn.2d 761, 768, 953 P.2d 796 (1998); Nord v. Shoreline Sav. Ass’n, 116 Wn.2d 477, 484, 805 P.2d 800 (1991). Common law fraud is recognized as a valid basis for an emotional distress award. Nord, 116 Wn.2d at 483-84 (citing McRae v. Bolstad, 32 Wn. App. 173, 646 P.2d 771 (1982), aff’d on other grounds, 101 Wn.2d 161 (1984)). Determining the amount of damages is primarily and peculiarly within the trier of fact’s province. Ethridge v. Hwang, 105 Wn. App. 447, 455, 20 P.3d 958 (2001).

We will not disturb an award of damages made by the trier of fact unless it is outside the range of substantial evidence in the record, shocks the conscience of court, or appears to have been arrived at as a result of passion or prejudice. Henderson v. Tyrrell, 80 Wn. App. 592, 631, 910 P.2d 522 (1996) (citing Bingaman v. Grays Harbor Cmty. Hosp., 103 Wn.2d 831, 699 P.2d 1230 (1985)). Substantial evidence supports the trial court’s general damages award. Reagan tricked the Collards into giving him a deposit for the house on 56th Street. The Collards had no savings, John’s worker’s compensation payments were their only source of income, and his $640.22 check was their only rental deposit source. They had called the utilities company and telephone company to disconnect the services at their old house. Corina had just started a respite care job and had arranged with the bus company to drop off the 19-year-old developmentally disabled boy at the new address. They packed all their belongings and loaded them onto a borrowed truck to move. Reagan then refused to rent the house to them and refused to refund their deposit.

The Collard family consisted of John, Corina, and their five children with ages ranging from 2 to 12. They had arranged for their children to change schools. Their landlord allowed them to stay a little while longer, but also he told them they had to move. Eventually, their landlord contacted an attorney and served them with a letter indicating that he was initiating formal eviction proceedings against them. Their only alternative was to move in with Corina’s mother, who lived in a two-bedroom house with Corina’s sister. Corina’s former husband was threatening to obtain custody of her two oldest children because of the contemplated living arrangements with Corina’s mother. They were terrified at the prospect of being homeless and losing two of their children. Brown was also in a crisis. She received limited worker’s compensation benefits and qualified for Section 8 housing. She was coping with the recent death of her 19-year-old son, and she used $750 of the remaining $1,000 from the crime victims fund to place a rental deposit with Reagan. Brown told Reagan about her Section 8 housing situation and her son’s death when she applied to rent Reagan’s house. She packed her belongings in preparation for the move after Reagan told her that she could rent his house. Reagan then refused to rent the house to Brown and refused to refund her deposit. He did not respond to Tacoma Housing Authority’s multiple requests to arrange for a home inspection. Brown was diagnosed as bipolar and suffering from insomnia and depression. She attempted suicide by drinking alcohol and taking many sleeping pills. She was forced to move into a two-bedroom apartment along with her daughter and her two children. She had to tie her son’s dog to a tree in the nearby woods and feed it each day because her daughter’s apartment did not allow dogs. Eventually she had to give away the dog.

The trial court indicated in its oral ruling that its decision was based on the plaintiffs’ experiences and the exhibits presented. The trial court also stated that although it recognized the difficulty of placing a dollar amount on emotional suffering, it felt that the plaintiffs must be fairly compensated for their injuries. Although the trial court characterized Reagan’s conduct as “reprehensible at best” (RP 5/17/00 at 156), there is no evidence that the court’s monetary award was arrived as a result of passion or prejudice. Finally, the amount of the award is not outrageous nor does not shock our conscience.

Reagan also argues that the trial court’s emotional distress damages award was unjustified because the deposits the plaintiffs lost `were not substantial.’ Appellants’ Brief at 35. Reagan would have us ignore the plaintiffs’ desperate situations and focus solely on the amount of the deposits they lost. We decline to do so. Although the $640.22 that the Collards and the $750 that Brown lost may appear insignificant to those in a better financial situation, to those who are living on a limited fixed income with no savings and at risk of losing all they own, including the roofs over their heads, these amounts of money are significant. Reagan also cites Nord to support his argument that the trial court’s emotional distress award was excessive. Reagan’s argument is unpersuasive. Washington law does not approve of comparing verdicts of other cases to determine the excessiveness of awards. See Washburn v. Beatt Equip. Co., 120 Wn.2d 246, 267, 840 P.2d 860 (1992) (rejecting the notion that comparing verdicts is the proper appellate court standard in evaluating a claim of excessive award, and affirming the standard that the propriety of damage awards must be determined from the facts of each individual case). Plaintiffs’

Cross-Appeal Costs
The plaintiffs cross-appeal the trial court limitation on recovery of their costs to those listed in RCW 4.84.010. They assert that the law allows full cost recovery because the CPA does contain a statutory cost limitation.[10]

The CPA allows the prevailing party to recover the `costs of the suit.’ RCW 19.86.090. Although the CPA does not define `costs,’ our Supreme Court has limited that term under the CPA to those items listed in RCW 4.84.010. Nordstrom, Inc. v. Tampourlos, 107 Wn.2d 735, 743, 733 P.2d 208
(1987).

The plaintiffs cite Panorama Village Condominium Owners Ass’n Board v. Allstate Insurance Co., 144 Wn.2d 130, 26 P.3d 910 (2001) and Louisiana-Pacific Corp. v. Asarco Incorporated, 131 Wn.2d 587, 934 P.2d 685
(1997), as limiting or implicitly overruling Nordstrom. We disagree. Panorama Village and Louisiana-Pacific involved non-CPA claims. The court based the full cost awards in those cases on the Model Toxic Control Act and equitable grounds, respectively. Absent our Supreme Court explicitly overruling Nordstrom, we cannot award non-statutory costs on a CPA claim.

We decline to do so here. Attorney Fees on Appeal

Both parties request an award of attorney fees and costs on appeal. RAP 18.1(a) authorizes the prevailing party on appeal to recover attorney fees or expenses if so granted by `applicable law.’ The CPA authorizes the prevailing party to recover `a reasonable attorney’s fee.’ RCW 19.86.090. As the prevailing parties on appeal, the plaintiffs are awarded attorney fees and costs on appeal, upon their compliance with RAP 18.1(d).

Affirmed.

A majority of the panel having determined that this opinion will not be printed in the Washington Appellate Reports, but will be filed for public record pursuant to RCW 2.06.040, it is so ordered.

MORGAN and SEINFELD, J., concur.